Variable Pricing for Power Plant Maintenance
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Solution Overview
Problem
Conventional service agreements for power plants with gas and steam turbines result in inequities and inefficient operation due to fixed pricing mechanisms that do not account for varying load levels, leading to economically detrimental outcomes for both customers and service providers.
Innovation Solution
A variable pricing method that calculates fees based on the output level of generating units, using a tiered pricing structure that aligns billing with hardware life consumption, reducing maintenance and service costs at part load levels and incentivizing more efficient plant operation.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If fixed pricing mechanisms are used in service agreements, then service providers receive guaranteed payments, but the pricing does not account for varying load levels resulting in inequities and inefficient operation
Solution Approach 1:
The patent applies dynamics by transitioning from fixed pricing to variable pricing mechanisms that dynamically adjust service provider compensation based on actual generating unit output levels. The pricing structure varies according to load levels (full load, part load, idle), creating a dynamic payment system that reflects actual operational conditions and aligns economic incentives with operational efficiency.
Solution Approach 2:
The patent changes the pricing parameter from a fixed value to a variable value that depends on operating parameters such as generating unit output level. By making the service fee dependent on actual production levels rather than maintaining a fixed rate, the system adapts pricing to match actual resource consumption and operational efficiency.
2Ease of manufacture
If conventional service agreements with fixed pricing are used, then service providers are compensated based on contract terms, but part load operation is counted inequitably favoring service providers
Solution Approach 1:
The patent inverts the conventional approach by making service provider compensation dependent on actual generating unit output rather than basing it solely on contract terms or time-based metrics. This inversion ensures that part load operations are compensated equitably based on actual production, eliminating the previous bias that favored service providers regardless of actual output levels.
Solution Approach 2:
The patent implements feedback mechanisms where actual generating unit output levels are monitored and used to adjust service provider payments. The system continuously measures actual production and provides feedback to the pricing calculation, ensuring that compensation reflects actual operational performance rather than relying on predetermined contract assumptions.
3Device complexity
If fixed pricing structures are used, then billing is simplified, but alignment with hardware life consumption is poor leading to economic detriment
Solution Approach 1:
The patent changes the billing parameter from a fixed simplified calculation to a variable calculation that incorporates actual generating unit output levels. While this increases calculation complexity, it achieves reliable economic alignment by making billing reflect actual hardware consumption and operational impact, ensuring both parties share economic risks and rewards appropriately.
Data Source
AI summary
A method relating to pricing under a contractual service agreement between a customer and a service provider, where the service provider provides maintenance services on a generating unit for a fee. An output of the generating unit is produced by a generator to which the generating unit is operably connected. The method comprising: determining a usage period for the generating unit; monitoring the output of the generating unit during the usage period and, therefrom, designating an output level for the generating unit for the usage period; calculating the fee for the usage period pursuant to a variable pricing plan, the variable pricing plan comprising a price for calculating the fee that varies depending on the designated output level of generating unit for the usage period; and billing the calculated fee to the customer.