Weekly News 14 June 2013 Alstom GT26 gas turbine can run on shale gas Alstom’s GT26 gas turbine can already handle shale gas and other variable fuels as internal calculations show that shale gas and LNG will be within the company’s hydrogen gas experience range. “We have prepared for extreme cases of shale gas with lots of C2+ and we may handle 16-18 percent and go up to even 20 percent C2+,” Dr. Klaus Knapp, group head, combustor operations and emissions with Alstom told this week’s VGB Congress in Friedrichshafen, Germany. n Algeria, Alstom has proven the C2+ variation capacity of about 300 MW. tolerance of its turbine by running the combustion Knapp outlined that particularly in chambers with 15 percent C2+. A hydrogen con- conjunction with shale gas the variants Itent of up to 15 percent volume can be handled by of gas quality are bound to increase and Alstom’s GT26 turbines, according to Knapp. “Even if customer demands to switch between we add hydrogen to gas not much happens to the gas types have to be considered.“We see Wobbe Index, even at 100 percent hydrogen,“ he said, today that the hydrogen discussion is explaining “Hydrogen and natural gas show similar coming up and we can expect that hy- Wobbe Index values and so jet penetration, mixing drogen will be added to gas locally that Fully bladed GT26 at Alstom's Birr rotor factory and pressure drop are similar.” the user or in the pipeline grid,” he said. Hydrogen in natural gas increases the reactivity of Handling variable fuel types the flame and tends to ‘flash back’ or create a flame AGENDA with upgraded GT26 flare within the combustion chamber. “We can handle the situation as far as NOx is con- Such flash backs can cause emissions increases, he POLICY & REGULATION cerned,” Knapp said pointing to experience gained by said. “If flame flashes back into the burner, it does not E.on UK chief concerned the company with handling Wobbe Index fluctuation necessarily cause damage, but leads to a NOX and emis- about cost implications of plus or minus 15 percent . sions increase. If I am careful I can adjust the flame, of EMR “The gas composition must be known in order opti- but then I have the risk of losing the flame,” he said. 3 mise the system. If we have NOX emissions of 15ppm, the composition must be known. For hydrogen it will Clients for GT26 in Algeria, MARKETS have to be developed. Be it LNG or be it hydrogen ad- Spain and Thailand New generators help dition, I would say we are prepared for this.” Alstom’s fleet of gas turbines and equipment is al- California meet Alstom has stepped up R&D efforts to prepare han- ready used with a wide range of gas compositions. It summer challenges to dling future increases in variable LNG with its GT26 has supplied GT26 gas turbine to clients in Thailand, supply security gas turbine combustion systems. It is already meeting Algeria, and Spain with variable gas compositions. 4 customer demands by supplying turbines capable of The fleet includes machines that use diluted gas with Egypt’s cement produc- switching to variable fuel types and compositions sim- high nitrogen, engines that operate blast furnace gas, tion drops 20% on gas ilar to shale gas with its GT26 gas turbine which has a and also syngas from heavy oil and gasification.  and power shortage 6

RWE optimises GT fleet maintenance Italy’s market share of gas forecast to drop to cope with reduced run-time hours 11.7% by 2020 – OIES RWE has saved tens of millions by renegotiating gas turbine maintenance with 7 OEMs, Bruno Schroeder, head of plant engineering and plant maintenance, fleet manager of gas turbines for RWE Group, said at the VGB Congress this week. PROJECTS & FINANCE “We appointed fleet managers last year who do not have direct line responsibility Siemens SGT 750 for maintenance but who are in charge of identifying maintenance options and reduces NOX to implementing programmes,” he said. single digits peaking to an audience of close to 200 has caused challenges for firmly contracted 9 delegates at the annual congress in maintenance works. The operator is locked into Financing setbacks Friedrichshafen, Germany, Schroeder inflexible maintenance contracts, which do not delay Pennsylvania revealed that the unanticipated decrease in adapt into reduced runtime hours, and this weighs CCPP project S 10 gas-fired production throughout Europe last year heavy on profits. continued on page 2 2  TECHNOLOGY & INNOVATION GTP Journal 14 June 2013 continued from page 1 ing losses,” he said. times when we started Monday morning and The current mar- stopped Friday evening. Today we are talking ket environment about a situation where we have short operat- fosters trends to ing times so we have two peaks a day; one in make contracts morning and one in afternoon.” more flexible, extend the terms Challenge set and duration, for manufacturers and account for Faster, larger machines are, from RWE’s per- internal service spective, no longer the answer as now the mar- organisations. ket determines the need for the turbines. “The Service contracts value of these machines changes constantly; will in the future this is the main problem,” according to have to be cus- Schroeder. When operators think about new gas tomer-or project-tai- turbine projects they need to think about new RWE npower's Pembroke Power Station in Wales lored: Long term, gas turbine projects whereby they need to inten- “The challenge is that we do not get the but flexible enough to account for changes in sify talks with OEMs to make clear what they money and we do not earn the money so the use, according to RWE Group. consider the drivers of demand in the future. gas turbines and gas and steam plants must be Another result of RWE’s very intensive ex- “Machines must be shorter in starting and utilized accordingly,” says Schroeder. amination of its power plant fleets is the opti- stopping and we require operational flexibility RWE Generation has about 50,000MW misation of its spare parts strategy. “In this and higher load points and it means fuel flexibil- generation capacity in Germany, UK and case we already achieved results especially in ity and response to what customers think, and it Netherlands, and Turkey. Its fleet includes large fleets, a double digit million sum, where also means flexibility in terms of machine Alstom, Rolls Royce, and Hitachi turbines. we said it’s good to know the other party has it dimensions, and with maintenance,” he said. then we don’t have to buy it,” he said. OEMs need smaller, more flexible machines More flexibility added The total costs of the contract can also be with higher load points and part-load flexibil- to maintenance contract reduced by defining the scope of maintenance ity, while maintenance contacts have to adapt RWE Group negotiated intensively with OEMs for a specific project’s operating regime. to reduced turbine operating hours and variable to find a mutual solution for maintenance dur- “Every machine must be regarded as different,” for demand for maintenance services. ing slow production schedules. “For the large Schroeder stressed, “If you know the machine “Very often our load distributors ask if we fleets, Alstom, GE and Siemens has appointed is a peak machine it does not make sense to can perform in inspections earlier than usual, fleet managers and already described tasks. We have a full service concept.” so this requires shorter delivery times of mate- look at fleets and we see if there are synergies rials and supplies; no capital investment on the in maintenance and who does the better job. Renewables eat into runtimes, one hand and no maintenance cost on the other, “We also talk to the OEMs who are our profit margins of fossil plants he said, adding “This requirement profile service partners in most cases. You must be The planned increase in renewables, specifi- means lower CAPEX, unit sizes matching out- open, so documents have to be disclosed,” cally wind power and photovoltaic in the come requirements, lower emissions. There is Schroeder underlined. German market, will require increased load no single machine that is capable of all this.”  He cautioned that a typical win-win situa- compensation by gas tur- tion would not always be easy to achieve. “You bines and steam plants understand it as a win, but it is rather optimis- capable of producing 50GW at short notice by Gas to Power Journal 2020, up from 30GW in Publisher Stuart Fryer 2009, despite low whole- Editor sale prices for this energy. Anja Karl Short operating times Tel: +44 (0)207 0173417 [email protected] present operators with Reporters more stringent budgets. Cristina Brooks Michal Zuk “We are talking about peak Tel: +44 (0)207 0173402 and if we are lucky this Advertising peak may be high enough Narges Jodeyri Tel: +44 (0)207 2533406 so that we earn some [email protected] Euros with our power,” Events Natasha Wedlock he said. “We need in the Tel: +44 (0)207 173410 future more gas turbine [email protected] power but we can’t see if Subscriptions Stephan M. Venter this continues that we will Tel: +44 (0)207 0173407 ever earn the money to pay [email protected] Production for these turbines.” Vivian Chee “Formerly we started Tel: +44 (0) 20 8995 5540 [email protected] once a day. There were RWE npower's Aylesford cogen plant 14 June 2013 GTP Unlimited REGULATION & POLICY  3 “Cost implications of EMR need to be more transparent”– E.on UK chief

Criticising the UK government's slow delivery of introduction capacity payments as part of a wider Electricity Market Reform (EMR), Tony Cocker, chief executive of E.on UK said "there needs to be greater transparency in discussion about the costs and implications of energy policy decisions."

eading a debate on the delivery of schemes in Britain, suggesting "smart meters liver needs to be debated." Britain's energy policy at the Oxford provide big opportunities for customer behav- Though admitting there is a need to LUniversity, he emphasised that the UK ioural change". invest in energy efficiency, the E.on UK consumer is at present "not only paying Adding to the debate, James Cameron, CEO CEO opposed the government's efficiency for power provision but also Climate Change Capital, cautioned that achiev- schemes such as the Eco-and Green Deal, the subsidy the Treasury pays ing capital investment in new-build power gen- forecasting these schemes "are likely to cost the power sector". eration capacity "is not without its difficulties, the country some £2 billion with unfortunate Apart from investing in particularly as the UK has had 20 different en- consequences". new power generation capac- ergy ministers in the last 15 years". He criti- He also discarded the carbon price as "just a ity, Cocker called on the in- cised there has been a tendency by the industry tax to subsidise old nuclear power stations". Tony Cocker dustry to focus on the to talk about its parts and not about the whole This stance surprised parts of the audience potential of demand-response system, warning "the question of how the in- as it comes from the CEO of a company which mechanisms. He called on policy makers to en- dustry is going to attract the requisite scale of recently withdrew from Britain's nuclear courage more distributed heat and power finance and whether it has the capacity to de- programme.  Unabated coal plants close faster than anticipated

What surprises forecasters at National Grid "is the segment of unabated coal generation, which has seen many coal plants close earlier than expected as they have already used up their allotted runtime hours," said Chris Train, Operations Director at National Grid. The British power transmission system operator had come up with three 2012 UK Energy Scenarios to evaluate the pathways towards meeting the country’s renewable integration and carbon reduction targets.

n the face of many uncertainties such as the pects Britain to meet it renewable energy target arrival of on-going Electricity Market Reform future level of economic growth, the decar- for 2020 not substantially earlier than in 2025, (EMR) whereby Train asserted "that the Ibonisation of the power sector, the imple- the ambitious 'Accelerated Growth' scenario reforms need to deliver to timetable" to create mentation of new regulation on capacity envisions greater low carbon generation, in- certainty for investors in order to encourage markets, decision makers at National Grid need cluding renewables, nuclear and fossil plants sufficient forthcoming new-build to be added to ensure that the day-to-day availability of sta- retrofitted with carbon capture and storage, to the network. In investors' calculations ble power supply, he said speaking at Oxford coupled with greater energy efficiency meas- "delivering the new power plant is more a University's UK Energy Policy Day. ures and electrification of heat and transport. question of getting the right strike price plus This development has exacerbated the ur- the cost of pylons." as Train put it. gency for UK energy industry to move forward ‘Going Green’ scenario For Britain's future energy market, he fore- with planned fossil new-builds, he said stress- increasingly unlikely casts, there will be more active demand from ing "There is no room for complacency in the He cautioned, however, that "due to economic consumers, improved interconnection, with not generating margins, since they are very tight." uncertainties, the 'Going Green' scenario is in- only wind farms in the North of Scotland, but National Grid has come up with three "2012 creasingly unlikely." Indeed, he acknowledged, with the rest of our neighbours. UK Energy Scenarios" – named 'Slow Progres- "only 15% of stakeholders surveyed by The real dilemma for the grid planners, sion', 'Going Green' and 'Accelerating Growth' National Grid believed that the 2020 targets particularly given the rising share of intermit- - which paint three possible pictures for the will be met". tent power supply, is "how do we encourage future of the UK's power sector up to 2050. The big elephant in the room, for both and restrict demand at the appropriate times," While the 'Slow Progression' scenario ex- National Grid and the UK power sector, is the he concluded. 

Industrial Application of Gas Turbines Committee The IAGT Committee Symposium and Conference, October 2013, Banff, Alberta 4  MARKETS GTP Journal 14 June 2013 New generators help California meet summer challenges to supply security A combination of adding new fossil power generation capacity and upgrading the power grids and substations will help California's Independent System Operator (CASIO) meet peak electric demand this summer.

AISO, the grid operator for most an additional 891 MW Transmission updates allow new, distant generators to supply Southern California of the state, is facing supply con- slated to come online straints heading into the summer by June 1, 2013. The Cpeak demand season, largely due two off-line SONGS to prolonged outage of the two units at the San units, in comparison, Onofre Nuclear Generating Station (SONGS), total 2,246 MW. which have been offline since January 2012. "This new capacity "Replacing the lost power supply from a will help make up for low-cost source of generation like SONGS the loss of the genera- already has changed wholesale electricity tion from SONGS, but prices in the state, analysts from the US Energy the reliability issue is Information Administration commented, for- more complicated than casting "Rising natural gas prices are likely to simply providing re- increase that effect in 2013." placement generation," In its annual report, CAISO noted that 2012 EIA analysts said. Geo- wholesale power prices were higher than prices graphically, the SONGS grid region is local- by June 15, increasing the amount of electricity in the previous three years even when adjusted ized pocket of electric power demand near San that transmission path can move. for the lower 2012 natural gas prices. In addition, Diego and Los Angeles. EIA analysts stressed that the region also the unusually large spread in wholesale electric- However, much of the new capacity lies out- needs local sources of reactive power – a portion ity prices between the northern and southern por- side of the San Diego-Los Angeles area, meaning of generated electricity which is lost in large tions of the state indicates system congestion. that additional upgrades of power transmission quantities when transmitting power over long capacity are needed to supply that area. distances, i.e. importing power from some of the Over 2,500MW of fossil capacity Plans of the grid operator are to bolster the new generating capacity to Southern California. added to replace nuclear local interconnectors at strategic locations in To that end capacitors will be added to In its latest Summer Loads and Resources the Los Angeles basin and northern San Diego several substations (see map above) by June 1, Assessment, CASIO noted that 2,502MW of County. Southern California Edison and to and two natural gas-fired generators at the capacity (capacity adjusted for planning pur- reconfigure the existing 220-kilovolt Barre- Huntington Beach facility will be converted poses) have been added since June 2012, with Ellis transmission line from two circuits to four to synchronous condensers by June 28.  Montana’s Mill-Creek 180MW open-cycle plant is replicable in Europe – PW Power Systems The resemblance between Montana, a state in north-western United States and European countries like Spain, Denmark or Germany is striking. "What we are seeing in Montana and also here in Europe is that our FT8 SWIFTPAC aero-derivative gas turbines are being used to maintain adequate power flows in the grid to counterbalance fluctuating wind energy," says Swift Tarbell, PW Power Systems' Area Director for Europe.

ontana's power transmission sys- gas turbine plant is actually operated "real tem operator (TSO) is required time" by the TSO directly to ensure adequate to maintain a constant level of power on the grid as wind energy generation Mpower on the grid. ebbs and flows in the system. "That is why 3x 60MW FT8 SWIFTPAC While Pratt & Whitney's fast-starting aero- were recently installed. One SWIFTPAC runs derivative gas turbines are famous for supply- continuously ramping up and down to maintain ing peak demand power, today they are also a fixed amount of power in the transmission being used to compensate for wind power fluc- Aerial photo of Montana power plant lines, counterbalancing rapid swings in wind tuations on the grid. The flexible ramp rate of "flexible" feature of Pratt & Whitney's FT8 and generation, while the second SWIFTPAC the 30MW / 60MW FT8 and soon available future FT4000 units. In fact, the SWIFTPAC cycles on and off as needed to add additional 60MW / 120MW FT4000 gas turbines are design provides this ancillary service without power to the system. The third unit stands "ideal for matching electric power generation the need for clutches or gearboxes. A signifi- ready in reserve," he told Gas to Power Jour- with the demand load on the system on a cant amount of wind turbine technology creates nal in an interview. moment-to-moment basis," he said. a deficit of reactive power on the grid, which NorthWestern Energy in Montana calls this Sychronous condensing service, which uses can be easily offset by the use of the SWIFT- "regulation service." In fact, the Mill Creek the electric generator to inject MVARS reactive PAC's electric generator operating in synchro- Generating Station's 180MW FT8 SWIFTPAC power into the transmission system, is another nous condensing mode.  Finding Flexible Futures

ThroughThrough Pöyry’sPöyry’s extensiveextensive eexperiencexperience inin marketmmarket 44HESTUDYlNDINGSWILLBEDISSEMINATEDFROM/CTOBERHE STUDYlNDINGS WILL BE DISSEMINATED FROM /CTOBER dedesign,sign, wewe continuecontinue toto wworkork wwithith cclientslients aacrosscross EEuropeurope 4HISTIMINGAIMSTOINmUENCETHEDEVELOPMENTOF 4HISTIMING AIMSTO INmUENCETHEDEVELOPMENTOF ttoo sshapehape tthehe dedevelopmentvelopment aandnd iimplementationmplementation ooff tthehe TTHE4ARGET-ODELSOTHATITFACILITATESMOREEFlCIENTHE 44AARGET -ODEL SO THAT ITFACILITATES MORE EFlCIENT EEuropeanuropeanE Electricitylectricity TargetTTaargetM Model.odel. CCROSS BORDERSHARINGOFmEXIBLERESOURCES4HISSHOULDROSS BORDER SHARING OF mEXIBLE RESOURCES 4HIS SHOULD IInn latelate JJuneune 22013,013, PPöyryöyry wwillill kkick-offick-off iitsts ppan-an- BBENElT%UROPEANELECTRICITYCONSUMERSBYREDUCINGTHEENElT %UROPEAN ELECTRICITY CONSUMERS BYREDUCINGTHE EEuropeanuropean multi-clientmulti-client studystudy oonn ‘‘RevealingRevealing FFlexibilitylexibility RRISKOFINVESTMENTINTHEmEXIBILITYTHATISNEEDEDTOISKOFINVESTMENTIN THE mEXIBILITY THATIS NEEDEDTO  VValue’.alue’.T Throughhrough a sseteto offt threehreew workshopsorkshops withwith cclientslients eeffectivelyffectively ddeliverelivera a llow-carbonow-carbon ppowerowers sector.ector. ffromrom acrossacross tthehe EuropeanEuropean electricityelectricity sector,sector, PöyryPöyry willwill RRElNEANDTESTOPTIONSFORA%UROPEANFRAMEWORKFORTHEElNEAND TESTOPTIONSFORA%UROPEANFRAMEWORKFOR THE FForor furtherfurther details,details, ppleaselease ccontact:ontact: CCROSS BORDERTRADINGOFmEXIBILITYCAPABILITYROSS BORDERTRADING OF mEXIBILITY CAPABILITY  [email protected]@poyyry.com (+44(+447 7800800 745611) 745611)

wwwwww.poyry.co.uk.poyry.co.uk

PöyryPöyry ManagementManagement CoConsultingnsulting ((UK)UK) LLtd.td. KKinging CCharlesharles House,House, ParkPark EndEnd StreetStreet OOxford,xford, OX1OX11 1JD,JD, UKUK TTeTelel ++4444 11865865 772266022660 FFaxax ++4444 11865865 772298822988 6  MARKETS GTP Journal 14 June 2013 Egypt’s cement production drops 20% as gas shortage prompts power supply constraints A shortage of natural gas in Egypt and subsequent constraints in elec- tricity supply over the last 4 months has forced the country's cement industry to reduce production by 20 percent. Peaking electricity use in the summer months is expected to aggravate the decline.

n even steeper drop in production eration to coal and refused derived fuel (RDF) capacity of 25 percent was incurred -based generation, with 70 percent of genera- by Arabian Cement Company tion to come from coal. The cement producer A(ACC)'s Suez plant after the opera- needs to make the switch to reduce its gas tor was struggled to come to terms with unfore- needs by 378 million cubic metres per year. seen gas and power shortages. The cement The company applied for the necessary gov- company, which produces 10 percent of ernment permits on 14 March 2013. It has Egypt's cement and is owned by Spanish Ce- since asked the government for swift issuance mentos La Union, anticipates production short- of an environmental permit and the removal of fall to reach up to 50 percent in summer. the operation license fees, which were origi- The main reason for Egypt's acute gas nally imposed for the use of natural gas. shortage is that reduced domestic gas produc- Industry players have called on the govern- the current energy shortage. tion cannot meet rising power demand while ment to remove operating fees for the new gen- government's subsidy system for gas and eration, and consider incentivizing the Egypt to become net gas importer power prices disincentivizes the use of gas for businesses for the costs associated with replac- Egypt, has been a net gas exporter in the past power generation and favours exporting as ing natural gas generation or mazot with coal. but is on its way to becoming a net importer, LNG to global markets instead. after the country's key gas importers arranged a Government encourages more swap deal with the word's leading gas producer ACC applies to switch to coal diverse energy mix Qatar to increase supplies. for generating power The Egyptian government has since 2010 In the past few years the government had To cope with the acute energy shortage, ACC encouraged industry to invest in power sources supported operators' plans to pushed gas-fired has applied to the Egyptian government to other than natural gas, but has recently intensi- generation in Egypt and there were several ini- switch 100 percent of the plant's gas-fired gen- fied its request to switch to coal generation. tiatives to expand gas-fired generation capacity In 2010, almost all of Egypt's electricity and increase subsidies. In this context, it also production came from domestically-produced encouraged use of natural gas by reducing sub- natural gas. sidies of petroleum. Representatives of Egyptian General In contrast, the Egyptian government's Petroleum Company (EGPC), a national oil current plan to reflate the gas supply involves company of Egypt owning 70% of Egyptian telling major industries to plan their mainte- Natural Gas Company, have said the country nance and slow production during summer has plans to cut natural gas exports during peaking months.  One of ACC's cement plants in Egypt India lowers gas-fired generation target amid gas shortage

India's Central Electricity Authority (CEA), which oversees development of the national grid for the Indian Ministry of Power, has reduced its gas-fired generation target for the current year by almost 46 per cent amid gas supply shortages. Low natural gas production output last year is expected to continue through 2013, an official told The Economic Times, despite Reliance Industry's recent announcement of a "signifi- cant gas condensate discovery in deep-water KG D6 block".

as production from at least one the scale and quality of the field," it said. The current priority ranking mandates that nat- facility, producer Reliance ural gas needs to be sold first to fertiliser Industries' KG-D6 fields off Power and fertiliser industry plants, followed by LPG units, and then to GIndia's eastern coast, has been compete for gas supply power plants, city gas, steel and refineries. falling since 2011 which forced the company to Current gas volumes produced at the KG-D6's The energy ministry has now put forth two reduce, or halt, gas supplies to power produc- field are sufficient to meet demand of India's options for freeing up gas volumes for power ers. In a move likely to ease government con- fertiliser sector's for urea-manufacturing needs generation. The first option is to give equal pri- cerns about risk of power shortages that and some LPG sector requirements, but leaves ority to buyers in the fertilisers, LPG, power hamper economic development, Reliance little gas as fuel for power plants. and city gas distribution sectors, and the sec- Industry announced last Friday a discovery, Ministers in India's federalist state have ond is for giving equal priority to just fertiliser named 'D-55', which is expected to add to repeatedly called for the abolition of laws that and power sectors. Either way, the Indian gov- the hydrocarbon resources in the KG D6 block. deprive gas-fired power plants of supply by ernment would need to subsidize urea import "Appraisal will now commence to better define prioritizing supply to fertilizer and LPG plants. for the fertilizer industry. continued on page 7 14 June 2013 GTP Unlimited MARKETS  7 Italy’s gas market share forecast to drop 11.7% by 2020 - OIES The erosion of the Italy’s gas use for power generation is forecast to intensify, leading to a 11.7 percent drop in market share by 2020 as the sector is squeezed by the growth in wind and solar power supply and low electricity demand in the prolonged recession, a paper authored by Dr. Anouk Honore, senior researcher at the Oxford Institute for Energy Studies (OIES) finds.

cenarios calculated by the author, based long-term supply contracts while Share of gross electricity generation per company on Italy's National Energy Strategy, demand remained low amid weak in 2011 (%) forecast the use of gas in the power economic growth. Profit margins Ssector to drop from 30 Bcm in 2010 of gas suppliers were hit as a conse- down to lows of 22.8 Bcm by 2020. quence and OIES analysts discarded Overall gas demand is projected to decline earlier predictions that demand between 12.5 and 19.8 percent, dropping from would continue to grow between 75.2 Bcm in 2010 to 60.3-65.8 Bcm in 2020. 2000 and 2010 as incorrect. Electricity produced from gas-fired plants, meanwhile, is forecast to drop 22.6 percent Price challenges for from 155 TWh in 2010 to merely 120- gas suppliers ahead 136.8TWh in 2020, pluning up to 22.6 percent, The relative cheapness of gas prices according to OIES projections. compared with coal prices (and low Enel declared in 2012 that nearly half of its costs for carbon allowances) since electricity generation came from coal-fired 2011 in Italy, as in much of the rest plants, which produced three times as much of Europe, "has made gas lose the electricity as its gas-fired combined-cycle competition with coal for base-load Source: AEEG power plants, despite the similarity in installed power generation," the paper reads. capacity between the two generation types. Despite Italy's wholesale power prices Power producers have for long called on being among the highest in Europe, this caused importers to step up price discounts for natural Gas dominates Italy’s energy mix an erosion in profit margins for gas-fired gas supplied under long-term contracts. Many The 1990s saw the number of gas-fired power power plants considering carbon prices (clean reduced the gas offtake under take-or-pay plants in Italy growing, spurred by innovations and spark spreads) compared to coal generation agreements to minimum levels, buying more wider deployment of CCGT technology, the aban- (clean dark spreads). gas at spot markets, instead. donment of nuclear power in 1987, the phasing out Enel in 2012 declared that nearly half of its of fuel oil, as well as environmental pressures. electricity generation came from coal-fired No return to 1990s-levels Italy in recent years relied on natural gas to plants, producing three times as much electric- Pointing to a plethora of uncertainties for fuel 50 percent of its installed power generation ity as its gas-fired combined-cycle power Italy's future consumption, particularly in the capacity, equivalent to about 125TWh in 2011. plants, despite the similarity in installed capac- gas to power sector, the OIES research sug- The late 2000s, however, saw a slowdown of ity between the two generation types. gests that "a return to 1990s-level demand demand for electricity and a rise in renewables With gas demand at record lows, the com- seems impossible". which put a lid on the market share of gas. petition among gas whole sellers intensified Factors that will influence this forecast Coal became as cheap as a competing fuel and the share of gas sold at spot markets in- include whether Italy's gas pipeline network to gas, helped by a drop in traded CO2 prices creased. Italy's dominant gas suppliers Enel will be expanded by additional export capacity due to a length in carbon allowances in the EU and Eni in 2011 had a market share of 13 per- to sell the oversupply of gas imported from Emissions Trading System. cent and 17 percent, respectively while EDF Algeria, Libya and to its neighbours in the North The Italian gas market in 2012 was over- affiliate Edison has another 12.7 percent. Enel and whether electricity demand increases as the supplied by 62 percent with buyers bound to also supplies the majority of the nation's coal. country's economy comes out of recession.  continued from page 6 Gas price hike proposed Uncertainty surrounding regulated gas did not come to pass. The Indian Oil Ministry meanwhile proposed to and energy prices has made risk-averse On June 20, stakeholders will meet to increase gas prices from $4.2 - $6.7 per million projects developers shy away or put on hold discuss what will be done with the Bibiyana 1 British thermal unit. Bodies that would see earn- a number of proposed power plant projects. plant project. ings increase from the price hike would include The proposed projects - Bibiyana 1, Reliance Industries as well as India's state- Projects for new capacity Bibiyana 2 and Meghnaghat 2, with a generat- owned Oil and Natural Gas Corp (ONGC) and put on hold ing capacity of 335-341MW each, were ini- Oil India Ltd (OIL). Summit Group, in an electricity-producing tially set up under a joint venture of GE Energy The Government's executive Union joint venture, has several times extended a LLC and Summit Industrial and Mercantile Cabinet will determine the outcome of this deadline to obtain funding for a 341MW Corp. Bibiyana 1 Power Company Ltd (SBPCL proposal after considering the impact of a combined-cycle gas-fired plant near a gas 1) was incorporated in 2010 and the project hike in power tariff and subsidies for fertiliser field by Bangladesh, Bibiyana 1. The simple partners signed a Power Purchase Agreement manufacturers, according to India's finance cycle unit of the plant was scheduled for (PPA) with the Bangladesh Power Develop- minister P. Chidambaram. commissioning in December 2012 but this ment Board in May 2011. 

” • –   – Š  ‘ ’ “ ‰ Š ‹ Œ  Ž   ‘ ’ “

{ | } { ~  € } {  ‚ { ~ € ƒ „ † ‡ ˆ {

@ A B C D

F B ] C ^ C c A F B `

\ k    

@ E F B G H

F G H E H ^ _ H ` a b C c G    !

q

I J K L M N O K O P Q R R L N

d L T e O P Q R R L N d L T e O P Q R R L N " # $ % & ' ( & ) * & ) $ + #

S T U T V L W L U N r

N K T N L V s T U e S T U T V L W L U N , # - # . & * / # 0 +

t L K P O K W T U M L $ 0 % 1 + ) $ + # 2 3

; X 8 Y Z

5

? f > < < = Y g h > i 8 :

8 Y < [ < = X = < = 8 Y

5 [ u h > i 8 :

4 5 6

8 < i > : v Y 7 8 9 8 : ; < = > 9 ?

o 6

F c l ^ F ] A F ^ F C ^

j w ›

E F ^

—

C c A F B ` D l ^ l l ] A C E E H B

k x \

l l ` ™

˜

d L T e O P Q R R L N t y T U U J U V

d L T e O P

d L T e O P

m U n L R N W L U N S T U T V L K

r

s R N L W I L R J V U

Q R R L N

S T U T V L W L U N

X 8 f < : = f = < z

6 S T U T V L W L U N

> : < g 8 : 9

o

; < = > 9 ; X 7 : = p > : < g 8 Y <

o o 5

h > i 8 : œ : = p

: = < = Y g 7 ; Y

š

¡ ¢ £ ¢ ¡ ¤ ¥ ¦ ¦ § ¨ ©

              

Uč``ÀiÃÃÌ iÀi}Տ>̜ÀÞV >i˜}iÃv>Vˆ˜}>ÃÃiÌ“>˜>}iÀà U>ˆ˜˜iÜ«iÀëiV̈ÛiÃœ˜“>˜>}ˆ˜}>˜`“i>ÃÕÀˆ˜}>ÃÃiÌ«iÀvœÀ“>˜Vi U1˜`iÀÃÌ>˜`Ì iV >˜}ˆ˜}v>Viœv>ÃÃiÌ“>˜>}i“i˜Ìˆ˜>-“>ÀÌܜÀ` U>ˆ˜ˆ˜Ãˆ} ̈˜Ìœ`iˆÛiÀˆ˜}ÌÀ>˜Ã“ˆÃȜ˜ˆ˜ÛiÃ̓i˜Ìˆ˜>,"ܜÀ` Uˆ˜`œÕÌ œÜޜÕÀ«iiÀÃ>Ài>`>«Ìˆ˜}̜Ì iiۜÛˆ˜}>ÃÃiÌ“>˜>}i“i˜Ì

i˜ÛˆÀœ˜“i˜ÌÌ ÀœÕ} wÀÃ̇ >˜`V>ÃiÃÌÕ`ˆiÃ

 ž Ÿ Ÿ ž ¡ ¢ £ ¡ ¤ ¥ Ÿ ¥ ¤ ¦ § § ¨

¡ ¢ ¥ © ª « ¡ ¬ ¢ ¢ § ¤ 14 June 2013 GTP Unlimited PROJECTS & FINANCE  9 Siemens hard-wearing SGT 750 capable of reducing NOX to single digits At this week's VGB Congress on gas turbines, Siemens regional sales manager for Germany, Dietmar Augele showcased the company's recently launched hard-wearing SGT 750 is capable to reduce NOX to single digits.

he turbine features a heavy, low-mainte- Siemens's popular industrial nance design, and is aimed at CHP ap- gas turbine, Siemens SGT- plications such as in cities with the 600/700 (GT10). The design Tpotential to support renewables. has been called more gener- Siemens has already provided one new SGT ous in design than a light- 750 turbine recently in a CHP plant in Greif- weight aero engine. swald, Germany where it supplied 37 MW of en- With a running regime of 3,000 hours, it be able to achieve 5 ppm. "The Greifswald ergy. The feed gas for the power plant is imported features a hybrid turbine design with high effi- customer had specifications in terms of NOX 2 from Russia through the Baltic pipeline and the ciency, over 40 percent. commercial orders and we want to see the gas is pre-heated before usage in the turbine. The new SGT 750 turbine will also offer a machines in the field in operation. We want to "The new industrial gas turbine is mainly reduced maintenance requirement: It has two see long term experience with the machines." aimed at combined heat and power applications complete maintenance cycles every 17 years. "We have the potential for single digits, primarily for those customers who have a need This works out to about 17 days of mainte- below 10 ppm. It is an advanced model for this for heat. Accordingly is able to perform well for nance during a 17 year period. capacity range. It stays below legislation," the needs of a German municipality for instance. Augele confirmed. It can supply about 37 MW electrical and 45 Advanced NOX control MW heat energy and its operational flexibilty at partial-load Introductory rating and short start-up ability enables its use in The SGT 750 is able to reduce NOX emissions Siemens is launching its new industrial gas tur- highly renewable energy markets," said Augele. down to approximately 18ml, achieving a far bine at an 'introductory rating' and offers a sales "We have the potential for single digits, below greater reduction than the current 50ml allowed package which can reduce maintenance costs. 10 ppm. It is an advanced model for this capac- by regulations. It is possible to reach these lev- "We were so far cautious in terms of distri- ity range. It stays well below legislation limits." els when operating at partial load. bution and now we see we are going to market Markus Tacke, CEO Business Unit Industrial an develop the product further," Tacke said, Hybrid design, over 40% efficiency Power Siemens Energy added that industrial tur- outlining "We produced a total of five machines The new turbine features a completely new, bines under development were capable of very one is undergoing testing in order to release the heavy design rather than a successor design to low NOX levels. "We are optimistic that we will machine for preliminary distribution now."  Loccioni's Smart Carbon project optimises combustion process to reduce carbon footprint Loccioni, a developer of automated control systems, has launched a Smart Carbon project that allows operators of fossil power plants to monitor and regulate the coal combustion process to add economic value to operations and reduce their carbon footprint. hile renewable energies currently to be destroyed, avoiding high eco- supply about 18 percent of world- nomic and environmental costs. wide energy demand, Loccioni Installed at a 660MW power plant Westimates that the contribution of under ordinary working conditions, coal will rise beyond today's 25 percent market the technology can reduce unburned share, mainly driven by current low of the raw carbon in fly ashes from 4 percent to material of coal as a fuel for power plants. 2.4 percent. As power producers need to mitigate the in- When integrating Loccioni POW- termittency impact of more renewable energy dER and Loccioni CINERIS, it is possible to ers for process monitoring and TDL systems being connected to the grid through deploying save 2.800 ton/year of coal that means a for the monitoring of the ammonia slip useful fossil backup capacity, Loccioni's Smart Carbon €280.000/year fuel cost saving and the avoid- to optimize ammonia injection inside the NOx project helps enhance fuel efficiency. CINERIS ance of 7.000 ton/year of CO2, without taking abatement system. is the patented system designed to on line meas- into consideration the effect of other polluting To keep the highest performances of the ure the percentage of unburned carbon in fly emissions, the company said. steam and water cycles, Loccioni provides ashes. This percentage represents a useful feed- Combustion also produces exhaust gases steam and water customized solutions to back on combustion efficiency and it allows to and to reduce pollutants emitted in the atmos- analyse possible contaminations and losses in control the quality of ashes have to be sold and phere, Loccioni integrated a set of CEMSs for order to maintain the optimal balance of chem- to avoid production of hazardous ashes needing the emission monitoring on stacks, gas analyz- ical and physical parameters on the steam.  10  PROJECTS & FINANCE GTP Journal 14 June 2013 Financing setbacks delay NEWS Pennsylvania CCPP project NUDGES Financing setbacks have forced Alberta-based EmberClear Corp to push GE to build open access wind back the start of construction of a 300MW gas-fired combined-cycle turbine test platform in the UK power plant (CCPP) in in Good Spring, Tennessee. The operator had in- June 10 – GE is spending £50 million tended to sell the electricity produced at the proposed plant to the PJM Interconnection – the largest electric market in the US. to build an open access wind turbine test platform at the National Renewable mberClear did not disclose any details owner and operator had anticipated to start Energy Centre (NAREC). on the financing setbacks. It had ap- construction during the third quarter of 2013. The test facility is designed to allow pointed CCA Capital LLC, a registered FPPI President James Palumbo had manufacturers to speed up the develop- Ebroker dealer, to act as advisor and described financing of the project as "very ment time of their systems, GE said placement agent for the construction and term attractive" due to its close proximity to both adding that the rising volume of wind financing of a 300MW combined-cycle plant. the Marcellus Shale, the fastest growing gas energy requires flexible fossil backup James Stahle, Group Managing Director of field, and the PJM Grid, the world's largest capacity to balance the grid. CCA Group said earlier he expects "significant electric grid system. The Energy Technologies Institute interest in this natural gas power plant" particu- "With over 18,000MW of coal-fired genera- (ETI) is investing a further £25 million larly as its close proximity to the Marcellus tion capacity slated to be decommissioned, our in the NAREC facility, through public- Shale region allows it to capitalize on low gas power should help address the challenge of private partnership between the UK prices. "North America remains the most desir- diminishing supplies," he added. government with GE Power Conversion able and lowest risk investment region for new The proposed plant is expected to operate as and MTS Systems Corporation. thermal generation," he said. a base load generation facility, according to Project development has been the responsi- EmberClear, and is intended to become "one of ABB Symphony Plus installed bility of Future Power PA Inc. (FPPI), a wholly the most competitive plants in the PJM markets" in 25,000MW power plants in owned subsidiary of EmberClear. Initially the due to its high efficiency and low emissions.  2 years June 10 – ABB announced that in the two years since its launch, Symphony™ APR Energy starts-up new 200MW Plus control solutions won orders for new power plants that generate more than gas turbine in Uruguay 25,000 megawatts (MW) of electricity, equivalent to the installed capacity of APR Energy, a global supplier of fast-track power solutions, has started countries the size of the Netherlands, commercial operation of its 200MW temporary power generation project in Uruguay, divided across two sites in La Tablada and Punta del Tigre. Malaysia or Egypt. Some recent Symphony Plus project e now begin a awards include the 700 MW Xiaoting commercial supercritical coal-fired power plant in stage in which China ; the Samra thermal power plant, “Wwe are strategic Jordan's largest power plant with a gener- partners, commented UTE President ating capacity of 885 MW; Enel's 590 Gonzalo Casaravilla. "With the avail- MW Grazia Deledda Sulcis power plant ability of these machines, we will sup- in Italy; Dong Energy's 250 MW Avedore ply the demand in Uruguay and it will Unit 1 in Denmark and the 125 MW allow us to optimize our system." Arlington Valley solar project in Arizona. The two revamped plants, together with the additional 100MW of turbines Siemens delivers 434MW gas- installed by APR Energy last July, now fired power plant to Niger Delta help increase Uruguay's power produc- Power tion capacity by a total of 300MW. June 10 – Siemens Energy has won a for protection and metering. contract to construct the 434-MW Geregu Fast-track project deployment Both sites utilize demineralized water solu- II power plant for the Nigerian utility Through APR Energy's fast-track project de- tions to comply fully with Uruguay's strict Niger Delta Power Holding Company ployment, eight mobile turbines were sent via a emissions standards. (NDPHC). mix of ocean and air freight to meet a tight op- APR Energy specializes in large-scale, fast- Geregu II is Siemens' third turnkey erational schedule. track power solution whereby it provide a project in Nigeria for which it will The full turnkey 150kV, 100MW solution turnkey approach covering everything from supply three SGT5-2000E gas turbines, at Punta del Tigre went into operation in mobilization of equipment to installation, oper- three SGen5-100A generators, all the May, bringing APR Energy's total capacity ation and maintenance of the power plant, electrical systems and the SPPA-T3000 at the site to 200MW. The 100MW plant at Since 2004, the company has installed over control system. La Tablada, which became operational in 1.5GW of capacity in approximately 30 proj- April, includes 150kV substation equipment ects across more than 20 countries.  14 June 2013 GTP Unlimited PROJECTS & FINANCE  11 Siemens to supply power plant components for two CCPPs in Algeria

Siemens has won a contract to supply power plant components, including six F-class gas turbines, to the Korean engineering and procurement companies Daewoo E&C Co and Hyundai Engineering Co. that are building two combined cycle power plants (CCPPs) for Algeria's state-run energy provider Sociéte Algérienne de Production de l'Electricité (SPE).

nce operational, the Ras Djinet Africa in terms of raw materials, with exten- million tons, an amount equal to the total and Ain Arnat combined-cycle sive crude oil and natural gas deposits. Due to annual CO2 emissions of Berlin, Delhi, Hong plants will have an installed elec- economic development, Algeria plans to ex- Kong, Istanbul, London, New York, Singapore Otrical capacity of more than 2,000 pand its power generation capacity from the and Tokyo.  megawatts (MW) and will supply power to current level of 11 GW to approximately 26 over five million households on Algeria's GW by the year 2022. Mediterranean coast. "By supplying the components for the new The Ras Djinet power plant location is ap- Ras Djinet and Ain Arnat power plants, we are proximately 100 kilometers east of the Alger- happy to be playing a major role in the indus- ian capital Algiers. Ain Arnat is located trialization of Algeria. Our proven F-class gas approximately 260 kilometers east of Algiers. turbine technology combines high levels of ef- ficiency with low capital costs. With those fea- Algeria’s power generation tures, this technology offers our customers capacity to reach 26GW by 2022 crucial economic benefits," said Thierry Siemens said the scope of its delivery of power Toupin, CEO of the Products Business Unit at plant components includes a total of six SGT5- Siemens Energy. 4000F gas turbines, six SST5-3000 steam tur- Highly efficient combined cycle power bines, and six SGen5-2000H generators. In plants are part of Siemens' Environmental Port- addition, Siemens will provide technical sup- folio. In fiscal 2012, revenue from the Portfolio port and services for the construction and com- totaled about €33 billion, making Siemens one missioning of the six power trains. A of the world's largest suppliers of ecofriendly framework agreement was also concluded for technologies. the delivery of spare parts for the plant in Ras In the same period, our products and solu- Djinet for a ten-year period. tions enabled customers to reduce their carbon Algeria is one of the wealthiest countries in dioxide (CO2) emissions by more than 330

“By supplying the components for the new Ras Djinet “and Ain Arnat power plants, we are happy to be playing a major role in the industrialization of Algeria.” Thierry Toupin, CEO, Products Business Unit, Siemens Energy.”

ICC approves ComEd's accelerated smart meter deployment June 7 – Illinois Commerce Commission (ICC) has issued an order approving the accelerated deployment of smart meters to all ComEd customers. ComEd said it can now start installing smart meters to customers in September 2013. The order follows the Illinois General Assembly's action last month to enact Senate Bill 9, getting the state's Smart Grid program back on track.

HZI selects Metso automation for Ferrybridge plant June 7 - Hitachi Zosen Inova (HZI) has selected Metso's automation technology for the Ferrybridge waste-to-energy plant in Knottingley, UK. The 68MW plant Ferrybridge is scheduled to start operations by summer 2015 and will produce power for Scottish and Southern Energy (SSE). The greenfield plant will be located at the SSE Ferrybridge C Power Station, which is due to be closed in 2015. The future role of Gas to Power in Germany Tuesday 2nd July - Wednesday 3rd July 2013, Düsseldorf

Germany goes green - so how can gas win market share against ‘dirty king coal’? Headline Sponsor: Challenges for gas-fired peaking plants to find a place in the Energy Transition

In the run-up of the September general election, debates on Germany's future power market design are at centre stage. Profitability, operational dispatch of gas-fired plants and commercial viability of existing fossilplants and investment into new capacity hinges on capacity mechanisms, the outcome of price arbitrationsover Russian gas supplies and electricity demand forecasts. Gold Sponsors: • Are capacity payments vital to keep gas-fired plants running and incentivise investment in new capacity? • Coal or gas? Which fuel source will be most economical for peak-load power supply? • Cogeneration - can selling heat make conventional gas plants profitable? • Will power and gas demand recovered as the German economy rebounds from recession? • Efficiency vs. flexibility - what technology enhancements are key for future gas turbine technology? Confirmed speakers : Franzjosef Schaffhausen, Head of Department for Energy, German Federal Environment Ministry Dr. Kathrin Thomaschki, Vice Chair Ruling Chamber 6, Access to Electricity Grid, German Federal Energy Regulator (BNetzA) Håkan Feuk, VP Political & Regulatory Affairs, Director of Market Rules, E.ON Mike Diekmann, Director, Head of Strategy/ Business Development, VNG Silver Sponsors: Dr. Jürgen Tzschoppe, Senior Vice President Continental Energy, Statkraft Markets Bernd Goedde, Head of Options and Structures Trading, Vattenfall Energy Trading Dr. Karsten Klemp, Head of Power Stations, RheinEnergie AG, Cologne Dr. Oliver Weinmann, Chief Executive Officer, Vattenfall Europe Innovation Dennis Volk, Gas, Coal and Power Markets Division, International Energy Agency (IEA) Olga Mikhailova, Advisor Markets Unit, Eurelectric Dr Fiona Riddoch, Managing Director, COGEN Europe Dr. Marco Nicolosi, Managing Director, CONNECT ENERGY ECONOMICS GmbH Mike Wilks, Director, Pöyry Management Consulting Reinhard Rümler, Senior Manager, Energy Advisory Practice, PricewaterhouseCoopers Frank Reichenbach, Manager, The Advisory House Bronze Sponsors: Tim Rudolph, General Manager – Energy Business, Rolls-Royce Michael Kruck, Head of Sales GT Power Plant Solutions NW-Europe, Germany Siemens AG, Energy Sector Klaus Payrhuber, Senior Product Manager Gas Engines, GE Power & Water Shonodeep Modak, Global Manager Marketing, GE Power & Water Markus Rieck, Country Sales Director Germany, ALSTOM Deutschland AG Swift Tarbell, Area Manager Europe, PW Power Systems Edward Nagelhout, Market Development Analyst, Wärtsilä Power Plants Dr. Tilman Tütken, Vice President Sales Europe for Power Plant, MAN Diesel & Turbo SE Dr John Newton, Business Development Manager, ITM Power Uwe Würtenberger, Clean Energy Technology, Linde Innovation Management Herbert Gries, Head of Pressure Equipment and Plant Security, TÜV Rheinland Service GmbH

WHO IS THIS CONFERENCE FOR? This conference is aimed at attendees from utilities and power generation companies, energy policy and regulatory bodies, energy in- frastructure project finance, banking and legal firms, and low-carbon and renewable energy companies. Including professionals responsible for: Energy Policy / Regulation Project Management and Development Gas Procurement / Origination Power Generation Carbon Reduction / CCS Programmes Gas Supply and Trading Power Plant Management CCGT Technology/Operations/ Maintenance Trading Operations Grid Development Gas Turbine Manufacture Market Development Analysis Business Development Fleet Management Project Finance and Investment Regulatory Economics Asset Management and Optimisation Sales and Marketing Corporate Strategy Turbine Engineering Regulatory Affairs PARTICIPATE | SPEAK | SPONSOR Save the date in your diaries and contact us to register your interest: Narges Jodeyri Email: [email protected] Phone: +44 (0)20 7017 3406