One of the strategic pillars and that has always been a keystone of the company, setting it apart in the industry, is the drive to maximize the operational performance of its wind farms and solar plants. In this area, EDPR’s teams, namely in operations and maintenance, have established a strong track record that support challenging targets set in the 2014-17 Business Plan. For this period, EDPR has set targets for three key metrics: Availability, Load Factor and Opex/MW. These three metrics provide an overall view of the progress in our operations and maintenance, wind assessment and cost control efforts. They also serve as good indicators for the overall operational efficiency of the company.

MAINTAINING HIGH LEVELS OF AVAILABILITY >97.5%

Availability measures the percentage of time the fleet is fully operational. If an equipment has a 97.5% availability metric this means that, in a given period, it was available to generate energy 97.5% of the time, which leaves only 2.5% for preventative maintenance or repairs. Availability is a clear indicator of performance of the company’s operations and maintenance practices as it focuses on reducing to a minimum any malfunctions and performing maintenance activities in the shortest possible timeframe.

The company always maintained high levels of availability and has registered availability of above 97.6% in 2015, in line with its 2014-17 Business Plan target. EDPR will continue to look for further increases in availability through new predictive maintenance optimization measures supported by the 24/7 control and dispatch centre, in reducing damages most common during extreme weather and improving the scheduling of planned stops. Also a new spare parts warehousing strategy will be key in reducing downtime during unexpected repairs.

LEVERAGING QUALITY GROWTH ON DISTINCTIVE WIND ASSESSMENT TOWARD 31.5% LOAD FACTOR

Load factor (or net capacity factor) measures the speed and quality of the renewable resource at the wind turbines or solar panels. A load factor of 31.5% means the percentage of maximum theoretical energy output with an equipment working at full capacity, in a given period. For example, for 1MW over a year, it equals to the production of 2.759,4 MWh (31.5% x 1 MW x 24 hours x 365 days).

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Ensuring the assets generate the maximum amount of energy possible is a key success factor. With regards to the operating portfolio, optimizing load factor is linked to improving availability as described and, if possible, introducing productivity enhancement retrofits that boost production by setting older equipment models with the most up-to-date technological improvements available to increase efficiency in the utilization of renewable resources available. With regards to wind farms and solar plants under development, maximizing load factor is mostly the expert work of energy assessment and engineering teams, designing an optimal layout of the plant, by fitting the positioning and choice among different equipment models with the characteristics of the site, specially the terrain, from the collected resource measurements and their estimated energy outputs.

The company has consistently maintained levels of load factor in the range of 29-30%, having registered 29.2% in 2015, which is slightly below the 29.4% P50 (mean probability) assessment for the current fleet, and has set a target of 31.5% until the end of the 2014-17 period.

INCREASING TURBINE PRODUCTION

EDPR is also creating value by improving its assets implementing new technologies on the turbines to boost the power output without requiring major component changes. EDPR’s Performance Analysis teams are collaborating with the manufacturers to determine the best practices to apply this new technology.

By monitoring real-time conditions, the rotational speed of the generator can be increased while staying within the existing loads envelope, thus increasing the power output. The extra output increases the revenues of the wind farm, without major investments needed. This technology has successfully being applied on many turbines and it will keep being developed in the following years.

INCREASING EFFICIENCY, REDUCING OPEX/MW -2%

In addition to all company initiatives to boost production, EDPR also focuses on strict cost control efforts to improve efficiency and gain additional profitability. Leveraging on the experience accumulated over time, we set a target in the 2014-17 Bussiness Plan to reduce Opex/MW by -2% CAGR 2013- 2017. Despite the natural aging of its installed asset base, the company is on track to achieve this objective, with a registered reduction on OPEX of -2% CAGR 2013-15. A strict control over costs has been applied to reduce the manageable company costs structure, also benefiting from the economies of scale of a growing company. With regards to O&M, representing c. 30% of total Opex, EDPR has already delivered results form the implementation of its M3 system and self- perform program to some of the wind farms that are no longer subject to initial warranty contracts.

M3 PROGRAM AND SELF-PERFORMANCE

pag54As EDPR’s fleet becomes more mature the initial Operations and Maintenance (O&M) contracts signed with the turbine suppliers expire. When that happens the company needs to decide between renewing the maintenance service with the OEM or insourcing activities to operate the wind farm on its own, whilst maintaining high levels of availability.

The M3 (Modular Maintenance Model) program is our solution. Based on EDPR’s expertise, our O&M teams will decide on the optimal balance between external contractors and in-house maintenance. Usually, EDPR keeps control of high value-added activities such as maintenance planning, logistics and remote operations while outsourcing, under direct supervision, laborintensive tasks.

This strategy resulted in estimated savings of around 20% in the wind farms where the M3 system was implemented, which account for 40% of Europe’s fleet.

In the US, during 2014 we expanded the M3 model to a pilot self-perform program in the Blue Canyon V wind farm. After a market review and a bottom-up analysis, we identified potential savings by fully insourcing O&M activities, given the in-house capabilities developed over the last years.

This new program immediately showed savings in operational expenses and increased control over quality. During 2015 self-perform maintenance was implemented in additional facilities whose maintenance contracts were up for renewal.