Abstract
Maintaining high facility reliability in power plants is essential to secure long-term electricity supply. This paper applies the survival analysis to the actual unit level power generation data in Korea to estimate the relationship between facility reliability and the preventive maintenance. Duration of generators between forced outages is used to measure plant reliability. the empirical analysis shows that preventive maintenance cost, planned outage for maintenance, use rate, and reserve margin lead to the longer duration of generators and, in turn, the lower forced outage rates. We uncover that the marginal benefit of the preventive maintenance cost is decreasing at an increasing rate. It indicates that the marginal benefit of the “current” maintenance cost is minimal. Results in the paper imply that power plants in Korea might be spending unnecessarily high maintenance costs considering already having world’s lowest forced outage rates.