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The life extension process: considerations for power companies

WTW Power Market Review 2023

By Alan McShane | November 8, 2023

In this article from the 2023 Power Market Review we take a look at the many challenges power plant operators face on a day-to-day basis

The business environment continues to be challenging for power plant operators, whether it be navigating the unlocking of economies in the aftermath of the pandemic, managing feedstock price fluctuations, the recent geopolitical shifts impacting supply chains caused by the ongoing conflict in Ukraine, or the pressures the industry is under to evolve into a low-carbon economy.

In particular:

  • On the demand side, there is an ever-increasing need for electrical power, together with an increased focus by national governments on energy security. This has increased their demand for the availability of generating assets that can provide a reliable power supply, which has made this demand more acute.
  • On the supply side, existing assets continue to age, and operators are increasingly looking more favourably at extension projects to meet this demand gap. There have even been instances where national governments have requested operators to have specific assets continue operating beyond their planned decommissioning dates.

Taken together, these two factors have made future investments in conventional power-generating assets extremely uncertain in the near term, causing a general slowdown in the construction of new conventional power plants being constructed. In turn, this is putting pressure on operators to extend the life of ageing assets. This increased interest in extending operating assets beyond their original operating life presents several risks that need to be carefully assessed and controlled.

This is why robust life extension processes and independent analyses of these processes by qualified engineers need to be undertaken by power companies to ensure that the assets that continue to operate do so in a safe manner and are considered to be “fit for service”. Failing to do so could, and probably will, result in losses that no one wants to experience, either as an operator or insurer. It’s little wonder that insurers are paying closer attention to this issue and will no doubt penalise insurance programmes where assets over a certain age have not undergone this process.

The standard life extension process

The ultimate objective of life extension processes is to determine the duration that assets can operate safely and profitably beyond their specified design lives, and the investment required to secure this outcome. The investment budgets supporting life extension programmes comprise capital funds (Capex) to replace or upgrade equipment, together with estimated future operating expense (Opex), necessary to cover maintenance expenditure and spare parts requirements for the extension period.

The output from this analysis will be a series of different combinations of operating durations versus investment budgets, with operators needing to select the combination range that suits their desired operating period and investment appetite. Typically, operators will seek to maximise the extension period while minimising (or optimising) their total investment, which will bear in mind whether the equipment can continue to operate safely and with accepted levels of reliability.

What does a good life extension process look like?

In particular, companies need to establish whether this objective can be achieved:

  • without any component changes and no (or minor) increases in future maintenance/spare parts budgets
  • with like-for-like replacements of some components
  • with upgraded components, or whole equipment modules that do not change facilities’ generating capacities - these upgrades may either improve reliability, future maintenance costs, or required investment, or all three
  • with upgrades required to address equipment and/or spare parts obsolescence - technology suppliers’ support through this period is also important
  • with upgraded components or whole equipment modules that upgrade facilities’ generating capacities

Using a life extension processes to upgrade facility generating capacity may look appealing, but caution needs to be exercised in order to avoid re-verification of regulatory operating licences, which could well introduce significant additional overheads in terms of costs and time.

Tracking asset ageing

For life extension projects to be successful and economically viable, operators first need to track asset ageing in a comprehensive and consistent manner. This requires the monitoring and collation of many operating parameters and the results of specific equipment inspections that can be used as inputs into various mathematical models that are used to establish plant ageing.

While not an exhaustive list, several key operational factors to be monitored include:

  • Maintenance costs and whether or not they are increasing or decreasing over time
  • Equipment reliability data obtained from maintenance and overhaul programmes - for example, wear, fatigue, and performance degradation
  • Programmed overhauls or component replacements, which also introduce new equipment
  • Availability/equivalent availability factors
  • Forced outage/equivalent forced outage rates
  • Equipment obsolescence and spare parts availability
  • Past upgrades in assets, which can increase performance/reliability but also introduces new equipment

Targeted equipment inspections will also provide crucial inputs in determining the extent of degradation, in terms of wear and stress, experienced by equipment components from past operations.

Non-standard life extension processes

Mothballed assets

Another area where life extension projects are being considered are mothballed assets, which may have been taken out of service for a variety of reasons. Here, the analysis needs to be more detailed, given that the condition of equipment may well be dependent on the mothballing methods employed – meaning that some methods are more effective at preserving asset condition than others. Detailed inspections are therefore normally required to evaluate the mothballing impact, in addition to the operational data outlined above.

Given this additional factor, life extensions on mothballed assets are considered potentially riskier than extension of operating assets. In the rest of this article, considerations will be given to the challenges of and life extensions for electrical generators and associated equipment.

Electrical generator life extensions

The main issues arising from generator stator ageing are:

  • Main stator bar insulation degradation, leading to decreased insulation resistance
  • Stator end-winding looseness, causing fretting and wear of the main stator bar insulation
  • Stator wedge looseness, causing stator bar insulation wear
  • Stator cooling water manifold and brazed joints are issues, causing hydrogen leaks and insulation problems
  • Stator core issues, causing core laminations, shorting, and overheating

Generally, generator stator bars last anything between 20-30 years, depending on the operating regime, operating excursions, insulation type, maintenance regime (cleaning, testing, wedge tightness etc.), oil ingress, cooling water temperatures, load cycling, specific OEM design pertinent issues and so on. Utilizing new insulation materials, stator life could be extended by another 20+ years, providing the stator core is healthy and in good condition.

To read more, please download the full article, below.


Global Head of Risk Engineering, Natural Resources, WTW


Carlos Wilkinson
Head of Power & Utilities, Downstream Natural Resources, Willis Towers Watson
email Email

Declan Cleary
Power and Utilities Broker at Willis Towers Watson
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