Pretty much everything has been said, I'm going to repeat it anyway and add what I know about power plants, even though nobody asked for it
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The red "104%" tells you that, with hardpoints deployed, all of your modules will consume 104% of your power plant's capacity - it has only an indirect connection to your ship's heat. As this is not possible, your ship will shut down modules until the power draw drops to 100% or below. To do so, it uses your power priorities. Modules that are assigned the
highest biggest priority number are shut down first, then the next lower group and so on.
The result is, when you go over power (either because your power plant capacity is too low, or because your power plant is at 0% and/or malfunctions) and you didn't set your power priorities, your whole ship shuts down and you're dead in the water. In general, you want a power plant that provides enough power for all of your modules. This isn't always possible, or you can choose to bring a smaller power plant for various reasons (mostly weight saving / jump range).
The heat buildup of your ship depends on your power plant's power efficiency and the power your modules draw as well as their thermal load. You can change the power efficiency by either choosing a different power plant, or with engineering. The heat efficiency depends on the rating of the power plant - the A, B, C, D, E part of the designation. A-rated power plants are the most efficient (with an efficiency of 0.4), E-rated plants run the hottest (1.0). The class of the plant (3, 4, 5...) does not matter for heat; as long as the plant can power the modules, it does not matter if you are using a 5A, 6A or 7A plant. The game doesn't know the concept of "headroom". The only things (power wise) that matter for heat generation are the efficiency of the plant and the power draw of your modules. In other words: It doesn't matter if your modules draw 50% or 95% of your plant's capacity, the heat is the same.
If you plan to save weight on your power plant (for an exploration or jumper vessel for example), it is always the better choice to use a lower class A-rated plant than choosing a lighter plant within the class. Example: A 6A plant has a mass of 20 t and provides 25.2 MW of power. Your ship only needs 18 MW, and you want to save weight to jump further. Now you could use a 6D plant that has a mass of 16 t and provides 18.9 MW of power; but it has a terrible heat efficiency of 0.75. Instead, you could go down one class and use a 5A plant. Not only is its mass lower than the 6D (the 5A has a mass of only 10 t), it also provides more power (20.4 MW) and has a better heat efficiency (0.4). The downside is of course that the 5A plant is an order of magnitude more expensive than the 6D (4 million vs. 400k), which will not only be reflected in your wallet, but also your rebuy. But if money is no issue, always choose an A-rated plant.
As for power priorities: Everybody does it a little differently. Your goal is to keep your plant from shutting down vital modules in case you go over power, your plant is damaged or it malfunctions. When its integrity goes below 80% (I think?), your power plant can malfunction, and its output drops to 40% for a period of time. If your plant's integrity is at 0%, its output drops to 50% permanently. To be still able to move and possibly escape, your goal is to at least keep your thrusters and FSD working even at the lowest output of your power plant.
I do it this way:
- 5: here I put things I don't need in normal space and with weapons deployed - fuel scoops, vehicle hangars, FSD boosters. Stuff I don't mind being shut off when I deploy my hardpoints.
- 4: I put everything shield related on 4, i.e. the generator and shield boosters. My reasoning is that for my power plant to get damaged, my shields need to be down. At that point I am in trouble already, so there is no need to put shields on a lower priority number.
- 3: group 3 is everything I need when flying in normal space and/or deploying hardpoints, i.e. weapons, scanners, limpets controllers, mining gear, and so on.
- 1 and 2: I put all core modules on 1 and 2. 1 is usually only the thrusters and the FSD, and group 1 should consume less than 40% of the plant's power capacity. the rest of the core modules (sensors, PD, life support) go to 2.
You can use power priorities to your advantage to undersize your power plant. I do that on my exploration ships for example; I don't account for AFMUs in my power budget, put them on 1 and turn them off until I need them. If I need the AFMU, I turn it on, and either group 5 gets shut down automatically (I don't need a fuel scoop while repairing) if I am repairing in space, or the thrusters are turned of anyway when I am landed.
If you want to play around with how all that works, go and play with
EDSY.
Here is one of my builds where you can see how I manage power with the priorities. In the TTL (Totals and Capacities) box at the bottom left you can see that the ship uses 103.8% power capacity, and that group 5 is red in the lower line (this represents the power usage with hardpoints deployed). When I deploy weapons, group 5 is shut off, because I don't need the fuel scoop and the hangar when I am fighting. As for the colors: Blue means usage of the group is below 40%, green is below 50%, orange is between 50 and 100% and red is over 100%.
That's probably much, much more than you wanted to know. Sorry
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