1. ICOD Deployment Financial Benefits EHT NTERNATIONAL I

2. Financial Analysis –Operational data such as failure rates may vary from one utility to another. This analysis uses data published by industry organizations such as CIGRE and obtained from discussions with utilities and experienced consultants. It aims to demonstrate the benefits of using ICOD in a realistic way. –Disconnect switches are strategic to an electric grid due to their direct influence on grid reliability. For our business case, assume that the utility has 32,000 disconnects installed and are distributed as follows: VoltagesDistribution (%)Quantities 735 kV5%1600 230-315 kV10%3200 120-161 kV20%6400 49-69 kV5%1600 34 kV and less60%19200 Hypothetical Utility Savings EHT NTERNATIONAL I

3. Financial Analysis Out of the 32 000 disconnects, assume 31.25% are motorized Descriptions Assumptions (%) Assumptions (Qty) Total amount of motorised mechanism31.25%10 000 Amount of critical disconnectors10%3200 Amount of critical disconnectors 735kV 3ph50%800 Amount of critical disconnectors 315kV and below 1ph7.5%2400 Amount of critical controls for disconnectors 735kV 3ph50%2400 Amount of critical controls for disconnectors 315kV and below 1ph 7.5%2400 Total amount of critical controls15%4800 Total amount of other important controls16.25%5200 Hypothetical Utility Savings EHT NTERNATIONAL I

4. Disconnect failure (location) Energy losses or outage MVA Duration Min./Max. Hours Losses $ 735kV -Line departure -Transformers -Bus bars -Breakers 1000/20005/24300k$ / 3M$ -Inductance 735kV -Inductance 315kV 150/300 150 5/48 50k$ / 1M$ 50k$ /,5M$ -Synchronise Compensation 6005/48200k$ / 2M$ -Static Compensation3005/48100k$ / 1M$ 315kV -Line departure -Transformers -Bus bars -Breakers 300/10005/48100k$ / 3M$ Evaluation Table: Losses due to Failures EHT NTERNATIONAL I

5. Disconnector failure (location) Energy losses or outage MVA Duration Min./Max. Hours Losses $ 230-120kV -Line departure -Transformers -Bus bars -Breakers 150/5005/4850k$ / 1,7M$ -Backup 315kV -Backup 230kV -Backup 120kV -Backup 69kV -Backup 25kV 500/1000 100/250 50/100 225/100 50/100 5/24 200k$ / 1,7M$ 30k$ /,4M$ 20K$ / 200K$ 10k$ / 165K$ 20k$ / 165k$ -Capacitor bank 315kV -Capacitor bank 230kV -Capacitor bank 120kV -Capacitor bank 25kV 300 100 50/100 5/10 5/48 100K$ / 1M$ 35k$ / 300k$ 20k$ / 300k$ 20k$ / 30k$ -Alternator25/3005/4810k$ / 1M$ Evaluation Table: Losses due to Failures (continued) EHT NTERNATIONAL I

6. N.B. The disconnect failure rate may vary between utilities. The ICOD’s predictive and real time monitoring will reduce failure rates by identifying incipient faults DescriptionsAmounts Critical disconnectors susceptible of failing every year 1%32 disconnectors Minor/Major mean costs per failure Minor100k$/yr Major1M$/yr Major failure/total failure 50% Total minor failures costs 3,2M$/yr Total major failures costs 16M$/yr % of reduction thanks to ICOD 50% Total gain per year 9.6M$/yr Financial Justifications – Failure and Energy Loss Reduction EHT NTERNATIONAL I

7. –20% of the annual substation maintenance costs is allocated to disconnects. –Using ICODs, the motorised disconnect maintenance becomes as follows: 1- ICOD supervision of operation, predictive and real time monitoring (70%) 2- Thermography (20%) 3- Visual inspection (10%) Financial Justification Reduced Maintenance DescriptionsAmounts Annual workload dedicated to disconnectors20 000 hrs/yr % allocated to motorised disconnectors (versus non motorised) 40% Annual workload for motorised disconnectors8000 hrs/yr % of reduction thanks to ICOD70% Total time reduction5600 hrs/yr Total reduction in $ (at 100$/hr)560 000$/yr EHT NTERNATIONAL I

8. Financial Justifications Reduction of the motorised DS mechanical failure rate DescriptionsAmounts Failure rate without ICOD1% Disconnectors failure rate reduction50% Failure rate with ICOD0.5% Replacement cost of parts50k$ Advantage due to mechanical failure reduction 800k$ Assuming 32 DS failures per year EHT NTERNATIONAL I

9. –In addition to the substantial benefits of predictive and real time monitoring, the cost of an ICOD control is less than or comparable to the refurbishing of a conventional control. –Refurbishing versus ICOD purchase comparison Description Conventional control mechanism costs DSC control mechanism DSV control mechanism Stocking and material handling of refurbished units (reception, expedition, etc.) 1000$ (1d x 1 person)0$ Disassembly (in the shop), recuperation, cleaning, tools 2000$ (2d x 1 person)1000$ Refurbishing3000$ (Material) 3000$ (3d x 1 person) 9000$ 4000 $ (cabinet) 11500$ 4000 $(cabinet) Project administration – management, building, vehicle, etc 2700$ (30% x 9000$)0$ Total≈ 12 000$≈ 14 000$≈ 15 500$ Financial Justifications Advantageous Replacement Costs EHT NTERNATIONAL I

10. –ICOD System: Allows early detection of the developing failures and reduces repairs Allows better scheduling and minimizes outages and transmission losses –Gains estimated due to a better scheduling: Greater than 100 000$/ yr –Gains estimated due to early detection: Greater than 60 000$ / yr Financial Justifications Reduction of detection and intervention time EHT NTERNATIONAL I

11.  For a 735kV grid (rates from CIGRE)  Failure rate of power transformers :  Without ICOD = 0.003 / yr  With ICOD = 0.0027 / yr  Failure rate of current transformers :  Without ICOD = 0.005 / yr  With ICOD = 0.00425 / yr  Economies for the utilities for a 30 years period (for 800 disconnectors) :  Power transformers : $27M  Current transformers : $13M Net gain : ~ 1.3M$/year Financial Justifications Advantages due to reduction of harmonics by 50% EHT NTERNATIONAL I

12. Financial Justification Minimum Annual Gain with a Conservative 1% Failure Rate DescriptionsDSCDSV Preventive maintenance time reduction$560 000,00 Energy losses reduction$9 600 000,00 Mechanical failure rate reduction$800 000,00 Just in time maintenance$100 000,00 Reduction by 20% of detection and intervention time $60 000,00 Reduced equipment and grid degradation by decreasing harmonics $0,00$1 300 000,00 EHT NTERNATIONAL I

13. Financial Justification Assumption of ICOD deployment DescriptionDSLDSCDSV 735kV Critical0 unit 2400 units 735kV Important0 unit2400 units0 unit 315kV (or less) Critical 0 unit2400 units0 unit 315kV (or less ) Important 2800 units0 unit Total2800 units4800 units2400 units EHT NTERNATIONAL I

14. Financial Justifications ICOD System Investment Conservative failure rate of 1% Investment: –2800 DSL units for 8 100 $ –4800 DSC units for 14 000 $ –2400 DSV units for 15 500 $ Total Investment127 080 000$ Total Annual Gain 22 820 000$ Payback : 5.6 years EHT NTERNATIONAL I

15. Thank You Energy HT International Inc. Quebec Canada www.energieht.com EHT NTERNATIONAL I