XN000022-1983-08-18 — Page 4

THURSDAY, AUGUST 18, 1983

2. IMPROVEMENT TO LOAD FACTOR AND POWER FACTOR

3.

CONCLUSIONS

(A) IMPROVEMENT TO THE LOAD FACTOR MAY LEAD TO A REDUCTION IN THE REQUIREMENT FOR NEW GENERATING PLANT. BOTH COMPANIES HAVE INTRODUCED SEVERAL PROGRAMMES TO IMPROVE THEIR LOAD FACTORS, BUT THERE IS NO EVIDENCE TO INDICATE THAT THESE PROGRAMMES HAVE RESULTED IN ANY SIGNIFICANT IMPROVEMENTS; AND

* (3)

(B)

AS FOR IMPROVEMENTS IN POWER FACTOR, BOTH COMPANIES ARE IMPLEMENTING PROGRAMMES WHICH ARE IN ACCORDANCE WITH ACCEPTED PRACTICES IN THE ELECTRICITY SUPPLY INDUSTRY. FROM THE TECHNICAL POINT-OF-VIEW, THERE ARE FEW MEASURES AVAILABLE FOR ADDITIONAL IMPROVEMENT.

RECOMMENDATIONS

(A) THE COMPANIES INVESTIGATE ADDITIONAL MEASURES TO IMPROVE LOAD FACTOR, INCLUDING CONSUMER EDUCATION AND PRICE INCENTIVES; AND

(B) THE COMPANIES CONTINUE ACTIVELY TO PURSUE POWER FACTOR

IMPROVEMENT PROGRAMMES.

USE OF THE INTERCONNECTION

CONCLUSIONS

(A)

THE INTERCONNECTION FACILITY HAS ALREADY BENEFITTED THE COMPANIES AND CONSUMERS PRINCIPALLY, BUT NOT ONLY, BY -

(1)

INCREASING THE RELIABILITY OF SUPPLY;

(II) CREATING SAVINGS FOR BOTH COMPANIES WHICH ARE NOW

ABLE TO MAINTAIN A LOWER SPINNING RESERVE (3)*; SPINNING RESERVE MINIMUM MAINTAINED RESERVE CAPACITY OF RUNNING GENERATING UNITS

I) ALLOWING DEFERMENT OF CAPITAL EXPENDITURE ON

GENERATING PLANT; AND

(IV) ALLOWING INSTALLATION OF LARGER GENERATING UNITS

WITH CONSEQUENT ECONOMY-OF-SCALE BENEFITS; AND

(B) FURTHER SAVINGS AND OPERATIONAL BENEFITS MIGHT BE OBTAINED

FROM THE INTERCONNECTION FACILITY IF

(1)

BETTER CO-ORDINATED PLANNING AND OPERATIONS MEASURES WERE ADOPTED BY THE COMPANIES; AND

/(II) THE INTERCONNECTION