Economics of Transformer and Reactor Life Management

This chapter aims to equip stakeholders with the knowledge to make informed decisions that optimize the performance and life of transformers and reactors while minimizing costs and environmental impact, thereby contributing to more sustainable and efficient power distribution systems. The fundamentals of asset management of transformers and reactors, with emphasis on the strategic importance of Life Cycle Costing (LCC) analysis for effective decision-making are presented. The impact of financial and regulatory frameworks on asset management strategies and the broad approach to managing a fleet of transformers and reactors are also examined. The main costs associated with transformers and reactors are analysed, covering major failure risks and models; electrical losses (load and no-load); maintenance; life extension alternatives; and environmental implications. The chapter further explores the application of LCC principles to transformer life management, addressing procurement; maintenance and online monitoring; life extension; reliability upgrades; and the critical decision-making process regarding repair, refurbishment, or replacement.