Estimation of Value of Lost Load, Reliability Benefit and Supply Reserve for an Industrial Plant

It is well recognized that reliability assessment is an important criterion in decision making for operation and planning of industrial plants. This assessment is affected by other parameters such as the value of lost load (VOLL) and the accessibility to electrical energy supply. The purpose of this paper is to extract the mentioned parameters for a cable-manufacturing plant and apply them to estimate the economic benefit of reliability for the plant. Work done in this paper provides two sets of parameters which are VOLL and optimal reserve level for the electricity-supply to the plant. Based on the field studies and data received from experienced operators who are working in the plant, the VOLL is calculated. The calculated VOLL is applied in a cost-benefit analysis to determine an optimized level for the reserve of electricity supply to the plant. Results are presented in the form of tables for the VOLL as well as the optimal reserve levels.

Keywords:

value of lost load (VOLL) , reliability benefit , cost-benefit analysis , industrial plan