Economics of

Generation
• Variable load on power station: The load on
a power station varies from time to time
due to uncertain demands of the consumers
and is known as variable load on the station
• In a power system the generation should
meet the demand
 Load
Curves

A typical daily load

• The curve showing the variation of load on
the power station with respect to time is
known as a load curve
• The load on a power station is never
constant ie;it varies from time to time
• These load variations during the whole day
(ie;24hours) are recorded half-hourly or
hourly basis and are plotted against time
on the graph
• The curve thus obtained is known as daily
load curve as it shows the variations of load
w.r.t. time during the whole day
• Fig.shows a typical daily load curve of a
power station
• It is clear that load on the power station is
varying,being maximum at 6pm in this
case
• The monthly load curve can be obtained
from the daily load curves of that month
• For this purpose average values of power
over a month at different times of the day
are calculated and then plotted on the graph
• The monthly load curve is generally used to
fix the rates of energy
• The yearly load curve is obtained by
considering the monthly load curves of
that particular year
• The yearly load curve is generally used
to determine the annual load factor
 Informations from daily load
curves
1) The daily load curve shows the variations of
load on the power station during different
hours of the day
2) The area under the daily load curve gives the
energy or number of units generated in the
day
• Units generated/day=Area(in kWh) under
daily load curve
3) The highest point on the daily load curve
represents the maximum demand on the
station on that day
4) The area under the daily load curve divided by
the total number of hours gives the average
load on the station in the day
• Average load=Area under daily load curve/24
5) The area of the rectangle in which the load
curve contained gives the max.energy that
could be generated in a day
• Maximum demand=area of the rectangle/24
6) The ratio of the area under the load curve to
the total area of rectangle gives the load factor
• Load factor=Average load*24
Max.demand*24
ie;L.F Average
= load
Max.demand
7) The load curve helps in selecting the size
and number of generating units
• The number and size of the generating units
are selected to fit the load curve
• This helps in operating the generating units at
or near the point of maximum efficiency(at
rated capacity)
8) The load curve helps in preparing the
operation schedule of the station
• It is the sequence and time for which the
various generating units in the plant will be put
in operation
 Important terms and
factors
1)Connected load:Connected load is the sum
of continuous ratings of all the equipments
connected to the system
• If a consumer has five 100W lamps and a
power point of 500W,then the connected
load of the consumer is 5*100+500=1000W
• The sum of connected loads of all the
consumers is the connected load of the
power plant
2)Maximum Demand(M.D.):Maximum demand
is the maximum of all the demands during
a given period say a day,month or year
• The load on the power station varies from
time to time which can be represented by
a load curve
• The peak point of the load curve
represents M.D
• M.D.is always less than the connected
load because all the consumers do not
use their equipments simultaniously
• The power station must be capable of
meeting the M.D
• The knowledge of M.D helps in
determining the installed capacity of the
plant
3)Demand Factor:Demand factor is the ratio
of maximum demand on power station to
its connected load
• Demand factor=Maximum demand
Connected load
• Its value is always less than 1 because M.D
is always less than the connected load
4)Average load(Average demand):Average load
is the average of all loads occuring on the
power station in a given period say a
day,month or year
• The average load can be daily average
load,monthly average load or
yearly(annual) average load
 Daily average load=area under the daily load curve/24hrs
= no.of units generated in a day/24hrs
 Monthly average load= no.of units generated in a month/no.of hours
in a month
 Yearly average load=no.of units generated in a year/8760hrs
5)Load factor(L.F):Load factor is the ratio
of average load on the power station to
its maximum demand during a given
period
ie;L.F = Average load
Max.demand
• Its value is always less than 1
because average load is always less
than the maximum demand
• Load factor can be daily load
factor,monthly load factor or annual load
factor
 Significance of load
factor
• The load factor determines the overall
cost per unit generated
• The cost per unit depends upon the
maximum demand on the power station
• The station capacity is so selected that it
must meet the M.D
• Lesser the M.D means lesser the capacity of
the plant which reduces the cost of the
plant and vice versa
• Higher the load factor means lesser will be
the
M.D and the number of units generated is
more for a given M.D and hence lesser will
be the cost per unit generated and vice
versa
6)Diversity Factor:Diversity factor is the ratio
of the sum of individual maximum
demands to the maximum demand on the
power station
• Diversity factor=sum of individual M.Ds
M.D on the power station
• The diversity factor is always greater than 1
because the sum of individual M.Ds will be
always greater than M.D on the power
station
• The greater the diversity factor means
lesser will be the M.D on the station which
will reduce the capacity of the plant which
reduces the cost of the plant
 High load factor and high diversity factor
are the desirable qualities of a power
system
 Units generated/annum=average load(kW)*hours in a
year
7)Installed capacity(plant capacity or rated
capacity):The total station capacity available
to supply the system load is called the
installed capacity
8)Plant capacity factor:Plant capacity factor
is the ratio of actual energy produced to
the maximum possible energy that could
have been produced during a given
period
• Plant capacity factor=actual energy produced
max.energy that could have been
produced Ie; Plant capacity factor=average load
installed capacity
• Annual plant capacity factor=annual kWh output
installed
capacity*8760
• The plant capacity factor is an indication of
reserve capacity of the plant
• Reserve capacity=installed capacity-max.demand
• The difference between load factor and plant
capacity factor is an indication of reserve
capacity
• If load factor is equal to plant capacity
factor,then M.D=installed capacity and the
reserve capacity is equal to zero.