Factors affecting system expansion planning

System expansion planning is affected by technical, economic, environmental and policy factors that decide how much capacity, of what type and when, should be added.

Factors

1. Load forecast: Growth rate of peak demand and energy, load curve shape and seasonal variation.
2. Existing system: Capacity, age, retirement and availability of present plants and lines.
3. Available resources: Hydro potential, solar, wind, fuel availability, import possibility.
4. Economics: Capital cost, O&M and fuel cost, discount rate, financing and tariff.
5. Reliability criteria: Reserve margin, LOLP, N-1 security.
6. Lead time: Construction period (hydro 5–10 years, solar 1 year).
7. Unit size and system size: The largest unit should not be too big compared with the system (usually below about 10% of peak).
8. Transmission constraints: Ability to evacuate power from plant sites.
9. Environmental and social issues: Land, resettlement, emissions, river ecology.
10. Government policy and regulation: Energy roadmap, PPA rates, private sector participation, cross-border trade agreements.
11. Uncertainties: Hydrology, demand growth, fuel price, technology change.