Transend - Appendix 5 Renewal capital expenditure - Australian ...

� reduced burden on spare parts management by using standard equipment;
� provide additional functionality and remote monitoring capability;
� alignment with strategic asset management plans; and
� location of equipment which allows for future expansion.
7 OPTIONS ANALYSIS
The following options have been considered for the redevelopment of Knights Road Substation:
1. manage existing assets and defer replacement;
2. replace selected assets in situ;
3. staged replacement of selected assets in situ; and
4. replace all assets in situ.
Other options considered at a high-level, but discounted for the reasons mentioned include:
0BInvestment Evaluation Summary
TNM-GS-809-0720
� Offsite greenfield development - not considered to be a cost effective alternative as other solutions can be
implemented within the existing perimeter of Knights Road Substation at a substantially lower cost.
7.1 OPTION 1: MANAGE EXISTING ASSETS AND DEFER REPLACEMENT
7.1.1 SCOPE
The scope for this option includes:
� replace assets that are known to present a significant safety risk, including post insulators and voltage transformers
in 2014;
� replace protection and control schemes due to condition and customer request;
� continue existing maintenance practices, albeit accelerated due to the declining condition and ageing of assets;
� undertake repairs and corrective maintenance as required; and
� defer replacement of certain assets for up to five years.
The capital cost of this option includes an initial $6.74 million ($June 2007) to address safety issues followed by a
deferred capital cost of $1.65 million ($June 2007) to replace remaining 110 kV assets five years later.
7.1.2 BENEFITS
The benefit for this option is the deferral of capital expenditure and that the identified safety issues are addressed.
7.1.3 DRAWBACKS
The drawbacks for this option are that it would:
� not allow Transend to achieve the capital expenditure objectives;
� not satisfactorily address the performance, reliability and design issues associated with circuit breakers and current
transformers identified in section 4;
� incur increased ongoing operating expenditure due to increased maintenance, condition monitoring requirements and
corrective maintenance requirements;
� not be sustainable given the reliability issues associated with the 110 kV primary and secondary assets, in particular
the circuit breakers, current transformers and protection and control equipment;
� result in an increased number of loss of electricity supply events at Knights Road Substation when compared with
other options;
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