Assessment of Cost of Unserved Energy for Sri Lankan Industrial Sector D. Punsara Colambage, Department of Electrical Engineering, University of Moratuwa, Moratuwa, Sri Lanka punsaracolambage@gmail.com H.Y. Ranjit Perera, Department of Electrical Engineering, University of Moratuwa 1 and IESL College of Engineering 2 Moratuwa, Sri Lanka 1 and Colombo 07, Sri Lanka 2 hyrp@uom.lk Abstract— The main function of a power system is to supply electricity to its customers at an adequate level of reliability and quality. Adequate level is the level of reliability and quality agreed upon by the stakeholders balancing the needs and costs of supply. Economic development of a country requires reduced frequency and duration of outages of supply and such improvements support the development in return. If such improvements are made, even a higher tariff is likely to be accepted by the customers. The Cost of Unserved Energy is one of the key economic evaluation parameters for deciding the required level of reliability of the power system. The need for an up to date study on this scope is strongly felt. This research presents the outcomes of a study for Assessment of Cost of Unserved Energy for Sri Lanka. The study is based on consumer survey method. The analysis has been done into three separate categories of electricity consumers as Industry, Commercial and Domestic. This research paper presents the results of Industry sector. Industry category is subdivided and results are presented separately for momentary, planned and unplanned electricity interruptions. It is expected that the results of this study helps the power sector to provide a better service, taking into consideration, the views of the customers and the national importance of electricity as an esential ingredient for economic growth. Keywords—Cost of Unserved Energy, Electricity Interruptions, Momentary, GDP, Consumer Survey I. INTRODUCTION Quantitative reliability evaluation is an important aspect of power system planning and operation. The indices produced in such evaluations serve as inputs to the process of making a wide range of sensitive management decisions. This study assesses the costs incurred by the industrial sector of the country due to electricity interruptions. Impacts of both planned and unplanned Electricity Interruptions are considered separately. Planned interruptions are those imposed and announced in advance by the supply authority in order to carry out maintenance work. Unplanned interruptions are those caused by emergency switching with no prior notice given to the consumers. Forced interruptions due to transmission and distribution system failures also come under this category. In order to evaluate the cost of electricity interruptions, it is important to understand their impact on the consumers. The impacts of an electricity interruption depend on factors such as; Type of consumer (Residential, Industrial, Commercial), Utilization pattern of electricity (lighting, heating, motor drives), Duration of interruption, Time of interruption (Day, night), Availability of standby sources to the consumer. An interruption of an industrial consumer could result mainly in loss of production, damaged machinery, wastage of raw materials and labour, poor quality final products. II. COST OF UNSERVED ENERGY The economic value of the price consumers would pay to avoid a service disruption [1] is called as cost of unserved energy. Alternatively, the cost of unserved energy is defined as the value placed on a unit of energy equal to the sum of all losses, arising due to an unplanned outage for a short duration. Investment decisions to improve supply sensitively depend on the cost of unserved energy. Thus the Cost of Unserved Energy is one of the key economic parameters influencing the need for investments to upgrade and refurbish the network both at Transmission and Distribution. Further, generation planning requires Cost of Unserved Energy to assess the extent of economic damage caused by generation capacity inadequacy. Capacity inadequacy can also slow down the future economic growth. Distribution planners use Cost of Unserved Energy for deciding on investments to strengthen the distribution network. The cost of the project to the electricity utility is compared against the cost impact to consumers if the project is not done [2]. An initial research was conducted in 1990 to assess the Cost of Unserved Energy [3] and another research was conducted in 1997 and an estimate of 142.72 LKR/kWh has been obtained [4]. Later, the Cost of Unserved Energy for Sri Lanka has been estimated in 2002 to be US$ 0.66 and US$ 1.06 per kWh for planned and unplanned interruptions (See Table I) [5]. TABLE I. VALUES OF COST OF UNSERVED ENERGY ESTIMATED IN 2002 FOR SRI LANKA Interruption Type Cost of Unserved Energy Planned Interruptions* US$ 0.66 Unplanned Interruptions* US$ 1.06 Source: SARI Report [5].