Pam Rost of ABB Inc. presented on the potential impacts of the Department of Energy's proposed changes to efficiency standards for distribution transformers set to take effect in 2016. The proposed changes would increase minimum efficiency requirements slightly, requiring design changes to most existing transformer models. Manufacturers are concerned about higher material costs if more advanced core steel is needed. Customers worry that larger, heavier transformers will increase costs related to transportation, installation and ownership. Rost emphasized that each customer's unique factors for the total cost of transformer ownership should be considered to determine the best design approach despite the new standards.

1. 2012 TECA Engineering and Operations Conference July 19, 2012
DOE - effects of new proposal on
distribution transformers
ABB Jefferson City, MO
© ABB Inc.
July 26, 2012 | Slide 1

2. DOE distribution transformers
ABB Jefferson City
 Speaker names: Pam Rost
 Speaker title: Market Channel Manager
 Company name: ABB Inc.
 Location: Jefferson City, MO
© ABB Inc.
July 26, 2012 | Slide 2

3. Contact information
If you have further questions , please contact me at:
PRESENTERS Pam Rost
COMPANY ABB Inc.
CONTACT PHONE (573) 659-6302
CONTACT E-MAIL pamela.j.rost@us.abb.com
© ABB Inc.
July 26, 2012 | Slide 3

4. DOE distribution transformers
Outline
 2010 National Efficiency Standards
 DOE 2012 Notice of Proposed Rule making February 1st
 Impact to manufacturers, customers and end users
 Total cost of ownership
 Summary
© ABB Group
July 26, 2012 | Slide 4

5. The 2010 National Efficiency Standards
Historical timeline
 2007 Final Rule Distribution Txfmrs (72 CFR 58190)
 Domestic and Imported production of Liquid & Dry
Distribution Transformers
 Manufactured in or imported into the United States and its
territories on or after Jan 1, 2010
 60 Hz, < 34.5 kV Input & < 600 V Output
 Ratings 1Φ - 10 to 833 & 3Φ - 15 to 2500 kVA
 Re-builders exempt unless found circumventing standard
 Inventories manufactured before start date exempt
© ABB Group
July 26, 2012 | Slide 5

6. The 2010 National Efficiency Standards
Lawsuit settlement
 Petitioners - Sierra Club, Natural Resource Defense
Council, Earthjustice & various states
 Petition to consider certain factors when considering
economic justification:
 Employment impact
 Value of reduced carbon dioxide emissions
 Impacts on the price of energy
 Settlement to dismiss petition contingent on…
1. Expedited timeline to determine whether to amend
standards for Distribution Transformers
2. If amendment justified, DOE shall publish no later than
Oct 1, 2012 a final rule.
3. Industry compliance no later than Jan 1, 2016
© ABB Group
July 26, 2012 | Slide 6

7. Notice of Proposed Rule – February 2012
Compliance date January 1st 2016
2011 2012 2013 2014 2015 2016
© ABB Group
July 26, 2012 | Slide 7

8. Notice of Proposed Rule – February 2012
Compliance date January 1st 2016
kVA Efficiency (%) Efficiency (%) Delta %
10 98.62 98.7 0.08
15 98.76 98.82 0.06
25 98.91 98.95 0.04
37.5 99.01 99.05 0.04
50 99.08 99.11 0.03
75 99.17 99.19 0.02
100 99.23 99.25 0.02
167 99.25 99.33 0.08
250 99.32 99.39 0.07
333 99.36 99.43 0.07
500 99.42 99.49 0.07
667 99.46 99.52 0.06
833 99.49 99.55 0.06
© ABB Inc.
July 26, 2012 | Slide 8

9. Notice of Proposed Rule – February 2012
Single phase kVA - efficiency
99.60
99.40
99.20
99.00
98.80
98.60
98.40
98.20
98.00
97.80
97.60
Min. TP-1 DOE Proposed 2016
© ABB Inc.
July 26, 2012 | Slide 9

10. Notice of Proposed Rule – February 2012
Compliance date January 1st 2016
kVA Efficiency (%) Efficiency (%) Delta %
15 98.36 98.65 0.29
30 98.62 98.83 0.21
45 98.76 98.92 0.16
75 98.91 99.03 0.12
112.5 99.01 99.11 0.1
150 99.08 99.16 0.08
225 99.17 99.23 0.06
300 99.23 99.27 0.04
500 99.25 99.35 0.1
750 99.32 99.40 0.08
1000 99.36 99.43 0.07
1500 99.42 99.48 0.06
2000 99.46 99.51 0.05
2500 99.49 99.53 0.04
© ABB Inc.
July 26, 2012 | Slide 10

11. Notice of Proposed Rule – February 2012
Three phase kVA - efficiency
99.60
99.40
99.20
99.00
98.80
98.60
98.40
98.20
98.00
97.80
97.60
150
225
300
500
750
112.5
15
30
45
75
1000
1500
2000
2500
Min. TP-1 DOE Proposed 2016
© ABB Inc.
July 26, 2012 | Slide 11

12. Notice of Proposed Rule – February 2012
Incremental savings
 Energy Savings
 1.58 quads over 30 years (2016-2045)
 Eliminate the need for 2.4 GW of generating capacity
by 2045
 Cost Savings
 Cumulative Net Present Value ranges from 2.9 billion
(7% discount rate) to 12.1 billion (3% discount rate)
 Environment Benefits:
 CO2 emission reduction 122.1 mt
 NOx emission reduction of 98.7 kt
 Hg emission reduction of .819 ton
© ABB Group
July 26, 2012 | Slide 12

13. Impact to manufacturers
Percent of designs meeting proposed ruling
 Percentage of 2007 designs that met 2010
 1Φ - 47%
 S3Φ < 750 kVA - 53%
 L3Φ > 750 kVA – 59%
 Percentage of 2011 designs that met the proposed 2016
 1Φ - 44%
 S3Φ < 750 kVA - 27%
 L3Φ > 750 kVA – 7%

14. Impact to manufacturers
Voiced concerns
 Core steel availability of high performance
steel to meet the demand
 Potential capital and R&D investment if
amorphous metal is required
 May be forced to sole-source their core
steel should amorphous metal be required
 May be required to strand assets if new
manufacturing processes are required
 Refurbished transformers may be more
attractive

15. Impact to manufacturer
2016 proposed efficiency
 Increase in conductor cross section
 Weights and dimensions increase
 Transportation cost increase as less units
per truck load
 Average oil volume per unit increases due
to wider & deeper tanks not being offset by
reduction in tank height

16. Impact to customers and end users
Strong views by all
Against
Not
Acceptable
enough
© ABB Inc.
July 26, 2012 | Slide 16

17. Impact to customers and end users
Concerns
 Substituting amorphous steel for RGO
 Higher costs
 Only one supplier
 Size and weight increases
 Polemounts
 Vault and networks
 Cost and payback
 Understated cost
 Overstated savings
 Driving away from successful A & B method
© ABB Inc.
July 26, 2012 | Slide 17

18. Impact to customers and end users
Price impact
1P (kVA) DOE DOE Proposed 2016
10-75 1.00 1.07
100-167 1.00 1.10
250-333 1.00 1.10
3P (kVA) DOE DOE Proposed 2016
75-500 1.00 1.10
750-1500 1.00 1.12
2000-2500 1.00 1.20
M3 Electrical core steel can be used for complete range

19. Transformer ownership cost
Cost capitalization formula
 TOC or Capitalized Cost = Price + Cost of Losses
 Price ($) = purchase price
 Cost of Losses = (A x NLL) + (B x LL)
 A ($/W) = Capitalized Cost of No-Load Losses
 B ($/W) = Capitalized Cost of Load Losses
 NLL (W) = No Load Losses
 LL (W) = Load Losses
 A & B Factors are unique to each purchaser of
transformer even to their respective industry
© ABB Group
July 26, 2012 | Slide 19

20. Transformer ownership cost
A & B factors are still needed
kVA NL (w) LL (w) NL (w) LL (w)
45 158 510 137 441
75 173 1013 199 683
112.5 302 1083 241 1105
150 279 1782 259 1611
225 347 2519 404 1927
300 451 3019 495 2567
500 723 4886 704 3970
750 915 6755 966 5398
1000 1189 8541 1138 7274
1500 1863 10495 1599 9667
2000 1835 15267 1866 12877
2500 2735 15290 2261 15309
Core loss or winding loss may not be lower
A & B factors still drive best design for individual customers
© ABB Inc.
July 26, 2012 | Slide 20

21. Transformer ownership cost
Web tools (www.abb.com/transformers)
© ABB Group
© ABB Group
July 26, 2012 Slide 21
July26, 2012 | |Slide 21

22. Summary
 Publication of final rule - October 2012
 Increases in efficiency expected for effective date of
2016
 Ask questions specific to your transformers, changes in
costs, weights, dimensions
 Review your A & B factors for the real cost of operating
transformers
 ABB website tools at www.abb.com/transformers
© ABB Group
July 26, 2012 | Slide 22

23. © ABB Group
July 26, 2012 | Slide 23