Peco distribution-transformer
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1. PECO has advantages for establishing transformer manufacturing due to existing facilities for motor and tower production, including machinery, equipment, technical manpower, and experience with utility companies. 2. The domestic market for distribution transformers is growing, with an estimated 10% of the market available for new manufacturers. PECO aims to capture this share. 3. PECO's investment in transformer manufacturing would pay back within 5 years due to price advantages from shared materials and facilities with its existing motor and tower units.
Peco distribution-transformer
- 2. BRIEF NOTE. Electrical transmission and distribution revolutionized with the invention of transformer. All Power generating units have to transmit and distribute power to the end user with the help of transformer. Distribution transformer is the main equipment for all utility companies, under WAPDA. AJK and KESC. Distribution Transformer demand will increase in Pakistan, Afghanistan and Iraq after war of terrorism. Major manufacturers in Pakistan will yield benefits, if they prepare themselves now for future business. PECO is only company in Pakistan who can yield Maximum benefit through its Transformer and Tower packages. Now is the time for PECO to establish and over come problems by 2010. PECO investment Pay Back is with in 5 years for this business due to the following advantages. Familiar with Wapda/Kesc utility companies due to tower business Technical manpower available Machinery and Equipment available due to similar work Material similarity will increase price advantage in quatitative purchase. Testing equipment/instrument similarity for Motor andTransformer Civil work will be minimum due to existing premises availability
- 3. CONSULTANCY SERVICES FOR PROJECT EXECUTION P.E.C.O. TRANSFORMER MANUFACTURING UNIT. Objectives: To initiate and provide all necessary technical expertise for establishment of electrical equipment manufacturing capabilities within the existing setup. The work shall be undertaken in phases: Phase1: Manufacturing of distribution transformers for the utility companies having requirement of upto 630 KVA for WAPDA, upto 1500 KVA for K.E.S.C. and for private sector having requirement upto 4000//KVA Transformers. Phase2: Manufacturing of pad mounted transformers for WAPDA, and Private housing societies, Kiosk (package ) substation and transformers for foreign markets (export) Phase3: Induction of other equipment in production line like : 11KV and LV instrument transformers Medium Voltage switchgear Low Voltage switchgear Medium Voltage Bus ways EHV instrument transformers Industrial battery chargers MV and EHV line hardware Phase4: Joint venture with international Known manufacturer for design supports. Capabilities of Consultants are competent and capable of handling the project from the consultants: conception until completion. They have in house expertise, graduate engineers having over 30 years of working experience with renowned manufacturer of similar equipment. Services shall be provided from Consultant’s offices and full time engagement of the one expert at works
- 4. Technical: Provide design, manufacturing drawings and drawings for wapda approval for 25, 50, 100, and 200 KVA transformer. (It is anticipated that by the time these rating come in regular production, in house capability will be developed for the designing of transformers. Consultant’s services shall however be available in case design/drawing of more rating are required,), Compilation of all formalities for pre- qualification with WAPDA. KESC and other public sector organization. Arrange and monitor type testing of transformer in Rawat HV lab and obtain prototype approval from wapda. Material Supply Chain Management : Make effective material supply chain system to ensure delivery in time, of quality and quantity to ensure timely completion of orders and quick rolling of available funds. Identify vendors for locally made components and locally available materials. Keep track of quality requirement with vendors . Monitor Procurement of imported material in quantities matching the production fore cast Marketing: Organize and train personnel for aggressive marketing both in public and private sector and for export.
- 5. 1. Basic Construction of Distribution Transformer, Almost same from all manufacturers. 2. PECO has advantage due to similar manufacturing units i.e. Motor & Tower, which will share materials and quantitative price benefit will be the Key for success.
- 6. Market Analysis PECO manufacturing unit for Distribution Transformer will be capable of production as per WAPDA, K.E.S.C and Export orders. Also PECO design office will be capable of designing transformers to customer’s specifications. In fact the production capabilities of PECO will be superior in many respects from others. But the future expansion and justification for higher share will depend on performance of “Just–in-Time” (JIT) supply. ISO 9000 Quality Management Certification is also to be the top priority after Commissioning and production start-up. Engineering design section and test laboratory will be the key for success in this product. Apart from WAPDA and KESC, the private sector industry, Builders and mega projects are the real source of profitable business. Future expansion in the following products will increase the profitability and market share. 1. Special transformers. A) Dry type transformer B) Traction Transformer 2. Furnace Transformers 3. Energy efficient Transformers 4. 11 KV current and Potential Transformers 5. EHV (Extra High Voltage) Current Transformers 6. Load Breaker Switches
- 7. 1. Analysis of Distribution of Transformer, Present Share and future Potential: These are established shares of local manufacturers in WAPDA /KESC business and private sector. Sr. Company Present Share Future Potential No. 1. SIEMENS 28% Siemens have capacity to take 40% share in WAPDA 2. PEL 28% PEL have enhanced their manufacturing capabilities by adding latest machinery and facilities at new site on Feroz Pur Road Lahore. 3. Transfo Power 14% They have got maximum share, which they can produce 4. ELEMETEC 10% They have potential to go up to 15% 5 Transfab 2.5% They will remain same in near future 6. Hammad 4% They will remain same in near future 7. Syed Bhais 2.5% They will demand more share next year after proto type approvals up to 10% 8. Pan Power 2.5% They will remain with in 2 – 3% 9. A .B. Ampere 2.5% They will remain with in 2 – 3% 10. ACE Indigo 2.5% They will remain with in 2 – 3% 11. Climax 2.0% They are in problem and fading out 12 MML 1.5% They can take up to 5% 13 Johnson & Phillips 1.0% They are out of WAPDA business and no chance to be in near future - Siemens & PEL are enjoying this business share. - Transfo power is at its maximum share - Elmetec is at its peak . - Short fall is seen in delivery from smaller participant due to financial/manufacturing limitations Siemens 28% PEL 28% Transfopower 14% ELEMETEC 10% Other 10% Available for new Comers 10% Slice 7 0%
- 8. Local Manufacturer's Production in Last Three Year as Per PEMA Assessments Sr. Company Present Share Production in Nos. No. 2005 2006 2007 1. Siemens 28% 43,800 26,000 23,200 2. PEL 28% 33,000 19,500 17,400 3. Transfo Power 14% 16,500 9,750 8,700 4. Elmetec 10% 7,000 3,900 3,480 5. Transfab 2.50% 3,500 1,950 1,740 6. Hammad 4.00% 2,400 1,300 1,160 7. Syed Bhais 2.50% - - 380 8. A. B. Ampere 2.50% - - 300 9. ACE Indigo 2.50% - - 450 10. Climax 2.00% 1,400 1,000 500 11. MML 1.50% 1,200 800 400 12. Johnson & Phillips 1.50% 1,200 600 300
- 9. siemens 43800 PEL 33000 Transfo power 16500 Elmeter 7000 Others 2400 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 Production No.s (2005) siemens PEL Transfo power Elmeter Others Companies Local Manufacturer's Production in Last Three Year as Per PEMA Assessments
- 10. Domestic Customers: WAPDA / Utility Companies under WAPDA: Their standard ratings are 10,15,25,50,100,200,400 and 630 KVA and for pad mounted transformers 100,200 and 300 KVA . Karachi Electric Supply Company (KESC): Their standard ratings are 250, 500, 1000, 1500 KVA. KESC also purchases transformers of WAPDA ratings. AJK Electricity Department: AJK purchases transformers of WAPDA ratings up to 200 KVA Gilgit and Northern Areas (Works Department) They purchase transformers according to WAPDA ratings. They have also requirements of small step up transformers. Private Housing Societies: These Societies purchase Pole Mounted and Pad Mounted Transformers as per WAPDA ratings. Private Industrial Customers: They purchase transformers non WAPDA ratings, generally 300, 500, 750, 1000, 1250, 1500, 2000, 2500 and 4000 KVA. Steel furnaces have demand of Furnace transformers as well . Some other Government and semi government departments and autonomous bodies have occasional requirements like Atomic Energy Commission, WASA, PTCL, Railways etc . Export Potential: SIEMENS and PEL have been and are exporting Distribution Transformers to Middle East. There is still Export Potentials for Countries like Afghanistan, Bangladesh, Kuwait, Iraq , East Africa
- 11. Projection WAPDA Orders Year 2008-09 25 KVA Rs, 120,000 total quantity 50KVA Rs, 170,000 40,000 Nos. 100KVA Rs, 261,000 200KVA RS, 403,000 Yearwise Wapda ordersYearwise Wapda orders Year Transformer Rating 25 KVA 50KVA 100KVA 200KVA Total QTY PURCHASE PRICE IN Rs. QUANTITY IN Nos. 2005-06 54,000 74,000 117,600 176,500 70,000 2006-07 93,000 131,000 209,500 322,000 35,000 2007-08 86,000 121,000 194,000 299,000 40,000
- 12. MACHINERY REQUIRMENT FOR PECO PLANT PECO has advantage of being in fabrication of Transmission Towers and motor manufacturing therefore have most of the machinery. How ever we are enlisting minimum requirement and suggested requirement for prequalification in WAPDA and efficient manufacturing at PECO Sr. No. Machinery Min. Reqd. WAPDA Approval Suggestion For Producing 300/ 350 Transformer Month Machinery Available with PECO 1. Machine Shop Central Lath Machine 3’, 5’, 8’, 10’, 12’ 5 10 Available Milling Machine 1 3 – do – Chuck Head Lathe 1 2 – do – Tool Grinder 1 3 – do – Shaper Machine 1 3 – do – Table Drill Machine 2 3 – do – 2. Tank Shop Iron worker 40T 1 1 Available Tube cutting machine 1 2 – do – Tube bending machine 2 3 – do – Notching machine 1 1 – do –(Heavy duty). Radial drilling machine 1 2 – do – Shearing machine 3’ 1 1 – do – Shearing machine 10’ 1 1 – do – Tank rolling machine 1 2 – do – Hydraulic tank body sizing machine 1 2 – do –
- 13. Sr. No. Machinery Min. Reqd. WAPDA Approval Suggestion For Producing 300/ 350 Transformer Month Machinery Available with PECO Body sizing jigs 1 Set for each Rating Tank Frame Bending Machine 1 2 Available Welding Plants 8 12 – do – Power Press 15 – 40 Tons With Dies 6 10 – do – Vertical Drilling Machine 3 5 – do – Portable Drilling Machine 2 4 – do – Tool Grinder 2 2 – do – 1. Shot Blasting and Paint Shop: Shot Blasting Machine 1 Available Compressor 2 – do – 2. Core Shop: Multiple Cutter Core Slitting Machine 1 2 Single Cutter Core Slitting Machine 1 2 Power Press With Dies. 6 12 Available Cutter For Slitting Machine 12 sets, 24 sets, Blade Grinder 1 2 Available 3. Insulation Shop: Manual Paper Cutter 1 2 Available Press Pahn Paper Cutter 1 2 – do –
- 14. Sr. No. Machinery Min. Reqd. WAPDA Approval Suggestion For Producing 300/ 350 Transformer Month Machinery Available with PECO Press Pahn Paper Winder 1 2 Power Press For Oil Ducts 1 2 Available Ring Cutter 1 2 Manual Press For L-Rings 1 2 Available 1. Winding Shop L.T Winding Machine Large 1 2 L.T Winding Machine Medium 2 4 H.T Winding Machine 6 10 Varnish Treatment Of Coils 1 3 Available Oven For Coil Drying Medium) 1 2 – do – Butt Welding Machine 1 2 2. Carpentry Shop Band Saw 1 2 Available Wood Planner 1 2 – do – Table band saw machine 1 2 – do – Tool Grinder 1 2 – do – 3. Assembly Shop Core Stacking Jigs 2 Sets For Each Rating
- 15. Sr. No. Machinery Min. Reqd. WAPDA Approval Suggestion For Producing 300/ 350 Transformer Month Machinery Available with PECO Induced Voltage MG-Set 1 Regulating Transformer 1 Silicon Steel Losses Meter 1 Regulating Transformer 1 Silicon Steel Losses Meter 1 Paint Thickness Meter 1 Tank Pressure Tester (Leakages) 1 Dielectric Test Sets 1 Flash Point Tester 1 Viscosity Meter 1 Acidicity Test Equipment 1 Set Pour Point – Testing Equip. 1 Weighing Scale 1 1. Store Steel Racks To Properly Store Materials And Tools 2. Other Facilities Over Head Cranes (5 Tons) 1 3 Transformer Tanks Testing System Small. 1 2 Transformer Tanks Testing System Large 1 1 HPT Trolley 6 10 Fork Lifter 1 2 Available
- 16. Sr. No. Machinery Min. Reqd. WAPDA Approval Suggestion For Producing 300/ 350 Transformer Month Machinery Available with PECO Transformer Oil Storage Tank 2 3 Oil Filtration Plant For Used Oil Stand By Generator 200 KVA Centralized Compressor Large Weighing Scale 1000 kg Computer, Printer Photo Copier, (For Store And Testing Lab). Rubber Hammers 3. Factory Tools Scissors 9”, 12” Available Rubber Hammers Wooden Hammers Nose pliers. Available Wire cutter – do – Hammer 100g – 1kg Available Ring spanner sets Screw wrenches. Available Screw Drivers. – do – Key spanners – do – Vanier calipers – do – Micro meter – do –
- 17. Sr. N o. Machinery Min. Reqd. WAPDA Approval Suggestion For Producing 300/ 350 Transformer Month Machinery Available with PECO Drill machine with drills – do – Steel measuring tapes – do – Insides calipers – do – Steel rulers – do – Smooth files – do – Half round files – do – Angle scales – do – Portable disc grinders – do – Hole punch – do – Pipe wrench – do – Cable knife – do – Vice – do – Copper strip cutter C Clamp Center punch Available Hand tape sets with handle Chisel for wood work Chisel for steel work Available Hack saw with blades – do – Paint brushes Spray guns Available Wood saw – do – Tip cutter
- 18. MATERIAL RATES Copper : Rs. 800 / kg Silicon Steel : Rs. 420 / kg Oil : Rs. 143 / kg Mild Steel : Rs. 90 / kg Which gives material cost as under: KVA copper S.S M.S Oil Total 25 32,000 33,600 9,000 10,585 85,185 50 464,00 48,720 13,050 15,515 123,685 100 71,200 74,760 20,070 23,780 189,810 200 109,600 115,080 30870 36,395 291,945 400 231,200 243,180 65,160 77,140 616,680 630 336,800 354,060 94,860 112,085 897,805 Generally Material Cost is 70% of the selling price of a transformer. Based on this selling prices should be: 25KVA : Rs. 121,692 50 KVA : Rs. 176,692 100 KVA : Rs. 271,157 200 KVA : Rs. 417,064 400 KVA : Rs. 880,971 630 KVA : Rs, 1,282,578 Note : These Selling Prices should yield minimum 10% Profit.
- 19. Tanks Core Clamp Core Steel L.V. Coil H.V .Coill Fabrication Fabrication Sitting & Cutting Winding Winding Short Core Building Varnishing Blasting & Clamping De-Rusting Assy. of L.V. Coil on Core Assy. of H.V. Coil on Core Preliminary Ratio & Inside testing Painting Complete Internal Assy. Inspection Tanking & Oil Filling Bushing Connection Testing Final Painting & Finishing Customer Inspection Delivery Manufacturing Flow Diagram
- 20. Capital Investment: 1. Cost of development of manufacturing facilities: Civil work: Buildings and Structures (new or modification), floors, trucking pathways, foundations for machines. Mechanical works: Overhead cranes, steel structures or shed as required. Electrical Works: Electrification, lighting, connections to machines. Utilities: Electrical power, 400-500 Amps load of fully equipped and operational Facilities, gas, water. 2. Cost of machinery, available in house, shifting, cleaning, making good for work if lying idle. 3. Cost of new machinery, plants, equipments, tools, instruments, jigs, fixtures. Their installation and commissioning . 4. Initial Consultancy fee 5. All incidental or contingency expenses to be made for assets and facilities of permanent nature The Major Portion of anticipated capital cost will be required and utilized during the first six month as concentration during the last six months of twelve months period shall be on production of prototypes and prequalification with WAPDA.
- 21. SUMMARY OF TOTAL ESTIMATE FOR PECO MANUFACTURING UNIT Machinery Local Rs, 1,75,00,000/= (Most of them are available in PECO.) Machinery and testing Rs, 2,50,00,000,/= These are testing equipment Equipment (Import) and basic Wapda Requirement for prequalification. Local Installation Utilities etc. Rs. 17,00,000/= Labor, civil work, oven & tanks. Rs. 50,00,000 Capital Coat Investment TOTAL Rs. 4,92,00,000
- 22. Running Expenses: These expenses are to be worked out in 3 steps. Running expenses during the first 12 months (1st year), during the next 12 months ( 2nd year) and for 5 next years. 7 years period should be kept for the total return of capital investment as well. First year is for establishing the facilities, staff and workers training and familiarization with the place and importance of work. Second year will be for consolidation and preparation to takeoff. Third year on ward, the company should stand by the leading manufacturers of transformer Running expenses during the 1st two years need to be carefully calculated, preferably for every month and then added for the year. From 3rd year onward, these will be pretty smooth except for the material cost . Running expenses during the 1st 12 months shall include: 1. Salaries for assigned staff / workers, temporary or permanent. 2. utilities: water, electricity, gas. 3. Transportation, communication. 4. Cost of materials for prototypes 25-200 KVA. 5. Testing fee, retesting if required. WAPDA related fees and cost. 6. Consumable Material. 7. Contingency expenses like entertainment, public relations costs (rather WAPDA relations), pre-qualification visits expenses. 8. Material for educational orders (which will be recovered from the sales) Income during this time will be from execution of educational orders. Running expenses during 12-24 months period It is anticipated that factory will be in regular production. If expenses are maintained to achieve break even In these 12 months, it will be a big achievement as orders will be less and cost to get the orders will be more. Workers and staff strength shall still be growing during this period. Material requirement shall be based on quantity anticipated for break even, with funds rolling of minimum thrice in the year. Financial charges as expenses are needed to be added accordingly. Cost to be shared with the other productive units of the company needs to be carefully taken care of in the feasibility as it will have impact on profitability.
- 23. Profitability Total weight of transformers are: 25KVA 285 kg 50 KVA 415kg 100 KVA 638kg 200 KVA 980kg 400 KVA 20698kg 630 KVA 31010kg Generally the material used has the following percentage: Copper, brass : 14% of the total weight Silicon Steel : 28% Oil : 23% Mild Steel etc: : 35% Hence material used shall be: KVA copper Silicon Steel Mild Steel Oil Kg Kg Kg Kg (Lit) 25 40 80 100 65 (73) 50 58 116 145 96 (107) 100 89 178 223 ` 147 (164) 200 137 274 343 225 (251) 400 289 579 724 476 (532) 630 421 843 1054 692 (773)
- 24. Profitability based on above: For regular production of 100 Transformer of 100KVA (or equivalent ) per month during the first year of regular operation, after approval of prototype, means ; Material to be consumed during the year : 100 x 189.810 x 12 = 227,772,000. based on above selling prices, selling income should be 100 x 271,157 x 12 = 325,388,400 and 5% gross profit during the first year of operation will be : Rs. 1,62,69,442
- 25. Five year production plan and running costs Below mentioned ratting and quantities have been considered for calculation of material cost. YEAR 25 KVA 50 KVA 100KVA 200 KVA First year 15 15 15 15 2nd year 150 150 150 150 3rd year 300 300 300 300 4th year 450 450 450 450 5th year 500 500 500 500
- 26. Production of Transformers can also be expressed in terms of KVA. YEAR Production KVA / year Production KVA / month First year 5625 469 2nd year 56250 4688 3rd year 112500 9375 4th year 168750 14063 5th year 187500 15625
- 27. Summary:Five Year Projections Category Key detail year 1 year 2 year 3 year 4 year 5 Over head Staff and workers salaries, utilities, all non production expenses. 5.45 18.6 25.4 25.5 25.5 Consultancy fee & expanses Design / drawing s of 25,50,100 & 200 KVA, prototype approvals. Complete technical, organization, procedural support. 4.5 3.6 2.4 1.2 1.2 Materials For production including consumables 10 117 257.4 424.71 519 Total Cost of production & selling 19.95 139.2 285.2 451.4 545.2 Sale value of production 14.8 150 330 544.5 665.5 Net Profit & Loss 5.15 10.8 44.8 93.1 119.8 Pay back with in 5 years .
- 28. Note: 1. The following sales values have been taken: 25KVA: Rs. 121,692 50 KVA: Rs. 176,692 100 KVA: Rs. 271,157 200 KVA: Rs. 417,064 2. sales values are increased 10% each year. 3. Overheads shall remain more or less constant during the last three years 4. Increased production will result in increased profitability. 5. Accurate estimates of material requirements, timely order in bulk quantities shall result in reduction in material costs hence increase in profitability.