Power System Structure and

Deregulation
Tristan G. Magallones, Jr.
Power System Structure and Deregulation

Learning Objectives

At the end of the chapter, the student is

expected to:
• identify the major components of a
deregulated power system
• identify the basic characteristics and structure
of power systems
Power System Structure and Deregulation

THE STRUCTURE OF THE POWER SYSTEM

An interconnected power system is a complex

enterprise that may be
subdivided into the following major
subsystems:
• Generation Subsystem
• Transmission and Subtransmission
Subsystem
• Distribution Subsystem
• Utilization Subsystem
Power System Structure and Deregulation

Generation Subsystem

This includes generators and transformers.

Generators– An essential component of

power systems is the three phase ac generator
known as synchronous generator or
alternator.
Power System Structure and Deregulation

Generation Subsystem

Synchronous generators have two synchronously

rotating fields: One field is produced by the
rotor driven at synchronous speed and excited by dc
current. The other field is
produced in the stator windings by the three-phase
armature currents.

The dc
current for the rotor windings is provided by
excitation systems.
Power System Structure and Deregulation

Generation Subsystem

In the older units, the exciters are dc generators

mounted on the same shaft, providing excitation
through slip rings. Current systems use ac generators
with rotating rectifiers, known as brushless excitation
systems. The excitation system maintains generator
voltage and controls the reactive power flow.
Because they lack the commutator, ac generators can
generate high power at high voltage, typically 30 kV.
Power System Structure and Deregulation

Generation Subsystem

The source of the mechanical power, commonly

known as the prime mover, may be hydraulic
turbines, steam turbines whose energy comes from
the burning of coal, gas and nuclear fuel, gas
turbines, or occasionally internal combustion engines
burning oil.
Power System Structure and Deregulation

Generation Subsystem

Steam turbines operate at relatively high speeds of 3600

or 1800 rpm. The generators to which they are coupled
are cylindrical rotor, two-pole for 3600 rpm, or four-pole
for 1800 rpm operation. Hydraulic turbines, particularly
those operating with a low pressure, operate at low
speed. Their generators are usually a salient type rotor
with many poles. In a power station, several generators
are operated in parallel in the power grid to provide the
total power needed. They are connected at a common
point called a bus.
Power System Structure and Deregulation

Generation Subsystem

With concerns for the environment and conservation of

fossil fuels, many alternate sources are considered for
employing the untapped energy sources of the sun and
the earth for generation of power. Some alternate
sources used are solar power, geothermal power, wind
power, tidal power, and biomass.
The motivation for bulk generation of power in the future
is the nuclear fusion. If nuclear fusion is harnessed
economically, it would provide clean energy from an
abundant source of fuel, namely water.
Power System Structure and Deregulation

Generation Subsystem

Transformers– The transformer transfers power with

very high efficiency from one level of voltage to
another level. The power transferred to
the secondary is almost the same as the primary,
except for losses in the transformer. Using a step-up
transformer will reduce losses in the line, which
makes the transmission of power over long distances
possible.
Power System Structure and Deregulation

Generation Subsystem

Insulation requirements and other practical design

problems limit the generated voltage to low values,
usually 30 kV. Thus, step-up transformers are used for
transmission of power. At the receiving end of the
transmission lines step-down transformers are used to
reduce the voltage to suitable values for distribution
or utilization. The electricity in an electric power
system may undergo four or five transformations
between generator and consumers.
Power System Structure and Deregulation

Transmission and Subtransmission

Subsystem

An overhead transmission network transfers electric

power from generating units to the distribution
system which ultimately supplies the load.
Transmission lines also interconnect neighboring
utilities which allow the economic dispatch of power
within regions during normal conditions, and the
transfer of power between regions during
emergencies.
Power System Structure and Deregulation

Transmission and Subtransmission

Subsystem

High voltage transmission lines are terminated in

substations, which are called high-voltage substations,
receiving substations, or primary substations.
The function of some substations is switching circuits in
and out of service; they are referred to as switching
stations. At the primary substations, the voltage is stepped
down to a value more suitable for the next part of the trip
toward the load. Very large industrial customers may be
served from the transmission system
Power System Structure and Deregulation

Transmission and Subtransmission

Subsystem

The portion of the transmission system that connects

the high-voltage substations through step-down
transformers to the distribution substations is called
the subtransmission network. There is no clear
distinction between transmission and subtransmission
voltage levels. Typically, the subtransmission voltage
level ranges from 69 to 138 kV. Some large industrial
customers may be served from the subtransmission
system. Capacitor banks and reactor banks are usually
installed in the substations for maintaining the
transmission line voltage.
Power System Structure and Deregulation

Distribution Subsystem

The distribution system connects the distribution

substations to the consumers’ service-entrance
equipment. The primary distribution lines from 4
to 34.5 kV and supply the load in a well-defined
geographical area. Some small industrial customers
are served directly by the primary feeders.
Power System Structure and Deregulation

Distribution Subsystem

The secondary distribution network reduces the voltage

for utilization by commercial and residential consumers.
Lines and cables not exceeding a few hundred feet in
length then deliver power to the individual consumers.
The secondary distribution serves most of the customers
at levels of 240/120 V, single-phase, three-wire; 208Y/120
V, three-phase, four-wire; or 480Y/277 V,
three-phase, four-wire. The power for a typical home is
derived from a transformer that reduces the primary
feeder voltage to 240/120 V using a three wire line.
Power System Structure and Deregulation

Distribution Subsystem

Distribution systems are both overheadand

underground. The growth of underground
distribution has been extremely rapid and as much as
70 percent of new residential construction is via
underground systems.
Power System Structure and Deregulation

Load Subsystems

Power systems loads are divided into industrial,

commercial, and residential. Industrial loads are
composite loads, and induction motors form a high
proportion of these loads. These composite loads are
functions of voltage and frequency and form a major
part of the system load. Commercial and residential
loads consist largely of lighting, heating, and cooking.
These loads are independent of frequency and
consume negligibly small reactive power.
Power System Structure and Deregulation

Load Subsystems

The load varies throughout the day, and power must

be available to consumers on demand. The daily-load
curve of a utility is a composite of demands made by
various classes of users. The greatest value of load
during a 24-hr period is called the peak or maximum
demand. To assess the usefulness of the generating
plant the load factor is defined.
Power System Structure and Deregulation

Load Subsystems

The load factor is the ratio of average load over a

designated period of time to the peak load occurring
in that period. Load factors may be given for a day, a
month, or a year. The yearly, or annual load factor is
the most useful since a year represents a full cycle of
time. The daily load factor is load peak load average
L.F. Daily = AVERAGE LOAD/PEAK LOAD
Power System Structure and Deregulation

Load Subsystems

Multiplying the numerator and denominator of the

previous equation by a time period of 24 hr,
we obtain
∗
24 ℎ
=
24 ℎ

*energy consumed all day

Power System Structure and Deregulation

Load Subsystems

The annual load factor is

=
8760 ℎ
Power System Structure and Deregulation

Load Subsystems

For reliable and economical operation of the power

system it is necessary to monitor the entire system in a
control center. The modern control center of today is
called the energy control center(ECC). Energy control
centers are equipped with on-line computers
performing all signal processing through the remote
acquisition system.
Power System Structure and Deregulation

Load Subsystems

Computers work in a hierarchical structure to

properly coordinate different functional requirements
in normal as well as emergency conditions. Every
energy control center contains control consoles
which consist of a visual display unit (VDU), keyboard,
and light pen. Computers may give alarms as
advance warnings to the operators (dispatchers)
when deviation from the normal state occurs.
Power System Structure and Deregulation

Load Subsystems

The dispatcher makes decisions and executes them

with the aid of a computer. Simulation tools and
software packages are implemented for efficient
operation and reliable control of the system. In
addition, SCADA, an acronym for “supervisory control
and data acquisition,” systems are auxiliaries to the
energy control center.
Power System Structure and Deregulation

Basic
Elements
of
Power
System
Power System Structure and Deregulation

Power Systems Deregulation

Deregulation is a re-structuring of the rules

and economic incentives that government setup
to control and drive the electric supply industry .
It is known in different names
– Re-regulated market
– Open Power Market
– Competitive power market
– Vertically unbundled power system
– Open access:
– Power system restructuring( Privatization and
deregulation)
– But not Privatization
Power System Structure and Deregulation

Power Systems Deregulation

Why Deregulate the Electric Supply

Industries?
– Better experience of other deregulated market
such as oil and gas, airlines, etc.
– Competition among energy suppliers and
wide choice for electric customers.
Why does the electric utility industry
regulate?
– Regulation originally reduced risk, as it was
perceived by both business and government.
Power System Structure and Deregulation

Power Systems Deregulation

Several important benefits:

• It legitimized the electric utility business.
• It gave utilities recognition and limited support from the
local Govt. in approving ROW and easements.
• It assured a return on the investment, regulated as that
might be.
• It established a local monopoly in building the system and
quality of supply without competitors.
• Simplified buying process for consumers.
• Electricity of new and confusing to deal with the conflicting
claims, standards and offerings of different power companies.
• Least cost operation.
Power System Structure and Deregulation

Power Systems Deregulation

The traditional vertically integrated utility company combines

the generation, transmission, distribution, and customer service in a
seamless operation that makes no detailed distinctions about the
costs of each of these four activity levels
Power System Structure and Deregulation

Power Systems Deregulation

In a de-regulated industry structure, most vertically integrated

utilities will disaggregate themselves into several companies, each
focused on a particular aspect of electric power. Here, T&D are
combined into one “wire company” - some utilities will split into two
separate functions.
Power System Structure and Deregulation

Power Systems Deregulation

• Forces behind the deregulation are
– High tariffs and over staffing
– global economic crisis
– regulatory failure
– political and ideological changes
– managerial inefficiency
– lack of public resources for the future
development
– technological advancement
– rise of environmentalism
– pressure of Financial institutions
Power System Structure and Deregulation

Power Systems Deregulation

Power System Structure and Deregulation

Power Systems Deregulation

Power System Structure and Deregulation

Power Systems Deregulation

Different terms:
– Competition: Two or more entities vying for same business or
opportunity. In PS, it can be introduced in generation and
distribution
– Deregulation: Better word is re-regulation. Changes
designed to encourage competition.
– Restructuring: Disassembly of ESI and reassembly into
another form or functional organization. Creation of new
Govt. agencies or
cooperatives between electric companies and the Govt.
– Open access: A common way for a Govt. to
encourage competition in electric supply industry.
Transmission system provides way for competitive generators
and buyers.
Power System Structure and Deregulation

Power Systems Deregulation

Different type of electric utility business
– national utilities
– state-own utilities
– Investors-owned utilities
– municipal utilities
– electric membership cooperatives
– public utility districts
• What will be the transformation ?
– Vertically integrated => vertically unbundled
– Regulated cost-based ==> Unregulated price-based
– Monopoly ==> Competition
– service ==> commodity
– consumer ==> customer
– privilege ==> choice
Power System Structure and Deregulation

Assignment

Gather by group, discuss the following:

1. What are the possible problems in a deregulated
environment?
2. Is deregulation good for our society? (referring to
the present Philippine situation)

Write/type your output in an A4 size paper.

Good luck!
Power System Structure and Deregulation

Announcement

Written Exam on next meeting

AUGUST 24, 2016

Coverage:

Growth of Power Systems

To
Power System Structure and Deregulation