Innovative project management practices for large power sector projects

INNOVATIVE PROJECT MANAGEMENT PRACTICES FOR WORKING PROFESSIONALS

by Prof. Sanjeev BahadurProgram DirectorInstitute of Advanced Management and ResearchApproved by AICTE, Ministry of HRD, Govt. of India.www.iamrindia.com

http://www.iamrindia.com/

Scope of “Project Management”

The topics proposed to be covered in this Project Management Program are:

Introduction / Overview/Importance Project Management Concepts & Standards Project Formulation and Appraisal / Approval Processes Environment Impact Assessment (EIA) Human Resources: Issues, Challenges and SolutionsStrategic Project Financial ManagementTips and Techniques for Cost Estimation in Project Management

Analyzing Risks in Project ManagementEPC: Engineering, Procurement, ConstructionProcurement Management and e-procurementQuality Assurance and InnovationMicrosoft Project Demonstration (CPM/PERT/GANTT Charts) Productivity, Efficiency and Time ManagementLive Case Study and discussionsReferences

Project Delays Cost Rs 1,24,000 CrConsequences of Time Delays

Total projects delays cost Rs 1,24,000 Crores., informs Sh M.S Gill MoS, Ministry of Statistics & Program Implementation.

Out of 567 projects costing more than Rs 150 crores each, 375 projects reported delays from 1 month to 72 months.

Causes are Land acquisition, getting Environment clearances, protest by Local people, incomplete Land Records, lack of coordination between different agencies.

Cost of delay is one third of India Plan Budget 2011-12 Sectors reviewed are Coal, Steel, Power, Petroleum, Railways,

Road transport/Highways, Telecommunications Original cost of these projects was Rs 5,92,535 crores.

(Source :Hindustan Times, 04 April 2011)

Objectives of Project Management

Definition, Meaning and examples of Projects What does Project Management involve? What are the qualities of a Project Manager ? Reasons for Time and Cost overruns (Govt. of India

agencies studies) Solutions for cutting Time/Cost Overruns Role of Consultants/Engg. Contractors in Tendering Brief overview of the Program (incl. PERT/CPM) Research on the Power /Infrastructure Sector Focus on NTPC, Tata Power, Reliance Infrastructure

(Ratio Analysis) References

Project Definition (ANSI/PMI 99-001-2004)

Project is a temporary endeavour undertaken to create a unique product or service or result.

ISO 10006 defines project as unique process, comprising of a set of controlled and coordinated activities with start and finish dates, undertaken to achieve an objective conforming to specific project requirements including constraints of resources, cost and time.

Project refers to a high value, time bound, mission of creating a product/facility with predetermined performance objectives in terms of quality specifications, completion time, resource constraints and budgeted cost.

Project Management

Project Management is the discipline of planning, organizing, securing and managing resources to bring about successful completion of specific project goals and objectives.

A project is a short term undertaking/endeavor, having a defined beginning and end (usually constrained by date, or by funding or deliverables), undertaken to meet unique goals and objectives usually to bring about beneficial change or value addition.

The temporary nature of projects stands in contrast to regular operations, which are repetitive, permanent or semi-permanent functional work to produce products or services. In practice, the management of these two systems is generally found to be different, and requires the development of unique technical skills and the adoption of separate management practices.

http://en.wikipedia.org/wiki/List_of_academic_disciplines

http://en.wikipedia.org/wiki/Planning

http://en.wikipedia.org/wiki/Organizing

http://en.wikipedia.org/wiki/Managing

http://en.wikipedia.org/wiki/Resources

http://en.wikipedia.org/wiki/Project

http://en.wikipedia.org/wiki/Business_operations

http://en.wikipedia.org/wiki/Management

Project Management (Meaning)

To understand project management, one must understand what a project really is.

Different types of Projects are cement projects, power projects, refinery projects, fertilizer projects etc.

In each case, the project is for setting up a manufacturing plant, but as soon as the plant is operational, the project is deemed to have been completed.

A project, is not a physical objective, nor is it the end-result.

Project Performance Objectives

SCOPE defines the deliverables QUALITY of Product stated in terms of design,

drawings and specifications RESOURCES includes manpower, materials and

machinery required to perform the work. COMPLETION TIME is the speed with which project is

executed. COST is the budgeted expenditure.

Examples of Complex Projects involving Technology

Reliance Industries Ltd., Jamnagar

Tata Chemicals Ltd., Babrala

NTPC Super Thermal Power Station

Tata Motors Ltd., Pune

Delhi Metro Rail Corporation

India Habitat Centre

NTPC Solar Power Project.

Reliance Industries Ltd. Refinery, Jamnagar, Gujarat

TATA Chemicals Ltd. – Fertilizer Plant, Babrala,U.P

NTPC Super Thermal Power Station, Singrauli

Thermal Power Plant Lay out :

Thermal Power Plant Lay out :

TATA Motors Ltd. , Pune, Maharashtra

Delhi Metro Rail Corporation (DMRC)

DMRC

India Habitat Center- Lodhi Road, New Delhi

India Habitat Center, Lodhi Road, New Delhi

NTPC Solar Power Plant – 15 Mw

What does a Project Involve 1 A Competent/Decisive and Experienced Team with Integrity. Identify Right Project Manager/GM (Project) with proven track record of successful

execution of Projects Clear Focused Goals (Cost of generation of one Unit should be the Lowest) Create clear Mission, Vision, Quality Policy and Organization Chart. Benchmark/Research the Project with worlds best 3 similar/better executed projects

(Ratio Analysis). Identify how much time and cost went into those projects (eg Reliance Refinery)

Reduce it by 20% on the cost of manpower ,cost of Raw Materials, Cost of marketing, cost of manufacturing etc

Estimate the targeted project cost and time required after benchmarking by appointing proven Consultants such as MECON , EIL,TCE,PDIL etc.

Get project funding sanction/approval/disbursement. Benchmark Interest rates with International Rates to reduce cost of capital.

Responsibility, authority, resources, team, time and processes are required for successful execution of Project.

Identify proper project site location considering the right seismic zone, Road/Highway/Rail/Airport, connectivity, Alternative Fuel/Raw material supplies (eg Tata Chemicals Babrala), clean water, 24*7 electricity, sewage, internet, medical facilities, availability of Engineers/Managers/skilled/unskilled manpower, Tax benefits.

What does a Project Involve 2 Dealing/Negotiation with Suppliers/contracts, Contractors, Architects, Facility

providers, District officials Local Politicians, Press, Insurance, Consultants, Service Providers , CA’s, Cost Accountants, IT specialists, bankers, Environmentalists, Accountants, Taxation specialists, Energy Economists, Security , Maintenance Specialists,Horticulturists etc

Defining the scope of various tenders, deadlines of execution, terms/conditions, penalty for late execution, inspection, testing and commissioning criteria.

Use of Computers/Telecom, PERT/CPM , CAD/CAM tools , SAP,DBMS,MIS for Monitoring and Control.

Use correct tools, equipment, Govt. approvals, people and management processes to execute the project both in targeted time and cost.

Maintain quality of project execution. Maintain high levels of Productivity, Efficiency and Transparent Monitoring. Identify Critical Success Factors and Causes for Delays. Success of the Project depends on proven technology, Control of Proven sources

for delays and Factor all of them in your estimated time and cost of your project. Target your project finishing time to be less by 30%

E procurement can reduce purchasing costs and time. List all activities, people responsible and classify them into A/B/C in order of

importance/cost Plan an Incentive scheme for actual achievers who achieve targeted or better

the Time/cost parameters planned and desired,

Project Life Cycle Phases

Project Clearance Cycle (Process)

NTPC Organization Chart (Top Mgmt.)

Why Projects Succeed and Fail

Projects succeed because of people, process and structure.

Projects fail because of inexperienced people, poor processes and structure.

Introduce your project team to the criteria for project success and failure, and make sure they know the difference!

Project Appraisal

Project appraisal is a generic term that refers to the process of assessing, in a structured way, the case for proceeding with a project or proposal. Project appraisal is the effort of calculating a project's viability. It often involves comparing various options, using economic appraisal or some other decision analysis technique

http://en.wikipedia.org/wiki/Economic_appraisal

http://en.wikipedia.org/wiki/Decision_analysis

Project Formulation

Points to be considered: The type and level of industrial activity.

To match financial resources available with required amount.

Prepare a sensible project report.

Broad Heads of Project Report

General Information Project Description Market potential Capital Costs and Sources of Finance Assessment of Working Capital Other Financial Aspects Economic and Social Variables

India Infrastructure Projects

In the last decade or so, development of India Infrastructure Projects have been propelled specially in transport sector with adequate intervention of Central and State Governments aided by a host of private investments from within and outside the country.

From independence, India Infrastructure Projects bear testimony of the inability of policymakers to transform ambitious plans into action. The issues responsible for this were:

Counter guarantees

State level issues

Delay in financial closure

Ability and willingness of the end customers to pay

Need to develop independent regulators who can monitor and guide development of the sector

Source : India Business Directory

Cost Overrun

A cost overrun, known as a cost increase or budget overrun, is an unexpected cost incurred in excess of a budgeted amount due to an under-estimation of the actual cost during budgeting. Cost overrun should be distinguished from cost escalation, which is used to express an anticipated growth in a budgeted cost due to factors such as inflation.

Cost overrun is common in infrastructure, building, and technology projects. A comprehensive study of cost overrun published in the Journal of the American Planning Association in 2002 found that 9 out of ten construction projects had underestimated costs. Overruns of 50 to one hundred percent were common.

http://en.wikipedia.org/wiki/Cost

http://en.wikipedia.org/wiki/Cost_escalation

http://en.wikipedia.org/wiki/Infrastructure

http://en.wikipedia.org/wiki/Building

http://en.wikipedia.org/wiki/Technology

http://en.wikipedia.org/wiki/Projects

Time/Cost overrun

Source : NCAER, Govt. of India

Table 1: Sector-wise comparison of project implementation data

Summary of NCAER Findings

Infrastructure projects are hugely complex, due to multiplicity of direct stake holders; intense market and non-market interface; development in a setting where there are shortages of critical inputs; and weak governance.

There has been an enormous increase in the scale of operations. While many things can be outsourced, the basic initiating, regulatory, supervisory and governance functions are within the government, so capacity becomes a constraint.

The evolving nature of policy is unavoidable but leads to uncertainty and may slowdown the process of investment.

Summary of NCAER Findings (Cont.)

Opening up the sectors for private investment and operation can speed up the process of execution once the policy framework is in place. However, the need for government intervention at different stages would require equal capacity for decisions within the government.

There is a need for prioritizing building up capacity. For example, building regulatory capacity for individual sectors and across states is not easy.

The experience in project execution has varied across sectors and across states as well as between private and public sector project. Some high profile projects have met the target levels of performance metrics while the others have not.

The Chinese experience highlights the need for strong accountability mechanisms.

Time and cost overruns in infra projects declining: Govt

In a move that could encourage many big investments in the sector, the government has stated that time and cost overruns in the infrastructure projects has improved significantly in 2010 compared to 1991.

The overall cost overrun in projects (worth Rs 150 crore or more) has come down from 61.6 per cent in March 1991 to astonishing 21.10 per cent in September 2010, a review by Ministry of Statistics and Programme Implementation said.

This became possible due to tightening of procedures and monitoring and feedback to the ministries and departments implementing the projects, it said.

Source : Indian Express

Project Roles and Responsibilities

There are many groups of people involved in both the project and project management lifecycles.

The Project Team is the group responsible for planning and executing the project. It consists of a Project Manager and a variable number of Project Team members, who are brought to deliver their tasks according to the project schedule.

Project Manager/GM (Projects) is the person responsible for ensuring that the Project Team completes the project. The Project Manager/GM (Projects) develops the Project Plan with the team and manages the team’s performance of project tasks. It is the responsibility of the GM/Project Manager to secure acceptance and approval of deliverables from the Project Owners and Stakeholders. The Project Manager is responsible for communication, including status reporting, risk management, escalation of issues that cannot be resolved within the team, ensuring the project is delivered in budget, on schedule and within scope.

Role of a GM-Projects / Project Manager

Leadership Role Monitoring Role Resource allocation Role Negotiation Role Liaisoning Role Disturbance handling Role Legal Representative Role Entrepreneurial Activity Communication dissemination Role Decision making Role

Essential Soft Skills for Project Managers

12 essential skills required for good Project Managers are: Effective Communication and Consultation Conflict and Crisis Management Flexibility, Adaptability and Creativity Selfless Leadership Efficient Teamwork Good Negotiation /Techno- commercial skills Organizational Effectiveness Problem Solving and Prompt Decision Making Professionalism and Ethics Trustworthiness Self-control Learning and Development

Critical Success Factors (1 of 2 )

Based on Review of 187 Centre Funded Projects-Planning Commission states causes of delays to be avoided for Success of the Projects, are:

Poor Project Formulation Changes in Design or Scope Midway Inability of Project Mgmt to take Quick decisions Mgmt Problems such as Personnel, Labour -

Contractor disputes, Mismatch of Eqpt. Specifications Poor Monitoring (Ideal - Weekly monitoring) According to Sh N Vittal, former CVC, Corruption

increases project costs

Inadequate/Untimely Release of Funds unforseen factors/ Natural Calamities.

Some cost overruns due to Inflation Due to Contracts incompleteness, some Delays/cost

overruns are inevitable Percentage cost overruns also escalate with length of

Implementation Bigger projects lead to much higher Cost overruns Defective Planning leads to Time/Cost Overruns Southern States have marginally shorter delays/ lesser Cost

escalation. Changes in Duty structure/Exchange Rates during project

execution.

Delhi School of Economics (DSE)

Critical Success Factors (2 of 2 )

Contracts and Projects Risk Management

One of the critical outcomes of contract and project management is to ensure that risks to owners and contractor are identified and controlled in a proactive way so that both parties are satisfied with the project outcome. While world class project and contract management cannot, of itself, make risk “go away”, it can, and should, identify the risks and opportunities, determine who is responsible for managing each individual risk, and for the consequences should the risk occur.

Knowledge to move contracts and project management from the tactical/reactive to the more important proactive/strategic focus.

Critical understanding of the risk minimization process. How to examine both the threats and opportunities facing contracts

and projects from both a top-down and bottom-up perspective. Skills in allocating contract and procurement risk. Ability to identify the warning signs of cost overruns, schedule

delays, and poor quality, as early as possible in the project to minimize or mitigate the likely impact.

10 Golden Rules of Project Risk Management

Rule 1: Make Risk Management Part of Your Project

Rule 2: Identify Risks Early in Your Project

Rule 3: Communicate About Risks

Rule 4: Consider Both Threats and Opportunities

Rule 5: Clarify Ownership Issues

Rule 6: Prioritize Risks

Rule 7: Analyze Risks

Rule 8: Plan and Implement Risk Responses

Rule 9: Register Project Risks

Rule 10: Track Risks and Associated Tasks

By Bart Jutte

Cutting Time/Cost Overruns (1 of 2)

Wherever possible, Fixed price rather than unit price EPC contracts be used.

Suitable changes in Standard Organization Structure required to minimize established causes of delays.

Contract Management during Construction phase is important

Both contracts and weekly progress monitoring may be done transparently thru webserver with Passwords.

Increased Competition can bring down Project costs by 5-7%

Standard capacities and Proven technologies can reduce Project Costs by 5-10%. Arbitration instead of Litigation can reduce Time delays

E-Procurement can cut costs by 5-10% (eg. SAIL CMO)

Penalties for delayed delivery/commissioning/poor Quality of workmanship should be incorporated in the Rs 100 cr plus B2B Contracts with suppliers.

Organizational failures are statistical cause of delays/cost overruns Change in ownership cannot mitigate problems Last 10% should be released after integrated plant/ Project shows

production. Payment thru L/C on measurable Milestones basis/ against

security/BG can reduce Project Costs and reduce time delays. An Incentive scheme to be given to project team/members for

timely installation/commissioning can also cut delays. Good administration of Infra facilities improves execution of project.

Cutting Time/Cost Overruns ( 2 of 2)

Project CoordinationIt is very important at all levels viz. Engineering, Procurement, Construction, and start-up period some other important aspects of project management are as follows

Broad Costing of 3X660 MW- TPP

Cost Estimates for 3X660 MW – Thermal Power Plant

Percentage Break Up of Costs

TCE/EIL/PDIL/MECON as Consultants

Competent services in diverse roles

The services provided by TCE for thermal power projects are wide ranging.

TCE meets the diverse requirements of different participating agencies- the Utility, the Independent Power Producer (IPP), the EPC contractor

and the lending institutions. TCE's comprehensive range of services for power projects include : Site selection Techno-economic feasibility studies Financial analysis Power system studies Site surveys Site specific studies Environmental impact assessment IPP bid solicitation and selection EPC bid solicitation and selection Pre-tender support to EPC bidders Owner’s Engineer services to utilities and IPPs O & M contractor bid solicitation and selection Concept-to-commissioning A-E services to utilities and IPPs Post-award detailed engineering services to EPC contractors Technical due diligence

TCE as Consultant

Thermal Power Station (TPS)

A Thermal Power Station is a power plant in which the prime mover is steam driven. Water is heated, turns into steam and spins a steam turbine which drives an electrical generator. After it passes through the turbine, the steam is condensed in a condenser and recycled to where it was heated; this is known as a Rankine cycle. The greatest variation in the design of thermal power stations is due to the different fuel sources. Some prefer to use the term energy center because such facilities convert forms of heat energy into electrical energy. Some thermal power plants also deliver heat energy for industrial purposes, for district heating, or for desalination of water as well as delivering electrical power. A large proportion of CO2 is produced by the worlds fossil fired thermal power plants; efforts to reduce these outputs are various and widespread.

Source : Wikipedia

http://en.wikipedia.org/wiki/Power_plant

http://en.wiktionary.org/wiki/prime_mover

http://en.wikipedia.org/wiki/Steam

http://en.wikipedia.org/wiki/Steam_turbine

http://en.wikipedia.org/wiki/Electrical_generator

http://en.wikipedia.org/wiki/Condensation

http://en.wikipedia.org/wiki/Surface_condenser

http://en.wikipedia.org/wiki/Rankine_cycle

http://en.wikipedia.org/wiki/Rankine_cycle

http://en.wikipedia.org/wiki/Heat

http://en.wikipedia.org/wiki/Energy

http://en.wikipedia.org/wiki/District_heating

http://en.wikipedia.org/wiki/Desalination

L&T Power Project DevelopmentL&T develops grid-linked independent Power Plant and Cogeneration and Captive Power Plants on Build-Own Operate (BOO), Build-Own-Operate-Transfer (BOOT), Build-Lease-Operate (BLO). build-Lease-Operate (BLO). Build -Own-Operate-Maintain (BOOM) basis.

Activities: Identification of new opportunities for grid-connected & captive power

plants. Evaluation of risks and strategies for mitigation of these risks. Ensuring various clearances. Evaluation of various financing structures. Arranging the requisite financial package for investment. Establishing partnering relationship with existing power plants to set up

joint ventures with equity participation - with or without reconstruction. Projects Executed: 116 naphtha -fire combined cycle cogeneration power plant, on BOO basis,

to generate 116 MW of power and 480 TPH of process steam, for Haldia Petrochemicals Limited, Haldia.

90 MW naphtha/natural-gas-fired cogeneration power plant, on BLO basis, to deliver 90 MW of power and 240 TPH of process steam, for Indian Petrochemicals Corporation Limited, Gandhar.

Power production statisticsSource- CEA Jan 2011

Plant Load Factor (CEA)

CEA Data (As on 31/01/2011)

CEA Website Data

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Compare Indian T&D Losses of 25% with Korea’s 4%.

Coal Consumption & Cost of Power

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Geo-facilities Management System for Electric Industry

Based on Intergraph’s G/Technology™, G/Electric is a multidimensional solution that provides powerful tools to support the facilities/asset management needs of electric transmission and distribution companies.

It was created specifically for the electric industry and incorporates input from clients and industry partners, combined with Intergraph’s extensive project implementation experience.

G/Electric fits into the comprehensive information technology (IT) environment we call Geospatial Resource Management (GRM).

Special CAD/CAM Tools for Power Sector

Water Infrastructure Management

Water infrastructure management (WIM) is an Intergraph software solution that supports all the details of a municipal or private water and wastewater distribution system.

With it, you can plan, conduct engineering analysis, design work orders, and manage mapping, asset, and maintenance records. The fundamental feature of WIM is a geospatial network asset database of the distribution assets of the system, such as water mains and sewers, storage reservoirs, pumps, pipelines, valves, and meters.

Special CAD/CAM Tools for Infrastructure

E-procurement (electronic procurement, sometimes also known as supplier exchange) is the business-to-business or business-to-consumer or Business-to-government purchase and sale of supplies, Work and services through the Internet as well as other information and networking systems, such as Electronic Data Interchange and Enterprise Resource Planning.

E-procurement Web sites allow qualified and registered users to look for buyers or sellers of goods and services. Depending on the approach, buyers or sellers may specify costs or invite bids. Transactions can be initiated and completed. Ongoing purchases may qualify customers for volume discounts or special offers. E-procurement software may make it possible to automate some buying and selling. Companies participating expect to be able to control parts inventories more effectively, reduce purchasing agent overhead, and improve Supply Chain Management.

Save 5-10 % Using E-procurement !

http://en.wikipedia.org/wiki/Procurement

http://en.wikipedia.org/wiki/Business-to-business

http://en.wikipedia.org/wiki/Business-to-consumer

http://en.wikipedia.org/wiki/Business-to-government

http://en.wikipedia.org/wiki/Good_(accounting)

HR-Issues, Challenges, Solutions

To visualize skilled/unskilled manpower planning after benchmarking with similar/better executed projects

To prepare organization chart Identify the key project staff with their job descriptions and

experience requirements To organize Recruitment and selection of talented staff with

proven track record. To prepare detailed HR policies/promotion guidelines To comply with Ministry of Labour guidelines To create Performance Appraisal system on Objective criteria To create comprehensive database of current staff To use SAP as tool for organization wide working To plan for Safety/quality monitoring/Disaster Management/Energy

Audit To improve productivity, efficiency of the system as a whole thru

Incentives/rewards/punishment of delibrate violation of HR policies To keep manpower costs competitive.

Gantt Chart

A Gantt chart is a type of bar chart that illustrates a project schedule. Gantt charts illustrate the start and finish dates of the terminal elements and summary elements of a project. Terminal elements and summary elements comprise the work breakdown structure of the project. Some Gantt charts also show the dependency (i.e., precedence network) relationships between activities

PERT and CPM

PERT= Project Evaluation Review Technique

CPM = Critical Path Method

A PERT chart is a project management tool used to schedule, organize, and coordinate tasks within a project. PERT is a methodology developed by the U.S. Navy in the 1950s to manage the Polaris submarine missile program.

A similar methodology, the CPM was developed for project management in the private sector at about the same time.

Why PERT/CPM?

Prediction of deliverables Planning resource requirements Controlling resource allocation Internal program review External program review Performance evaluation Uniform wide acceptance

Critical Path Method (CPM)

The critical path method (CPM) is an algorithm for scheduling a set of project activities. It is an important tool for effective project management.

PERT chart for a project with five milestones (10 through 50) and six activities (A through F).The project has two critical paths: activities B and C, or A, D, and F – giving a minimum project time of 7 months with fast tracking. Activity E is sub-critical, and has a float of 2 months.

All Tasks with zero Total Float are Critical. Any delay in these Tasks will delay Project Completion. Darken these Tasks to finish CPM Diagram.

If a task seems too complex or involved to easily determine primary properties . . .

Break the task up into simpler tasks . . .

Or create a CPM sub-project.

Determine Critical Path

The CPM Diagram

“Tasks” are Arrows “Critical Tasks” are

Thick Arrows

“Events” are Circles “Dummy Tasks” are

Dashed Arrows(depict precedence relation for next activity)

Innovation

Innovation is creativity plus productivity Business Innovation is Creativity plus

Commercialization Innovation is Idea selection, Development

and commercialization Requires Competencies and knowledge of a

team Different competencies,

structure,processes, resources and time scales are required

Innovative Organizations(Traits)

Drive to stay ahead Acceptance of risks. Growth Orientation Commitment to Technology Vigilance Diverse range of skills Adaptability Enthusiasm for knowledge Receptivity

Energy Audit -Innovation (Reliance Energy Limited)

Thermal power consist of various sub cycles / systems like air & flue gas cycle, main steam, feed water & condensate cycle , fuel & ash cycle, Equipment cooling water (ECW), auxiliary cooling water (ACW) system, Compressed air system, Electrical auxiliary power & lighting system, HVAC system etc.. There is tremendous scope of energy saving potential in each system/cycle which is given below.

Thermal power plant is designated sector as per EC Act 2001. Most thermal power plant uses 30-40% of energy value of primary fuels.

The remaining 60-70% is lost during generation, is in the form of heat.

Transmission and distribution also add to major loss.

Energy Audit –Innovation (1 of 4)

1. Air & flue gas cycle:- a. Optimizing excess air ratio: - It reduces FD fan & ID fan loading.

b. Replacement of oversize FD and PA fan: - Many thermal power plants have oversize fan causing huge difference between design & operating point leads to lower efficiency. Hence fan efficiency can be improved by replacing correct size of fan. If replacement is not possible, Use of HT VFD for PA & ID fan can be the solution.

c. Attending the air & flue gas leakages: - Leakages in air & flue gas path increases fan loading. Use of Thermo vision monitoring can be adopted to identify leakages in flue gas path. Air preheater performance is one crucial factor in leakage contribution. If APH leakage exceeds design value then it requires corrective action.

2. Steam, Feed water and condensate cycle:- a. BFP scoop operation in three element mode instead of DP mode: -

In three element mode throttling losses across FRS valve reduces leads to reduction in BFP power.

b. Optimization of level set point in LP & HP heater: - Heater drip level affects TTD & DCA of heater which finally affect feed water O/L temp. Hence it requires setting of drip level set point correctly.

c. Charging of APRDS from CRH line instead of MS line: -APRDS charging from cold reheat (CRH) is always more beneficial than from MS line charging.

Contd .. 2 of 4

2. Steam, Feed water and condensate cycle (contd.):- d. Isolation of steam line which is not in use: - It is not advisable to keep

steam line unnecessary charge if steam is not utilized since there energy loss occurred due to radiation. For example deareator extraction can be charged from turbine Extraction/CRH or from APRDS. In normal running APRDS Extraction is not used so same can be kept isolated.

e. Replacement of BFP cartridge: - BFP draws more current If Cartridge is wore out, causing short circuit of feed water Flow inside the pump. It affects pump performance. Hence cartridge replacement is necessary.

f. Attending passing recirculation valve of BFP: - BFP Power consumption Increases due to passing of R/C valve. It requires corrective action.

g. Installation of HT VFD for CEP: - CEP capacity is underutilized and also there is pressure loss occurs across Deareator level control valve. There is large scope of energy saving which can be accomplished by use of HT VFD for CEP or impeller trimming.

3. Fuel & ash Cycle:- a. Optimized ball loading in Ball tube mill: - Excessive ball loading

increases mill power. Hence ball loading is to be Optimized depending upon coal fineness report.

b. Use of Wash Coal or Blending with A- grade coal: - F-grade coal has high ash content. Overall performance can be improved by using Wash coal or blending of F-grade coal with A- grade coal instead of only using F- grade coal.

c. Avoiding idle running of conveyors & crusher in CHP Contd .. 3 of 4


3. Fuel & ash Cycle:- (contd.)d. Use of Dry ash Evacuation instead of WET deashing System: - Dry

deashing system consumes less power & also minimizes waste reduction.

e. Optimize mill maintenance:-Mill corrective/preventive maintenance is to be optimized depending parameter like- running hrs, mill fineness, bottom ash unburnt particle, degree of reject pipe chocking etc.

4. Electrical & lighting system:- a. Optimizing Voltage level of distribution transformer: - It is found that

Operating voltage level is on higher side than required causing more losses. It is required to reduce the voltage level by tap changing.

b. Use of Auto star/delta/star converter for under loaded motor Lighting: - Use of electronic chock instead of conventional use copper Chock, Use of CFL, Replacement of mercury vapor lamp by metal Halide lamp. Use of timer for area lighting is the methods can be used. Lighting has tremendous potential of saving.

5. ECW & ACW system:- a. Isolating ECW supply of standby auxiliaries: - Many times standby

coolers are kept charged from ECW side. Also Standby equipment’s auxiliaries like Lube oil system kept running for reliability. We can isolate Standby cooler from ECW system & switching of standby auxiliaries, doing trade off between return & reliability.

b. Application of special coating on CW pump impeller: - It improves pump impeller profile condition, increasing pump performance.

Contd .. 4 of 4



5. ECW & ACW system:- c. Improving condenser performance by condenser tube cleaning &

use of highly efficient debris filter: - Tube cleaning by bullet shot method increases condenser performance, condenser tube cleaning is necessary which is to be carried out in overhaul. Also highly advanced debris filter contribute condenser performance.

6. Compressed air system:- a. Optimizing discharge air pressure by tuning loading/ unloading

cycle: - It helpful to reduce sp. Power consumption.

b. Use of heat of compression air dryer instead of electrically heated air dryer: - Heat of compression air dryer use heat generated in compression cycle, thus reduces sp. Power consumption.

c. Use of screw compressor instead reciprocating compressor: - Sp. Power consumption of screw compressor is less than reciprocating air compressor leads to reduce aux. power consumption.

7. HVAC system a. Cooling tower performance improvement

b. Installing absorption refrigeration system instead of vapor compression system

c. Use of wind turbo ventilators instead of conventional motor driven exhauster

CONTROL & DIAGNOSTIC FEATURES OF 500 MW TURBO GENERATORS (BHEL)

With the increase in the power rating of generating sets, the issue of availability has become very important. The outage of even one large capacity machine from the grid causes a significant shortfall in power generation. High availability and reliability are therefore fundamental requirements of power generating units. To achieve this, the health of machines needs to be monitored continuously. Over and above this, we also require techniques for forecasting imminent problems. Diagnostic tools are therefore gaining increasing importance by the day. This paper gives details of the control and diagnostic tools used in 500 MW generators manufactured by BHEL.

(Refer BHEL Journal)

Government Clearances Required (1/4)

Advance action / clearance for feasibility report Investment approval Funds

Domestic funds / loans / bonds / debentures / equity Raising money in the foreign market Foreign direct investment

Foreign collaboration Engaging foreign consultants Global tenders Foreign assistance


Location Pollution Control Environment Forest Telecommunication Port angle Mining lease Mines safety Commissioning boiler Steam and condensate

piping Fire protection system Labour laws Inspection certification

of electrical system

Statutory clearance for power projects

Techno-economic clearance for power projects/captive power plants

Chimney/tall buildings near airport

Defense angle / proximity to defense installations

Railway siding construction / operation

Safety against explosion Fire protection system Equipment lay-out under

Factory Act / approval before commissioning


Tenders specifications Tender Approval Shipment arrangements Letter of Intent Industrial license Coal linkage Oil / Gas linkage Power linkage Water Appointing foreign technicians / engineers


Building plans/no objection Land acquisition Right of way clearance Formation of company Appointment of Managing Director/ Director(s) Sales tax/VAT/GST (when applicable) registration Discounts in insurance rates Registration under Excise Act Approval under Service /Sales Act. Registration under Shop & Establishment Act Movement of over-dimensional equipment on roads Movement of over-dimensional equipment on barges etc. Income tax registration / income tax clearance regarding

foreign technicians

INDIAN STANDARDS ON EARTHQUAKE ENGINEERING

Bureau of Indian standards, the National Standard Body of India, is a Statutory Organization under the Bureau of Indian Standards Act 1986. One of the activity is formulation of Indian Standards on different subjects of Engineering through various Division Councils.

The Civil Engineering Division Council is responsible for standardization in the field of Civil Engineering including Structural Engineering, Building materials and components, Planning Design, Construction and Maintenance of Civil Engineering Structures, Construction Practices, Safety in Building etc.

These standards are evolved based on consensus principle through a net work of technical committee comprising representatives from Research and Development Organizations, Consumers, Industry, Testing Labs and Govt. Organizations etc.

Environmental Impact Assessment

An environmental impact assessment is an assessment of the possible positive or negative impact that a proposed project may have on the environment, together consisting of the natural, social and economic aspects.

The purpose of the assessment is to ensure that decision makers consider the ensuing environmental impacts while deciding whether to proceed with a project. The International Association for Impact Assessment (IAIA) defines an environmental impact assessment as "the process of identifying, predicting, evaluating and mitigating the biophysical, social, and other relevant effects of development proposals prior to major decisions being taken and commitments made."

NTPC Ratio Analysis (Last 5 Years) 1 of 2

Mar ‘ 10 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06

PER SHARE RATIOS

Adjusted E P S (Rs.) 9.82 8.72 8.93 8.02 6.01

Adjusted Cash EPS (Rs.) 13.04 11.59 11.53 10.55 8.5

Reported EPS (Rs.) 10.59 9.95 8.99 8.33 7.06

Reported Cash EPS (Rs.) 13.8 12.82 11.59 10.85 9.54

Dividend Per Share 3.8 3.6 3.5 3.2 2.8

Operating Profit Per Share (Rs.) 15.09 12.79 13.98 12.32 9

Book Value (Excl Rev Res) Per Share (Rs.) 77.28 71.55 65.81 58.94 54.53

Book Value (Incl Rev Res) Per Share (Rs.) 77.28 71.55 65.81 58.94 54.53

Net Operating Income Per Share (Rs.) 56.25 50.91 44.98 39.58 31.71

Free Reserves Per Share (Rs.) 62.75 56.25 52.34 47.38 43.24

PROFITABILITY RATIOS

Operating Margin (%) 26.81 25.11 31.07 31.13 28.4

Gross Profit Margin (%) 21.1 19.48 25.31 24.77 20.56

Net Profit Margin (%) 17.72 18.11 18.51 19.39 20.2

Adjusted Cash Margin (%) 21.83 21.1 23.74 24.58 24.31

Adjusted Return On Net Worth (%) 12.7 12.18 13.57 13.61 11.02

Reported Return On Net Worth (%) 13.69 13.9 13.66 14.12 12.94

Return On long Term Funds (%) 12.45 12.27 15.15 14.69 12.26

NTPC Ratio Analysis (Last 5 Years) 2 of 2

Tata Power Ratio Analysis (Last 5 Years) 1/2

Mar ' 10 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06

PER SHARE RATIOS

Adjusted E P S (Rs.) 37.62 21.71 21.36 24.19 22.22


Reported EPS (Rs.) 39.93 41.65 39.42 35.21 30.85


Dividend Per Share 12 11.5 10.5 9.5 8.5

Operating Profit Per Share (Rs.) 78.37 50.79 41.67 35.46 42.48













Tata Power Ratio Analysis (Last 5 Years) 2/2LEVERAGE RATIOS

Long Term Debt / Equity 0.55 0.52 0.34 0.6 0.49

Total Debt/Equity 0.56 0.6 0.38 0.61 0.5

Owners fund as % of total Source 63.84 62.22 72.15 61.97 66.34

Fixed Assets Turnover Ratio 0.7 0.8 0.91 0.78 0.76

LIQUIDITY RATIOS

Current Ratio 2.45 2.1 2.04 2.25 2.22

Current Ratio (Inc. ST Loans) 2.39 1.64 1.78 2.22 2.18

Quick Ratio 2.17 1.77 1.75 2 1.85

Inventory Turnover Ratio 18.98 15.49 18.7 6,072.41 498.76

PAYOUT RATIOS

Dividend payout Ratio (Net Profit) 34.08 31.2 30.84 31.6 31.41

Dividend payout Ratio (Cash Profit) 22.65 22.9 23.02 22.05 21.34

Earning Retention Ratio 63.82 40.16 43.09 54.01 56.37

Cash Earnings Retention Ratio 76.44 64.68 65.02 71.79 73.65

COVERAGE RATIOS

Adjusted Cash Flow Time Total Debt 4.35 6.44 4.02 4.71 3.84

Financial Charges Coverage Ratio 5.02 4.15 6.23 5.55 6.63

Fin. Charges Cov.Ratio (Post Tax) 4.39 4.86 7.78 6.34 6.89

COMPONENT RATIOS

Material Cost Component(% earnings) 61.28 73.86 72.76 70.1 70.43

Selling Cost Component 0.74 0.67 0.59 5.19 1.19

Exports as percent of Total Sales 0.78 4.47 0.31 2.12 1.82

Import Comp. in Raw Mat. Consumed 0 0 0 0 0

Long term assets / Total Assets 0.68 0.7 0.69 0.64 0.68

Bonus Component In Equity Capital (%) 0.47 0.51 0.51 0.57 0.57

Reliance Power Ratio Analysis (Last 5 Years) 1/2


PER SHARE RATIOS

Adjusted E P S (Rs.) 0.45 0.79 0.33 0.01 -25.57

Adjusted Cash EPS (Rs.) 0.45 0.79 0.33 0.01 -25.57

Reported EPS (Rs.) 1.14 1.04 0.41 0.01 -25.57

Reported Cash EPS (Rs.) 1.14 1.04 0.41 0.01 -25.57

Dividend Per Share 0 0 0 0 0

Operating Profit Per Share (Rs.) -0.4 -0.3 -0.11 0.06 -22.27

Book Value (Excl Rev Res) Per Share (Rs.) 58.69 57.55 59.92 10 -19.22

Book Value (Incl Rev Res) Per Share (Rs.) 58.69 57.55 59.92 10 -19.22

Net Operating Income Per Share (Rs.) 0 0 0 0.11 0

Free Reserves Per Share (Rs.) 48.69 47.55 49.92 0 -29.22


Operating Margin (%) 0 0 77.44 60.98 0

Gross Profit Margin (%) 0 0 77.44 60.98 0

Net Profit Margin (%) 122.09 90.9 83.9 7.19 0

Adjusted Cash Margin (%) 48.92 69.75 66.89 7.68 0

Reliance Power Ratio Analysis (Last 5 Years) 2/2Adjusted Return On Net Worth (%) 0.77 1.38 0.55 0.08 0

Reported Return On Net Worth (%) 1.94 1.8 0.69 0.08 0

Return On long Term Funds (%) 0.89 1.45 0.64 0.68 0

LEVERAGE RATIOS

Long Term Debt / Equity 0 0 0 0 0

Total Debt/Equity 0 0 0 0 0

Owners fund as % of total Source 100 100 100 100 0

Fixed Assets Turnover Ratio 0 0 0 0.03 0

LIQUIDITY RATIOS

Current Ratio 189.31 167.36 12.6 9.16 1.72


Quick Ratio 189.31 167.36 12.6 9.16 1.72

PAYOUT RATIOS

Earning Retention Ratio 100 100 100 100 0

Cash Earnings Retention Ratio 100 100 100 100 0

COVERAGE RATIOS

Financial Charges Coverage Ratio 74.91 113.42 15.27 1.67 0

Fin. Charges Cov.Ratio (Post Tax) 162.62 142.03 17.54 1.2 0

COMPONENT RATIOS

Selling Cost Component 0 0 1.31 0.57 0


Bonus Component In Equity Capital (%) 5.7 5.7 0 0 0

Reliance Infra. Ratio Analysis (Last 5 Years) 1/2


PER SHARE RATIOS

Adjusted E P S (Rs.) 40 31.11 24.69 25.37 31.04


Reported EPS (Rs.) 47.03 50.39 45.86 35.07 30.63


Dividend Per Share 7.1 7 6.3 5.3 5

Operating Profit Per Share (Rs.) 35.74 19.22 22.73 21.75 35.99













Reliance Infra. Ratio Analysis (Last 5 Years) 2/2LEVERAGE RATIOS

Long Term Debt / Equity 0.1 0.14 0.06 0.16 0.41

Total Debt/Equity 0.29 0.69 0.48 0.67 0.6

Owners fund as % of total Source 77.37 58.96 67.19 59.59 62.23

Fixed Assets Turnover Ratio 1.33 1.4 0.99 0.97 0.72

LIQUIDITY RATIOS

Current Ratio 1.73 1.55 2.47 3.93 4.25


Quick Ratio 1.66 1.45 2.37 3.82 4.07

Inventory Turnover Ratio 59.45 55.96 40.26 32.87 19.6

PAYOUT RATIOS

Dividend payout Ratio (Net Profit) 15.94 16.19 15.93 17.68 18.37

Dividend payout Ratio (Cash Profit) 12.47 13.33 13.21 13.6 11.18

Earning Retention Ratio 81.25 73.77 70.41 75.57 81.88

Cash Earnings Retention Ratio 85.87 80.55 78.59 82.72 88.91

COVERAGE RATIOS

Adjusted Cash Flow Time Total Debt 3.17 7.73 6.21 7.14 3.96

Financial Charges Coverage Ratio 6.28 4.25 4.13 4.76 6.88

Fin. Charges Cov.Ratio (Post Tax) 6.04 5.19 5.23 5.16 6.57

COMPONENT RATIOS

Material Cost Component(% earnings) 34.17 44.32 39.5 26.96 27.67

Selling Cost Component 1.82 1.79 2.36 2.32 0.21

Exports as percent of Total Sales 0.43 0.96 0.01 0 0


Bonus Component In Equity Capital (%) 3.3 3.57 3.43 3.53 3.8

References

Planning Commission, Govt. of India

Ministry of Statistics and Programme Implementation

Ministry of Power ,Govt. of India NCAER , Govt. of India Central Electricity Authority, Govt.

of India Delhi School of Economics, Delhi

University National Thermal Power

Corporation (PSU) Mckensie Report Tata Consulting Engineers/Tata

Power EIL/PDIL/Mecon/MN Dastur Reliance Industries Ltd India Habitat Center Tata Chemicals Ltd Delhi Metro Rail Corporation

Total Project Management P K Joy, McMillan publishersProject Management by Rory Burke, WileyProject Management by Jack R Meredith/Samuel J Mantel ,WileyEnergy Audit: Reliance Energy Ltd BHEL InnovationsMinistry of Environment & Forest, Government of IndiaInnovation Management Dr R Lalitha, Himalaya PublishingLarsen and Toubro (L&T)Ministry of Labour ,Govt. of IndiaDion Global Solutions Limited, Insight (Research Data Base)TERI, New DelhiWikipediaHindustan Times / Indian Express Vijayant Consultants, Ahemadabad

Acknowledgement

The Author / Presenter thankfully acknowledges the contribution of the following IAMR Staff members in the creation of this Power Point Presentation on ‘Innovative Project Management Practices for working professionals’.

1. Mr. Rajendra Yadav

2. Mr. Avadesh Mishra

3. Mr. Mayur Sharma

Mr. Rakesh Bhatia, with his rich experience of 25 years in execution & marketing of EPC Projects, has been a great help in validating and correlating the inputs & streamlining the flow.

Thank you all the participants for patient listening, your valuable contribution by making the session interactive and value added .

It was a great experience sharing platform to cut time & cost overruns in major projects in the power, infrastructure, construction sectors.