Tier 2 Fixed Loss Levels on Distribution andPower Transformers implementationEURELECTRIC proposals and comments

October 2017

WG Standardisation, Sub Group Distribution Network AssetsContact:

Anthony WALSH, Asset Management, ESB Networks –anthony.walsh@esb.ie

Dépôt légal: D/2017/12.105/51

EURELECTRIC is the voice of the electricity industry in Europe.

We speak for more than 3,500 companies in power generation, distribution, and supply.

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Carbon-neutral electricity by 2050

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We support well-functioning, distortion-free energy and carbon markets as the best way to produce electricity and reduce emissions cost-efficiently.Integrated EU-wide electricity and gas markets are also crucial to offer our customers the full benefits of liberalisation: they ensure the best use ofgeneration resources, improve security of supply, allow full EU-wide competition, and increase customer choice.

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Europe’s energy and climate challenges can only be solved by European – or even global – policies, not incoherent national measures. Such policiesshould complement, not contradict each other: coherent and integrated approaches reduce costs. This will encourage effective investment to ensurea sustainable and reliable electricity supply for Europe’s businesses and consumers.

EURELECTRIC. Electricity for Europe.

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1 EXECUTIVE SUMMARY

The EcoDesign Directive encourages the use of more energy efficiency equipment to the extent thatsuch measures do not impose ‘excessive’ costs on customers, where ‘excessive’ has been understoodto refer to a level of extra costs which is not balanced by the value of the extra benefits obtained.

In 2015 the EU introduced Tier 1 levels for EcoDesign Transformers which increased transformerprices by about 30%1 and are now proposing to introduce more stringent Tier 2 levels which will havean even more significant impact on overall costs.

This is because in addition to the extra costs of the transformer itself (about 30%+), the associatedinstallations cost may also be increased, with EU consultants proposals requiring:

(a) Levels of Transformer Losses where extra costs are not covered by the savings made(b) Extra Installation costs due to requirements for:

a. Duplicate Transformer designs for use in Greenfield and Brownfield installationsb. New larger Greenfield Substations to accommodate larger and heavier transformersc. Use of a second pole to accommodate heavier Pole Mounted Transformers

(c) Limitations (via Fixed Losses) on the ratio of Transformer Iron and Copper losses which meanthat the Transformer design can no longer be optimised to match the load it feeds –actuallyresulting in increased losses.

(d) Lack of a clear process to cater for situations where Tier 2 requirements cannot be physically,practically of economically achieved.

The above measures have not been shown to be economically justified by the savings achieved, ashas been demonstrated in the many EURELECTRIC responses to the Consultation on the Reportsissued.

In summary EURELECTRIC proposes:

(a) Less disruptive Tier 2 Targets for 2021 with the existing more ambitious targets held until2025+ to avoid disruption and also avoid:

a. Requirement to hold two separate stocks of all Trafo sizes - one set for‘Greenfield’ and one for ‘Brownfield’ substations – this would simply doublestockholding costs

b. Requirements to use two poles for Pole Mounted Transformers so that heaviertransformers with slightly lower losses can be accommodated

(b) Choice of FIXED LOSSSES OR PEI for Distribution transformers – this allows the ratio ofIron and Copper Losses to be matched to the Load Factor and optimises transformercosts and improves efficiency

(c) Single Phase Transformers are not material to EU loss levels and should be dealt withthrough subsidiarity, as only UK and Ireland involved.Alternatively the PEI Targets proposed for 2021 should be more realistic and lessdisruptive to the market.

1 Clasp ‘Design Report Lot 2: Distribution and Power Transformers’ p 18; www.opsprograms.com/.../04/CLASP-Transformers-Design-Report-OPS.pdf

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(d) Pole Mounted Transformers:No changes to treatment of Transformer with Special Windings/Dual Voltages- Utilities buy such transformer as part of long term voltage conversion program which

significantly reduces system losses.- However Table 1.3 should also apply to Table 1.6 to avoid anomalies.

(e) Simple Exemption Procedure for situations where Tier 2 Trafo is too heavy/too large tofit into substation – current proposal requires Market Authority to clear each exemptionin advance for all such Transformers.

(f) Extension of ability to apply Power Trafo Exemption for Replacement PowerTransformers to Greenfield sites without restriction to use of Tier 1

There should be no requirement to use Tier 1 – the exemption Procedure of Tier 2/Tier 1/next Best should apply – Utilities already using Tier 2 now, so will only use Tier 1 or less ifproblems exist – more difficult and expensive to source a non-Tier 2 trafo.

The existing exemption for replacement of Existing Trafos in Substations should be leftunrestricted as issue may be constructing a replacement trafo to the old design so that itdid not need a SC test etc.

(g) Ability to replace bushings or tap changer without replacing Transformer with Tier 2unit – current proposals would imply that if an MV/LV tap changing Transformer isinstalled to facilitate electric vehicle charging, then when the tap change mechanism failsthe whole transformer must be replaced, although fixing the tap changer is trivial.

(h) Transfers of already owned assets between utilities shall not be considered ‘putting onmarket’ or putting into service’

In EU countries with multiple DNO’s it is common to transfers areas with networks fromone utility to another and would be impractical if such transfers then required all assetsto be replaced.

(i) No Restrictions on repairs to Power Transformers

These only happen in unusual circumstances with good reason, and adding in extracriteria is not worthwhile

1.1 New Tier 2 Efficiency standards are not economic and are very disruptive to themarket Ground Mounted Transformers

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Fig. 1 Ground Mounted Transformer Loss Levels

Less disruptive targets should be set for 2021 and current Tier 2 proposals deferred to 2025+.

To avoid installation extra costs and to have a greater likelihood of the extra cost not exceedingthe extra benefits, the new Tier 2 levels should not exceed: average Copper Losses for Tier 1 &Tier 2 (i.e. (Ck+Ak)./2 up 1000kVA, (Bk+Ak)/2 .100kVA), use A0 as Iron Losses is the economiclimit for Ground Mounted Distribution Transformer

Pole Mounted Transformers

Fig. 2 Pole Mounted Transformer Loss Levels

Maintain Ck+32%, C0 as the Poles on which 160kVA Transformers are mounted will still be inexistence for many years, and will not accommodate extra weight.

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Transformers over 200kVA are few in number (1 – 5%) and generally replaced by GroundMounted units when loads > 250kVA, so uneconomic to require costs of second pole andseparately designed transformer.

Allowances for losses on Dual Voltage transformers (Table 1.3) should also be available for PoleMounted units in Table 1.6.

1.2 PEI should be provided as an Additional Alterative to Fixed Losses

PEI (Peak Energy Index) is an index formed from the combination of Iron and Copper Losses, sothat the ratio of the Iron and Copper Losses can be varied in order to match the transformer anddemand Load Factors.

Without PEI being available as an alternative to Fixed Values of Losses, the mismatch betweentransformer and demand Load Factors will unnecessarily institutionalise extra losses in all EUUtilities

In addition Transformers will be bought only on EcoDesign Fixed Loss values, with no LossCapitalisations possible, resulting in smaller Manufacturers being driven out of the EU market.

1.3 Distinction between ‘GreenField and ‘Brownfield’ sites is not justified

Because Larger & Heavier Transformers may not fit into existing substations, EU’s consultantshave proposed that new ‘Greenfield’ substations should be larger and capable of accommodatingbigger transformers. This will in turn require two transformer designs for each kVA rating,doubling the Stockholding costs.

Adopting the less disruptive Tier 2a proposals eliminates the above problem.

In addition the extra costs arising from larger Greenfield substations now required have not beenincluded in the overall assessment of the costs

1.4 No economic justification for requiring a second pole to accommodate Tier 2 PoleMounted Transformers

Pole Mounted Transformers use a single pole and are limited in the weight they canaccommodate and the extra costs of a second pole would not be justified by the extra lossessaved

Table 1-3 in existing EcoDesign Transformer legislation which provides allowances for Voltage andWindings, also needs to apply to Pole Mounted Transformers in order to provide consistency withGround Mounted Transformers

Adopting the less disruptive Tier 2a proposals eliminates the above problem.

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1.5 Single Phase Transformers:

Agree that losses are so insignificant that application of ‘subsidiarity’ principle is appropriate.

However if PEI levels are set, they should be at a reasonable level. Current proposals reflect onlythe efficiency levels of Irish Transformers which are artificially high due to need for lowimpedance which requires very low copper losses.

Fig. 3 PEI Levels for Pole Mounted Single Phase transformers

1.6 Exemptions Process needs to be streamlined and simplified

Reason for an exemption is generally that the EcoDesign requirements would result in excessivecost to the customer in that particular case.

EU approaches as expressed are complicated, although aspects of EU proposals could beapplicable.

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EURELECTRIC proposes that:

Market Surveillance Authority is notified of derogation being applied, and this notificationis accompanied by a statement confirming that the process below has been applied.

Market Surveillance Authority would accept that a derogation was justified if this was theoutcome of the process but would have the right to audit the process to confirm that ithad been applied correctly in any case.

This proposal means that the Market Surveillance Authority is still responsible for the Derogation,but that the assessment and evaluation required is actually carried out in using an independentprocess, administered by the Market which is efficient, transparent and auditable.

Process:

i. Weight/Size/Other restrictions as already set out set out in Utility Specification

ii. Tender then issued for transformers that meet these requirements at either Tier 2, Tier 1or the next alternative, which would simply be a transformer built using Tier 2 steel((‘not more than the equivalent of the losses from silicon steel at 0.8W/kg @1.7Tduring normal operation ‘) and conductor. Conductor is determined by Capitalisation,and Impedance requirements.

iii. Tender is awarded to best Tier 2 transformer

Or if no Tier 2 offered, to best Tier 1

Or if No Tier 1 offered, to Trafo with lowest TCO using capitalised closes.

Note: It is not possible to specify conductor characteristics as this could make the transformeruneconomic – it is because the particular circumstances involved make the Transformerexcessively expensive/impractical or not feasible that the Exemption process is being used.

This approach is:

o Open and Transparento Process operated by Manufacturers whose interest is best served by offering best

Tier so that they win Tender.

o Enforceableo Tender Procedure is under EU Utilities Directive with fine of 10% Turnover

o Changes as technology improveso If better steel available in future then Tier 2 offered more frequently – currently

standardise on 0.8W/kg @1.7T where Tier 2 not possible

o Fairly assesses costso Operated by the Tender process, so costs are transparent. If Tier 2 can be

provided technically/ economically / practically then this happens. If Technologyimproves then Tier 2 can be offered once available

o Easy to Administer and Open to Market Surveillanceo Operated through Tender Process by Manufacturers

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1.7 Extension of ability to apply Power Trafo Exemption for Replacement Trafos toGreenfield sites

The EU Proposal to extend the current Derogation for replacement of existing PowerTransformers to Green field sites is welcomed.In general Power Transformers are very efficient and already meet Tier 2 on new purchases.Typically utilities buy a certain Tier 2 design of Power Trafo and this facilitates the installation ofsuch units from stock/manufacturer as standard.

Non-standard designs are only required in a minority of situations where Tier 2 designs areunsuitable, in which case a bespoke design is required which is generally going to be more costlythan standard Tier 2 as it is a bespoke design, and has longer delivery time.

Accordingly if a bespoke design is required there are problem issues with the location such as anunusual Transformer design (e.g. impedance), restriction in size or weight etc.

In such cases if it is a replacement of an existing unit it might be required to simply buy a Trafo tothe same design as the original as otherwise delays in design and Short Circuit testing wouldoccur.

Accordingly no requirement to use Tier 1 transformers should be applied in such instances as thereason a non-Tier 2 Trafo is being used is because if some unusual problem.

In Greenfield sites the restrictions will be Transport and weight/size and the requirement for anefficiency level should be addressed using the Exemption procedure proposed.

1.8 Proposals for Transformer repair need review:

The suggestion that existing installed Transformers would have to be replaced with new Tier 2units if any repairs to Tap Changers or Bushings took place is ill conceived and mistaken – thesetypes of repair are minor and would not encourage the large scale refurbishment and resale ofsecond hand transformers which was the intention. It should be corrected.

This wording also discourages the future use of MV/LV Transformers for use with low carbonsolutions such as Electric Vehicles and Heat Pumps.

On Power Trafos Replacement of the Tap Changer may also require replacement of theTransformer with a Tier 2 unit. Again this needs clarification.

1.9 Consequences of excessively stringent Tier 2 requirements are dysfunctional.

1.9.1 Encouragement to extend continued of older, Higher Loss Transformers

More stringent EcoDesign proposals will encourage the continued usage of older (higher loss)transformers as these will fit into Brownfield substations without requiring any civil works.However this effect is not analysed by VITO, although excessively stringent Tier 2 levels wouldpromote the increased usage of older transformers, resulting in an increases in losses.

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1.9.2 Encouragement to overcome space/weight restrictions by using smaller kVATransformer operated at higher load factor

Although advocated by VITO as a solution this would increase Copper Losses and result in adoubling of Iron Losses, as the only way to provide additional transformer capacity would bevia an additional transformer with a full complement of Iron Losses i.e. instead of upratingform 500kVA to 1000kVA, the initial uprate would be to say 750kVA which when capacity wasexceeded would require an additional substation with an additional transformer say 500kVA,with extra Iron Losses.

1.9.3 Use of ONAF Distribution Transformers to decrease size

Another proposal from VITO was to use ONAF Transformers where there were restrictions inspace. ONAF Transformers can pack more power into a given volume as the excess heatgenerated is extracted more efficiently. However this would again involve a lower kVA ratingoperated at a higher load factor which would increases losses (which would now include fanlosses). Overall the result would be greater energy losses.

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2 Working Document Comments:

Preamble (p. 1):

(4) Transformer manufacturers ‘concluded that there are no technical barriers to manufactureTier 2 compliant transformers , even when taking into account space and weight constraints inexisting installations’ .

T&D stated at the Stakeholder Meeting in March 2017 that the majority of their members couldmanufacture Tier 2 transformers but:

(a) Did Not provide any prices for how expensive Tier 2 transformers would be(b) Did Not state that Tier 2 Transformers would always meet the weight and size limitations

required – in fact a subsequent CENELEC enquiry revealed a wide variety of Utilityrequirements arising from historical antecedents which meant that dimension andweight requirements carried widely across EU.

Synergrid Tendered for Tier 2 Transformers but did not get Tenders which met the weightand dimensional requirements stipulated at Tier 2 i.e. Tier 2 Trafos tendered were suitable.

(5) Statement that Tier 2 Trafos in Green Field sites are always justified on TCO compared to Tier1

This statement is only valid if the value of the savings made is in excess of the extra costsincurred. VITO were not supplied with Transformer costs by T&D so could not make thisevaluation definitively. In contrast, EURELECTRIC supplied costs and savings2 which showed thisnot to be the case.i

EU accepted that size and weight considerations affect ‘brownfield’ sites and require ‘moreexpensive copper based transformers; to be used ‘which ‘can become uneconomic under relativelow loading conditions’.

(6) Proposal to extend exemption for replacement of large power transformers where there aredisproportionate costs associated with their transportation and/or installation with a similarexemption for new installations where such cost constraints are also applicable

- This is welcomed by EURELECTRIC as a sensible measure.

(7) Guidance on where upgrade/repair/replacement/retrofitting makes a transformer into a newproduct and hence requires compliance with Tier 2 is provided but is not correct in detail or inprinciple, and needs to be reworded.

2 ‘Consultation on Tier 2 Fixed Loss Levels on Distribution and Power Transformers Implementation - EURELECTRICMarch 2017. http://www.eurelectric.org/media/314743/eurelectrc_resp_ecodesign_tier2_250317_final2_public-2017-030-0205-01-e.pdfhttps://transformers.vito.be/documents

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2.1 Discussion Topics (P2):

EURELECTRIC supports the proposed exemption for transformers designed and qualified toensure safety of nuclear installations. And also the proposed exemption (from CENELEC) forSingle Phase Medium Power Transformers <1kVA and Three Phase units below 5kVA

2.1.1 Tier 2 requirements for three phase Medium Power Transformers:

‘2.1 Cost effectiveness of Tier 2 requirements’ (p. 4)

It is stated that the review study had to assess to what extent the Tier 1 and Tier 2efficiency requirements were ‘technologically feasible , and more importantly , costeffective.’

It then continues to state that ‘most current transformer models available on the marketare able to meet Tier 1 requirements without difficulty’ and that ‘some progressiveutilities (e.g. Synergrid in Belgium) are already using Tier 2 requirements as a referencein their procurement processes’.

However Synergrid did not receive any Tenders at Tier 2 which met the weight anddimensional requirements requested.

Next it is stated that ‘the lifecycle cost of Tier 2 compliant transformers is always lowerthan that of only Tier 1 complaint transformers in the case of new installation sites(greenfield sites), this is without size or space constraints.’

This is not in fact the case for the following reasons:

(a) VITO did not include the extra cost of larger ‘Greenfield’ sites(b) VITO did not include the extra costs of developing and stocking extra classes of

transformers for use in such sites(c) VITO were not provided with information on the extra Transformer costs which

would be required to make this assessment, and in any case overestimated thesavings involved.

(d) Utilities using capitalised losses are not being offered Tier 2 in Tenders, which islikely to mean that the capitalised losses required to justify Tier 2 would need to besignificantly greater, which is not justified.

It is then acknowledged by EU that there are cost issues with Brownfield Stations in Urban areasalthough these do not seem to affect DER, industrial or large Power Trafo sites.

EU acknowledge that the extra costs for Brownfield will not make Tier 2 economic but that theycould not estimate exactly how many sites would be affected but that one VITO estimate was27% of total installed capacity and conclude that : ‘Therefore a regulatory adaptation to addressthese situations could be considered’

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P. 7 Explanatory Notes:

‘…a situation where the replacement of the existing transformer requires the replacement ofthe substation is not satisfactory either, It would not be wise to fragment the market , throughregulatory intervention , into different transformer designs for greenfield and brownfieldinstallations as this would probably be unenforceable in practice.

Additionally, transformers have long service lives of up to 40 or even 50 years, The calculation ofthe lifecycle costs requires making assumptions in a number of key variables such as the discountrate , the price of electricity and the evolution of future electricity prices, All this is necessary tocalculate the net present value for future losses which are trying to be avoided.

The use of different assumptions produces different outcomes which may or may not justify theadoption of stricter requirements in Tier 2.

…

The conclusion of this discussions is that minimum requirements fir Tier 2 may need to becomplemented with some form of regulatory relief, when the installation of complianttransformers becomes uneconomic under specific circumstances. As it is not possible to know inadvance all situations in which this will be the case, such regulatory relief needs to be as future –proof as possible and should not lend itself to situations of potential abuse. A number of optionsto address this issue are presented in the related consultation document.

EURELECTRIC agrees that Tier 2 is definitely not economic in Brownfield, but would also state thatthe number of Brownfield sites is considerably in excess of 27%, as this figure was based on anaverage of MVA installed, not on the number of substations affected. Looking at the number ofsubstations affected it would be greater than 60%3, and probably closer to 90% when rebuiltsubstations on existing small sites are included.

Four Options are then proposed:

1. Option 1 – Derogation (p5):

This proposal suggests that every time a transformer has to be replaced in a brownfieldsite permission is obtained from national authorities. Also that the transformer mustmeet Tier 1 requirements regardless of whether it fits in or not.

Also that it must use steel of 0.8W/kg at 1.7T.

This is very bureaucratic and cumbersome – transformers are normally tendered andproduced in bulk, whereas now each individual installation would have to be assessed inadvance and a transformer designed and proposed to the Market Surveillance authority,with installation delayed until permission granted.

By implication this also means that a second stock of more efficient Transformer designsmust in addition also be kept in stock for Greenfield applications, which is excessivelycostly.

The requirement to use 0.8W kg at 1.7T is pointless – all it means is that to achieve Tier 1losses only 0.8W/kg steel can be used, not other steels which could achieve the same

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result. Vito assumed that using 0.8W/kg steel would improve performance, but this is notthe case when the overall level required is capped at Tier 1.

2. ‘2.2 Requirements based on PEI’ (p. 5):

PEI is an alternative method of specifying transformer efficiency and is already used forPower Transformers. It was proposed as an additional alternative to Fixed Losses forDistribution Transformers.

The advantage of PEI is that it allows different combinations of Iron and Coper losses andthis is advantageous in matching the Transformer design to the load it feeds, so thatlosses are minimised.

A mis-understanding of PEI is evidenced in the discussion where it is suggested thatbuyers would seek to reduce costs by designing transformers to minimise cost for allowvalue of PEI by using an artificially low load factor, rather than to buy a more efficienttransformer, and that this would be evident where the Iron and copper losses resultingwere different from those in the existing legislation.

There are several clarifications required here:(a) In situations where the load factor is low then the transformer should be

optimised to minimise Iron losses as these are on continuously, a t the expense ofcopper losses which are only incurred intermittently. Designing a transformer fora 19% Load Factor where the actual load factor is (Say) 5% produces atransformer that is less efficient in energy terms than it should be

(b) Using TCO in conjunction with PEI (as is required in Cenelec) means that thetarget load factor, and the trade off in Iron and Copper Losses to achieve thistarget, are signalled to the manufacturer. Evaluating the tender using TCO thenprovided the optimum result from the Tender of greatest efficiency at least costto the customer.

(c) Alternatively, the Utility could assess the Load Factor, and use it in combinationwith the PEI to calculate an alternative set of Fixed Losses for use in the Tender.This would also help optimise the performance of the Transformer for that typeof load.

(d) If a user simply wants to buy a cheap transformer and is unconcerned aboutlosses then they can simply buy a transformer of lower kVA rating but whichmeets EcoDesign requirements. Such a transformer will have a high load factorand higher losses but may be more economic than the alternative required whenEcoDesign levels are uneconomic an inappropriate.

Accordingly, imposing limits of the Load Factor as suggested will simply result in lessefficient transformers as different counties and locations within countries will havedifferent Load Factors e.g. winter Electric Heating in Norway , summer air conditioning inItaly, city areas against suburban/rural.

The following Options are suggested:

Option 2A – use Fixed Losses only (p6)Option 2B – use PEI with set minimum values of kPEI, or just provide selectedcombination of Iron and Copper losses. (p6)

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In Option 2A and 2B there is concern expressed that with the choice of Iron and Copperloss combinations it would be possible to buy cheaper transformers rather thantransformers which minimised losses, and that to avoid this minimum levels of kPEIshould be imposed.

Option 2C – use Fixed Losses or additional alternative of PEI (p7)

EURELECTRIC favours Option 2C as it allows flexibility in optimising the transformer design andin purchasing the transformer.

The buyer can then either:

(a) Tender for the Fixed values of loss stated in the legislation- This provides a very standardised product although it may/may not besuitable for the intended load, in which case losses could be higher thannecessary, or if suitable the standardisation would provide the cheapesttransformer.

(b) Tenderer could assess the intended load class and use the associated Load Factor andPEI to price an optimal combination of Iron and Copper losses which optimised thetransformer design and minimised losses

(c) Tenderer could tender for PEI with Capitalised values of Iron and Copper Losses andthen use TCO to assess the best Tender.

(d) Tender could use a combination of the above as ‘Priced Options’ in the tender andthen select the option which was best value.

The statement made that Options 2B and 2C ‘would risk fragmenting the market and potentiallyadd production costs for manufacturers’ is confusing. Buyers want the best value and the marketwill resist fragmentation by providing a lower price for the most common product. The only waythat ‘fragmentation’ will happen is when the buyer feels that the benefits of fragmentation aregreater than the costs, and with Option 2C all the costs and benefits are transparent.‘Fragmenting the market ‘could better be expressed as ‘giving utilities a wider choice oftransformers to purchase.’

It is also unimportant, even for manufacturers, if this could ‘potentially add production costs’because Transformers are bought in a Tender process so that if additional productions costs areincurred they inevitably add to the tendered price, but equally important, if costs are saved thenthis results in a price reduction and the saving is accrued by the ultimate user, the customer.

So the only winner here is the customers – having wider choice in a free market means costsare minimised and excessive profits are not obtained by either manufacturers or utilities.

Note: A final suggestion is that any of these options could also be combined with the option for aderogation in Option 1, which is just excessively complicated as a process.

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2.2 ‘3. Energy Efficiency Requirements for Single Phase Transformers’ (p7):

Only used in UK and Ireland, and capacity added is insignificant – not really worth regulating.

It was found that because of their use in rural areas with low loads, there was no benefit toreducing Copper Losses as the current top produce Load Losses was just too low, but that it mightbe worthwhile to reduce Iron Losses.

The issue of Single Phase Transformer Losses was looked at in detail in several EURELECTRICpapers provided to the EU3, where it was shown that under the most extreme conditions whereMagnetic steel was completely replaced with amorphous core (resulting in extra weight, size andcost) that the saving gained would be at most 32W per 15kVA Transformer, or 160kW for the5,000 pa purchased in Ireland – it is simply not material in the context of the EU.

Although VITO suggested subsidiarity rather than inclusion in legislation in their Final Report, dueto the non-materiality of the losses, it is now suggested that for consistency the values given byCenelec 50588 are used.

The Cenelec values are derived from the existing performance values for Irish 15 & 33kVATransformers and are acceptable in Ireland (which represents 50% of the EU market with UK theother 50%).

However the Irish values for the most predominant unit - the 15kVA Trafo – are not set byeconomics but by the requirement to use significantly more copper in the Transformer so thatthe impedance can be reduced to 2.2%.

Hence Irish 15kVA Transformer have Iron Losses of 48W Load Losses of 270W, but UK 16kVA a naverage of 48W Iron but 405W for Load Losses. The fact that the UK and Ireland both have similarIron Losses but vastly different Copper Losses indicates that both utilities value kWh lossessimilarly, but that there is a significant extra factor in Ireland driving down the Copper Losses tounnaturally low levels.

This is in fact because it is not physically possible to achieve the required 2.2% impedance in a15kVA unit without reducing the resistive component significantly i.e. the copper losses for the15kVA unit are not set by efficiency or loss requirements but simply by the impedance needed.

However this means that Irish Efficiency Levels may be an excessively stringent level for the UK,where such low impedances are not required and 4.5% is sufficient.

3 ‘Review of EU Proposal of 14./6/2017 to use Fixed Iron losses for various Single Phase Pole Mounted Transformersizes’ (June 2017)

P.8 Explanatory Document - 2.3 Requirements for single-phase transformers

Only 238MVA of single phase distribution transformer capacity is installed annually in the EU(UK 154 MVA & Ireland 84 MVA) - savings from new energy efficiency requirements will beinsignificant.

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It is also possible to separate out Product requirements by Impedance giving one set of PEI for2.2% Units and another for 4.5% units.

EURELECTRIC proposes (in order of preference):

(a) Using Subsidiarity- this area of the market is very small and not material and including it adds extracomplexity for little benefitOR

(b) Specifying separate Tier 2 PEI levels according to the Transformer Impedancei.e. PEI Tier 2 levels for 2.2% (typically used in Ireland) and 4.5% ImpedanceTransformers (mainly used in UK)A

Fig 4 Tier 2 Levels for Transformers > 4% and less than 4% Impedance

The Tier 2 Levels shown for Transformers <4% Impedance (Typically Irish 2.2% Impedancetransformers) are as per EU Working document and Cenelec, and the Tier 2 > 4% PEI Levelsmainly apply in UK.

To date there has been no Tier 1 level for Single Phase Transformers so any change should not beexcessively disruptive.

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2.3 ‘ 4. Regulatory Concessions: ‘ (p. 4)

2.3.1 ‘4.1 Large Power Transformers’ (p. 8)

Option 4 p8

For New Installations weight, transport involving disproportionate costs or if technicallyunfeasible are accepted as derogations.

Derogation has to come from National Authority. Trafo must still meet Tier 1 and be made with steel of 1W/kg @ 1.7T, so the losses are

still Tier 1 just with more expensive steel.

In general Large Power Transformers are already at or above TIER 2 which indicate s that there isno attempt to try and save costs by putting in a sub-optimally efficient unit.

The only reason a non-Tier 2 unit would be used is because of space, transport or weightlimitations, and if these still exist when a Tier 1 unit is to be installed then it will certainly not beeconomic to remove these restrictions simply to gain a tiny saving in losses at the expense of anenormous cost.

Accordingly EURELECTRIC proposes that to avoid excessive complications in an area which isalready exceeding Tier 2 in general, it is suggested that the proposed Exemption Procedurebecome applicable i.e.

Transmission Asset Owner Tenders for Tier 2 with applicable Weight and Size restrictions, PEI,and Capitalisation values and then assesses Tier 2 units or if no Tier 2 then Tier 1 and if no Tier 1then uses TCO.

This proposal provides a derogation where it is required, results in the installation of a Tier 1 if aTier 2 is not possible, and if a Tier 1 is not possible documents why not and allows work to goahead with Next Best Transformer.

The Steel Grade clause of 1W/kg at 1.7T then becomes applicable if Tier 1 is not possible i.e. Trafowill be made with good quality steel.

Option 5 (p. 9)

This is the same as Option 4 but applies to the derogation for replacement of Transformers inexisting substations and requiring them to also be Tier 1 if possible.

However the difference here is that the existing transformer may have been designed in aparticular way to facilitate installation and if a replacement design meant that it was not exactlythe same could result in other work being required in the station, or that A Short Circuit test wasrequired because the Trafo now used was not the same design as that which had been usedbefore.

There are relatively few instances where transformer are replaced in the same substation as thelife of Trafos is typically 50 years, cases where there are limitations are unusual (but possible) andthe tendency is to use off the shelf Tier 2 Transformers as they are already available – a non-standard unit will be more expensive. So it is unlikely that someone will seek to use a more –expensive bespoke unit with higher losses to save on costs.

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Hence EURELECTRIC proposes no change should made to the existing derogation forreplacement of existing Power Transformers in substations.

2.4 ‘4.1.3 Power Transformers with rated power lower than 4MVA’ (p. 9)

Issue here is that for smaller ratings of HV Trafos it is not possible to achieve the PEI levels set inthe legislation, so amended values are provided.

These would apply to say a 52kV/LV 100kVA Trafo. There are Tables for both Dry and Oil filledTrafos.

Dry type Trafos are allowed higher losses than Oil types. Logically if either Oil or Dry type can beused then Dry should require the same losses, and if this is not possible a Dry should not be used.

The Table Proposed is to cover a situation recognised by Cenelec where the Transformer is above36kV but the Power required is very small, and it is not possible to physically make a transformerconforming to PEI values for <= 4MVA units in Table 1.7 (Tier 1: 99.465% and Tier 2 : 99.532%)

Consequently a new Table is proposed for units in the range 25kVA to 3150kVA where Um isbetween 36kV and 72.5kV.

Such transformers are very unusual and would be used typically to provide LV house Supplies forinstrumentation, battery charging etc. in HV substations.

So there are very few such units purchased annually (e.g. 5 per annum in ESB) but they areessential to the operation of the Substation.

Testing one of the figures 100kVA and 99.09322% against a physical design produced for atransformer that was purchased, the best that the manufacturer could provide was 0.41kW IronLoss and 1.4 kW Copper Loss for a 100kVA Unit, corresponding to a PEI of 98.48%.

So the values in this Table do not appear to be achievable, but more than that the numbers ofunits to which the Table will apply will be insignificant, yet an inability to provide suchtransformer will require a Derogation form the Market Authorities OR, the installation of a1000kVA unit (instead of 100kVA Unit) which will have much higher losses but which will meetthe EcoDesign Proposals.

EURELECTRIC proposes that to avoid unnecessary bureaucracy either:

(a) Omit Transformer below 1000kVA from the Table as there few HV/LV Transformer used(b) Verify with a manufacturer that transformers have been designed in detail and can

meet these values.

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2.5 ‘4.2 Concessions for transformers with unusual combinations of windingvoltages: ‘P 10

Suggestion here is that Dual Voltage trafos are allowed higher loss levels to compensate for extrainsulation required, but people are now looking for Dual Voltage as they are cheaper.

P9 Explanatory Document 2.4.2 Transformers with unusual combinations of winding voltages.

Suggests that a dual winding trafo is 10 – 15% cheaper than single ratio unit due to lossesconcession.

Proposal (7) is that the steel used in such cases must be 0.8W/kg @1.7T

However all this means is that the loss level will remain unchanged, just that it will be achievedusing a more expensive steel.

Utilities are the greatest users of Dual Ratio Transformers for use in voltage conversion programswhich go on over a long period (10 – 15 years). Voltage Conversion produces very significantreductions in losses (e.g. changing form 10kV to 20kV reduces line losses by 75%) and suchprograms also accelerate the retirement of older higher loss transformers.

Utilities should not have extra costs added unnecessarily to their costs - any voltage conversionprogram has been approved by the regulator as it involves a strategic decision costing billions ofeuro, so that no utility will buy Dual Ratio Transformers in hope of low price. Experience inseveral utilities is that Dual Ratio Transformers are more expensive than Single Ratio due to extramanufacturing and requirement for tap changer.

Accordingly EURELECTRIC recommends no changes.

2.6 4.3 Concessions for Pole Mounted Transformers p11

Pole Mounted Trafos are allowed higher losses because existing support structures would notbear the extra weight of more efficient units.

It is suggested that the practice of mounting transformer son poles is being phased out in Europeand that in Norway the practice of mounting Trafos on poles is being abandoned on safetygrounds and there is now a requirement to use ground mounted transformers instead.

EURELECTRIC suggests that there is a lack of understanding of electricity networks shown herewhich needs to be addressed.

In countries with large overhead networks the majority of transformers are pole mountedbecause the population is spread out thinly and the cost of mounting a transformer on theground for small kVA ratings (<400kVA) are inordinately high, and safety is actually less in suchareas as effective earthing will not be possible, and, in addition, assets at ground level are thehighest risk to the public as they are accessible but less easy to inspect for damage.

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In addition a ground mounted Transformer is a multiple of up to 5 times the cost of a PoleMounted Unit – this is because it needs a housing, an earth mat and earthing system to addressearth faults in its vicinity, switchgear, cables up/down the pole, land purchase and finally regularongoing inspection and maintenance of assets accessible to the public.

The life of a pole is about 50 years and the pole installation is at least as valuable as thetransformer.

The suggestion that it could be economic in any circumstances to require a pole with aremaining life of 40 years to be abandoned and replaced with either a ground mountedsubstation or a 2 pole installation simply so as to save the marginal differences in lossesbetween Tier 2 and Tier 1 is unfounded.

Furthermore the volume of Pole Mounted Transformer in comparison to Ground Mountedunits is very high – In Ireland alone there are about 200,000 pole mounted Units (all smallsizec15kVA) and about 20,000 ground mounted units of 400kVA average.

The replacement of such large volumes with Ground Mounted Units or with Two PoleInstallations to any appreciable extent will simply never happen.

Options proposed: (p. 11)

Option 8A – withdraw concessions, all Trafos to meet levels for Tier 2 for Ground mount

o This effectively ignores the situation where the Trafo is too heavy to go on thepole and requires that to save the extra losses between Tier 2 and Tier 1 a secondpole and fittings is installed at an inordinate cost which is not covered by thesavings in losses.

o In addition any attempt to install a 2 pole installation and landowner will requirethe pole set to be moved back from the house – but the extra losses on thelonger connecting one will now swamp any copper loss savings in thetransformer.

o Most Pole Mounted Transformers are used to replace faulty existing transformersafter a storm/lightning – such repairs are urgent and an inability to install aTransformer on an existing pole because it is too heavy will delay supplyrestoration.

Option 8B – continue concession for 6, 8 or 10 years ‘ to allow a gradual phase out of existingpractice’, then have all meet Tier 2 levels for Ground Mount.

o See Explanations in 8a above. The lifetime of the Pole is 50 years. It is not in anyway meaningful to suggest that such installations which form the bulk ofconnections in a country could be attempted to be phased out.

Option 8C – as an addition to Option 8B only allow the 6- 10 year phase out for replacementTrafos, not for new ones

o See Explanations in 8a above. This proposal is even less economic as it wouldrequire two types of transformer during the Phase Out period at excessive cost.

Option 8D – This combines Option B or Option C with a requirement to use magnetic steel withlosses of 0.8W/kg @1.7T

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o Using a more efficient steel but keeping to the same Tier 2 loss levels does notactually change the amount of losses – it just provides tier 2 losses usingexpensive steel. Not really a good idea.

Option 8E – Portugal have reported that for 250KVA units BkA0 is not feasible as too heavy forpole and that CkC0 should be used instead.

o EURELECTRIC supports proposal 8E. Less than 5% of Pole Mounted Transformersare larger than 160kVA and above 250kVA Transformers tend to be too heavyfor pole mounting, in which case there is a natural progression to groundmounting where Tier 2a can apply.

o Adopting CkC0) has minimal effect on losses and BkA0 would not be justified asthe lifetime of a 250kVA unit on a pole is less than 20 years (due to load growthexceeding trafo capacity) so that payback on reduced losses of BkA0 of 40 yearswill not occur.

EURELECTRIC would propose a simpler solution:

– * Assuming Pole can take the 100kVA at BkA0 design

As can be seen from the above Tier 2 would be accepted for Trafo sizes up to 100kVA, with theonly caveat being that the Pole would be able to take the extra weight of a BkA0 design (althoughthis will generally be acceptable).

For 160KVA where it is already known that anything above Ck+32%, C) is too heavy for the polethen Ck+32%, C0 continues.

For sizes above 160kVA then Ck, C0 is used on the basis that:

(a) Only 1-5% of Pole Mounted Transformers are >160kVA(b) Two Pole Platform Mounted Transformers which are often used for heavier weights are

not considered Pole Mounted and Ground Mount requirements apply(c) Single Pole Designs which can accommodate >200kVA are at the limit of the size that can

be held by the pole which means that further increases in load which would requireuprating of the Transformer mean that Ground Mounting is the only reasonable optionavailable. Given that a 200kVA+Transfofmer feeds what must be a significant point loadsuch as a large farm or rural factory, load growth will require this transformer to beuprated within about 10 years , so that the payback on any investment in improvedTransformer losses must be obtained over 10 years, not over 40 years. i.e. investments ingreater energy efficiency in the se transformers will be stranded and not make benefitthe customer

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This proposal means that current Tier 2 would be applied for the majority of Pole MountedTransformers with only larger sizes being unaffected, but this impact would not be material.

Note:

Sizes of Transformer Pole Mounted Units were received from two European Utilities which eachhad about a third of a million units each:

As would be expected, large sizes of Pole Mount Transformers are uncommon as they are used tofeed rural loads. Once load develops Overhead Network becomes less suitable and is replacedwith Ground Mounted network.

2.7 ‘5. Issues related to other environmental impacts:’ (P 12)

‘It has been reported that transformers of higher efficiency with compact design may be prone tonoise issues … investigate by 2023’

Noise issues arise where noise levels exceed Environmental Regulations. Trafos which exceednoise regulations cannot be produced. It is not a matter for EcoDesign and does not requireinvestigation.

2.8 ‘6.1 Small Power Transformers:’ (p. 13)

‘… with the gradual introduction of electric vehicles a growth in LV.LV transformers is expected.’

Electric Vehicle Chargers do not use Lv/LV Isolation Transformers, so this is not clear.

Utility A Southern EU Utility B Weste rn EU

Pole Mount Pole Mount kVA % Total

10 1% 5 7%20 1% 15 72%75 1% 33 12%100 25% 50 4%250 5% 100 2%

TOTAL (nº) 100% 200 1%No. Units 85,000 TOTAL (nº) 100%

No. Units 230,000

No. Ground Units 260,000 No. Ground Units: 20,000

% TOTAL

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2.9 6.2 Technology Neutral requirements for liquid immersed and dry typetransformers:

Option 11 Adopt a technologically neutral approach to liquid, dry and electronictransformers in next review 2023.

EURELECTRIC agrees that this is a reasonable approach.

2.10 ‘6.3 Retrofitted Transformers:’ (p13)

EU propose that if existing Trafos have their energy performance or life expectancy substantiallyincreased then they should be considered as new products and be required to meet theRegulation.

The intention is to stop old trafos being bought wholesale and refurbished for sale, but thewording is too loose and likely to cause problems.

Replacing windings in a trafo, is very substantial and would make it a new product but‘Replacement of the tap Changer, of the bushings and on the complete insulation ‘ is a relativelytrivial job and would definitely not make the product new, although replacing the insulationmeans replacing the winding and is a major job. So Replacement of Bushing s and Tap Changershould be deleted in this section.

Bushing replacement is normal everyday maintenance. Tap Changers are replaced on larger HVTrafos as routine and are designed to be easily replaced.

On modern MV/LV Tap Changing Transformers that are now being used by utilities to cope withextra Load from Electric Vehicles or PV , this would mean that if the Tap Changer breaks in 10years’ time it cannot be repaired and instead the transformer must be completely replaced with aTier 3 unit.

EURELECTRIC proposes:

‘Replacement of the complete active part with a new one , for instance replacement of thecomplete phase of a Medium Power single phase transformer less than 500kVA , or the threephases of a three phase transformer less than 4MVA or fixing /replacing a whole magneticcircuit with new steel will mean the retrofitted transformer will be considered a new product.

Transfer of already owned assets between utilities shall not be considered ‘putting on themarket’ or ‘putting into service’.

This caters for the situation concerned where large amounts of retired small transformers wouldbe refurbished substantially and put back on the market, but it also allows the repair of largerTransformer units – these are much fewer in number but economic to repair, but not economicto design a new winding for.

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The last sentence concerning ‘transfers between utilities’ covers situations where one utilitytransfers a territory and associated network to an adjoining utility, which is essentially a sale ofpart of the company and assets and happens routinely in countries like Belgium which haveseveral DNO’s.

Option 12

‘Power Trafos on which routine repair operations are performed shall not be considered as havingbeen retrofitted. … Routine repaid Operations include, in particular, the following:

Replacing all coils

…

Repairing leakages, corrosion protection.’

Noticeably Replacement of the Tap Changer and of the Bushings is not included although theseare some of the most usual occurrences, and would suggest that the whole Transformer wouldneed to be replaced with a Tier 2 unit if a cracked bushing were replaced?

However EURELECTRIC feels that the following wording is more appropriate:

EURELECTRIC proposes:

Option 12

Any repair of Power Transformers shall not be considered a new product.

Power Transformers vary in cost form 0.5m to perhaps €100m, which in turn means that thegenerators /load they serve are more valuable by a large factor.

Typically such assets already have very high efficiency. Requiring a trafo to be redesigned andfitted with new winding s during repair following a fault would be incredibly costly – ta newdesign would be required for the new winding and a Short Circuit test in addition. Frequentlysuch occurrences strain the system and a fast repair is required.

The whole reason behind concern over repair was only on Distribution transformers being boughtby industry, not utilities, and there is no need to attempt to draft condition s that provide nobenefit but can make a situation more complex.

The owner of the 200MVA Amazon Data Centre in Dublin will not be attempting to buyrefurbished Power Transformers nor will any other user of such assets, as their business is simplymuch more critical.

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3 Appendix 1: References to EURELECTRIC Inputs to EcoDesign Tier 2

EURELECTRIC pursues in all its activities the application ofthe following sustainable development values:

Economic Development

Growth, added-value, efficiency

Environmental Leadership

Commitment, innovation, pro-activeness

Social Responsibility

Transparency, ethics, accountability

Union of the Electricity Industry - EURELECTRIC aisblBoulevard de l’Impératrice, 66 - bte 2B - 1000 Brussels • BelgiumTel: + 32 2 515 10 00 • Fax: + 32 2 515 10 10VAT: BE 0462 679 112 • www.eurelectric.orgEU Transparency Register number: 4271427696-87