Recognized as an

American National Standard (ANSI) IEEE Std C57.120-1991

,-

IEEE Loss Evaluation Guide for

Power Transformers and
Reactors

IEEE Power Engineering Society

Sponsored by the
Transformers Committee

Published by the Institute of Electricaiand Electronics Engineers, Inc., 345East 47th Street, New York, NY 1001Z USA.

August 12. 1992 si15511

 Recognized as an IEm
American National Standard (ANSI) Std C57.120-1991

IEEE Loss Evaluation Guide for

Power Transformers and Reactors

Sponsor
Transformers Committee
of the
IEEE Power Engineering Society

Approved September 16,199 1

IEEE Standards Board

Approved February 28,1992

American National Standards Institute

Abstract: A method for establishing the dollar value of the electric power needed t o supply
the losses of a transformer or reactor is provided. Users can use this loss evaluation to
determine the relative economic benefit of a high-first-cost, low-loss unit versus one with a
lower first cost and higher losses, and to compare the offerings of two o r more
manufacturers to aid in making the best purchase choice. Manufacturers can use the
evaluation to optimize the design and provide the most economical unit to bid and
manufacture. The various types of losses are reviewed.
Keywords: economic, loss evaluation, reactors, transformers

The Institute of Electrical and Electronics Engineers, Inc.

345 East 47th Street, New York, NY 10017-2394,USA

Copyright 0 1992 by
The Institute of Electrical and Electronics Engineers, Inc.
All rights reserved. Published 1992
Printed in the United States of America
ISBN 1-55937-245-1
No part of this publication may be reproduced in any form,
in an electronic retrieval system or otherwise,
without the prior written permission of the publisher.
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 Foreword
(Thisforeword is not a part of IEEE Std C67.120-1991, IEEE Loss Evaluation Guide for Power Transformers and
Reactors.)

The users of power transformers and reactors have become more concerned about the
value of losses as the cost of energy and of installing generating capacity has increased.
The evaluation of losses has become a very significant part of the purchase decision for
some users.
This guide has been written to provide a method of establishing loss evaluation factors
for transformers or reactors. With loss evaluation factors, the economic benefit of a high-
first-cost, low-loss unit can be compared with a unit with a lower first cost and higher
losses. This enables a user to compare the offerings of two or more manufacturers to aid in
making the best purchase choice among competing transformers or reactors. Loss evalua-
tion also provides information to establish the optimum time to retire or replace existing
units with modern low-loss transformers or reactors.
This guide was prepared by the Transformer Loss Evaluation Working Group of the
IEEE West Coast Transformer Subcommittee. The following Working Group members
participated in the development of the guide:

Roger Jacobsen, Chair

Ray Allustiarti Charles Hoesel Dan Nix
I. Stephen Benko William Isberg Robert Norton
Fred Elliot Herbert Johnson Samuel Oklu
Dennis Gerlach Robert Kimball Denise Roth
J i m Gillies Gary Lindland Pete Sorensen
Thomas Hawkins Ron Little Lou Tauber
Charles Hendrickson George McCrae L. Kay Thompson
Jess J. Herrera Larry Merrifield Charles Todd
The following persons were on the balloting committee that approved this document for
submission to the IEEE Standards Board:
L.C. Aicher J. H. Harlow C. Millian
D. J. Allan T. K. Hawkins R. E. Minkwitz
B. F. Allen F. W. Heinrichs H. R. Moore
R. Allustiarti W. Henning R. J. Musil
R. J. Alton K. R. Highton W. H. Mutschler
S. J. Antalis P. J. Hoefler E. T. Norton
E. H. Arjeski C. R. Hoesel B. K. Patel
J. C. Arnold R. H. Hollister H. A. Pearce
R. Bancmft C. C. Honey D.PerCO
P. L. Bellaschi F. Huber, Jr. C. A. Robbins
S. Bennon C. Hurty L. J. Savio
J. J. Bergemn G. W. Iliff W. E. Saxon
J. V. B O M U C ~ ~ R. G. Jacobsen V. Shenoy
J. D.Borst D.C. Johnson B. E. Smith
G. H. Bowers A. J. Jonnatti W.W. Stein
D. J. Cash C. P. Kappeler L. R. Stensland
E. Chitwood R. B. Kaufman R. B. Stetson
0. R. Compton E. J. Kelly E. G. Strangas
F. W. Cook, Sr. J. J. Kelly L. Swenson
J. Corkran W. H. Kennedy A. L. Tanton
D. W. Crofts A. D. Kline V. Thenappan
M. G. Daniels E. Koenig R. C. Thomas
D. H. Douglas J. G. Lackey F. W. Thomason
J. D.Douglass H. F. Light J. A. Thompson
J. C. Dutton T. G. Lipscomb J. P. Traub
J. K. Easley R. Little D. E. Truax
J. A. Ebert L. W. Long R. E. Uptegraff
R. L. Ensign R. I. Luwe G. Vaillancourt
C. G. Evans M. L. Manning R. A. Veitch
P. P. Falkowski H. B. Margolis F. Vogel
H. G. Fischer J. W. Matthews L. B. Wagenaar
S. L. Foster L. S. McCormick J. W. Walton
M. Frydman J. W. McGill R. J. Whearty
H. E. Gabel, Jr. C. J. McMillen A. Wilks
D. A. Gillies W. J. McNutt W. E. Wrenn
R. L. Grubb S.P. Mehta A. C. Wurdack
G. Gunnels, Jr. C. K. Miller D. A. Yamucci
G. Hall E. J. Yasuda
 The final conditions for approval of this guide were met on September 16, 1991. This
guide was conditionally approved by the IEEE Standards Board on February 15, 1990, with
the following membership:

Marco W. Migliaro, Chairman Dennis Bodson, Past Chairman

Andrew G. Salem, Secretary
Paul L. Borrill Thomas L. Hannan L. Bruce McClung
Fletcher J. Buckley Kenneth D. Hendrix Donald T. Michael*
Allen L. Clapp John W.Horch Stig Nilsson
James M. Daly Joseph L. Koepfmge? Roy T. Oishi
Stephen R. Dillon Michael A. Lawler Gary S. Robinson
Donald C. Fleckenstein Donald J. Loughry Terrance R. Whittemore
J a y Forste? John E. May, Jr. Donald W.Zipse
Lawrence V. McCall

*Member Emeritus

Also included are the following nonvoting IEEE Standards Board liaisons:
Fernando Aldana
Satish K. Aggarwal
James Beall
Richard B. Engelman
Stanley Warshaw

Paula M. Kelty
IEEE Standards Department Project Editor

The Accredited Standards Committee on Transformers, Regulators, and Reactors, C57,

that reviewed and approved this document, had the following members at the time of
approval:
Leo J. Savio, Chair John A. Gauthier, Secretary
Organization Represented Name of Representative
Electric Light and Power Group ................................................................... P. E. Orehek
S. M. A. Rizvi
F. Stevens
J. Sullivan
J. C. Thompson
M. C. Mingoia (Alt.)
Institute of Electrical and Electronics Engineers .............................................. .J. D.Borst
J. Davis
J. H. Harlow
L. Savio
H. D. Smith
R. A. Veitch
National Electrical Manufacturers Association ............................................... .G. D. Coulter
P. Dewever
J. D. Douglas
A. A, Ghafourian
K. R. Linsley
R. L. Plaster
H. Robin
R. E. Uptegraff, Jr.
P. J. Hopkinson (Alt.1
J. Nay (Alt.)
Tennessee Valley Authority ....................................................................... F. A. Lewis
Underwriters Laboratories, Inc. .................................................................. W. T. O’Grady
US.Department of Agriculture, REA.. .......................................................... J. Bohlk
US.Department of Energy, Western Area Power Administration. ......................... D. R. Torgerson
US.Department of the Interior, Bureau of Reclamation. ...................................... F. W. Cook, Sr.
US.Department of the Navy, Civil Engineering Corps ....................................... H. P. Stickley
 Contents
SECTION PAGE
1. Purpose and Scope ............................................................................... 7
2 . List of Terms Applicable to Transformer Loss Evaluation Equations ..................8
3 . Definitions ....................................................................................... 9
4 . Basic Concept .................................................................................... 11
5 . Description of Transformer and Reactor Power Losses .................................. 11
5.1 Transformers ............................................................................ 11
5.2 Reactors ................................................................................... 12
5.2.1 Shunt Reactors .................................................................. 12
5.2.2 Series Reactors .................................................................. l2
5.3 No-Load (Excitation) Losses (NLL)................................................... 12
5.4 Load Losses (LL)......................................................................... 12
5.5 Auxiliary Power Losses (APL) ........................................................ 12
5.6 Total Power Losses ...................................................................... 13
6 . Cost Evaluation Methodology ................................................................. E3
6.1 Explanation of Factors .................................................................. E3
6.1.1 Efficiency of Transmission (ET)............................................ l3
6.1.2 Availability Factor (AF)....................................................... 13
6.1.3 Peak Responsibility Factor (PRF) ........................................... 14
6.1.4 P e a k .P e r .U n i t Lo a d ( P UL ).................................................... 14
6.1.5 Tranformer Loading Factor (TLF).......................................... 14
6.1.6 Fixed Charge Rate or Carrying Charge Rate (FCRG for Generators,
FCRS for Transmission Systems, and FCRT for Transformers)......14
6.1.7 Capital Recovery Factor (CRF) ............................................... 14
6.1.8 Increase Factor (IF) ............................................................ l5
6.1.9 Levelized Total System Investment Cost (LIC)............................. 15
6.1.10 Levelized Energy Cost (LECN for No-Load Loss Evaluation,
a n d LECL for Load Loss Evaluation)........................................ 16
6.1.11 Levelized Auxiliary Energy Cost for Stage One (LAEC1) ................16
6.1.12 Levelized Auxiliary Energy Cost for Stage Two (LAEC2)................ 16
.
6.1.13 FOA FOW Cooling .Methods .................................................. 17
6.2 Loss Cost R a t e Formulas ................................................................ 17
6.2.1 No-Load Power Loss Cost Rate (NLLCR) ................................... 17
6.2.2 Load Power Loss Cost Rate (LLCR) .......................................... 17
6.2.3 Auxiliary Power Loss Cost Rates ............................................. 18
6.3 Use of Power Loss Cost R a t e s........................................................... 18
7 . Bibliography ..................................................................................... l9
APPENDIXES
Appendix A-Levelized Energy Costs ............................................................ 21
Appendix B-Example Calculation of Transformer Loss Cost Rates ....................... 25

.
.
 IEEE Loss Evaluation Guide for
Power Transformers and Reactors

1. Purpose and Scope

The purpose of this guide is to provide a method of establishing the dollar value of the
electric power needed to supply the losses of a transformer or reactor. Users can use this
loss evaluation to determine the relative economic benefit of a high-first-cost, low-loss unit
versus one with a lower first cost and higher losses. Manufacturers can use the evaluation
to optimize the design and provide the most economical unit to bid and manufacture. The
evaluated cost of losses also enables a user to compare the offerings of two or more
manufacturers to aid in making the best purchase choice among competing transformers
or reactors. Loss evaluation also provides information to a user for establishing the
optimum time to retire or replace existing units with modern low-loss transformers or
reactors.
The user should determine, on a dollars-per-kilowatt basis, the sum of the present worth
of each kilowatt of losses of a transformer throughout its life, or some other selected period
of time. This figure represents the maximum amount that can be spent to save a kilowatt of
loss. A portion of this evaluated cost can be paid to the manufacturer to reduce losses.
However, this evaluated cost includes other costs associated with owning a more expensive
piece of equipment, such as financing costs, taxes, etc.
This guide provides formulas by which the costs of energy, power, and money, and the
loading pattern of a transformer can be converted to dollars-per-kilowatt values of the
transformer losses.
These dollars-per-kilowatt figures should be furnished to the manufacturer when bids
are requested. If the final tested values of losses vary from the manufacturer’s guaranteed
values, economic adjustments may be made.
Nothing in this guide is mandatory. It should not be inferred from this paper that the
methodology described in the following pages is the only valid methodology for computing
the cost of transformer losses. Many users have developed their own transformer loss
evaluation techniques that are suitable for the intended purpose. The list of terms in
Section 2 uses symbols selected for mnemonic effectiveness and might be different from
symbols used in other references.

7
IEEE
Std C57.120-1991 IEEE LOSS EVALUATION GUIDE FOR

2. List of Terms Applicable to Transformer

Loss Evaluation Equations
Text
Term Unit Symbol Reference

Auxiliary loss cost rate of $/kW ALCRl 6.2.3.1

stage one cooling equipment

Auxiliary loss cost rate of $/kW ALCRZ 6.2.3.2

stage two cooling equipment

Auxiliary power lost in kW APLl 5.5

stage one cooling equipment

Auxiliary power lost in kW APLZ 5.5

stage two cooling equipment

Auxiliary power loss kW APL 5.5

Availability factor - AF 6.1.2

Average hours per year for hours 01) AHPY 1 5.5

stage one cooling alone

Average hours per year for hours (h) AHPY2 5.5

stage two cooling equipment

Booklife years BL Section 4

Capital recovery factor - CRF 6.1.7

Carrying charge (see fixed charge rate)

Current year energy cost $/kWh CYEC APP. B

Efficiency of transmission - ET 6.1.1

Energy cost inflation rate per year EIR Al.

Fixed charge rate (generator) $/$/yr FCRG 6.1.6

Fixed charge rate (transformer) FCRT 6.1.6

Fixed charge rate (transmission systems) $/$/yr FCRS 6.1.6

Generation installation cost $/kW GIC 6.1.9

Increase factor - IF 6.1.8

Levelized auxiliary energy cost $/kW-yr mc1 6.1.11

for stage one
 mm
POWER TRANSFORMERS AND REACTORS Std C67.120-1991

Term Unit Symbol Reference

Levelized auxiliary energy cost $/kW- yr LAEc2 6.1.12

for stage two

Levelized energy and operating cost $/kW-yr LECN 6.1.10

LECL 6.1.10

Levelized generation investment cost $/kW-yr LGIC 6.1.9

Levelized total system investment cost $/kW-yr LIC 6.1.9

Levelized transmission system $/kW-yr LSIC 6.1.9

investment cost

Load Loss (copper or conductor loss) kW LL 5.4

Load loss cost rate $/kW LLCR 6.2.2

No-load loss (iron or core loss) kW NLL 5.3

No-load loss cost rate $/kW NLLCR 6.2.1

Number of years years N 6.1.7

_- Peak-per-unit load - PUL 6.1.4

Peak responsibility factor - PRF 6.1.3

Present worth energy and operating cost $/kWh PWEC 6.1.10

Rate of return per year ROR 6.1.7

Sum of present worth - $/kwh booklife SPWECH 6.1.10

energy and operating cost or
$/kW-yr booklife SPWECY 6.1.10
Transformer loading factor - TLF 6.1.5

Transmission system $/kW SIC 6.1.9

installation cost

3. Definitions
For further explanation of the following terms, see Sections 5 and 6. For definitions not
found in this guide, consult IEEE Std 100-1988 rB31.1
auxiliary power losses (APL).The power required for cooling fans, oil pumps, and
other ancillary equipment.

The numbers in brackets correspond to those of the Bibliography in Section 7.

9
lEEE
Std C57.120-1991 IEEE LOSS EVALUATION GUIDE FOR

availability factor (AF).The proportion of time that a transformer is predicted to be

energized.
capital recovery factor (CRF). The factor used to determine total levelized annual
costs.
core loss. The power dissipated in a magnetic core subjected to a time-varying magnetiz-
ing force.
efficiency of transmission (ET). The energy received at the input terminals of the
transformer divided by the energy transmitted from the source.
fixed charge rate or carrying charge rate (FCRG for generators, FCRS for
transmission systems, and FCRT for transformers). The levelized annual cost
divided by the cost of investment.
increase factor (IF). The factor representing the total that the user must pay to acquire the
transformer, including the purchase price, overhead, fee, tax, etc., based on its value.
levelized auxiliary energy cost for stage one (LAEC1). The sum of the present worth
of energy and operating costs in dollars-per-kilowatthour booklife (SPWECH) is
multiplied by the total number of hours per year that stage one cooling is expected to be
operating, to get the sum of the present worth of energy and operating cost in dollars-per-
kilowatt-year booklife (SPWECYl).
levelized auxiliary energy cost for stage two (LAEC2). The sum of the present
worth of energy and operating cost in dollars-per-kilowatthour booklife (SPWECH) is
multiplied by the total number of hours per year that stage two cooling is expected to be
operating, to get the sum of the present worth of energy and operating cost in dollars-per-
kilowatt-year booklife (SPWECYB).
levelized energy cost (LECN for no-load loss evaluation, and LECL for load
loss evaluation). The cost of energy and operation is expressed in dollars per kilowatt-
year.
levelized total system investment cost (LIC). The annual cost, in dollars per
kilowatt-year, of the additional generation and transmission system capacity needed t o
supply the power used by the losses, including the cost of financing that investment.
load losses (LL). Those losses that are incident to the carrying of a specified load.

no-load (excitation) losses (NLL). Those losses that are incident to the excitation of the
transformer.
peak-per-unit load (PULLThe average of yearly peaks over the lifetime of the trans-
former, or some other load growth cycle,2 divided by the rating at which the load losses are
guaranteed and tested.
peak responsibility factor (PRF). The power transformer’s load at the time of the
system peak divided by the power transformer’s peak load.
total power losses. The sum of the no-load losses and the load losses, not including
auxiliary losses.
transformer loading factor U‘LF). The root-mean-square value of the predicted loads
of the power transformer over a representative yearly period is an equivalent load.

A load growth cycle may be, for instance, the time between the initial loading and when the planned loading
limit of the transformer is reached.

10
 EEE
POWER TRANSFORMERS AND REACTORS Std C57.120-1991

4. Basic Concept
The basic concept of this guide is that the evaluation for each type of loss (no-load, load,
and auxiliary) is the sum of (1)the demand portion, and (2) the energy portion.
(1) The demand portion is the cost of installing system capacity in dollars per kilowatt,
and
(2) The energy portion is the present value of the energy that will be used by one kilowatt
of loss during the booklife of the transformer, converted to dollars per kilowatt.
For convenience in adding like terms, the values are levelized, that is, converted to
yearly values, and then the sum is divided by the fixed charge rate for transformers and
any other appropriate factors, to give equivalent values that can be used directly by the
manufacturer in designing and pricing the transformer, and later by the user in
comparing bids. Fixed charge rates are the “cost of ownership,” and have the dimensions
of dollars-per-dollar-per-year, or simply per-year. The units are satisfied in the following
basic equation:

1 ]+I
Yearly Cost of Yearly Cost of
Demand Portion Energv Portion
cost of fixed hours per
installing charge cost of a year that
X
a kilowatt rate of kilowatthour transformer

the loss cost rate =

1 ofplant plant J 1 is energized
(fixed charge rate)
(for transformers )

The numerator of the above formula shows how much it will cost per year to provide a
continuous kilowatt. The denominator is the fixed charge rate for transformers. The
numerator divided by the denominator determines how much a user can afford to pay for a
more efficient transformer to save that kilowatt.

$
xyr = -+-=- $ $
kWyr kWyr kW kW kW

NOTE: Dimensionless factors, such as transmission efficiency, tax rate, transformer loading factor, peak-per-
unit load, and peak responsibility fador, may also be involved.

5. Description of Transformer and Reactor Power Losses

5.1 Transformers.The losses in a transformer are basically of two types: no-load losses,
which occur simply because the transformer is energized; and load losses, which vary with
the transformer’s loading. In addition, auxiliary power is required by fans, pumps,
heaters, and other ancillary equipment. This auxiliary power is not necessarily

11
IEEE
Std C57.120-1991 IEEE LOSS EVALUATION GUIDE FOR

dependent upon the load. All losses and auxiliary power requirements, as discussed in this
guide, are expressed in kilowatts.

5.2 Reactors

52.1 Shunt Reactors. A shunt reactor acts as a constant load at a given voltage. Its total
loss cost evaluation (even though consisting mainly of I% losses) is calculated using only
the no load loss formula in 6.2.1 (Eq 7). Its losses increase as the impressed voltage
increases.

5.2.2 Series Reactors. A series reactor experiences a varying load. Because it does not
have a no-load loss, its total power loss cost evaluation is calculated using only the loud
loss formula in 6.2.2 (Eq 8).

5.3 No-Load (Excitation) Losses (NLL). Those losses that are incident to the excitation
of the transformer. No-load (excitation) losses include dielectric loss, conductor loss in the
winding due to exciting current, conductor loss due to circulating current in parallel
windings, and core loss. Core loss is the power dissipated in a magnetic core subjected t o a
time-varying magnetizing force. Core loss includes hysteresis and eddy current losses of
the core. These losses change with the excitation voltage, and may increase sharply if the
rated voltage of the transformer is exceeded. The no-load losses also increase as the
temperature of the core decreases.When transformer no-load losses are compared, the
same reference temperature should be used.

5.4 Load Losses (LL). Those losses that are incident to the carrying of a specified load.
Load losses include PR loss in the winding due to load and eddy currents, stray loss due t o
leakage fluxes in the windings, core clamps, and other parts, and the loss due to circulat-
ing currents (if any) in parallel windings or in parallel winding strands. These losses
are often referred to as "copper losses," although the actual winding may be of some other
material, such as aluminum. These losses vary with the square of the load. The losses also
vary with the absolute temperature of the windings. For comparative purposes, load loss
values are given at a reference load and at reference winding temperature. It is important
that these reference values be stated whenever loss values are given.
NOTE: The rating upon which the load losses are based usually refers to the self-cooled rating of the transformer
(for those transformers that have a self-cooled rating), based on cooling class and temperature rise, and not to the
extended ratings available with auxiliary cooling. For example, 12/16/20 MVA transformers having a self-
cooled rating of 12 MVA usually have load losses tested at 12 MVA. When carrying 20 MVA, the load losses would
be approximately 2.78, i.e., (20/12)'times the tested losses. In addition, the extended loading would call for fans
and pumps to be running, which require additional power as listed in 5.5.
For an FOA or FOW transformer, the losses are measured at the FOA or FOW rating, or other agreed upon
ratings.
Any rating may be used to evaluate load losses (even one that may not be shown on the nameplate), so long as
the manufacturer knows in advance, for optimizing the design and the test results are appropriately shown on the
test report.

5.5 Auxiliary Power Losses (APL). The power required for cooling fans, oil pumps,
and other ancillary equipment. All of these power requirements are expressed in
kilowatts. If two or more separate stages of cooling are used, these should be expressed in
separate parts, APL1, APL2, etc., because the individual stages will be used for different
amounts of time. The number of hour per year for each stage of cooling, AHPY1, AHPY2,
etc., will need to be estimated in order t o calculate a value for the energy for each stage. It
should be kept in mind that generally stage one cooling is also running whenever stage
two is on.
 IEEE
POWER TRANSFORMERS AND REACTORS Std C57.120-1991

NOTES:
(1)The above three loss values: NLL, LL, and APL, are normally stated by the manufacturer with his bid, and
later determined by actual tests.
(2) For power transformers used in HVDC converter stations, additional considerations are necessary for losses
incurred by harmonic currents. These harmonic losses are not discussed in this guide.

5.6 Total Power Losses. Defined by IEEE C57.12.00-1987 [B41, subsection 5.9, these losses
are the sum of the no-load losses and the load losses, and do not include auxiliary losses.
For purposes of economic evaluation, however, the user should consider no-load, load, and
auxiliary power losses. Care should be taken not to use the term total load loss, as the reader
will not know whether load loss or total loss is meant.
In addition to kilowatt losses, there also exists a kilovar consumption. However, the cost
of providing the kilovar consumption is typically not evaluated. Only real power losses are
considered in this guide. However, if the kilovar consumption were to be evaluated, the cost
per kvar of installing capacitors might be used as a basis of evaluation.
NOTE: The losses in load tapchanging (LTC) transformers vary with the LTC position. In addition, at any given
position, the losses may vary with different configurations of LTC equipment, such as tap winding location, the
presence of series transformers, preventive autotransformers, etc. The user should consider these variations
when comparing two or more offerings.

6. Cost Evaluation Methodology

6.1 Explanation of Factors
NOTE: In this guide, base and peak costs are used as if they were the same. If they are not the same, the user
should determine the relative cost and the complex interrelationship of each, for no-load and load losses.
The determination of the cost of transformer losses involves many loss cost factors,
some of which must be estimated. The user is advised to pay particular attention to the
number of significant figures in the data and the assumed economic values, and to be
consistent in the application of these significant digits in the calculations. There is little
justification in using assumed values with two-place accuracy to calculate the cost of losses
to four or more places. The factors that are used to develop the power loss cost rates for no-
load losses, load losses, and auxiliary losses are defined in the following subsections:

6.1.1 Efficiency of Transmission (ET).The energy received at the input terminals of

the transformer divided by the energy transmitted from the source. The efficiency will
vary seasonally, or by loading, location, or voltage level, but unless this variation is
unusually large for a particular instance, a general overall system efficiency will
probably be adequate for this factor. Also, the capacity and the energy portions of the loss
equations may have differing efficiency values applied to them, but here again, in most
cases, one overall system efficiency factor will probably be adequate.
(If different values were to be used, then Eq 7 (6.2.1),for instance, might become the
following:

LIC LECN
NLLCR =
(ET,)(FCRT)(IF) + (ET,)(FCRT)(IF)

where ETc = efficiency for capacity, and ETE = efficiency for energy.)

6.1.2 Availability Factor (AF).The proportion of time that a transformer is predicted

to be energized. This factor is significant in connection with the energy cost of the losses.
lEEE
Std C57.120-1991 IEEE LOSS EVALUATION GUIDE FOR

6.1.3 Peak Responsibility Factor (PRF). The power transformer’s load at the time of
the system peak divided by the power transformer‘s peak load. The portion of the system’s
capability allocated to meet this transformer’s losses varies as the square of this ratio.

6.1.4 Peak-Per-Unit Load (PULI. The average of the yearly peaks over the lifetime of
the transformer, or some other load growth cycle: divided by the rating at which the load
losses are guaranteed and tested. The demand portion of load loss cost rate will vary as the
square of this ratio.
NOTE: The above definition gives an approximation that is consistent with the accuracy of most estimated,
future, peak loading values. If the transformer is planned to be loaded to a compound or a linear load growth rate,
then PUL can be determined by using other methods. One such method is given on pp. 790-91 in Nickel and
Braunstein [B71.

6.1.5 Transformer Loading Factor (TLF). The root-mean-square value of the pre-
dicted loads of the power transformer over a representative yearly period is an equivalent
load. This equivalent load, in MVA, divided by the rating at which the load losses are
guaranteed and tested, yields an equivalent load in per unit, which is referred to in this
guide as the transformer loading factor (TLF).
The energy cost of the load losses will vary as the square of this factor. The equivalent
load, if applied uniformly 8760 hours of one year, would produce the same amount of load
losses as that produced in the transformer by the actual load current during a given year.
Equivalent load is discussed in IEEE C57.92-1981[B61,where it is defined as the constant
load that generates losses at the same rate as the average rate caused by the fluctuating
load.
If the representative yearly loss factor is known, a generally easier way to find (TLFI2is
by the following formula (keeping in mind that the loss factor must be based on 8760 hours
of a representative yearly period, the same as the basis for TLF):

(TLF)~= loss factor x (PUL)~ (Es 4)

6.1.6 Fixed Charge Rate or Carrying Charge Rate (FCRG for Generators, FCRS
for Transmission Systems, and FCRT for Transformers). The levelized annual cost
divided by the cost of investment. The fixed charge rate represents the “cost of ownership.:
The costs are fixed inasmuch as they do not depend on system kilowatthours sold. The use
of this rate shows the income (savings) per year necessary to support a capital investment.
Some of the components of cost in the fixed charge rate, expressed a s a proportion of
investment, are as follows:
(1) Minimum acceptable rate of return;
(2) Annual cost of depreciation;
(3) Levelized federal and state income tax; and
(4) Annual cost of property taxes and insurance.

NOTE: The fured charge rate for transformers is used in the denominatorof the loss cost rate formulas (see 6.2.1,
6.2.2, 6.2.3). A high fmed charge rate will result in a low dollars-per-kilowattevaluation, and a low fured charge
rate will result in a high evaluation. The formulas are only meaningful for realistic values of fmed charge rate.
Users who buy transformers with some form of financing that does not include interest, depreciation, taxes,
insurance, etc., cannot use the formulas given in this guide.

6.1.7 Capital Recovery Factor (CRF). The factor used to determine “total levelized
annual costs.” The sum of the present worth of the costs is levelized by multiplying by the
capital recovery factor.

See Footnote 2.

14
 IEEE
POWER TRANSFORMERS AND REACTORS StdC57.120-1991

ROR (1+RORIN
CRF = (Eq 5 )
(I+R O R I -
~1

where
CRF = the capital recovery factor, expressed in units
ROR = the rate of return
N = the number of years the costs are to be levelized

6.1.8 Increase Factor (IF). The factor representing the total ha he user must pay to
acquire the transformer, including the purchase price, overhead, fee, tax, etc., based on its
value.
The loss evaluation figures supplied to the manufacturers at the time of soliciting bids
should be reduced appropriately, below the actual value of a kilowatt of power. Internally
imposed, in-house overheads may not apply here, depending upon user practices.
Examples of applicable cost increase factor are the following:
Sales tax
Architect-Engineer's fee
Construction supervision fee
0 Contractor's fee
0 Job order fee (imposed by outside organization)
Interest during construction
0 Extended warranty and transportation insurance, if these can be uniformly applied
to all bidders
Examples of possible applicable cost increase factor are the following:
0 General overhead
0 Stores charges
All of the applicable rates in per unit are added to 1.0,and the resulting value is used in
the denominator of the loss cost rate formulas in 6.2.1,6.2.2,and 6.2.3.
Example:
Sales tax 8%
Architect-Engineer's fee 10%
0 Transportation insurance 1%
Interest during construction 2% (2months @ 12% per annum)
Increase fador = 1.00 + 0.08 + 0.10 + 0.01+ 0.02= 1.21
6.1.9 Levelized Total System Investment Cost (LICL4The annual cost, in dollars
per kilowatt-year, of the additional generation and transmission system capacity needed
to supply the power used by the losses, including the cost of financing that investment.

The discussion in this paragraph is applicable to users who own their generation and/or transmission
facilities. Many users who do not own those facilities pay a demand charge. This demand charge can be
converted to LIC by multiplying by a suitable factor. For example, if the demand charge is levied in dollars per
kilowatt per month, it can be multiplied by 12 to give the value of LIC in dollars per kilowatt-year.
IEEE
Std C57.120-1991 IEEE LOSS EVALUATION GUIDE FOR

NOTE: The concept of levelization is described in Appendix A. The levelized total system investment cost (LIC)
is computed as follows:
LIC = (GICXFCRG) + (SIC)(FCRS) (Eq 6)
where
GIC = the cost of installing generation, expressed in dollars per kilowatt
SIC = cost of installing transmission systems, expressed in dollars per kilowatt
FCRG = the fixed charge rate for generation
FCRS = the fixed charge rate for the transmission system
(GICXFCRG) = LGIC, the levelized generation investment cost
(SIC)(FCRS) = LSIC, the levelized transmission system investment cost

6.1.10 Levelized Energy Cost (LECN for No-Load Loss Evaluation, and LECL
for Load Loss Evaluation). The cost of energy and operation is expressed in dollars per
kilowatt-year. This cost is computed by using the following method t o obtain a present
worth value:
(1) List the projected cost of energy in dollars per kilowatthour for each year being
considered.
(2) Discount these annual inflated energy costs by the appropriate present worth factor,
at the user's rate of return, for each year being considered (see Appendix A), to get the
present worth value of each year's energy and operating cost in dollars per kilowatt-
year (PWEC).
(3) Add each of the present worth values, for all of the years being considered, to get the
sum of the present worth of energy and operating cost in dollars-per-kilowatthour
booklife (SPWECH).
(4) Multiply SPWECH, the sum of the present worth of energy and operating cost in
dollars per kilowatthour by 8760 hours per year (or the number of hours the
transformer is expected to be energized per year or 8760 times the availability factor),
to get SPWECY, the sum of the present worth of energy and operating cost in dollars-
per-kilowatt-year booklife for the operation of the transformer.
Determine the capital recovery factor (CRF) by Eq 5 (6.1.7).
Multiply SPWECY by CRF to get LECN, the levelized annual energy and operating
cost of no-load losses in dollars per kilowatt-year for the operation of the
transformer.
NOTE: The calculation covered here by (4) yields the levelized annual energy and operating cost of no-
load losses. When finding the levelized annual energy and operating cost of load losses, SPWECH in (4)
should be multiplied by 8760 Wyr to get SPWECY.
In calculating LECL, it is not appropriate to use a reduced number of hours per year,
because the transformer loading factor takes this into account.
See Appendix B for example calculations.

6.1.11 Levelized Auxiliary Energy Cost for Stage One (LAEC1). The sum of the
present worth of energy and operating costs in dollars-per-kilowatthour booklife
(SPWECH) is multiplied by the total number of hours per year that stage one cooling is
expected to be operating, to get the sum of the present worth of energy and operating cost in
dollars-per-kilowatt-year booklife (SPWECY1). (Note that stage one cooling is also
operating whenever stage two cooling is operating.) SPWECYl is then multiplied by the
capital recovery factor (CRF) to get the levelized annual energy and operating costs for
stage one cooling (LAECl), in dollars per kilowatt-year.

6.1.12 Levelized Auxiliary Energy Cost for Stage Two (LAEC2). The sum of the
present worth of energy and operating cost in dollars-per-kilowatthour booklife
(SPWECH) is multiplied by the total number of hours per year that stage two cooling is
expected to be operating, to get the sum of the present worth of energy and operating cost in
dollars-per-kilowatt-year booklife (SPWECYB).

16
 BEE
POWER !I'RANSFORMERS AND REACTORS Std C57.120-1991

SPWECY2 is then multiplied by the capital recovery factor (CRF) to get the levelized
annual present worth of energy and operating cost for stage two cooling (LAECB), in dol-
lars per kilowatt-year.

6.1.13 FOA, FOW Cooling Methods. The discussions in 6.1.11 and 6.1.12 are based
on a triple-rated transformer. A similar evaluation can be made for FOA and FOW trans-
formers using the number of hours per year that each fan or pump is expected to run. Equip-
ment that runs continuously will be evaluated the same as the no-load losses.

6.2 Loss Cost Rate Formulas. Loss cost rate formulas are developed for no-load losses,
load losses, and auxiliary losses. The results of these formulas-loss cost rates-are
supplied to the manufacturer a t the time of requesting bids. The cost rates in dollars per
kilowatt, multiplied by their respective guaranteed losses in kilowatts, can be added
directly to the bid price in the evaluation of purchase alternatives.
The loss cost rate formulas represent the cost of installing generation and transmission
t o supply the demand represented by one kilowatt of transformer loss, and the cost of
producing the energy consumed by that loss.
The loss cost rate formulas are computed in the following manner:

6.2.1 No-Load Power Loss Cost Rate (NLLCR)

yearly cost of demand portion+ yearly cost of energy portion

NLLCR = fixed charge rate for transformersx efficiency and tax, etc., factors

LIC + LECN
NLLCR = (Eq 7)
(ET)(FCRT)(IF)

where
NLLCR = the equivalent no-load loss cost rate in dollars per kilowatt. This is the value
of no-load power losses that the user should furnish to the manufacturers at
the time of soliciting bids.
LIC = the levelized annual total system investment cost in dollars per kilowatt-
year
LECN = the levelized annual energy and operating cost of no-load losses, expressed
in dollars per kilowatt-year
E T = the efficiency of transmission
FCRT = the fixed charge rate for transformers
I F = the increase factor

6.2.2 Load Power Loss Cost Rate (LLCR)

yearly cost of demand portion + yearly cost of energy portion

LLCR = fixed charge rate for transformers x efficiency and tax,etc., factors,
-and as modified by the loading factors squared

(LIC)(PRF)~(PUL)~+ (LECLXTLF)~
LLCR =
(ET)(FCRT)(IF)

17
IEEE
Std C57.120-1991 IEEE LOSS EVALUATION GUIDE FOR

where
LLCR = the equivalent load loss cost rate, in dollars per kilowatt. This is the value of
load power losses that the user should furnish to the manufacturers at the time of
soliciting bids.
LIC = the levelized annual total system investment cost in dollars per kilowatt-year
PRF = the peak responsibility factor
PUL = the peak-per-unit load
TLF = the transformer loading factor
LECL = the levelized annual energy and operating cost of load losses, expressed in
dollars per kilowatt-year
ET = the efficiency of transmission
FCRT = the fixed charge rate for transformers
IF = the increase factor

6.2.3 Auxiliary Power Loss Cost Rates

6.2.3.1 Auxiliary Loss Cost Rate for Stage One (ALCR1)

LIC+LAECl
ALCRl= (Eq 9)
(ET)(FCRT)(IF)

where
ALCRl = the rate of the auxiliary power costs related to stage one cooling, expressed in
dollars per kilowatt
LIC = the levelized annual total system investment cost expressed in dollars per
kilowatt-year
LAECl = the levelized annual energy and operating cost for stage one, expressed in
dollars per kilowatt-year
ET = the effkiency of transmission
FCRT = the fixed charge rate for transformers

6.2.3.2 Auxiliary Loss Cost Rate for Stage Two (ALCR.2)

LIC + LAEc2
ALCR2 =
(ET)(FCRT)(IF)

where
ALCFU = the rate of the auxiliary power costs related to stage two cooling, expressed in
dollars per kilowatt
LIC = the levelized annual total system investment cost, expressed in dollars per
kilowatt-year
LAEC2 = the levelized annual energy and operating cost for stage two, expressed in
dollars per kilowatt-year
ET = the efficiency of transmission
FCRT = the fixed charge rate for transformers
IF = the increase factor

6.3 Use of Power Loss Cost Rates. Following are some of the ways in which trans-
former loss cost rates can be used:
(1) By manufacturers, to design and build efficient, cost-effective transformers.
(2) By users, to choose between two or more offerings.
(3) By owners, to decide whether or not to replace existing units with new, more efficient
equipment, or to build new systems to eliminate double transformations, etc.
 IEEE
POWER TRANSFORMERS AND REACTORS Std C57.120-1991

The loss cost rates, in dollars per kilowatt, for no-load, load, and auxiliary losses, as
found in 6.2.1, 6.2.2 and 6.2.3, respectively, are the figures that should be furnished t o the
manufacturers at the time of soliciting bids.
The manufacturer may utilize the cost rate values to build a transformer that has
amounts of conductor and iron that are economically dictated by the dollar evaluation.
That is, the manufacturer may reduce losses, by adding conductor and iron up to an
amount where the incremental construction costs of adding conductor and iron equal the
incremental value of the transformer.
The rates should be preferably furnished to the manufacturers in the dollars-per-kilo-
watt form as discussed above. They may also be given in the levelized annual form of
dollars-per-kilowatt-yearybut if they are so given, it will be necessary also to supply the
manufacturer with information as to the purchaser’s fixed charge rate, sales tax rate,
overheads, etc., and to rely on the manufacturer to make the proper calculations. Use of the
dollars-per-kilowatt form will ensure that each manufacturer is using the same basis for
optimizing the design.
In order to compare two or more bids, add the following products to the bid price (for each
separate bid):
(1) The manufacturer’s guaranteed no-load losses in kilowatts, times the dollars-per-
kilowatt figure for NLLCR.
(2) The manufacturer’s guaranteed load losses in kilowatts, times the dollars-per-
kilowatt figure for LLCR.
(3) The manufacturer’s guaranteed losses for each type of auxiliary loss, times the
appropriate dollars-per-kilowatt figures for ALCR1, ALCR2, etc.
When all of these are added to the bid price, the lowest resulting figure indicates the “best
buy,” provided, of course, that the offered transformers are comparable in other respects.
If loss evaluation figures are furnished to the manufacturers at the time of soliciting
bids, the steps outlined above should be used to select the best offering. A selection based
only on bid price will not necessarily represent the true value of the offered equipment.

7. Bibliography
[B 11 Electrical Power Research Institute, Technical Assessment Guide,” PS-1201-SR,
Special Report, July 1979.
[B21 Grant, Eugene L., Principles of Engineering Economy, 6th ed., Ronald Press
Company, 1976.
[B31 IEEE Std 100-1988, IEEE Standard Dictionary of Electrical and Electronics Terms
(ANSI).
[B41 IEEE C57.12.00-1987, IEEE Standard General Requirements for Liquid-Immersed
Distribution, Power, and Regulating Transformers (ANSI).
[B51 IEEE C57.12.80-1978 (Reaff 1986), IEEE Standard Terminology for Power and
Distribution Transformers (ANSI).
[BSI IEEE (37.92-1981 (Re& 1991), IEEE Guide for Loading Mineral-Oil-Immersed Power
Transformers up to and Including 100 MVA with 55 “C or 65 “C Winding Rise (ANSI).
[B71 Nickel, D. L. and H. R. Braunstein, “Distribution Transformer Loss Evaluation-
Part 1: Proposed Techniques,” pp. 788-97, and “Distribution Transformer Loss
Evaluation-Part 2: Load Characteristics and System Cost Parameters,” pp. 798-811, IEEE
Transactions on Power Apparatus and Systems, Vol. PAS-100,No. 2.
 IEEE
Std C57.120-1991

(These appendixes are not part of IEEE Std C57.120-1991,but are included for information only.)

The energy costs utilized in the no-load loss, load loss, and auxiliary loss power cost
formulas represent present worth values that have been levelized (see 6.1.10, 6.1.11, and
6.1.12). This appendix describes the concept of a present worth value and the concept of
levelization.

Al. Present Worth Value

An understanding of the procedure of inflating, discounting, and summing may be
gained by development of the following ten-year present worth value table. The procedure
involves the escalation of energy costs by year at a constant rate over a selected period of
time-ten years in this example. In actuality, the time frame may be selected to be
consistent with the booklife of the transformer and variable inflation rates may be
e mp 1oy ed.
To introduce the concept of present worth value, Table A1 uses a constant 5% energy cost
inflation rate. Each year’s inflated energy cost is discounted by the appropriate present
worth factor and then summed to a total present worth energy cost for the entire time period.
The discount factor is defined as the user’s required rate of return.
Present worth value calculations are described as follows:

A l . l Escalated Value. The escalated value equation, F = P(1 + i>N, may be utilized in
order to escalate a present value (P),to a future value F),in a future year (NI, for a given
escalation rate (i). For a 5% escalation, the following year’s average escalated energy
value is as follows:

F=P( 1+ .05)’

Example:
Using a 5% escalation rate, the energy value five years from a current year’s energy
value of .051 $/kwh is computed as follows:

F = .051(1.05)5= .065 $/kwh

A1.2 Present Worth Value. The present worth calculation utilizes the inverse of the
escalation formula. The present worth equation, P = F(l + r)-N, may be utilized in order to
calculate the present worth (P),from a future value (F), from a future year (N), for a given
discount rate (r).

Example:
Using a 16% discount rate or rate of return, the current present worth value of the cost of
energy of .068 $/kwh six years in the future is computed as follows:

P=.068(1+ .16)4 = .0279 $kwh

21
IEEE
Std C57.120-1991 IEEE LQSS EVALUATION GUIDE FOR

A present worth table may be computed utilizing (1 + r k N . Table A1 results from

applying a 16% rate of return to obtain the present worth factor per year over a ten-year
period ((1+ .16)FN).

Table A1
Ten-Year Present Worth Value Table
Year I II III Iv V VI w VI11 M x
Present
Worth .862 .743 .641 552 A76 .410 .354 305 263 .227

An example of energy cost of $0.05lAtWh escalated at a 5% rate over a ten-year period and brought back to a
present worth value is as follows:
At End
Row ofYear I II III Iv V V I W V I I I K X
A Costof
Energy .054 .OS .059 .062 .065 .068 .072 .075 .079 .083
B Present
Worth B62 .743 .641 552 A76 ,410 .354 305 263 227

C Present
Worth .047 .042 .038 .034 .031 .027 .025 .023 .021 .019
Value
D The Sum of Present Worth Values = 0.307 $/kWh
NOTE: The levelized energy cost in dollars per kilowatthour equals 0.307 times the capital -very fador.

levelized energy cost = $0.307 x CRF' = $0.307 x 0.207 = $0.064

(See explanation of this step in the following paragraphs.)

Row A of Table A1 shows the escalated cost of energy in dollars per kilowatthour over a
ten-year period. The cost of energy is assumed to grow at a 5% annual rate from year one to
year ten. The cost of energy is multiplied by the present worth factor (Row B) in order to
arrive a t the present value of energy costs on a yearly basis (Row C). The present worth
values per year are summed over the entire ten-year period in order to arrive at the sum of
present worth values of the escalated energy costs for the selected time frame. The sum of
present worth values = 0.307 (Row D).
The capital recovery factor is calculated by using Eq 5 (6.1.7) as follows:

The sum of the present worth energy and operating cost is multiplied by the capital
recovery factor (CRF) in order to compute the levelized energy cost (Row E).

$0.064/kWh is then multiplied by the number of hours per year that the transformer will
be energized, to yield the levelized annual cost of energy in dollars per kilowatt-year.

22
 IEEZ
POWER TRANSFORMERS AND REACTORS Std C57.120-1991

A2. Levelization
The concept of levelization is illustrated in Fig Al.

ANNUAL
LEVELIZED
I NCR EASlNG
ANNUAL
COSTS /
COSTS

EQUIPMENT TIME IN YEARS BOOKLIFE

PURCHASE DATE DATE

Fig A1
Illustration of Levelization

The solid line in the graph above represents increasing annual costs from time of
equipment purchase to the last year of the equipment booklife. "he procedure of levelization
takes the present worth value of this increasing stream of energy costs and spreads this
"lump sum" present worth value equally over the years of the equipment's booklife.
The dotted line in the graph represents the levelized energy costs. In this guide, energy
costs are levelized on an annual basis. Levelization is accomplished by multiplying the
sum of the present worth values by the capital recovery factor. The levelized energy cost is
an input variable in the equations for the cost rates of no-load, load, and auxiliary power
losses as described in 6.2.1,6.2.2,and 6.2.3.

23
IEEE
Std C57.120-1991 IEEE LOSS EVALUATION GUIDE FOR

A3. Variable Inflation Rate Formula

When annual energy inflation rates are not constant over the evaluation time period,
each year's present worth factor may be calculated and summed. The example calculation
below shows the calculation of the present worth of energy cost for a three-year time period.
Given that the energy cost inflation rate is 6% in year one, 4% in year two, and 2% in
year three, the rate of return is 16%, and the current-year energy cost is .03 $/kWh, the
present worth energy calculation is as follows:

YearL (1+.06)'- 106 -.914

(1+.16)' 116

Year 2: (1+.06)(1+.04)=.819
(l+.16)2

(1+.06)(1+.04)(1+.02)
=.720
Year 3:
(l+. 1613

SPWECH = .030(.914+ .819+ .720+ each succeeding year's value)

SPWECH = .0736$/kwh

where
SPWECH = the sum of the present worth of energy and operation costs, in dollars per
kilowatthour
 Em
P O m R TRANSFORMERS AND REACTORS Std CS7.120-1991

4-B
Example Calculationof Transformer Loss Cost Rates
Assuming the following data, calculate the cost rates for the following:

A. No-Load Losses NLLCR

B. Load Losses LLCR
C. Auxiliary Losses ALCRl and ALCR2

Availability factor AF 97%

Average hours per year for stage one cooling, running alone AHPY 1 2000h
Average hours per year for stage two cooling AHPY2 l000h
Booklife BL 35 Yr

Current year energy cost CYEC $0.05l/kWh

Efficiency of transmission ET 95%
Energy cost inflation rate EIR 5%

Fixed charge rate-generation FCRG 17%

Fixed charge rate-transformer FCRT 19%
Fixed charge rate-transmission system FCRS 18%

Generation installation cost GIC $800/kW

Peak-per-unit load PUL 1.67
Peak responsibility factor PRF 0.96

Rate of return ROR 16%

Increase factor IF 1.07

Transformer loading factor TLF 0.5

Transmission system installation cost SIC $2OO/kW
Capital recovery factor CRF 17%

A. No-Load Loss Cost Rate:

LIC + LECN
NLLCR =
(ET)(FCRT)(IF)

To determine LIC:

LIC = (800) (0.17) + (200)(0.18)= 136 + 36 = $172/kW-v

To determine LECN:

Transformer users have many different ways of predicting their future energy costs.
In the interest of continuing this example, the following is presented as one way to
determine LECN (steps (1)through (4), below, are illustrated in Table A1 of Appendix A):
(1) Determine each year’s energy cost in dollars per kilowatthour for the period of time
being considered, (e.g., the booklife of the transformer).
lEEE
Std C57.120-1991 IEEE LOSS EVALUATION GUIDE FOR

(2) Determine the present worth factor for each year, based on the rate of return.
(3) Multiply the energy cost for each year by the present worth factor for that year, to get
the present worth of that year’s energy cost in dollars per kilowatthour.
(4) Add each of the present worth values for all of the years being considered, to get the
sum of the present worth of energy and operating cost in dollars per kilowatthour.
(5) Multiply 8760 hours per year by the availability factor (0.97)to get 8497 hours per year
for the operation of the transformer.
(6) Multiply the sum of the present worth in dollars per kilowatthour by 8497 hours per
year to get the sum of the present worth of energy and operating cost in dollars per
kilowatt-year.
(7) Multiply the sum of the present worth of energy and operating cost in dollars per
kilowatt-year by the capital recovery factor to get LECN, the levelized energy and
operating cost of no-load losses for the transformer, in dollars per kilowatt-year. For
the sake of the present example, assume that LECN was found to be $500 per kilowatt-
year.
To continue the example calculation:

LIC+LECN - 172 ‘0°

NLLCR = = $3479I kW
+

(ET)(FCRT)(IF)- (0.95)(0.19)(107)

This is the figure that would be furnished to the manufacturers at the time of soliciting
bids, and in the bid evaluation process, each manufacturer’s guaranteed no-load losses in
kilowatts would be multiplied by $3479 and added to the manufacturer’s bid price.

B. Load Loss Cost Rate:

NOTE: LECN was calculated using an availability factor of 0.97. Therefore LECL will be equal to LECN divided
by 0.97.

-- ’0° - $515.46 per kW - yr (see 6.1lo)

---
0.97 0.97

LLCR =
+ LECL(TLF)~
(LIC)(PRF)~(PUL)~
(ET)(FCRT)(IF)

- 442.08
- + 128.87 = $2958 kW
0.193
This is the figure that would be furnished to the manufacturers at the time of soliciting
bids, and in the bid evaluation process, each manufacturer’s guaranteed load losses in
kilowatts would be multiplied by $2958 and added to the sum of the bid price and the no-load
loss values given in A above.

26
 IEm
POWER TRANSFORMERS AND REACTORS Std C57.120-1991

C. Auxiliary Loss Cost Rate:

LIC + LAEC 1
ALCRl=
(ET)(FCRT)(IF)

LECN, found in A. above, can be converted to LAEC1 by multiplying LECN by the ratio of
the total number of hours per year that stage 1 cooling will be running, to the number of
hours per year used for finding LECN. (In the present example,

LAEC1 3000 (500)(3000)= $176.5/ k w - yr.)

=LECN-=
8497 8497

LIC+LAECl - 172+176.5 - 348.5

ALCRl=
(ET)(FCRT)(IF)- (0.95)(0.19)(107)- (0.95)(0. 19)(107)

- $1804/ kW

LECN, found in A. above, can be converted to LAEC2 by multiplying LECN by the ratio of
the total number of hours per year that stage 2 cooling will be running, to the number of
hours per year used for finding LECN. (In the present example,

LIC+LAEC2 - 172+59 - 23 1
ALCR2 =
(ET)(FCRT)(IF)- (0.95)(0.19)(107)- (0.95)(0.19)(107)

- $1196/ kW

When bids are solicited, the values found above should be stated to the manufacturers as
follows:

“Losses will be evaluated at the following values:

No-load loss at 100%of rated voltage - $3479/kW

Load loss at self-cooled rating - $2958/kW
Stage one cooling equipment power - $1804kW
Stage two cooling equipment power - $1196kW

In the bid evaluation procedure, each loss evaluation figure listed above
will be multiplied by its respective guaranteed loss value in kilowatts, and
the resulting figures will be added to the bid price to give a total evaluated
price for bid comparison.*

If the following bids were received, they would be compared as shown below (assume that
all four bids represent acceptable transformers with comparable features):
IEEE
Std C57.120-1991

(kw,
Stage 1 Stage 2
Cooling lhQl.iu
A $=,000 14 45 1 0.5
B $215,000 15 46 2 1
C $195,000 la 55 3 2
D $24w@o l3 40 1 0.5

NLLCR = $3479/kW
LLCR = $2958/kW
ALCRl = $1804/kW
ALCR2 = $1196/kW

evaluated cost = bid price + (NLLCR)(no-load losses) + (LLCR)(load losses) +

(ALCRl)(stage one losses) + (ALCR2)(stage two losses)

Mfr. A: $225,000 + (3479)(14)+ (2958x451+ (1804x1) + (1196X0.5)= $409,218

Mfr. B: $215,000 + (3479)(15) + (2958)(46)+ (1804)(2)+ (1196x1)= $408,057
Mfr. C:$195,000 + (3479)(18)+ (2958)(55)+ (1804)(3)+ (1196X2)= $428,116
Mfr. D: $240,000 + (3479) (13)+ (2958x40) + (1804)(1)+ (1196) (0.5)= $405,949

The offering from Manufacturer D is seen to be the most cost-effective, even though the
bid price is the highest.
An analysis such as this should be made to determine the lowest evaluated cost.