Power - May 2014

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Vol. 158 No. 5 May 2014

Using Storage to Address
Multiple Grid Challenges
Best Practices in Outage
Management
CFB Boilers Enable Fuel
Diversity
Low-Carbon Efforts in the
UK and India
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May 2014
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POWER www.powermag.com 1
ON THE COVER
The 64-MW AES Laurel Mountain Storage Array in West Virginia competitively provides
reliability services to utilities across 13 states and the District of Columbia. Courtesy:
Brent Kepner/AES
COVER STORY: ENERGY STORAGE
24 The Year Energy Storage Hit Its Stride
Technology innovations, market need, policy support, and lower prices are all teeing
up energy storage to become a familiar part of grids worldwide. The implications for
variable renewable generation should be obvious, but more extensive use of grid-
tied storage could also affect fossil units. For example, certain storage technologies
sited with gas-fired units could improve start-up times, efficiencies, and heat rates.
34 Balancing Renewables with Li-ion Energy Storage
Lithium-ion (Li-ion) remains the predominant battery technology for grid applica-
tions, as it can be scaled for specific uses and deployed in a modular way. Case stud-
ies from three countries demonstrate how Li-ion installations can make the most of
variable renewable generation.
SPECIAL REPORT: OUTAGE MANAGEMENT
38 Critical Path: Getting Your Outage Ducks in a Row
Every power plant experiences routine and unscheduled outages, but not every
plant employs the best planning and execution practices. Especially with leaner,
less-experienced staffs, you cant afford to leave outage success to chance.
FEATURES
FUELS
44 Fuel-Flexible CFBs Add Flexibility to Resource Plans
Fuel quality, fuel availability, and fuel usability (in response to ever-changing regula-
tions) can vary significantly over the life of a thermal power plant. Those variables
are providing generators around the world with a rationale for using circulating flu-
idized bed (CFB) boilers.
RENEWABLES
50 Utility Biomass Use: Turning Over a New Leaf?
The use of biomass has a checkered past, but understanding the challenges and con-
trolling for them can make biomass use a good move in many scenarios, especially
when cheaper fuels are unavailable or low-carbon generation is a priority.
54 Despite Challenges, India Banks on Renewable Energy
India may be the only country with a ministry for renewable power, but coal still
accounts for 59% of installed capacity. However, unreliable fossil fuel supplies are
keeping the country focused on ever-bigger solar and wind installations.
Established 1882 Vol. 158 No. 5 May 2014
24
38
44
Expanding Talent and
Technology into ONE
The global merger of Mitsubishi Heavy Industries and Hitachi Thermal Power Generation
businesses, now expands resources for and in the Americas.
Maximizing availability, reliability and protability is the continuing goal of Mitsubishi Hitachi
Power Systems for existing and evolving energy needs with a presence of more than 1,500
U.S. based personnel and 800,000 sq. ft. of state-of-the-art manufacturing, maintenance and
repair facilities in support of our world class products.
Mitsubishi Hitachi Power Systems expanding talent and technology into one.
Visit us online to learn more about our world class capabilities.
Mitsubishi Hitachi Power Systems Americas, Inc.
100 Colonial Center Parkway Lake Mary, FL 32746 USA
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www.powermag.com POWER
|
May 2014 4
DISTRIBUTED GENERATION
59 David Crane and the Coming Electric Utility Apocalypse
David Crane, CEO of NRG Energy, one of the earliest and biggest non-utility genera-
tors, has long been predicting that the days of conventional utilities are numbered
because of the threat posed by distributed solar generation. Some in the industry
are starting to take him seriously.
POWER POLICY
63 UK Struggles to Attract Low-Carbon Investment
Unlike the U.S., the UK actually passed an energy bill at the end of last year, but that
may not be sufficient to solve short-term price and capacity challenges while ensur-
ing a lower-carbon future.
DEPARTMENTS
SPEAKING OF POWER
8 Disruptions vs. Status Quo
GLOBAL MONITOR
10 Are Large Dams Unviable?
10 Indias Nuclear Liability Law: Breakthrough for Russia, Stalemate Endures for
U.S.
12 THE BIG PICTURE: Storage Snapshot
14 59-MW Fuel Cell Park Opening Heralds Robust Global Technology Future
15 POWER Digest
FOCUS ON O&M
18 Himalayan Run-of-River Project Depends on New Component Types
LEGAL & REGULATORY
22 What to Watch for in EPA Carbon Regulations for Existing Plants
By Mark Perlis, Davis Wright Tremaine LLP
COMMENTARY
72 Greenhouse Gas Emissions Are Not Our Only Problem
By Marilu Hastings, Cynthia and George Mitchell Foundation
50
63
10
In this web exclusive, listed online at powermag.com with the features for this issue,
Editor Gail Reitenbach provides some observations of and observations made at the an-
nual Platts event for those involved in project development, financing, and litigation.
Coal and Nuclear Nearly Invisible at Platts Global
Power Markets
Connect with POWER
If you like POWER magazine, follow us online for timely industry news and comments.
Become our fan at facebook.com/POWERmagazine

Follow us on Twitter @POWERmagazine
Join the LinkedIn POWER magazine Group
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May 2014 6
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May 2014 8
SPEAKING OF POWER
T
heres been a lot of talk in the past
couple of years about disruption to
the long-established status quo in
the electric utility and power generation
sector. But I would argue that both terms
in this latest battle are inflated.
Whether the issue is central station
versus distributed generation (DG) or re-
newables versus fossil fuels, the future
likely wont declare clear winners and
losers but something closer to frenemies
(Google it).
The Status Quo Is Short-Lived
Even in the traditional utility industry,
business and technology have seen major
shifts over the past century. Technology
and fuel availability are often the disrup-
tive forces, as they are today with new
and cheaper sources of both natural gas
and renewable generationplus all the
digital tools that enable smarter grids
and microgrids. But overall, on a capacity
basis, nuclear energy was the most mo-
mentous fuel/technology change in the
past 100 years.
Policy can also change how and where
power is generated. The deluge of new
and pending federal environmental regu-
lations may seem unprecedented, but
previous policies also had notable, some-
times widely swinging, consequences:
The 1920 Federal Water Power Act en-
couraged hydropower development, while
the 1978 Power Plant and Industrial Fuel
Act (repealed in 1987) put restrictions
on new plants fueled by oil or natural
gas (because of concerns about national
energy security) and encouraged those
fueled by coal, nuclear, and alternative
fuels. Today we take for granted that the
U.S. is fully electrified, but thats only
because of the 1936 Rural Electrifica-
tion Act, which provided federal loans
(yes, theyve been around that long) to
encourage the building of distribution
systems in rural areas.
Disruption Will Be Less Dramatic
Than Billed
Industry outsiders (entrepreneurs and
their venture capitalist pals) and minor-
ity players (including renewable energy
developers) have reason to claim that
their technologies and business mod-
els will end the stranglehold of familiar
generation behemoths and distribution
companies. Its how they get attention
for their ideas. Similarly, media and con-
sulting companies promote in-person
and virtual events to discuss disruption
in the industry. Is all the noise about the
D word just marketing hype? No.
Though knowledgeable people may
disagree about the degree and speed of
change ahead, theres no question that
the industry is already changing, so if it
takes a bit of hyperbole to get everyone
focused on what their future roles might
be, thats a good thing.
This issue of POWER has multiple ar-
ticles on technologies, including new and
cheaper modes of energy storage, that
promise to change how electricity is gen-
erated and delivered. Also in this issue,
Contributing Editor Kennedy Maize offers
an article titled David Crane and the Com-
ing Utility Apocalypse that looks at the
hype and reality of increasing amounts of
DG. As I was preparing that piece for pro-
duction, I was struck by an irony buried
in the now-familiar story of DG overtaking
the traditional utility.
DG is typically thought of as small-scale,
usually renewable generation that is under
the control of the owner of a residential,
commercial, or industrial site oras is
becoming more commonan aggregator
or lessor of that generation. NRG CEO Da-
vid Crane predicts a future in which these
distributed energy resources (DER) partner
with onsite natural gaspowered fuel cells
for greater customer independence. How-
ever, he also envisions a super-utility
not a traditional utility, but nevertheless,
one that he controls. Unlike most current
scenarios that frame DG as something the
utility doesnt own, Crane wants NRG to
own and control this DG. So, ultimately,
he isnt anti-utility; he has his eyes set on
creating a new-fangled monster utility
albeit a distributed one.
To control DER, NRG (or like-minded
utilities) would still need access to some
sort of communications linethe gas
pipeline wont sufficeso a smart grid, or
at least microgrid, infrastructure will still
be essential.
In the meantime, NRG is building scale
the old-fashioned way: On Apr. 1, with the
acquisition of Edison Mission Energy and
Dominions competitive retail electricity
business, NRG became not only the largest
U.S. independent power producer but also
the second-largest generator overall, with
a total of 53,000 MW of capacity. (That
same week, other NRG executives were
speaking at the ELECTRIC POWER Confer-
ence in New Orleans. See our coverage of
that event in the next issue.)
Slow-Motion Disruption
As the articles on efforts in the United
Kingdom and India to advance a low-car-
bon economy demonstrate, achieving that
goal isnt easy or fast, even with the lat-
est technology innovations and aggressive
policy support. Consequently, industry
leaders globally agree that fossil fuels will
continue to play a critical role in deliv-
ering reliable, affordable electrons for at
least the next few decades.
Nevertheless, the nature and extent of
change on both business model and gen-
eration source fronts is likely to be great-
er than what you might call incremental.
And really, if you dont expect your in-
dustryany industryto be affected
by the larger shifts in technology and
culture, youre in denial. Google seems
to announce some new digital device or
service nearly every month, and in the
space of a decade, Elon Musk (cofounder
of the ambitious all-electric car maverick
Tesla) has taken SpaceX from fantasy to
reality and is now the only U.S. entity to
send rockets into space (NASA is using
SpaceX rockets to send astronauts to the
International Space Station).
The question is whether todays utili-
ties and regulators will be sufficiently
proactive to avoid being largely overtak-
en by young upstarts. It may be time to
embrace the concept of frenemies.
Gail Reitenbach, PhD is POWERs
editor (@GailReit, @POWERmagazine).
Disruptions vs. Status Quo
HYDRO.Power
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May 2014 10
Are Large Dams Unviable?
After a lull that spanned nearly two de-
cades, a hoard of new massive hydropower
projects are being developed around the
world. Some, like the 11.2-GW Belo Monte
dam in Brazil, the 4.5-GW Diamer-Bhasha
project in Pakistan, the Jinsha River dams
in China, the 6-GW Myitsone dam in Myan-
mar, and the 1.8-GW Gilgel Gibe III dam
in Ethiopia are controversial for their sup-
posed environmental and social impacts,
but they are also unprecedented in scale
and cost. Nonetheless, according to re-
searchers from the University of Oxford, in
the vast majority of cases such large dams
are not economically viable, and policymak-
ers in developing countries should instead
seek out more prudent alternatives that
can be built over shorter time horizons.
Basing their data on 245 large dams in
65 different countries, Professor Bent Fly-
vbjerg of the University of Oxfords Said
Business School and Dr. Atif Ansar, lectur-
er at the University of Oxfords Blavatnik
School of Government, posit in a recent
study published in the journal Energy Poli-
cy that three out of every four large dams
suffer a cost overrun in constant local
currency terms and that the construction
costs of large dams are on average 96%
higher than original budgets.
By the same token, forecasts of costs
of large dams today are likely to be as
wrong as they were between 1934 and
2007, they say. The researchers suggest
that the Itaipu Dam, which straddles a
border and provides 72% of Paraguays
power and 17% of Brazils, suffered a
240% cost overrun. China (Figure 1), In-
donesia, Pakistan, and other nations show
similar amnesic behavior regarding the
building of dams, they say.
At the same time, an overwhelming
eight of 10 large dams also suffered sched-
ule overruns, the study shows. Large dams
take an average of 8.2 years to buildand
often extend more than 10 years. The re-
searchers concluded that these long time
horizons leave dam projects particularly
ineffective in resolving urgent energy cri-
ses and are especially vulnerable to cur-
rency volatility, hyperinflation, political
tensions, and swings in water availability
and electricity prices. The systematically
poor outcomes of large dams suggest that
fools and liars have been at the helm,
said Professor Flyvbjerg in a statement.
But for the International Hydropower
Association (IHA), which rebutted a num-
ber of claims made by the authors, the
question that should be asked is: Is the
project a good investment? not Does
the project overrun? When all things are
considered, hydropower can make a pow-
erful case as a long-term investment, by
delivering sustainable energy and water
services for multiple generations. Unfortu-
nately, the reports authors seem to have
completely ignored the multiple benefits
of hydropower, and so [present] an un-
balanced picture of the economic value
versus the investment risks, says the
group, whose platinum members include
companies that build mega-dams, among
them, China Power Investment Corp., Chi-
na Three Gorges Corp., Itaipu Binacional,
RusHydro, and SinHydro.
Only about 20% of the worlds dams
actually have any hydropower associated
with their reservoirs and yet hydropower
produces 76% of the worlds renewable
power according to the IHA. It is unaf-
fected by volatile and rising fuel prices,
which can have dramatic impacts on the
viability of fossil power technologies, not
to mention the avoided pollution. The
organization admits that hydropower proj-
ects do have high upfront outlays during
the construction phase, but also very low
running costs and [they] operate for many
decades. Not to mention, modern hydro-
power operating efficiencies can reach
95% and turbine availability for opera-
tion can exceed this percentage, it says.
This is unmatched by any other source of
power generation.
On the whole, the worlds largest hydro-
power projects are worth their while, the
IHA concludes. Itaipu indeed saw a cost
overrun during construction, but all debts
will be paid by 2023 according to the 1973
binational Treaty that created the project,
it says. The primary purpose of the Three
Gorges dam in China is for flood control
not power generationand since the proj-
ect was commissioned in 2007 (one year
ahead of schedule and RMB30 billion under
budget), it has significantly attenuated
peak flow and averted economic impacts
from floods, as well as increased naviga-
tion by more than four times.
Because the technology is reliable, the
scale is considerable, and the resulting pow-
er prices are economical and predictable, At
a time when energy and water services are
at the forefront of policy agendas around
the world, hydropower is an investment that
makes a lot of sense, the IHA says.
Indias Nuclear Liability
Law: Breakthrough for
Russia, Stalemate Endures
for U.S.
India and Russia on Apr. 1 said they had
devised a significant deal that will allow
the first import of nuclear reactors in In-
dia, despite Indias 2010-passed nuclear
liability law that allows nuclear power
plant operators to hold a supplier respon-
sible for an accident if the cause is blamed
1. Worth a dam? Chinas 12th Five-Year Plan (20112015) foresees 285 GW of new hydro
capacity, including 41 GW of pumped storage, to boost its share of renewable power. That
means construction is ongoing at an estimated 60 projects to exploit 71% of the countrys hydro
potential, many of which are large dams. In 2012, as well as installing the worlds largest hydro-
power generating turbine at the 6.4-GW Xiangjiaba station, the 22.5-GW Three Gorges complex
(shown here) entered full operation, generating an estimated 14% of the countrys total hydro
power. Projects under construction include the 13.9-GW Xiluodu and the 5.8-GW Nuozhadu
projects. Courtesy: Harvey Barrison/Flickr
May 2014
|
on equipment defects.
The law has stalled the implementation of deals for new reac-
tors that India signed with the U.S., Russia, and France in 2008,
when the Nuclear Suppliers Group (NSG) allowed India to import
nuclear fuel technology without being a member of the multina-
tional body concerned with reducing nuclear proliferation. India
said the breakthrough deal with Russia reached this April after
four years of negotiations takes into account the liability law
when pricing four more Russian reactors meant for Indias Kun-
dankulam plant in Tamil Nadu (each of which is valued at $2.5
billion) as well as four or six other VVER-1200 units planned for
Haripur, West Bengal. The deal essentially calls for Indias public
sector General Insurance Co. to evaluate each component of the
Russian reactors and prescribe a 20-year insurance premium it
will charge to cover Russias liability for an accident.
Russias state-owned nuclear firm Rosatom reportedly has
indemnity from any liability arising from an accident at the
VVER-1000s at Kundankulam Unit 1 (Figure 2), which attained
criticality in July 2013 and is expected to come online later
this year, and Unit 2, expected to be operational in October
2014. Observers note that contracts for those plants were
signed in 1998, before Indias domestic liability legislation had
even been contemplated.
Before Indian legislation on civil nuclear liabilityThe Civil
Liability for Nuclear Damage Billfinally passed both houses of
parliament in August 2010, exempting suppliers from all liability
had been Indias typical practice, starting in 1962, when India
signed its first nuclear cooperation agreement with the U.S. to
allow General Electric to supply two 200-MW reactors to Indias
Tarapur site. The practice of liability exemption was modeled on
Americas own 1957-passed nuclear liability law, the Price Ander-
son Act, and went on to extend indemnity protection to Atomic
Energy of Canada Ltd. for two reactors in Rajasthan in 1965, and
later to Russia.
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2. The early bird and Indias nuclear worm. The first of
two VVER-1000 reactors at the Kundankulam nuclear power plant in
the Indian state of Tamil Nadu attained criticality in July 2013 and is
expected to come online later this year, more than a decade after con-
struction began within implementation of an intergovernmental agree-
ment between Russia and India signed in 1988 and supplemented
in 1998. A memorandum of mutual understanding between the two
countries calls for at least two more units at the Kundankulam site and
the construction of at least 16 nuclear power plants of Russian design
in India. Courtesy: Rosatom
|
May 2014 12
QATAR
DENMARK
S
.
K
O
R
E
A
NETHERLANDS
SAUDI
ARABIA
UAE
COUNTRIES WITH EXISTING ENERGY STORAGE
ASIA: 64.6 GW
(150 projects)
EUROPE: 52.7 GW
(225 projects)
N. AMERICA: 21.3 GW
(237 projects)
AFRICA/MIDDLE EAST: 3 GW
(10 projects)
S. AMERICA: 1 GW
(7 projects)
AUSTRALASIA: 2.5 GW
(20 projects)
TOTAL: 145.3 GW
649 projects*
The worlds energy storage efforts have experienced a tremendous boost in recent years, as this April 2014 U.S. Energy Department snapshot (of veried
projects and projects whose verication is in process) shows. The edgling grid storage market is expected to transform into a $10.4 billion business by
2017, compared to just $200 million in 2012. Storage capacity is rated here in wattsas opposed to watt-hours, energys true measure, because most
storage projects are pumped hydro (some of them seasonal) or projects that have no clear indication of duration. Sources: Sandia National Laboratories, DOE
Global Energy Storage Database Copy and artwork by Sonal Patel, a POWER associate editor.
181 GW
Total storage projects
that are operational,
under construction, or
have been announced
worldwide
ASIA EUROPE N. AMERICA S. AMERICA AFRICA/
MIDDLE EAST
AUSTRALASIA
NO STORAGE DEVELOPING
STORAGE
*Denotes only energy storage projects that are operational worldwide; includes 26 MW of projects that are less than 500 kW.
BREAKDOWN BY STORAGE TECHNOLOGY
PUMPED HYDRO
97.8%
142,078 MW
2.2%
HYDROGEN
<0.1%
1.4 MW
THERMAL STORAGE
0.98%
1,431 MW
COMPRESSED AIR
0.3%
434 MW
FLYWHEEL
0.7%
1,027 MW
BATTERY
0.2%
334 MW
OPERATIONAL PROJECTS
145.3 GW
ANNOUNCED
8.1 GW
PROJECTS UNDER
CONSTRUCTION
27.4 GW
THE BIG PICTURE: Storage Snapshot
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May 2014 14
Ironically, India only passed its 2010 nuclear liability law to
boost its credibility and as a last step to activate the 2008 In-
do-U.S. civilian nuclear agreement, because U.S. nuclear reactor
manufacturing companies require a liability bill to get insurance
at home. In return for Washingtons help in persuading the NSG
to create an exemption that allowed its members to engage in
nuclear trade with India (even though the country is not a sig-
natory to the nonproliferation treaty), per the 2008 agreement,
India committed to buy U.S. reactors worth 10 GWroughly $50
billion or more in reactor sales.
And in fact, the final Indian liability law actually quashes an
absolute liability mandate established by the Indian Supreme
Court in the aftermath of the 1984 Bhopal disaster, in which
15,000 people died after methyl isocyanate leaked from a plant
run by U.S. company Union Carbide and whose cause was pinned
to corporate negligence. It caps the liability of the Nuclear Power
Corporation of India Ltd., Indias state-owned nuclear firm that
owns all of the countrys commercially operating reactors, at
about $250 million. But though the government stealthily at-
tempted to prevent it, the final law also contains a clausea
right to recoursethat allows the public sector company to
reclaim some of those funds from a supplier.
Significantly, the April-drafted India-Russia liability deal could
serve as a template for a similar government-to-government pact
with France, whose state-owned nuclear firm AREVA has proposed
to build two EPR reactors in Maharashtra, India said. But for the
U.S., the right to recourse clause remains a major deterrent.
Though U.S. Energy Secretary Ernest Moniz met with Indian
officials March 1112 for an ongoing India-U.S. energy dia-
logue, the two countries are reportedly no closer to resolving
their stalemate over the nuclear liability law. For U.S. suppliers
like Westinghousethe American unit of Japans Toshiba Corp.
that has proposed to build an AP1000 reactor in Gujaratand
for GE-Hitachi, which has been in talks with India for years for
six proposed ESBWR units in Andhra Pradesh, efforts to develop
nuclear projects in India have been frustrating, despite the 2008
Indo-U.S. civil nuclear agreement.
The companies contend that specific sections of the nuclear li-
ability act violate the International Atomic Energy Agencys Inter-
national Convention on Supplementary Compensation for Nuclear
Damage (CSC). Though the 1997-adopted CSC has 17 country sig-
natories, only four countries have ratified it, and until five signa-
tory countries with a minimum of 400 GWth of installed nuclear
capacity (a third of all the worlds currently operable reactors)
ratify it, the convention cannot pass into force. Last December,
Canada signed the CSC, and Japan announced plans to become the
fifth country to ratify it, but that hasnt happened yet. And while
India is a signatory of the CSC, it will continue to rely on its own
law covering nuclear liability, which it blankly refuses to dilute,
as officials told the U.S. energy dialogue delegation in March.
59-MW Fuel Cell Park Opening Heralds
Robust Global Technology Future
The 59-MW Gyeonggi Green Energy fuel cell park (Figure 3) in South
Koreas Hwasung Cityone of the worlds largest fuel cell facili-
tiesbegan operation in February. The five-acre facility built by
South Koreas largest private energy producer, POSCO Energy, con-
sists of 21 FuelCell Energy DFC3000 power plants rated at 2.8 MW
each to provide continuous baseload power to the power-strapped
South Korean grid and heat for a district heating system.
Completion of the projectbegun in November 2012took
only 13 months, according to project developers. And though it is
the first fuel cell project of its scale for stationary power, several
more are in the pipeline, evidence of an emerging trend for the
fledgling alternative energy source. UK-based market intelligence
firm Fuel Cell Today posits that overall shipments of fuel cell sys-
tems for stationary power in 2012 soared 50% compared to 2011,
with more than 24,100 units shipped worth a total 125 MW.
Proton exchange membrane fuel cells (PEMFCs) dominated a
stunning 88% of the market in 2012, because that technology is
well-suited to applications from the small, sub-watt scale to the
megawatt scale and can be used with different fuel types. PEMFCs
are expected to continue their growth because the technology is
the preferred choice in automotive applications.
But the firm also noted exceptional growth for five other spe-
cific fuel cell technologies. Molten carbonate fuel cells (MCFCs)
are rising to an equal footing with PEMFC in terms of megawatts
shipped, largely due to adoption of large stationary power plants
in South Korealike the Gyeonggi Green Energy fuel cell park
and the U.S., says Fuel Cell Today. The firm forecasts that more
megawatts of MCFC will be shipped in 2013 than any other fuel cell
type. Then, there are solid oxide fuel cells, which are showing in-
creasing penetration of residential microcombined heat and pow-
er in Japan and megawatt-scale installations in the U.S. by Bloom
Energy, it said. The other three technologies are direct methanol
fuel cells, phosphoric acid fuel cells, and alkaline fuel cells.
FuelCell Energy, maker of the Direct FuelCell power plant, says
Asian markets, in particular, are accelerating market demand for
stationary power plants. The company in October 2012 agreed
to supply modules worth 122 MW to POSCO, which is pursuing
a number of combined heat and power applications as well as a
demonstration project at a liquefied natural gas terminal to con-
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vert boil-off natural gas to power.
Meanwhile, in Seoul City, 26 miles
to the north of Hwasung City, FuelCell
Energy is putting up seven DFC3000
plants for the 19.6-MW Godeok Rolling
Stock Management Office fuel cell park,
a project that could counter power dis-
ruptions to a nearby railroad depot when
it becomes operational later this year.
And in the U.S., the 14.9-MW Bridgeport
fuel cell park, owned by Dominion, has
been completed and is delivering power
to the grid under a 15-year power pur-
chase agreement.
POWER Digest
Netherlands to Ban Financing of Coal
Plants Abroad. The Netherlands on Mar.
24 joined an initiative of the U.S., the UK,
Denmark, Finland, Iceland, Norway, and
Sweden to reach a global climate change
agreement in 2015, agreeing to end support
for public financing of new coal-fired power
plants abroad except in rare circumstanc-
es. The Netherlands and U.S. are already
working together to promote a technology-
neutral standard in the Organization for
Economic Cooperation and Development
Export Credit Group that limits support
for high-carbon-intensity power plants by
export credit agencies, said Dutch Prime
Minister Mark Rutte in a statement.
IEA: High Renewables by 2050 Sce-
nario Is Challenging. A report released
in March by the International Energy
Agencys platform for enhancing interna-
tional cooperation on policies and market
instruments for renewable technologies
the Renewable Energy Technology Deploy-
ment (IEA-RETD)envisions what the
energy system of a high-renewable-energy
world might look like in 2050. Many chal-
lenges will need to be overcome before
the vision could become a reality, it con-
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3. 21 plants on site. The 59-MW Gyeonggi Green Energy fuel cell park that recently
began operating in South Koreas Hwasung City comprises 21 FuelCell Energy DFC3000 power
plants rated at 2.8 MW each. Courtesy: FuelCell Energy
|
May 2014 16
cludes however. These will include making
the implementation and the transition to
such a radically different energy architec-
ture happen; ensuring the system will op-
erate in a stable manner without crashing
and jeopardizing security of energy sup-
ply; and determining how all this can be
achieved at a reasonable societal cost.
The cost hurdle could soon be overcome:
Large hydropower, photovoltaics, and on-
shore wind in areas with high yields, and
some biomass waste generation, are now
competitive when compared with fossil fuel
based energies, while most remaining renew-
able energy technologies can be expected
to see considerable cost reduction through
learning by doing as increased capacity is
deployed, the report notes. But it remains to
be seen what level of centralized control will
be required to provide the markets and regu-
lators confidence that the energy system
will be able to respond dynamically to bal-
ance demand and supply while maintaining
supply, it concludes. All this needs studying
and testing in practice.
Renewable Targets, Promotion of
Nuclear Power Highlighted in Japans
Draft Energy Plan. Japans ruling coali-
tion comprising the ruling Liberal Demo-
cratic Party (LDP) and the New Komeito
party on Apr. 4 approved a draft of what
could become the countrys first Basic En-
ergy Plan since the Fukushima disaster.
The draft includes revisions, pushed for
by New Komeito, that include numerical
targets, not just stated commitments, for
renewable energy. It reportedly now calls
for renewables to constitute 20% of total
power supply by 2030. Japans Ministry
of Land, Infrastructure, and Transport on
Mar. 17, meanwhile, unveiled a compre-
hensive environmental action program
identifying steps the country should un-
dertake by 2020 to reduce greenhouse gas
emissions by 3.8% in 2020 compared with
2005 levels. The pledge is much lower than
the 25% reduction in 2020 compared to a
1990 benchmark proclaimed in 2009.
Though all 48 of the countrys operating
reactors are still shut down pending safety
approvals, and no specific targets have
been unveiled for nuclear power, the gov-
ernments draft energy plan also reportedly
calls for the promotion of further research
and development of high-temperature gas-
cooled reactors that make them less sus-
ceptible to core meltdown than other types
of reactors, and for technological develop-
ment to enhance the safety of light water
reactors, including countermeasures for
severe accidents. Japans Cabinet is soon
expected to approve the new energy plan.
Spains Renewables Subsidy Cuts
Make Big Gains in Deficit Reduction.
Spain reported a 33% tariff deficit drop
to $5 billion in 2013 compared with $7.5
billion in 2012, a reduction that it said
is due to an industry overhaul that cut
renewable subsidies and introduced new
taxes on electricity generation starting
in July 2013. In February, the govern-
ment laid out a proposal that sets new
formulas for calculating an overall reduc-
tion in subsidy payments to solar, wind,
and other renewables to further slash the
deficit by $2.4 billion. The formulas are
based on a level of reasonable profit-
ability that each type of project can
expect during its decades-long lifespan.
Wind farmsrepresenting 37% of the
countrys installed wind power capaci-
tywould receive no further subsidies
under the proposal. Energy companies
such as wind leader Iberdrola and renew-
ables group Acciona have reportedly sold
off assets and overhauled business plans
in response to the proposed rules, which
have yet to be signed into law.
World Bank OKs Grand Inga Funding.
The World Bank on Apr. 1 approved a $73.1
million grant for the gargantuan 40-GW Grand
Inga project in the Democratic Republic of
Congo (DRC). The funds will be dedicated to
Inga 3, the first of six stages planned for the
$80 billion Grand Inga scheme, which gar-
nered $33.4 million last year from the Afri-
can Development Bank. Under a deal signed
with the DRC in May 2013, South Africa will
receive 2.5 GW of the 4.8 GW capacity an-
ticipated from Inga 3.
Unit 14 Commissioned at Chinas
13.9-GW Xiluodu Dam. The China Three
Gorges Corp. on Mar. 30 commissioned
the 14th generating unit at its 13.9-GW
Xiluodu hydropower project. The project
located on the Jinsha River near Chengdu
in Sichuan province consists of 18 Francis
turbine generators each rated at 770 MW
and a 937-foot-tall dam, one of the tallest
in the world. It is Chinas second-largest
hydropower project after the 22.5-GW
Three Gorges plant. Construction began in
2003 and the project could be fully opera-
tional as soon as 2015.
France Gets a Carbon Tax. Frances car-
bon tax on coal, heavy fuel oil, and natural
gas became effective on Apr. 1. The internal
tax on consumption (taxe intrieure sur la
consommation) was adopted in December
2013 to back President Francois Hollandes
announced target of reducing fossil fuel
consumption by 30% by 2030, to speed the
governments planned energy transition
to renewables while reducing the role of
nuclear power, as well as to reduce the pub-
lic deficit. Only 3% of Frances total power
and heat was generated with coal and peat
in 2011; natural gas took a larger share of
5%. The tax on gas is set at 1.41/MWh as
of Apr. 1, and will double to 2.93/MWh in
2015 and 4.45/MWh in 2016.
Sonal Patel is a POWER associate edi-
tor (@POWERmagazine, @sonalcpatel)
Editorial Excellence
POWER is proud to report that Associate Editor Sonal Patel
was a finalist for a Jesse H. Neal Award for a series of country
reports, Exceptional Transitions, published in the magazine
in 2013. The articles recognized were: The Russian Power
Revolution, Germanys Energy Transition Experiment,
Indonesia: Energy Rich and Electricity Poor, and South
Korea Walks an Energy Tightrope (available at powermag.
com). Sonal graciously included Editor Gail Reitenbach, PhD
in the nomination.
The Jesse H. Neal Awards are the most prestigious editorial
honors in the field of specialized journalism and are given
by The Association of Business Information & Media
Companies. The award winner in our category (one of 45
total categories with approximately 180 finalists combined)
was also the overall Grand Neal Award winner, so we had
some extra-tough competition!
Congratulations, Sonal on your strong submission and your
contributions to each issue of POWER and POWERnews.
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May 2014 18
Himalayan Run-of-River
Project Depends on New
Component Types
The Himalayan Mountains tower over some
of the most rugged terrain and harshest
climate conditions on the planet. Melting
snows from Mount Everest, K2, and hun-
dreds of other snow-capped peaks carve
out more than 6,000 rivers in Nepal, Chi-
na, Bhutan, India, and Pakistan. The vast
majority of the people living along these
remote rivers and valleys survive in under-
developed living conditions in geographi-
cally isolated and difficult-to-access areas.
In more ways than one, the rural people of
the Himalayas exist off the grid.
The homes and schools in these tiny vil-
lages (Figure 1) do not have a consistent
source of electricity, although a few have
small solar panels that provide enough
power for one or two lights. As in most
developing countries, basic serviceslike
heat and electricityare scarce and in-
consistent. Small stoves, burning animal
dung or scarce wood resources, provide
all of the heat and cooking for villagers.
Unfortunately, connecting these small
communities to existing power grids and
centralized power is cost prohibitive.
Life isnt easy in a tiny Himalayan com-
munity that doesnt have reliable power,
explains Lynn Tessier, engineering advi-
sor with Advantage Products Inc. Small
rural schools, for example, are limited in
their ability to educate students because
of the lack of consistent electricity. The
schools in these remote villages typically
only provide education up to grade seven,
and beyond that the children must go to a
bigger city, like Katmandu, for additional
schooling. And, as is often the case, once
the children experience the world at these
bigger schools, they dont return to the
village to help improve living conditions
or educate the next generation.
Hydrokinetic Generation
System Changes Lives
To combat the scarcity of reliable power,
US Synthetic, Advantage Products Inc.,
New Energy Corp., World Wildlife Fund
(WWF), and Himalaya Currents Inc. have
teamed up to develop a local, sustainable,
clean energy system that can provide Hi-
malayan villages with continuous power.
The project relies on an in-stream hydroki-
netic power generation system that is sub-
merged in a flume in a nearby river. The
5-kW EnCurrent power generation system
(Figure 2) converts kinetic energy in the
rivers water current into electrical power.
The pollution-free electricity is then trans-
mitted to the village.
As a humanitarian project, Advantage
Products is donating the EnCurrent power
generation system developed by New En-
ergy. New Energy, for its part, is provid-
ing project support and flume and weir
design. US Synthetic is donating an envi-
ronmentally friendly, grease-free polycrys-
talline diamond (PCD) bearing. Funding
to transport and install the equipment is
being provided by Himalaya Currents. WWF
is providing project coordination with lo-
cal government and communities, permit
applications for the project, and travel co-
ordination for the project team. Local com-
munity members from the village are also
1. View from a helicopter of Ringmo, Nepal. Isolated villages, such as Ringmo,
offer significant challenges for electricity generation and distribution. Courtesy: US Synthetic
2. A hydrokinetic turbine generator. Using the current of a river, the turbine and
direct drive generator can provide continuous power in a free flow environment. Courtesy: US
Synthetic
|
May 2014 20
helping out with the projectgathering
rock and constructing wire mesh gabions
to form the flume and weir in the river and
installing the EnCurrent generator.
The life-changing possibilities of this
project are exciting! explains Jair Gon-
zalez, general manager for US Synthetic
Bearings. Its fun to think that our tech-
nology might literally keep the lights on
in a classroom or help a child learn some-
thing new online.
New Bearing Design Improves
Reliability
The project utilizes the flow of the river
to keep the hydrokinetic turbine rotors
constantly spinningsupplying power 24
hours a day, seven days a week. The gen-
erators simple design provides clean and
continuous power with an extremely small
environmental footprint. The industrys
first above-water direct drive generator
coupled with the water-lubricated, long-
lasting PCD bearings used in the underwa-
ter turbine rotor eliminates environmental
contaminates like grease or oil.
As snow melts year round in the high
Himalayas and flows down into the ex-
pansive river system, villagers have access
to significant and consistent potential
energy. Hydroelectric power generation
is more reliable and, in many locations,
more easily accessed than other renewable
energy sources like wind or solar. The riv-
ers in the Himalayas offer one of the larg-
est, untapped renewable energy sources
in the world. The EnCurrent generator is
ideally suited to capture potential energy
in these remote areas.
Geographically, most remote villages in
the region are built in deep mountain val-
leys that experience limited sunlight. The
shadows made by these towering moun-
tains limit the efficiency and effectiveness
of solar power (especially when panels are
installed within or near the village). In-
stalling solar panels on mountaintops or
ridgelines where sunlight is more abun-
dant, presents other problems in construc-
tion, system maintenance, and energy
transmission.
Like solar power, wind power would
present logistical problemsrequiring
mountaintop or ridgeline construction that
would require transmission line construc-
tion. In both cases, providing 24-hour
power would require a much larger sys-
tem and an equally large battery storage
bank. Batteries also present a significant
environmental hazard, are expensive, offer
limited life, and present significant trans-
portation challenges in remote areas.
The first EnCurrent system will be in-
stalled at the remote mountain village of
Ringmo. Ringmo is located on the shores
of Lake Phoksundo in the Shey Phoksundo
National Park, high in the Dolpa region
in Nepal. A suitable location along the
river was chosen in April 2013. Ringmo
residents were very enthusiastic about the
possibility of having electricity for their
village (Figure 3).
Villagers were so excited that as soon
as they were shown the sketches of the
gabion (Figure 4) and weir design (Figure
5), they wanted to go down to the river
and begin construction immediately,
says Tessier.
Overcoming Challenging
Conditions
A significant problem with this project is
the remoteness of the location. The first
location for installation is a three-day
3. Ringmo villagers. Residents meet
to learn details about the project. Courtesy:
US Synthetic
4. Model image of the gabion with a hydrokinetic turbine installed. The
caged rocks form the foundation for the turbine. Courtesy: US Synthetic
5. Model image of a weir constructed in the river. The low damwhich is
relatively easy to construct using locally available rocksdirects the flow of water through the
turbine. Courtesy: US Synthetic
May 2014
|
walk from the nearest airstrip and a six-
day walk from the nearest road. Getting
equipment in and out is difficult. And,
doing it by helicopter is incredibly expen-
sive, explains Clayton Bear, president,
New Energy Corp. Because we will have
to haul the equipment in by porter or pony
caravans, we quickly recognized the need
to make our system as simple and light-
weight as possible. So, we scrapped the
gearbox and focused on a simple above-
water direct drive hydrokinetic generator
using a submerged water-lubricated PCD
bearing for the turbine rotor. This design
breaks the system down into small enough
components that can be carried by porters
and assembled on site with hand tools.
The biggest challenges facing the hydro-
kinetic system are underwater abrasion and
wear on the turbines rotor. As water moves
downstream in Himalayan rivers, it picks
up more and more debris and sediment
turning the water brown from all of the
mud, gravel, and sand churning up from the
river bottom. The melting ice from Hima-
layan glaciers is laden with abrasive sedi-
ment. These abrasive particles can quickly
destroy standard sealed bearings and wear
components on traditional turbine rotors;
however, New Energy designed the projects
underwater turbine rotor to work with PCD
bearings from US Synthetic.
PCD bearings are ideally suited for oper-
ation in harsh process fluid environments
where abrasive particles can cause accel-
erated wear. US Synthetic diamond bear-
ings are designed to be the perfect match
for the harshest, most demanding condi-
tions and environments. In our initial
testing, we threw sand and gravel into the
PCD bearing to see how it would perform.
It seemed to like itjust ground up the
particles with no problem. In some ways,
it actually worked better, Bear quipped.
The system was scheduled to ship to
Nepal in mid-March 2014, as this issue
was being produced. The people of Ringmo
plan to install the system in April and May
2014. Once completed, the project will
generate 24-hour power, easily handling
fluctuating energy loads without losing a
lot of energy in the transmission process.
PCD bearings will make the generator vir-
tually maintenance free. And, the small,
environmentally friendly hydrokinetic sys-
tem will provide power for needed light
and satellite connections to the rest of
the world for an isolated, ecologically sen-
sitive area of the planet (Figure 6).
The first installation builds on the con-
cept of localized power. It utilizes clean
energy technology and available resources
without contaminating the environment in
the process. The initial load for the village
was estimated to be in the neighborhood
of 2 kW, but there is already talk among the
villagers of additional uses for the electric-
ity. More units could be installed on the
river downstream from the initial system.
There are tens of thousands of loca-
tions around the globe, similar to this
one in Nepal, that do not have access to
continuous, reliable electricity. Thanks to
the new technology utilized in this in-
novative system, that may change in the
near future.
Edited by Aaron Larson, a POWER
associate editor (@AaronL_Power,
@POWERmagazine).
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|
May 2014 22
What to Watch for in EPA
Carbon Regulations for
Existing Plants
Mark Perlis
T
he U.S. Environmental Protection Agency (EPA) is expected
to propose first-of-a-kind greenhouse gas (GHG) emission
limits for existing power plants by June 2014. The EPA will
do so under a rarely used provision of the Clean Air Act, known as
Section 111(d). Here are some of the key questions that the EPA
faces in crafting its forthcoming regulations.
What Kind of GHG Limits Will Be Imposed?
Section 111(d) authorizes the EPA to prescribe performance stan-
dards for existing sources that emit GHGs. Although the EPA has
identified six primary GHGs that endanger the worlds climate, car-
bon dioxide (CO
2
) is the most prevalent (measured in terms of its
potential global warming impact), and fossil fuel electric generating
plants are the largest source of CO
2
emissions in the U.S. Since the
EPA is not required to regulate all GHGs or to regulate all sources
that emit a particular GHG, the EPA will likely start its regulatory
regime by proposing performance standards only for fossil-plant
emissions. The EPA will likely reserve similar authority to impose,
in the future, performance standards under Section 111(d) for other
GHGs, such as methane and nitrous oxide, and upon other industrial
sources that emit significant CO
2
or other GHG emissions.
Will the EPA Prescribe Uniform or Differentiated
Limits?
Performance standards are typically expressed as maximum rates of
emissions per unit of output, for example, pounds of CO
2
per MWh.
As a very rough approximation, existing coal-fired plants produce
approximately twice as much CO
2
per MWh as combined cycle plants.
This CO
2
performance differential is attributable to the higher car-
bon content in coal and higher heat rates of coal plants.
The EPA might prescribe a uniform, national power-sector per-
formance standard. Alternatively, the EPA might prescribe higher
performance standards for coal-fired steam boilers than for com-
bustion turbines, both simple cycle and combined-cycle. Further
differentiation may be introduced because Section 111(d) relies
upon state implementation plans, rather than a uniform national
plan. Thus, the EPA might prescribe different performance stan-
dards for each state, based on its historic generation mix.
How Will the EPA Justify the Stringency of
Performance Standards?
From a climate policy perspective, the EPAs goal is to achieve
substantial reductions in the aggregate level of power sector CO
2

emissions. President Obama has established an economy-wide
target for reducing the nations GHG emissions to 17% below
2005 levels by 2020. A key challenge for the EPA is whether it
can prescribe performance standards that will lead to CO
2
emis-
sion reductions from the power sector at least as large and as
quickly as the presidents overall target.
From a legal perspective, Section 111(d) might constrain the
EPAs discretion to set the stringency level of proposed CO
2
perfor-
mance standards. Section 111 requires that performance standards
reflect the degree of emission limitation achievable through the
application of the best system of emission reduction which . . .
the Administrator determines has been adequately demonstrated.
Among the most controversial issues confronting the EPA are how
to determine the best system of emission reduction (BSER) for
power plant CO
2
emissions, and how to determine that BSER has
been adequately demonstrated. Some commentators contend
that BSER must be determined based on emission reduction strate-
gies and technologies that operators can implement within the
fence of the power plant. Other commentators contend that BSER
may be determined for the electricity sector as a whole based on
regulatory measures that can be imposed beyond the fence to
reduce aggregate load (for example, by end-use energy efficiency
and demand side management measures) or to force a shift in gen-
eration mix away from coal to natural gas and to renewables (such
as by pricing carbon in electricity dispatch models or imposing
renewable portfolio standards).
How BSER is determined matters greatly because within the
fence, existing coal and natural gas plants might not be able to
achieve more than 4% to 5% reductions in heat rates and CO
2
emis-
sions. However, outside the fence policies and measures might
reduce demand for fossil-fuel generation and induce a shift in the
sectoral fuel mix that could, in the aggregate, achieve CO
2
emis-
sion reductions of at least 17% to 25% from the existing fleet.
How Will State Implementation Plans Reduce the
Overall Cost?
Section 111(d) is enforced through the EPA-approved state im-
plementation plans. This opens up the possibility that, however
BSER is determined, the EPA might encourage state adoption of
sector-wide policies and measures that enable a target level of CO
2

emission reductions to be achieved at least cost for the electricity
sector as a whole. The EPA might endorse statewide or region-
wide emissions trading systems, similar to those in California or
under the Regional Greenhouse Gas Initiative. The EPA might also
encourage state deployment of energy efficiency measures and re-
newable portfolio standards.
Given that the starting point for regulation will be the EPA-
prescribed performance standards only applicable to power plants,
states may need to design creative trading and crediting systems
that translate CO
2
emission reductions achieved throughout the
electricity sector into compliance obligations imposed on fossil
fuel power plants.
Mark Perlis (markperlis@dwt.com) is a partner in Davis
Wright Tremaines energy practice group in the firms
Washington, D.C., office.
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May 2014 24
ENERGY STORAGE
The Year Energy Storage
Hit Its Stride
Just-in-time delivery has become an ide-
al for many industries looking to optimize
their efficiency and responsiveness. For the
power sector, though, its been the business
model for well over a centuryand thats
the problem.
The North American grid is the largest
distribution system on earth, yet its one
with virtually none of its product in reserve.
For the most part, electricity needed by cus-
tomers and the system must be produced
at the moment its required. At the end of
2013, according to Energy Information Ad-
ministration (EIA) and Department of Ener-
gy (DOE) data, the United States had about
1,200 GW of installed generating capacity
and a miniscule 21.1 GW of grid-connect-
ed, utility-scale storage (counting projects
larger than 1 MW). Measured by electricity
generation, the figures are even worse: To-
tal net generation in the U.S. for 2013 was
about 4,058 TWh, against roughly 10 TWh
of total utility-scale storage. (These totals
are somewhat arbitrary given the many dif-
ferent functions played by energy storage;
see sidebar.)
Storing energy on the grid is not a new
idea, and a number of major storage projects
have been operating since the 1970s. Virtu-
ally all of these, however, are pumped storage
hydroelectric (PSH) plants. Of the 21.1 GW
of total energy storage capacity in the U.S.,
more than 96% is PSH. Another method,
compressed air energy storage (CAES), has
been in use since the 1990s, though world-
wide only two large-scale CAES projects
are currently in operation. According to the
International Energy Agency, of the ap-
proximately 140 GW of large-scale storage
in global operation, more than 99% is PSH.
Nearly 50% of the remainder is accounted for
by the two CAES plants.
PSH and CAES, however, have geograph-
ic limitations in that they can only be sited
in areas where storage of large volumes of
water or air is feasible, not where they might
be most useful for the grid. In addition, both
methods, though well-suited for hours-to-
days storage, cannot ramp fast enough to
respond effectively to more immediate de-
mands, such as for frequency regulation.
More nimble methods that can be sited in
areas of highest need have been handicapped
by limited capacities and high costs.
However, 2014 may be remembered as the
year that began to change.
Whats driving the shift is a mix of factors
from greater policy support, to growing need,
to advances in technology. Around the world,
a number of significant projects are poised to
begin operation this year or in the near future,
while several technologies that have been per-
colating in development for years are finally
seeing meaningful grid-scale deployment.
(For additional background, see the web sup-
plement to this article, Energy Storage Tech-
nologies Primer, associated with the features
for this issue online at powermag.com.)
A report in January from IHS predicted
After operating on the sidelines for years, the energy storage sector is finally poised
to begin making its mark, driven by greater policy support and technological ad-
vances that have begun making new solutions economic.
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ENERGY STORAGE
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May 2014 26
that the energy storage market was about to
explode, adding 6 GW in 2017 and 40 GW
by 2022, with about 40% of this growth oc-
curring in the U.S. While total capacities are
currently small, events suggest energy stor-
age is building momentum toward becoming
a key element of the grid.
Policy Developments
Perhaps the single most significant devel-
opment driving attention to energy storage,
according to Matt Roberts, executive direc-
tor of the Energy Storage Association, has
been the increased penetration of intermit-
tent renewable generation. Adding storage
is a way to help with intermittency and peak
load aspects, he told POWER in March. This
has meant increased demand for methods to
smooth output and respond to sudden drops
in production. Not surprisingly, most of the
policy activity has been in areas with sub-
stantial recent additions to renewable capac-
ity (Figure 1).
California. In 2010, California passed
legislation instructing the California Public
Utilities Commission (CPUC) to consider re-
quiring the states service providers to procure
certain levels of energy storage. Last year, the
CPUC issued a requirement for the states
investor-owned utilities, Southern California
Edison, San Diego Gas & Electric, and Pacific
Gas & Electric (PG&E), to collectively obtain
1.3 GW of energy storage by 2020.
The targets are broken down into trans-
mission, distribution, and customer storage,
and will be phased in over two-year periods
starting this year. No more than 50% can be
owned by the utilities, and PSH is excluded
from the mandate. Certain existing projects
can count toward the total, and the program
is designed to encourage a range of owner-
ship models.
Roberts noted that the mandate incorpo-
rates a lot of storage activity that was already
under way. Many of these projects, he said,
were coming because they were valuable,
not because they were policy driven. That
said, the policy is there to encourage con-
tinued growth after this year and help over
the long term.
Coming up with a process for procurement
required some new thinking. The CPUC rec-
ognized that the existing auction process un-
der the states renewable portfolio standard
wouldnt work for energy storage, which
isnt simply a block of generation but rather
a range of roles and services that cut across
most grid functions. Instead, the utilities are
to issue requests for offers (RFOs) that will
meet defined needs.
Other electricity service providers have
their own marching orders. Entities other
than municipal utilities must procure stor-
age equal to 1% of their annual peak load
by 2020. Municipal utilities do not have
fixed targets but must instead conduct as-
sessments, come up with their own plans
for obtaining storage, and submit them for
approval by the California Energy Commis-
sion by October 2014.
The targets, though ambitious, are some-
what fluid. In the event the RFOs dont
produce bids that meet identified needs, the
utilities are allowed to defer up to 80% of
their targets to the next phase. The utilities
are also allowed to shift targets between cat-
egories to some extent.
New York. This state has long suffered
from significant load congestion around New
York City, where the majority of its popula-
tion lives. Most of the citys power is gener-
ated elsewhere and transmitted through a few
narrow corridors. This congestion naturally
causes frequent spikes in wholesale power
prices. Another key concern is the potential
closure of the Indian Point nuclear plant
the Nuclear Regulatory Commission has yet
to rule on a license extension, and state poli-
ticians have called for its retirementwhich
supplies about 25% of the citys power.
In January, the state government an-
nounced a program with Consolidated Edi-
son (ConEd) intended to reduce the load on
the area grid by 125 MW, in part through en-
ergy storage. The proposed program includes
generous subsidies for storage projects: up to
$2,100/kW for battery storage and $2,600/
kW for thermal storage, with added incen-
tives for large-scale (greater than 500 kW)
facilities. The state is also investing in a bat-
tery storage testing and commercialization
center in Rochester, a $23 million partnership
between the New York Battery and Energy
Storage Technology Consortium and DNV
KEMA (now DNV GL).
The New York Independent System Op-
erator (NYISO) has the distinction of having
the first large-scale flywheel-based frequency
regulation plant in the country, a 20-MW/5-
MWh facility operated by Beacon Power.
Beacon Power struggled financially when
the plant was opened in 2011, but changes in
compensation for frequency regulation (see
Apples and Oranges
Energy storage facilities are unfortu-
nately not always described consistently
in media reports and press releases (or
even government data), being typically
rated in terms of power capacity (watts)
and only sometimes in storage capac-
ity (watt-hours). The approach in this
article is to report both figures where
available, because two 2-MW projects
may have very different performance
characteristics despite having the same
rated power.
The distinction is important because
some technologies (such as flywheels)
have high power but low energy, while
others (flow batteries) may be low power
but high energy, and still others (pumped
storage hydro and compressed air) have
power and energy capacities that are de-
termined by their associated power plants
and volume of available physical storage,
values that unlike other storage technolo-
gies are generally not interdependent.
1. Looking to lead the way. After adding nearly 4 GW of renewable capacity in 2013,
Californias need for energy storage is growing rapidly. This 4-MW/24-MWh sodium-sulfur bat-
tery in San Jose, inaugurated last year, is a pilot project by the California Energy Commission
and Pacific Gas & Electric Co. Courtesy: PG&E
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May 2014 28
below) have placed the company on a more
stable footing.
FERC and the ISOs. The Federal Energy
Regulatory Commission (FERC) has issued
several orders intended to improve market
access for energy storage. FERC Orders 890
in 2007 and 719 in 2008 directed the nations
independent system operators (ISOs) to re-
vise their regulations and operating proce-
dures to allow energy storage to participate
in wholesale energy markets. These were
followed by Orders 755 and 784 in 2011
and 2013, respectively, that required ISOs
to adopt methods allowing compensation for
frequency regulation and other ancillary ser-
vices, roles that newer energy storage tech-
nologies are well-suited to adopt.
Previous rules had handicapped third-party
ancillary services because there was no finan-
cial benefit for a transmission customer to go
outside the services offered by its transmission
provider, a share of which it was required to
pay for anyway. Most recently, in November
2013, FERC issued Order 792, which adds
energy storage to the category of resources
eligible to connect to grid under the Small
Generator Interconnection Procedures.
PJM was the first ISO to adopt Order 755,
followed by NYISO, which was the first to
adopt 784. (The others have followed suit,
with ISO-New England most recently adopt-
ing Order 755 this year.) PJMs Advanced
Technology Pilot program has explored
a number of options for storage within its
territory, and PJM has partnered with AES
on two battery projects, one of them a 32-
MW/8-MWh facility at a wind farm in West
Virginia. AES and PJM also launched an
initiative known as the Storage Applications
Center at the PJM campus in Pennsylvania
in March (see below). PJM has also been
studying the feasibility of using electric ve-
hicle batteries for frequency regulation in a
project with NRG Energy and the Univer-
sity of Delaware.
The Electricity Reliability Council of
Texas (ERCOT), while not under FERC ju-
risdiction, is studying similar steps to make
its market more storage friendly. A law
passed in 2011 gave energy storage the same
rights of interconnection and transmission as
generators. Though a possible shift toward a
capacity market has grabbed the headlines,
ERCOT is also looking at revisions to ancil-
lary services rules.
A pilot project using advanced lead-acid
batteries has been operating at Duke Energy
Renewables 153-MW Notree wind farm
near Odessa. ERCOT has also been testing a
fleet of 12 truck-mounted batteries to provide
mobile frequency regulation services.
Island Time. Solar energy has been a boon
for island grids that must rely on expensive
imported diesel and fuel oil. But the growth
of residential and commercial solar in places
like Hawaii and Puerto Rico has challenged
grid operators to maintain stability during pe-
riods of peak daytime output.
Late last year, the Puerto Rico Electric
Power Authority and the islands main utility,
the Autoridad de Energa Elctrica, issued
new guidelines for renewable energy proj-
ects that want to connect to the island grid.
All new projects must include energy stor-
age equal to 45% of maximum output for 1
minute in order to smooth output and reduce
the severity of ramping events. In addition,
projects must have storage equal to 30% of
rated capacity for 10 minutes for purposes of
frequency regulation.
This approach has garnered attention for its
focus on installed capacity rather than perfor-
mance. Whereas storage projects bidding into
markets such as PJM could face penalties for
failing to perform, such a scheme was seen as
a deterrent on the islands much smaller grid.
Hawaii now requires new wind projects
to limit their ramp rates, which as a practi-
cal matter is only possible through energy
storage. The state government has launched
several partnerships and initiatives to study
the best means of integrating storage into the
power mix and find ways for reducing costs.
Japan. The success of Japans ambitious
feed-in tariffs in spurring development of re-
newable energyit installed a breathtaking
9.4 GW of solar photovoltaic generation in
2013has created a sudden need for energy
storage, and the national government is mov-
ing aggressively to support it.
The Ministry of Economy, Trade and In-
dustry (METI) has allocated about $300 mil-
lion for energy storage projects, among them
the worlds largest redox flow battery in Hok-
kaido. The 15-MW/60-MWh facility, due to
come into service in 2015, will support the
massive build-out of solar in Hokkaido that
has threatened to overwhelm the islands
grid. (See Japan Ramps Up Renewables
in the February 2014 issue.) METI is sup-
porting several other smaller battery projects
elsewhere in the country, including through a
$100 million subsidy program for individuals
and small businesses announced in March.
Japan is a world leader in sodium-sulfur
(NaS) battery technology thanks to intense
research and development, mainly by NGK.
It currently has more than 190 NaS installa-
tions across the country with a total of 270
MW/1,640 MWh of installed capacity. The
largest installation is a 34-MW/245-MWh
facility backing up the 51-MW Rokkasho-
Futamata Wind Farm in northern Aomori
Prefecture (Figure 2).
Germany. With the worlds largest in-
stalled capacity of renewable generation,
Germany has not been idle on the energy
storage front. The federal government has al-
located $260 million for support of grid-scale
energy storage, of which $172 million has
been apportioned to specific projects.
In 2011, the government revised regula-
tions governing energy storage to clarify grid
fee exemptions for such projects and improve
the policy support for storage investment. In
2013, it also began offering 25 million in
homeowner subsidies for energy storage. The
program is aimed mainly at rooftop solar and
covers up to 30% of the installed cost of a stor-
age system when paired with solar panels.
Germany is also looking into power-to-
gas (P2G). In August 2013, E.ON inaugurat-
ed a 2-MW/30-MWh facility in Falkenhagen
that generates methane via electrolysis and
methanization with CO
2
, and uses it to gen-
erate electricity via fuel cells. In October,
a second P2G facility was added to a wind
farm in Grapzow; that plant has a capacity
of 1 MW/27 MWh. Both projects were built
by Canadian firm Hydrogenics. A third P2G
facility near Hamburg, also for E.ON, is un-
der development.
Batteries Charge Ahead
A great deal of activity is afoot in the battery
industry, from evolution of existing designs
and improvements in manufacturing to new
technologies. Navigant Research estimates
that the global market for utility-scale stor-
age batteries will grow from $164 million
this year to more than $2.5 billion by 2023.
Lithium-ion (Li-ion) batteries have reached
grid-scale commercial viability for certain
applications, with several manufacturers
moving beyond merely selling batteries to of-
fering integrated storage-related services. In
March, AES subsidiary AES Energy Storage
introduced its Advancion solution compris-
ing containerized Li-ion batteries, a propri-
etary hardware and software management
platform, turnkey installation, and full opera-
tions and maintenance support. The system
is available in 2-MW to 50-MW units and is
scalable into the hundreds of megawatts.
According to Chris Shelton, president of
AES Energy Storage, Advancion is intended
as a clean, cost-competitive alternative to
peaking power plants. Advancion can be de-
livered turnkey at around $1,000/kW, com-
pared to $1,300/kW for a gas turbine peaking
plant. Youre starting out with a lower cost,
and the storage has additional benefits that are
really meaningful for power industry needs,
he told POWER in March. Many peaking
plants have capacity factors under 10%, but
storage is available 24 hours a day and can
be synchronized and available for dispatch in
various flavors.
French battery giant Saft has been devel-
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oping similar containerized solutions, built
around its modular Intensium Max units,
which offer rated power ranging from 500
kW to 1.6 MW, and storage from 420 kWh to
1 MWh. A123 Energy Solutions Grid Bat-
tery System, which powers several current
AES Energy projects, offers both long-dura-
tion and high power options, ranging from 2
MW/575 kWh to 4 MW/4 MWh (Figure 3).
Hybrid battery projects, which leverage
the advantages of different battery technolo-
gies to create a more flexible overall product,
are also gaining momentum.
E.ON, battery manufacturers Exide and
Beta Motion, and SMA Solar Technology
announced in February that they were join-
ing forces to develop a 5-MW modular bat-
tery system, named M5BAT, at Aachen in
Germany. The design will combine Li-ion,
lead-acid, and sodiumnickel chloride bat-
teries into a single unit capable of meeting
short-to-medium-term demands. Construc-
tion is set to begin this year and be completed
in 2015. The project is being supported by
6.5 million from the Ministry for Economic
Affairs and Energy.
Another hybrid battery project, under con-
struction on Pellworm Island in Germany,
is combining a Saft Intensium Max module
with a vanadium redox flow battery to pro-
vide similar added flexibility in storage. (For
more on the Pellworm project, see Balanc-
ing Renewables with Li-ion Energy Storage
in this issue.)
The growth in demand for Li-ion batter-
ies is driving new partnerships and initiatives,
several of which are kicking off this year. In
March, Siemens and engineering firm M+W
Group announced plans for a joint venture
aimed at advancing production technology
for battery manufacturing and developing a
complete control technology solution for the
mass production of large-size batteries.
Also in March, A123 Systems Energy
Solutions business unit was purchased by
Japans NEC, which plans to create a new
division focused on storage, NEC Energy
Solutions. The new operation, slated to open
its doors in June, will combine NECs infor-
mation and communications technology with
A123 Energys storage systems to offer com-
plete turnkey storage solutions.
The biggest news in manufacturing, howev-
er, is automotive firm Teslas plans for what it
calls a gigafactorynot just the largest bat-
tery factory in the world but one with an out-
put that, at 35 GW per year, would exceed the
total worldwide production of Li-ion batteries
in 2013. The $4 billion to $5 billion project is
currently in development, but construction is
slated to begin later this year. Though mainly
intended to supply Teslas fleet of electric ve-
hicles, the factory is also specifically aimed at
meeting storage needs of the renewable ener-
gy market. Analysts expect that, if successful,
the factory could significantly drive down the
cost of Li-ion batteries, possibly under $150/
kWh. Currently, Tesla pays around $200/kWh
to $300/kWh.
Several new battery technologies are near-
ing commercialization this year. Eos Energy
Storage worked with ConEd in New York
City last year to test a 5-kW/30-kWh version
of its zinc-air battery technology. Eos report-
edly has a 1-MW/6-MWh version, called
Aurora, due for deployment this year, and it
claims its batteries will be cheaper than other
technologies, at about $160/kWh. However,
the design has a reported 75% round-trip ef-
ficiency, which is significantly lower than
other options (Li-ion batteries typically see
efficiencies around 95%). In March, Eos re-
ceived a $1 million grant from the New York
State Energy Research and Development Au-
thority to help develop its technology.
Primus Power has developed a zinc bro-
mine hybrid redox flow battery that it is roll-
ing out this year at sites in Washington and
San Diego. Like other designs, the system
is containerized and can be installed in 250-
kW/750-kWh units, which it calls Energy-
Pods (Figure 4). Primus has a grant from the
DOE to install a 25-MW/75-MWh system
for the Modesto Irrigation District in Califor-
nia; work on that project is expected to begin
in 2015.
Axion Power is introducing an advanced
lead-acid battery in which the negative elec-
trode is replaced by a supercapacitor made
of activated carbon. This gives its patented
PbC battery much faster recharge rates and
approximately five times the cycle life of a
traditional lead-acid battery. For grid appli-
cations, the PbC batteries are mounted into a
PowerCube module, a mobile container with
up to 1-MW/500-kWh storage capacity. Two
pilot projects are in operation, and a 500-kW
project attached to a solar plant in New Jer-
sey is under construction with a target com-
pletion date later this year.
CAES/LAES: The Pressure Is On
After decades of stagnancy, in which only
two commercial plants were constructed
and none brought online since 1991there
are signs that CAES may finally be poised
to grow. Much of this is being driven by ad-
vances in technology and developments in
next-generation CAES that is not dependent
on geographical limitations. A report from
Navigant Research released in August 2013
predicted that 11 GW of new CAES capacity
would be added worldwide by 2023.
In July 2013, Apex Compressed Air Ener-
gy Storage and Dresser-Rand announced that
they would partner to build a 317-MW CAES
2. Big backup. This wind farm in northern Japan incorporates one of the largest battery-
based energy storage systems in operation worldwide. The 51-MW facility includes 245 MWh
of sodium-sulfur battery storage. Courtesy: Japan Wind Development Co.
3. Standardized units. A123 Energy
Solutions containerized Nanophosphate
Li-ion battery modules are available in both
long-duration and fast-discharge rate configu-
rations. Courtesy: A123 Energy Solutions
ENERGY STORAGE
May 2014
|
plant in Anderson County, Texas (roughly be-
tween Dallas and Houston). The project will
use the Bethel salt dome, which has previous-
ly been used for natural gas storage, to store
the compressed air. Permitting and financ-
ing is currently under way, and Apex hopes
to break ground this year with completion
targeted for 2017. The $200 million project,
which is potentially expandable to 476 MW,
will sell energy into the ERCOT market.
PG&E has been exploring a CAES plant
of its own to be built somewhere in the Cali-
fornia Central Valley. The PG&E plant will
use porous rock formations. The project has
received funding from the DOE and CPUC
and has a goal of 300 MW rated power and 3
GWh storage.
Meanwhile, the Bonneville Power Admin-
istration (BPA) has been looking at CAES as
a means of dealing with its regular oversup-
ply issues. BPA has been working with the
DOEs Pacific Northwest National Labora-
tory to identify sites, also in porous rock, for
CAES plants. Two possibilities in eastern
Washington were identified last May.
While the Bethel and PG&E projects will
employ conventional CAES technology,
another project has the potential to greatly
expand the reach of CAES, though into a dif-
ferent niche. New Hampshirebased SustainX
has developed the first MW-scale isothermal
CAES (ICAES) system (see First Mega-
watt-Scale Isothermal CAES Completion in
the November 2013 issue at powermag.com).
Unlike conventional CAES, the heat from the
compression process is captured and stored
using a two-stage aqueous foambased sys-
tem using pneumatic cylinders. Because the
system does not rely on geological storage, it
can be sited anywhere.
Though its storage capacity is much small-
er than that of conventional CAESthe first
ICAES project in New Hampshire is rated at
1.5 MW/1.5 MWhit is far more efficient.
SustainX claims a round-trip efficiency of
better than 95%, compared with around 40%
to 50% for conventional CAES.
Another project under development by Ger-
man energy giant RWE and General Electric
(GE) represents a more incremental advance
in CAES by making the process adiabatic
that is, transferring the heat to a storage res-
ervoir as compared with storing it in the same
system, as with ICAES. The ADELE project
in Stassfurt, Germany, currently in a one-year
pilot phase, will pass compressed air through
40-meter-tall containers of ceramic brick to
capture heat energy and then return it during
expansion. Power will be generated using an
air turbine rather than natural gas. The goal
is a 90-MW/360-MWh demonstration plant
that will operate at around 70% efficiency
and store output from area wind farms with-
out CO
2
emissions. If all goes well, operation
could commence in 2016.
Though CAES is theoretically a worth-
while add-on to gas turbine plants, its
geographical limitations have prevented
wide-scale applications. Liquid air energy
storage (LAES), however, has the potential
to remove that limitation.
UK-based Highview has been develop-
ing LAES technology for several years and
has been operating a 350-kW/2.5-MWh pilot
project adjacent to SSEs 80-MW Slough bio-
mass plant near London since 2011 (Figure
5). In February, the UK Department of En-
ergy & Climate Change awarded Highview
and Viridor more than 8 million to build a
new 5-MW/15-MWh LAES demonstration
project at a Viridor landfill-gas power plant.
The following month, Highview and GE
announced a partnership to explore oppor-
tunities for adding LAES technology to gas
turbine peaker plants using GE turbines.
GE believes LAES has the potential to
improve start-up times, efficiencies, and heat
rates in addition to adding energy storage to
allow time-shifting and increased plant flex-
ibility. Highview says its LAES method is
potentially scalable to more than 50 MW.
Flywheels and Rails
Beacon Power is finishing construction of its
second flywheel facility in Hazle Township,
Penn. The plant began commercial operation
in September 2013 when the first 4 MW of
flywheel storage came online. The remaining
16 MW of capacity have been added progres-
sively since then. Like its plant in New York,
the Hazle Township facility provides fre-
quency regulation services, in this case into
the PJM market.
One of the most unusual storage projects
currently under waythough one with in-
triguing potential given its remarkable sim-
plicitymight be likened to dry PSH. Santa
Barbara, Calif.based Advanced Rail Energy
Storage (ARES) is building a 50-MW, 12.5-
MWh storage system in Nevada that uses
nothing more high tech than rail cars filled
with cement. The cars are driven to the top
of a hill by electric motors, and when power
is needed, theyre rolled back down the track,
running their motors in reverse to generate
electricity (Figure 6).
The $40 million system is being built as
a merchant plant but will connect to Valley
Electric, a local electric cooperative with
connections to the California ISO. The goal
is to get online by 2016 in hopes of serving
the California storage mandate. Assuming
sufficient space is available, ARES believes
its system could be scaled up to as much as 3
GW capacity and 24 GWh of storage, at up to
80% round-trip efficiency.
Storage Services Mature
As the energy storage industry matures, busi-
ness models are maturing with it. A number
of companies are introducing services in-
tended to support energy storage solutions
independent of the products or technology
being used.
In March, AES announced that it was
launching a new initiative called the Storage
Applications Center. The project is designed
to serve as a test bed for new storage tech-
nologies and applications in partnership with
PJM. According to Shelton, the center will
help refine applications for battery-based ser-
vices such as dynamic voltage support, peak-
ing capacity, real-time autonomous dispatch,
faster regulation, and protocols for merit or-
der dispatch.
AES also recently launched its Battery
Integration Center in Indianapolis, which
4. Containment. Primus Powers EnergyPod containers employ zinc bromine hybrid redox
flow batteries. Courtesy: Primus Power
ENERGY STORAGE
|
May 2014 32
is designed to work with battery and power
conversion manufacturers in developing
products for AESs Advancion solution. We
found it was better for us to procure compo-
nents from [these suppliers] and wrap it all
together with our control system and make a
finished solution. The project is technology
agnostic, he saidwhile currently focused
on Li-ion batteries, AES is also looking at
other technologies.
Several companies have introduced storage
management software intended to standard-
ize how storage projectsmainly batter-
iesoperate and connect to the grid. While
battery manufacturers typically offer their
own software, the intent is to make it possible
for customers to break free from proprietary
solutions. Maryland-based Greensmith has
offered its GEMS platform for battery man-
agement since 2008 and will deploy 23 MW
of storage projects in 2014. Seattle-based
1Energy Systems and San Franciscobased
GELI are also pushing their own solutions.
1Energy is currently partnering with the Sno-
homish County Public Utility District, Als-
tom Grid, and Parker Hannifin on a 1-MW
pilot project in Washington.
Stem, based in Millbrae, Calif., though
it also offers a software product, is taking a
different tackone modeled after third-party
ownership for rooftop solar photovoltaics.
Stem has raised $5 million to offer energy
storage as a contract service for entities that
can take advantage of energy storage but that
dont want to commit to the large up-front
costs. Under Stems approach, it will own
the batteries and contract to provide storage
services over a set period, typically 10 years.
Stem currently has contracts for 6 MWh of
storage, though only about 100 kWh has
been installed so far.
On the Horizon
A number of other methods have drawn inter-
est as a means of grid storage but are not yet
commercial. These include new technologies
such as supercapacitors and hybrid superca-
pacitor-flow batteries, as well as new uses for
existing technologies, such as repurposing
used electric vehicle batteries (the latter idea
is being tested by Sumitomo in Japan).
Shelton noted that the storage industry has
made competitive inroads without the sort of
direct subsidies and incentives that have pro-
pelled wind and solar. That doesnt mean pol-
icy support cant be improved, though. The
number one thing we can do is have FERC
and regulatory folks make sure that storage is
in the game. We have to be competing along-
side the other resources, he said. Still, if
direct support for renewables is to continue,
its worth looking at putting storage into the
grab bag of renewable support.
Much attention is likely to be devoted
to Californias experiences with its storage
mandate and whether this is successful in
economically adding capacity to the grid and
nurturing the still-nascent industry. In that,
Roberts said, Were going to see different
types of energy storage systems deployed for
different uses, which will increase visibility
for the various roles storage can play.
The energy storage sector still has many
growing pains to work through, but 2014 will
likely be remembered as the year the process
kicked off in earnest.
Thomas W. Overton, JD is a POWER
associate editor (@thomas_overton,
@POWERmagazine).
5. Chill out. This pilot liquid air energy storage (LAES) system operated by Highview in the
U.K. provides storage for a biomass plant. Highview is developing a larger (5-MW/15-MWh)
LAES system for a landfill-gas plant near London. Courtesy: Highview
6. Roll on. This rail car loaded with concrete weights is a prototype for a novel energy stor-
age system under development in Nevada. The system will store energy by driving the cars up
an incline and recover it by generating electricity as the cars roll back down. Courtesy: Advanced
Rail Energy Storage
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May 2014 34
ENERGY STORAGE
Balancing Renewables with
Li-ion Energy Storage
T
he inherently unpredictable and vari-
able nature of wind power can pres-
ent significant integration challenges
when increasing the penetration of wind
turbines within already highly stressed
medium-voltage (MV) distribution grids.
Energy storage systems (ESSs) based on
lithium-ion (Li-ion) battery technology are
now starting to play an increasingly impor-
tant role in helping control the output of
wind farms as well as providing ancillary
services to the grid. Furthermore, for wind
plant installations remote from a strong
grid connection point, energy storage can
provide a cost-effective, fast-track alterna-
tive to grid reinforcement.
According to the U.S. Department of
Energys Global Energy Storage Database,
there are 102 Li-ion battery installations
worldwide in operation or in development as
of March 2014, with an estimated combined
storage of more than 175 MWh.
The technology behind Li-ion battery sys-
tems has been developing fast in recent years,
and the chemistrys high energy density (up
to 385 Wh/liter and 180 Wh/kilogram) means
that significant levels of storage capacity can
be packed into a relatively compact and light-
weight footprint. Li-ion ESSs are now able
to store energy at the megawatt scale, and
integrated containerized systems can be con-
nected in parallel to deliver multiple mega-
watt-hour storage capacity.
One advantage of Li-ion ESSs is that volt-
age, power, and storage capacity can be pre-
cisely tailored to the requirements of specific
installations because these industrial-scale
batteries are built up from strings of in-
dividual cylindrical cells, such as Safts VL
cells, each of which has a storage capacity of
just a few amp-hours and a nominal voltage
of 3.6 V. These strings are combined in series
and parallel into modules, racks, cabinets,
and ultimately containers.
Operators of wind turbines and wind
farms are keen to make the most of their
generation capacity so that they can sell
electricity to the grid at times of peak de-
mand and avoid curtailment. Grid opera-
tors, on the other hand, are eager to ensure
that wind farms supply high-quality power
that meets the demands of their grid codes
and avoids high ramp rates caused by rapid
changes in wind conditions.
To stabilize output from wind farms, an
ESS must handle significant daily energy
flows, high power output, and very dynamic
charge/discharge behavior at variable depth
of discharge. The Intensium Max concept
was developed to offer the ideal combination
Li-ion energy storage systems are being deployed around the world to balance out-
put from wind and solar, and the first grid-scale projects are demonstrating the
technologys impressive potential.
Michael Lippert
Courtesy: Saft
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ENERGY STORAGE
|
May 2014 36
of energy and power output, with the ability
to deliver high performance in demanding
cycling conditions over a lifespan exceeding
10 years.
Taking a containerized approach to an
ESS offers multiple advantages. It means
not only that a single technical solution
can address multiple applications but also
that a single battery system can enable
grid operators to network multiple value
streams. For the wind power plant, an ESS
can facilitate grid integration, smooth in-
termittent generation, reduce ramp rates,
and shape power outputs. For the MV grid,
an ESS can help manage power flows to
reduce feeder congestion during demand
and generation peaks, provide local dy-
namic voltage support, and enable black
start and islanding.
Battery Management
When engineering a Li-ion ESS, a vital
consideration is ensuring that a battery
management system is in place to control
the charge and discharge of each battery
module and monitor its state of charge and
health. Both thermal and electrical manage-
ment are important to ensure a homogenous
state of charge and operating temperature
under dynamic operating conditions. This
delivers safety and reliability throughout a
long service life. The value in such a fully
integrated plug and play solution is that
operators receive a containerized product
including a management system that can
be monitored either locally through a hu-
man machine interface or from a remote
control room.
While Saft has delivered Li-ion ESS
solutions for a number of installations,
including integrating solar photovoltaic
(PV) and other on-grid applications, three
projects highlight the benefits of the tech-
nology and how it can be applied to suit
different circumstances.
Overcoming Intermittency in
Canada
Since taking delivery of two containerized
ESS units in 2013, a remote community in
Canada is smoothing out the fluctuations in
power from its wind turbines. Cowessess
First Nation (CFN) is now benefiting from
a $5.5 million project delivered with the
Saskatchewan Research Council (SRC) that
comprises an 800-kW wind turbine installed
with a 1-MWh Li-ion ESS that overcomes
the issue of intermittency of wind power on
the prairies.
For this project, Saft supplied two Inten-
sium Max 20E systems, which have a total
capacity of 1 MWh (Figure 1). The ESS
limits the ramp rate to 10% per minute of
the turbines rated output and provides up to
400 kWh of peak-shaving capability. CFN
has reduced the volatility of its wind power
by 70%, an important consideration for re-
mote communities.
Funded by a government agency, the SRC
delivered the project in part to demonstrate
the benefits of energy storage to other First
Nations communities that are looking to
overcome intermittency. It worked in close
cooperation with CFN to consult on the best
location for the new installation and within
Canadas well-developed framework for de-
veloping wind farms to minimize the impact
on wildlife and make the most of natural
wind resources.
Maximizing Wind Potential in
France
A project in the Aube region of France has
brought together several partners to test in-
novative equipment and management tools
for electricity distribution grids in rural
environments. As part of the VENTEEA
project sponsored by ADEME (the French
Environment and Energy Management
Agency), consortium leader ERDF is in-
stalling an ESS supplied by Saft that com-
bines more than 1 MWh of storage capacity
and 2 MW of power. The system will serve a
12-MW wind power plant and demonstrate
multiple services, including smoothing of
1. Smooth output. The 1-MWh Saft In-
tensium Max Li-ion energy storage systems
inside the two containers at the base of this
wind turbine reduce the turbines ramp rate
and smooth out fluctuations in its output.
Courtesy: Saft
2. Multi-talented storage. The Saft Intensium Max system on the right is part of a
hybrid energy storage system (ESS) being developed on Pellworm Island in Germanywhere
total annual production from renewables is three times local consumptionas a test of how
ESSs can support very deep renewable integration. Courtesy: Saft
ENERGY STORAGE
May 2014
|
output as well as grid voltage and frequency
management.
The location of the ESS on the grid be-
tween two MV feeders (a dedicated feeder
and a mixed feeder) was chosen for its high
testing potential. The intention is to test the
various services provided by the battery in
order to improve the overall system perfor-
mance for both the wind power generating
company and the distribution grid operator.
It is anticipated that the Li-ion ESS will
increase the grids integration capacity for
renewable energy, contribute to stabilizing
the grid, and drive an overall increase in
energy efficiency.
Predictability and Manageability
Pellworm Island, off the North Sea coast of
Germany, represents a vision of the renewable
energy mix of the futurethe islands cur-
rent share of renewables already corresponds
to the countrys national target for 2050. Its
annual energy production of around 21 GWh
from wind turbines, PV power plants, and
biogas plants is around three times the annual
consumer load of 7 GWh. There is also a re-
markably high level of night storage heaters
and heat pumps.
Yet, even with this large excess of local
production, the islands community of 1,200
people still relies on its connection with the
mainland grid, via two 20-kV subsea cables,
for balancing local surpluses and importing
energy at peak periods when demand ex-
ceeds supply.
An E.ON-led pilot project, running from
2012 to 2015, is now implementing a smart
grid for Pellworm, based on a combination
of intelligent control technology, flexible
load management, and central energy stor-
age. One of the main aims of the project is to
increase the islands self-consumption of its
own renewable energy generation and trans-
mit less energy to the mainland.
Different storage technologies are be-
ing implemented on Pellworm to cover the
range of needs to store and deliver energy
over time scales ranging from minutes-to-
hours to hours-to-days. A combination
of commercially available storage systems
within an overarching hybrid storage sys-
tem concept has enabled a reduction in in-
vestment costs. Retrofitting thermal loads
with the potential for flexibility also re-
duces the system cost for the integration of
renewable energy sources.
The hours to days storage is provided by
a 200-kW, 1.6-MWh Vanadium redox-flow
battery. Load flexibility in terms of hours
storage is provided by a combination of night
storage heaters and heat pumps, with an av-
erage energy capacity per household of 135
kWh and an average power of 17 kW.
The minutes to hours storage is provid-
ed by a Saft Intensium Max 20 Li-ion battery
system providing 560 kWh of energy storage
and 1 MW power (Figure 2). The system will
smooth intermittent generation and reduce
ramp rates as well as help to manage power
flows within the MV grids, making wind and
solar energy a predictable and manageable
contribution to the Pellworm energy mix.
Speaking about the project, Dr. Klaus Pe-
ter Rttgen, head of E.ON Innovation Center
Energy Storage, said, E.ON regards energy
storage as a key innovation that will help im-
prove the grid performance and especially
the integration of renewable energy, and Li-
ion batteries are one of the most interesting
and important technologies in this sector.
SmartRegion Pellworm Island is therefore a
crucial lighthouse project that will enable us
to evaluate how Safts Li-ion technology can
operate in a real-world situation to help make
smart grids even smarter.
Michael Lippert is marketing and busi-
ness development manager for Saft.
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May 2014 38
OUTAGE MANAGEMENT
Critical Path: Getting Your Outage
Ducks in a Row
Productive maintenance turnarounds are vital to long, successful online peri-
ods. Getting the work done quickly and properly takes more than just luck.
Good planning and excellent communication can lead to safe and efficient
outages with fewer hiccups and less stress.
Aaron Larson
I
ts no secret that equipment requires
maintenance. Just as your personal ve-
hicle needs an oil change periodically, a
power plant needs to shut down regularly for
a tune-up to take care of all those little issues
that would otherwise turn into big problems.
Most generating companies are preparing
for outages continuously. When one outage
ends, plans begin for the next. Often planning
is in progress for major projects years into the
future (Figure 1). Work list items that could
not be completed for one reason or another
are added to the next outage schedule. The
entire process is a full-time job, often with
entire departments focused on the task.
But what makes some maintenance peri-
ods go smoothlycoming in on budget and
on timewhile other outages hemorrhage
with cost overruns, unexpected delays, and
continual surprises? It is very difficult to
foresee every possible problem, but planning
for contingencies and scheduling appropri-
ately are two vital tasks required to get all
involved parties on the same page.
Planning for Success
In a career spanning more than 30 years, Guy
Starr, president of D&Z Atlantic, a Day &
Zimmerman (D&Z) company, has been in-
volved in hundreds of outages at nuclear and
fossil-fueled power plants, as well as process
and industrial plants throughout the U.S. He
has seen what works and what doesnt.
You must have a good scopeknow
what youre going to doyou must have a
good plan, and a good team. Thats really
what makes for a successful project, Starr
said. Now that sounds really simple, but
there are a lot of activities that must go on to
make that happen.
If youve been involved in many outages,
youve probably experienced maintenance
periods that were run more like a mishmash
of disconnected activities. Perhaps multiple
contractors were brought in, each with differ-
ent goals and schedules, none of which were
integrated into an overall timetable. Manag-
ers who werent used to the process or in
touch with the big picture may have directed
the work, which resulted in activity conflicts
and ultimately outage delays.
A lot has changed as utilities have come
to realize how important a well-run outage
is to the companys bottom line. Hundreds
of thousandsor even millionsof dol-
lars hang in the balance based on outage
durations. With many best practices already
implemented, outage schedules have been
condensed dramatically over the years. Ac-
cording to the Electric Utility Cost Group,
nuclear refueling outage durations averaged
105 days in 19901991, but that has been cut
to under 40 days for a typical refueling out-
age today. Although plants continue to place
an emphasis on shortening outage durations,
companies must also maintain high qual-
ity standards and conduct the work safely.
Although not all of the time savings can be
attributed to improved outage management,
Starr believes better execution is a direct re-
sult of better planning.
The most successful outages have the
proper planning in place, said Starr. Over
time the clients have seen that the utility
owner and the contractor need to be one
team to incorporate for proper outage readi-
ness. We have to be a partner in order to get
this accomplished.
There are other factors, such as plant size
and location that can affect outage prepa-
rations. For plants located in remote rural
1. Major projects require extensive coordination. An air quality control system
upgrade can take years and cost hundreds of millions of dollars. Planning the outage to tie it all
in is no small feat. Courtesy: Aaron Larson
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and materials testing. Its just another way
TerraSource Global ensures that our top-quality
equipment, integrated systems and reliable
services meet and exceed your expectations.
|
May 2014 40
OUTAGE MANAGEMENT
areas, finding qualified people can be prob-
lematic. Mobilizing a team of workers can
take time and can be costly. Early planning
is essential to ensure necessary personnel
are available.
Plant size also affects staffing and prepa-
ration for outages. Small plants rarely have
excess people who can focus solely on out-
age preparations. The tasks of planning,
scheduling, and executing the work all fall
on a tiny group of core personnel who run
day-to-day operations. In some ways, how-
ever, having that responsibility and author-
ity makes managing outages easier because
it minimizes the red tape that can hog-tie
managers at larger plants.
New employees and contractors require
special consideration. Outage periods are
intense and require additional focus be-
cause of all the activities that take place
concurrently. If any staff have never been
involved in an outage before, it is particu-
larly important to have a well-designed
indoctrination program to get them up to
speed prior to throwing them to the wolves.
Even things as simple as a persons route
from the parking lot can change due to
heavy traffic patterns around a facility.
Making the effort to ensure everyone un-
derstands safety policies and work proce-
dures is time well spent.
Setting the Scope
As Starr pointed out, having a good scope is
at the top of the list for running an effective
outage. He noted that utilities have learned to
freeze scopes early in the process. Once the
scope is frozen, the contractor can begin esti-
mating and scheduling activities. Setting ear-
ly milestones for work package development
allows proper safety steps to be incorporated
and ensures good instructions are provided.
Late planning, scope creep, and unplanned
emergent work are a sure recipe for failure.
Having that core planning and execu-
tion team on site earlyfixing and freez-
ing the scope as early as possibleis what
we have seen that makes an outage suc-
cessful, said Starr.
Another key is having an integrated outage
schedule. Many tasks require coordination
not only between the plant and the contrac-
tor, but also among departments within the
plant. Having an integrated schedule can help
facilitate that coordination.
If a pump rebuild were required, for ex-
ample, the timing of operators locking out
the equipment, technicians removing instru-
mentation, electricians unwiring the motor,
carpenters erecting a scaffold, mechanics
uncoupling and disassembling components,
and perhaps a contractor repairing internal
defects on the housing could all be planned
accordingly. Integrating that schedule has
been paramount in condensing outage dura-
tions over the years.
Having a good teammotivated employ-
ees with the skill and desire to perform qual-
ity work in a safe and efficient mannerwith
a well-defined project organization and clear
expectations is important. Not only are lead-
ership abilities necessary, but good commu-
nication skills also are vital. For example, the
managers making final decisions often dont
have intimate knowledge of what is necessary
to complete a job in the field, but a picture
showing physical obstructions in a work area
can instantly explain why a job takes longer
than one might otherwise have expected. Ex-
plaining the details and providing drawings
and diagrams with specifics can lead to bet-
ter, more confident decision-making.
Technology Tools Help
Technological advances have improved the
work management process too. There are a
number of software tools available today for
basic project management and scheduling.
Many computerized maintenance manage-
ment systems have these functions built into
their programs, but there are also off-the-shelf
programs, such as Microsoft Project, that can
be used. The technology allows easier track-
ing of tasks with scheduled start times, dura-
tions, and finish times.
Oracles Primavera solution is another op-
tionreportedly used at 60% of the worlds
top utilitiesto manage outages and capital
projects. The platform offers a single set of
solutions for managing outages, daily main-
tenance, and capital expansion projects of all
sizes. It also helps companies institutionalize
best practices and methodologies to achieve
repeatable success. When changes inevita-
bly occur, the program enables managers to
pinpoint potential delays and develop contin-
gency plans.
Dashboards (Figure 2) offer a wealth of
visual information, including Gantt charts,
to manage time lines and allow critical path
activitiesthe jobs and sequence that must
be done in order for the outage to com-
plete in the shortest amount of time pos-
sible with no change in scopeto be easily
identified. Employee productivity can be
increased through better planning and al-
location of resources.
In addition to scheduling software, D&Z
utilizes estimating systems, historical data-
bases for lessons learned and best practices,
and its own internally developed outage
readiness program called the Project Execu-
tion Tool (PET).
Pre-outage milestones are ranked in
PET using color codesgreen, yellow, or
redbased on whether a job is ready to go
or has issues that could delay or preclude
completion. A yellow task may have parts
on backorder that are being expedited by the
supplier and are expected to arrive in time
to conduct the activity on schedule. A job
needing parts that havent yet been fabricat-
ed or have long lead times would likely be
classified as red and may ultimately delay
outage completion.
The PET is constantly being updated
with the client. Meetings are held 90 days,
60 days, and 30 days prior to shutdown,
with tasks appraised right up to the outage
date to make sure that all items are ready to
be executed. If something isnt ready to be
performed, D&Z places the task on a risk
register, assigns it an opportunity value,
and starts developing a contingency plan to
minimize the risk.
The most important thing that PET does
is force communication. People get together
2. Oracle Primavera P6 project management software. The program can be
used to organize projects with up to 100,000 activities. Graphical timelines provide managers with
a visual depiction of outage progress. Courtesy: Oracle Corp.
May 2014
|
OUTAGE MANAGEMENT
around a table and discuss the status of the scheduled jobs. The indi-
viduals who are responsible for the work must provide answers about
what is being done to overcome obstacles. PET prompts the discus-
sion, allowing members to understand their roles. Expectations can
be set, and the process drives accountability. It allows the entire or-
ganization to respond when necessary and allows for more of a team
effort, which leads to a successful outcome.
Trust but Verify
In the end though, the tools are only as good as the people using them.
The old saying, garbage in equals garbage out, still applies. Having
trust in your employees is obviously very important, but verifying
their reports is imperative to keep systems updated and reports accu-
rate. If incorrect information is relied upon, proper decisions cannot
be made.
When youve got your supervisors coming in and telling you
what percent theyre complete, how many welds theyve made or how
many feet of pipe theyve put in, thats good and fine, but weve got
our project controls group and theyre out there and theyre verifying.
We trust, but we verify constantly to make sure the data that were
getting in is good data. That we dont just have pipe hanging in the
rack with ropes versus actual hangers and welded together or screwed
together, said Starr.
When talking about outages, words that seem to come up time and
time again are expectations, responsibility, and accountability.
For the team to complete tasks on schedule, the expectations must be
defined and the people responsible for meeting milestones must be
identified on the teams organizational chart. Ultimately, that process
designates a single person with the authority to sign off on work for
both the client and the contractor. Having that single point of con-
tact drives proper communication, eliminates confusion, minimizes
finger-pointing, and reduces delays.
Forced Outages Force Action
Of course, some outages pop up unexpectedly. A tube rupture can
spoil everyones holiday plans and throw managers into crisis mode
(Figure 3). But there are things that can be done to make even those
situations go more smoothly. First and foremost is having an up-
dated contingency plan and work list available for on-call personnel
to reference.
Keeping a list of reliable external contacts that can help provide
needed resources in an emergency is also important. The time to se-
lect your trusted partner is not when your back is against the wall
following a tube leak, but well in advance of any unexpected outage.
Developing trust and confidence with a contractor is important for
getting a quick response, which is helpful in getting a unit back online
in a minimal amount of time. Most plants have a number of go-to
contractors on speed dial.
Managing the activities during a forced outage requires planning
on the fly. Safety and quality must never be compromised, so manag-
ers need to take a step back and monitor the big picture. It is very easy
to become caught up in the task of getting the work done and return-
ing the unit to service, but following well-defined procedures can help
maintain focus and prevent accidents.
Having a continually updated work list is another best practice.
If a unit is forced offline, there are frequently additional mainte-
nance activities that can be done in parallel with the repair that
brought the plant down. For this reason, scheduling work and de-
fining the critical path is just as important during a forced outage
as it is for an outage that has been planned for months or years.
Understanding the work progression allows sequenced actions
to be prepared in advance and staged so that handoffs take place
without a hitch.
If nondestructive testing is to be conducted during a forced
outage, it should be done as soon as possible. Identifying issues
early helps establish the scope for the shutdown and allows unex-
pected deficiencies to be caught sooner rather than later (Figure
4). Although it may not always be possible, getting early results
from hydrostatic, ultrasonic, radiographic, or die penetrant tests
can save a lot of time by allowing work items to be completed
in parallel.
A common saying in maintenance organizations is that there is
always time to do a job right the first time. Rarely is placing time
pressure on workers going to result in the highest quality and fast-
est task completion. Supervisors are expected to get tasks done as
expeditiously as possible, but they must walk a fine line, because
placing too much emphasis on completing jobs quickly often
doesnt turn out well. Quality can suffer, and performing rework
will never be the most efficient work process, not to mention that it
is always a morale-killer. (Sometimes it is even a literal killer. See
3. And theyre off! As in a race, speed is important during a forced
outage. When sootblower erosion brought this biomass-fired boiler of-
fline suddenly, having a list of dependable contractors saved time and
reduced stress on plant supervisors. Courtesy: Aaron Larson
4. Early testing can identify previously undetected
issues. This tube leak on a superheater U-bend was found while
conducting a hydrostatic test during a forced outage for a completely
different problem. Detecting problems promptly can allow repairs to
be scheduled without extending outage durations. Courtesy: Aaron
Larson
|
May 2014 42
OUTAGE MANAGEMENT
Safety Is Not an Accident in the April
2014 issue or online at powermag.com.)
Keeping track of the hours worked by
essential employees is also imperative.
Fatigue sets in very quickly during forced
outages. Often, workers have been awake
and may have worked an entire normal
shift prior to being called back for emer-
gency repairs. A proper plan can minimize
wasted time, allowing workers to maximize
their rest without unnecessarily prolonging
the outage.
Most companies have policies restrict-
ing the number of hours that an employee
can work without a rest period, but even
those limitations can border on excessive.
The quality of work that you can expect
from an exhausted employee is much
lower than normal. Additionally, some
jobs can only be done by a select group of
qualified individuals.
For example, if you only have one welder
qualified to perform a certain weld that is re-
quired to complete a repair, you cant afford
to waste that persons time because the job
could be shut down when they have to take
a rest break.
In nuclear outages, radiation dose must be
tracked even more closely than time in some
cases. Personnel with a skill set needed on
a high-dose-rate job must have their total
dose managed conservatively on other jobs
to maximize their availability for the work
that only they can do. Accurate scheduling
and time estimating is crucial to maximizing
their productive hours and minimizing over-
all outage duration.
Of course, fluff is a schedulers night-
mare. When workers provide a cushion for
themselves within their estimates, it will fre-
quently throw the entire timeline off track.
Realistically, finishing a job early is just as
bad as finishing a job late. The goal should
always be to have accurate estimates based
on the averages.
Postgame Analysis
During an outage, there should be a con-
stant flow of informationupdating sta-
tuses and projecting outcomesbut when
the outage is over, its also important to go
back and review the results. Its no secret
that there can be a lot of stress and pres-
sure when a unit is offline. Corporate folks
want to know if the unit will be up on time,
finance types are curious if the projections
are right, people need parts yesterday, so
emotions can run high.
Conducting a post-outage critique two to
three weeks after startup with the plant back
online and making money allows cooler
heads to prevail. At that point, people can
look at the lessons learned, provide construc-
tive feedback, and come away with a better
understanding of what can be done to im-
prove the process in the future.
According to Starr, D&Z shares lessons
learned and industry best practices with its
clients. These include safety, quality, cost,
and scheduling practices.
At the end of the day, the project man-
agement tools and the principles are the
same across all industries, Starr said. We
try to drive the same planning concepts, as
far as the estimating, the scheduling, having
the core planning and execution team onsite
early, having an integrated schedule, your
lessons learned database and your historical
estimating, all of that is the same across all of
these industries.
Good communication, a well-defined
scope, solid personnel who buy into the plan,
and the right checks and balances are all
needed. In the end, what works is having a
team effort.
Aaron Larson is a POWER associate edi-
tor (@AaronL_Power, @POWERmagazine).
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May 2014 44
FUELS
Fuel-Flexible CFBs Add Flexibility
to Resource Plans
The downward trend in solid fuel quality has negatively affected many power genera-
tors that rely on imported fuels. For others, this represents a market opportunity.
A quick survey of recent installations found that fuel-flexible circulating fluidized
bed (CFB) boilers addressed owners fuel source concerns by efficiently burn-
ing low-quality, high-moisture coals, even when mixed with biomass and other
opportunity fuels.
Dr. Robert Peltier, PE
C
oal has fueled the generation of 41%
of the worlds electricity demand in
the 21st century thus far, according to
a fact sheet released by the World Coal Asso-
ciation last December. You may be surprised
to learn that the amount of coal used globally
has grown each year since 2000, and coal
continues to be the worlds favorite and fast-
ing growing fuel. New coal-fueled power
generation facility capacity installed since
2000 exceeds the capacity of new generation
by nuclear, oil, gas, and renewables com-
bined. In fact, coal is expected to overtake
oil as the worlds main source of energy for
power production by 2020.
Coal will likely remain the dominant fuel
for some time, as global electricity demand
is expected to double over the next three de-
cades, particularly in regions experiencing
electricity poverty. For example, coal-fueled
generation has played a vital role in providing
electricity to more than 450 million people in
China in the past 15 years. Another 1.4 bil-
lion people remain without access to electric-
ity, and coal will be the likely fuel source for
many future electrification projects.
Developed countries demand growth re-
mains stagnant, and the focus is on energy
efficiency, emissions reductions, and greater
use of less-carbon-intense biomass fuels.
However, economic development and the
eradication of poverty remain the primary
concerns of two-thirds of the world, and that
means significant demand growth and the
burning of more coal and indigenous bio-
mass fuels.
Lower-Quality Fuels Abound
Regional disparities in coal quality have ma-
terialized as global coal use grows. Very at-
tractive price discounts and growing supplies
of lower-quality Indonesian and domestic
coals are outpacing the supply of imported
high-quality Australian, Russian, and U.S.
coals. This downward trend in coal quality is
of interest to power plant developers in terms
of available coal quantities, particularly for
plants designed around conventional pulver-
ized coal (PC) boilers, as PC boilers gener-
ally prefer coal with a heating value over
5,500 kcal/kg.
Indonesia, with coal exports exceeding
400 million metric tons in 2013, is the larg-
est coal exporter in the world, with twice the
exports of Australia, its nearest competitor.
Today about 50% of Indonesian coal exports
are low-quality high-moisture subbituminous
coal with gross higher heating values (HHV)
between 3,900 kcal/kg and 4,200 kcal/kg,
well below the historical benchmark of 6,000
kcal/kg used in the international coal market
for the past 50 years.
These lower-quality coals have created a
market advantage for generators that can burn
less-energy-intensive coals, because the price
is discounted, on a Btu basis, about 25%. Be-
cause the cost of fuel represents about 80%
to 85% of the cost of operation, the ability to
burn a lower-quality coal (without affecting
plant operations and maintenance costs) has
a dramatic effect on a plants wholesale cost
of electricity.
Cofiring coal with biomass is another way
to gain fuel flexibility, though it does add
complexity to the fuel supply equation.
Biomass is a generic term that describes
a range of organic mixtures, ranging from
clean wood chips produced from harvested
trees to agricultural residue (agro, such as
some straws, olive, and rapeseed), salvaged
wet forest residues, and manufacturing wood
waste. Biomass properties vary considerably,
depending on their biological and regional
origin, seasonality, farming and harvesting
practices, and ultimately on their preparation
and processing. This leads to broad varia-
tions in chemical composition and physical
properties across different biomass types and
even within the same source type. These wide
property differences are one of the key chal-
lenges of using biomass as a fuel for power
1. Polish powerhouse. The 460-MW Lagisza CFB Power Plant, located in Bedzin, Poland,
is the largest circulating fluidized bed boiler in the world. It reliably burns both low-rank and
high-quality coals, as well as biomass and waste coal slurries. Steam is produced in the boiler
operating at supercritical steam conditions. Courtesy: Foster Wheeler
May 2014
|
FUELS
and steam production. (For more on the chal-
lenges and advantages of using biomass, see
Utility Biomass Use: Turning Over a New
Leaf? in this issue.)
Each of these fuels often causes difficul-
ties when cofired, such as agglomeration,
fouling, and corrosion of boiler convective
heat surfaces. These problems can usually
be traced back to elevated concentrations of
alkali, phosphorous, and chlorine, which are
typically much higher in most agricultural
products than in wood waste.
PC boilers also are particularly sensitive
to the unpredictable fuel heat content experi-
enced when burning ever-changing mixes of
biomass fuels. CFB boilers, in contrast, are
particularly effective when burning a combi-
nation of waste biomass and can even fire 20%
to 30% of difficult agro biomass with coal and
up to 100% of other forms of waste biomass.
The maximum size of a CFB plant designed
for cofiring large amounts of biomass with
coal appears to be about 600 MW today.
In addition to inherent fuel flexibility, CFB
boilers enjoy a flameless, low-temperature
combustion process (~850C versus ~1,500C
for a PC boiler) that does not melt or soften
the ash formed, as does a conventional boiler
with an open flame. In many regions, the
lower combustion temperature of the CFB
design plus the capability to add limestone
directly into the furnace bed eliminates the
requirement for separate NO
x
and SO
2
re-
moval equipment. Eliminating the external
air quality control systems could save $150
million to $200 million in capital cost on a
600-MW project.
These design differences can also have a
significant effect on plant availability. Data
from the European Union on bituminous
coal, brown coal, and lignite-fired utility-
scale CFB plants show that plant availability
for CFB plants was about five points higher
than for PC installations. Those five points of
increased plant availability will produce fuel
savings of about $100 million for a baseload
plant over 10 years at todays fuel and whole-
sale electricity prices.
Flexible Fuel Projects
Different plant developers have responded to
the challenge of building fuel-flexible power
plants in different ways. The rest of this ar-
ticle profiles seven CFB plants that cofire
solid fuels, are of utility-scale (>50 MW),
and have either recently been constructed or
are in the process of being constructed. Each
plant design is unique and reflects the fuel
supply and electricity markets of its particu-
lar region. Several are touted as the worlds
largest. . . . Others are interesting because of
their fuel mix.
Lagisza Power Station, Poland. The
Lagisza power plant in southern Poland op-
erates the worlds largest CFB boiler (Figure
1). Owned by Tauron Wytwarzanie S.A., the
460-MW plant was commissioned in June
2009. The CFB boiler burns fuels ranging
from low-rank to high-rank coals, plus bio-
mass and waste coal slurries.
Lagisza has many unique first-of-a-kind
design features, including vertical-tube
supercritical steam technology and low-
temperature flue gas heat extraction that
explains how the plant achieves a very high
43% net lower heating value (LHV) thermal
efficiency. The efficient performance of the
CFB also produces less air emissions. Lag-
isza meets all its air emission permit levels
without any postcombustion de-NO
x
or de-
SO
x
equipment, such as a selective catalytic
reduction (SCR) or separate flue gas desulfu-
rization system.
The Foster Wheeler AG (FW) CFBs load-
following capability is another important
feature for grids experiencing increasing
amounts of intermittent renewable power. In
fact, Lagisza enjoys the same load ramp as
an equivalently sized PC boiler, but it has a
much better turndown. Lagisza cycles from
about 40% to 100% of full-load rating each
day to meet the requirements of the Polish
National Grid.
Konin Power Plant, Poland. In July
2009, ZE PAK SA signed a contract for the
turnkey construction of a 55-MW biomass-
fired CFB boiler at its Konin Power Plant, the
oldest generating plant within ZE PAK SA.
The plant is also the supplier of space heat-
ing for the town of Konin and surrounding
areas. Construction began in February 2010,
and the unit was commissioned in July 2012
(Figure 2). With completion of the new unit,
the Konin Power Plant now consists of six
cross-connected boilers interconnected with
its three steam turbines plus the CFB boiler.
Although much smaller than Lagisza,
Konin is unique (Figure 3). Its CFB boiler is
a state-of-the-art biomass-fired unit designed
for burning clean, woody biomass and up to
20% of agricultural biomass including wil-
low, straw, rapeseed residue, cherry stones,
and oat husk. The boiler design consists of
the furnace and two high-efficiency solid
separators that capture unburned material en-
trained in the boiler exhaust gas and recycle
2. Multifuel boiler. One of the primary advantages of the CFB is its ability to handle a
range of biomass fuels without problem. Courtesy: ZE PAK SA
3. Many biomass mixes. The Konin
Power Plant was designed to handle a wide
range of biomass fuels. Courtesy: Foster
Wheeler
4. Pure biomass burning. The Pola-
niec Green Unit, at 205 MW, claims to be the
largest 100% biomass-fired power plant in the
world. Courtesy: Petr tefek
|
May 2014 46
FUELS
the material back to the furnace. The result
is much-improved combustion efficiency and
fewer emissions. The guaranteed boiler effi-
ciency was 91% with guaranteed emissions
of 200 mg/Nm
3
NO
x
and 200 mg/Nm
3
SO
x
.
A variety of biomass is transported by
trucks to the plant unloading station and con-
veyed to silos in the storage yard. There are
three separate storage silos, each dedicated to
forest and woody biomass, and five separate
silos for agro biomass. Each agro fuel is fed
from its own silo, as the fuel mixture con-
sists of straw pellets, oat husk, cherry stones,
rapeseed cake, and energy willow.
The system allows the dosing of different
types of biomass using screw conveyors in or-
der to feed a homogenous fuel mixture to the
boiler fuel silos. The mixture of different types
of biomass is distributed evenly to the CFB
boiler by four feeding points. The fuel is fed to
solid return chutes from external integrated heat
exchangers and mixed with circulating material
before entering the furnace.
Polaniec Power Station, Poland. GDF
Suez Energia Polska SAs 1,800-MW coal-
fired Polaniec Power Station is the fifth-
largest power plant in Poland (Figure 4). It
consists of eight units, each with a capacity
of 225 MW, built between 1979 and 1983.
In April 2010, GDF Suez Energia began
construction of the worlds largest CFB
boiler designed to fire 100% biomass at its
Polaniec plant site, and the plantknown as
the Polaniec Green Unit (a POWER renew-
able Top Plant, see the December 2013 issue
at powermag.com)was commissioned on
Nov. 15, 2012.
The FW Advanced Bio CFB combustion
technology was selected for the plant that
now produces 205 MW using a broad range
of biomass fuels. The wood and agro biomass
fuel is composed of 80% wood and 20% agro
biomass. The wood portion is clean wood
from forestry residues. The agro portion in-
cludes a variety of agricultural biomass such
as straw, sunflower pellets, dried fruit, and
palm kernel shell.
The boiler is equipped with an ammonia
injection system and catalystselective non-
catalytic reduction (SNCR) plus SCRfor
controlling NO
x
emissions, and an electro-
static precipitator for controlling particulate
emissions. Boiler steam conditions are 127
bar and 535C. Emissions guarantees, based
on a 24-hour average, are 150 mg/Nm
3
NO
x
,
150 mg/Nm
3
SO
2
, and 50 mg/Nm
3
CO.
The boiler has operated well with vari-
ous fuel mixes and continues to operate with
high efficiency. Boiler operation responds to
requirements of electricity production, and
full load range is in use on a weekly basis.
The boiler fulfills all Polish grid require-
ments with a 4% minimum load change rate
demonstrated solely with solid biomass fuels
with a turndown to 40% of design load.
Narva Elektrijaamad AS, Estonia. Al-
stom is constructing a 300-MW CFB boiler
plant for Narva Elektrijaamad AS (affiliate
of Eesti Energia), located near the Russian
border in Estonia (Figure 5). The Eesti Pow-
er Plant, built between 1963 and 1973, was
originally constructed with 16 boilers and
eight 200-MW steam turbines. Eesti was se-
lected as the site for the utilitys new fuel-
flexible CFB boiler that is designed to burn
low-heat-content fuel mixtures of oil shale
(8.2 MJ/kg), peat (8.75 MJ/kg), and up to
50% cofiring of wet wood chips (50% water
by weight, 8.35 MJ/kg), all LHV.
The unique combination of fuels has an
unexpected benefit. The inherent calcium
content of the oil shale facilitates high natu-
ral sulfur removal, and the 200 mg/Nm
3
limit
on SO
2
emissions will be met without adding
additional limestone to the CFB furnace.
The low combustion temperature of the
CFB furnace also produces less than the NO
x

limit of 150 mg/Nm
3
without an additional
denitrification system despite the high NO
x

emissions produced when combusting peat.
An electrostatic precipitator removes the
particulate emissions from the stack gas. Al-
stom guaranteed a boiler efficiency of 92.3%
(LHV) based on a steam pressure of 178 bar
and superheat/reheat steam temperatures of
543C/568C. The plant is scheduled to enter
commercial service in October 2015.
Samcheok Green Power Plant, South
Korea. Korean Southern Power Co. (KO-
SPO) also concluded that fuel procurement
flexibility would save the company millions
of dollars in fuel costs over its new plants
life. KOSPO selected CFB technology for its
2,200-MW Green Power Plant project, per-
haps one of the most ambitious power proj-
ects ever undertaken in South Korea. KOSPO
describes the project as the most efficient and
greenest coal plant ever built. When complet-
ed (expected by 2020), the facility will house
5,000 MW of power generation, including
renewable energy projects (Figure 6).
The Samcheok plant is located in Gang-
won-do Province in northeast South Korea
on 2.5 million square meters of reclaimed
coastal land. Now under construction, the first
phase uses four 550-MW FW CFBs featur-
ing the worlds first CFB boilers operating at
ultra-supercritical steam conditions (257 barg,
603C/603C), which is a scale-up of the Lag-
isza plant design. The CFBs will be the most
advanced CFB boiler units in the world when
5. Unique fuel mix. Alstom is con-
structing for Narva Elektrijaamad AS a plant
that will cofire oil shale, peat, and wet wood
chips. Estonia has significant domestic oil
shale resources. Courtesy: Alstom
6. Building from scratch. This artists rendering depicts KOSPOs 2,200-MW Green
Power CFB Plant, located in Samcheok, on the shoreline in northeast South Korea. The plant
will become the largest CFB power plant in the world when it goes online (scheduled for mid-
2015). The plant will burn both high- and low-rank coals and will sit on 2.5 million square meters
of reclaimed land. Source: Foster Wheeler
|
May 2014 48
FUELS
the plant enters commercial servicesched-
uled for July 2015. Foster Wheeler was given
a full release for the project in July 2011.
The following project phase is planned to
include approximately 1,000 MW produced
from renewable resources such as wind tur-
bines, solar panels, wave power generation,
and small hydropower generation. When
completed, the entire facility is expected to
cost $3 billion.
The plant will burn high-moisture Indone-
sia coal and biomass with a net plant heat rate
of 8,800 Btu/kWh (HHV), although the plant
is expected to initially burn Indonesian sub-
bituminous coal and some petroleum coke.
The Korean Renewable Portfolio Stan-
dard provides many incentives for burning
biomass, so the plant is designed to burn up
to 20% biomass, a total of about 400 MW.
KOSPO CEO Lee Sang-ho noted in an in-
terview with the Korea Herald in late 2013,
CFB steam generators can maximize effi-
ciency of coal-powered power plants as they
can be run based on cheap, low-grade coal.
Lee added, low-grade coal was about 50
percent cheaper than high grade coal. That
makes a big difference, as Korea must im-
port all its coal used for power generation.
Clecos Madison Unit 3, U.S. In the U.S.,
CFB boiler technology has proven its ability
to efficiently, cleanly, and reliably convert
petcoke, a waste product produced by petro-
leum refineries, into electricity. The largest
operating petcoke-fired power plant in the
world is Clecos 600-MW Madison Unit 3
(Figure 7), located in central Louisiana. (See
the August 2010 issue at powermag.com for
an in-depth description of the plant.)
Cleco selected CFB technology so that it
has the capability to use multiple solid fuels,
including biomass [to] help us lower custom-
er fuel costs. Petroleum coke is much less
expensive than the alternative fuels available
in this region, and a fraction of the cost of
western subbituminous coal delivered to the
plant site. Cleco believes that over 30 years,
the use of petcoke will save its customers
several billion dollars in fuel purchases. The
unit consumes approximately 1.5 million
tons of petcoke each year.
Fuel is delivered to the plant site from the
Gulf Coast via barge moving along Louisi-
anas Mississippi and Red Rivers. The site al-
ready had access to waterborne transportation
from the Gulf Coast. The petcoke is unloaded
onto a 1.5-mile-long conveyor that moves the
solid fuel to the plant for storage.
The reclaimed petcoke is crushed to about
-inch, mixed with crushed limestone, and
gravimetrically metered as it is injected into
the CFB furnace. The limestone removes
about 90% of the SO
2
formed in the combus-
tion process. Aqueous ammonia is injected to
further reduce the NO
x
produced in the CFB.
A polishing dry scrubber absorbs additional
SO
2
, and a baghouse removes particulates
from the stack gas.
Madison Unit 3s boiler operates at sub-
critical steam conditions. The steam pres-
sure is 2,550 psig, and steam temperatures
are 1,050F/1,050F. NO
x
production is lim-
ited to 0.07 lb/MMBtu and SO
2
is limited
to 0.15 lb/MMBtu, which represents a 99%
removal rate.
EKPCs Hugh L. Spurlock Generating
Station 4, U.S. East Kentucky Power Co-
operatives (EKPCs) Spurlock Station 4, lo-
cated in Maysville, Ky., entered commercial
operation in 2009 (Figure 8). Alstom sup-
plied the boiler island for Station 4, which in-
cluded the CFB, SNCR for NO
x
control, and
its flash dryer absorber or NID system, which
is designed to remove 95% of SO
2
emissions
regardless of the sulfur content of the fuel.
The unit reduces limestone consumption by
about 25% by reactivation of free lime in the
NID system.
The CFB boiler is designed to fire a wide
range of coals as well as enable up to 20% co-
firing of petcoke, biomass, and approximate-
ly five million tires per year. The boiler steam
conditions are 174 bar and 541C/541C. The
design coal is Western Kentucky coal with a
heating value of 24 MJ/kg (HHV). SO
2
emis-
sions are limited to 245 mg/Nm
3
at 6% O
2

and NO
2
is 85 mg/Nm
3
from 70% to 100%
of maximum continuous rating. A fabric fil-
ter collects any particulates produced by the
CFB boiler.
Dr. Robert Peltier, PE is POWERs
consulting editor.
7. Primarily petcoke. Cleco Power constructed the 600-MW Madison Unit 3 with the
capability to burn 100% petroleum coke as well as other biomass fuels. The $1 billion plant
entered commercial service in February 2010. Courtesy: Cleco Power
8. Fuel buffet The Hugh L. Spurlock Generating Station 4 is designed to cofire a wide range
of solid fuels with West Kentucky coal, including petcoke, biomass, and waste tires. Courtesy:
Alstom
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From the organizers of ELECTRIC POWER
|
May 2014 50
RENEWABLES
Utility Biomass Use: Turning Over a
New Leaf?
Once thought to be an excellent method for reducing emissions at coal power plants,
biomass generation is still underutilized in the U.S. Inexpensive natural gas,
lack of government incentives, and power plant operations concerns have lim-
ited biomass use at the utility level. Despite these challenges, biomass has
several advantages that can be leveraged in certain situations.
Una Nowling, PE
I
f there is one truth to the power indus-
try, it is that environmental regulations
will only proceed down one paththat
of stricter limits. Although legislatures and
courts may argue over the issue for years to
come, it appears inevitable that at some point
a carbon or greenhouse gas (GHG) emissions
tax will be applied to utility generators in
the U.S. Countries that are subject to a car-
bon tax typically employ three solutions to
reduce GHG emissions: improving plant ef-
ficiency via capital improvements plus moni-
toring and diagnostic tools, converting some
or all of the coal generation to natural gas, or
finding ways to utilize biomass fuel instead
of coal.
Previous articles have examined the ben-
efits of natural gas and monitoring and di-
agnostic programs; this article examines the
options available to successfully utilize bio-
mass at coal-fired power plants.
Even without GHG regulations for exist-
ing plants, current emissions requirements can
make biomass cofiring or conversion attrac-
tive. For example, Portland General Electrics
(PGE) Boardman Coal Plant is a 585-MW
pulverized coal plant that has fallen under
environmental regulations, leaving its owners
only three options: install expensive back-end
emissions controls, close the plant completely,
or switch to an environmentally friendly fuel.
As a result, PGE has studied the option of re-
ducing unit output to 300 MW and burning
up to 18 types of biomass for a total coal to
biomass conversion. We at PGE are really
excited to have this opportunity to keep a fa-
cility operational and maintain jobs, and help
the environment at the same time, said Randy
Curtis, engineering supervisor at Boardman.
Current Status of Biomass Utiliza-
tion at Utility Power Plants
Although biomass use is not uncommon
among industrial units, and is the norm
within the pulp and paper industry, biomass
utilization for grid-connected utility-scale
generation is rare in the U.S. According to
the Federal Energy Regulatory Commission
(FERC), operating biomass power capacity
is only 15.8 GW, representing 1.4% of the
total U.S. generation mix. Interest in biomass
cofiring or conversion peaked in the early
2000s and has only been seriously pursued at
utility scale at a handful of U.S. locations.
One notable installation was the AES
Greenidge plant, near Dresden, N.Y., which
employed a homemade biomass direct in-
jection system that allowed the operators to
burn approximately 10% biomass with coal
(Figure 1). Typically using waste food or
crop residues as fuel, Greenidge was closed
in 2012, the victim of cheap natural gas and
environmental concerns.
According to Dave OConnor, biomass
program manager at the Electric Power Re-
search Institute (EPRI), the primary bar-
rier to biomass cofiring or conversion in
the United States is low natural gas prices.
Power plants with convenient natural gas
access face lower capital barriers to natural
gas cofiring than biomass cofiring. In ad-
dition to this barrier, most renewable port-
folio standards for non-utilities are already
fully subscribed.
Interest in biomass for utility-scale pow-
er is much greater outside of the U.S., with
Europe and the developing world being the
leaders in this field. (See also Fuel-Flexible
CFBs Add Flexibility to Resource Plans in
this issue.) One of the most notable biomass
cofiring success stories to date has been the
cofiring and conversion work at the 3,960-
MW Drax Power Station in the United King-
dom. (For more on Drax, see UK Struggles
to Attract Low-Carbon Investment in this is-
sue.) The station has been working toward a
goal to reduce GHG emissions by more than
70% and has explored burning several bio-
mass fuels, such as willow, straw and wood
pellets, and agricultural waste. The current
1. A worthy effort. During its operating life, the AES Greenidge plant demonstrated that
biomass cofiring does not need to be expensive or complicated. Source: Black & Veatch
May 2014
|
RENEWABLES
Biomass Heat Rate Impacts
Biomass cofiring or conversion at the utility scale is typically driv-
en by environmental concerns. Understanding the corresponding
heat rate impacts of biomass combustion is critical for evaluating
the spectrum of risk and reward possibilities. Heat rate impacts
from biomass cofiring and conversion, relative to coal combustion,
result from three primary causes:
Boiler efficiency: A higher fuel moisture and hydrogen content
can lead to higher latent heat losses in the boiler. Changes in
combustion efficiency, furnace heat transfer, and flue gas flow
can lead to higher sensible heat losses. The higher volatility
of biomass fuel can contribute to lower unburned combustible
losses, but oversized fuel particles can negate this benefit, or
even result in greater unburned combustible losses.
Station service: Biomass handling, grinding, and preparation
systems can result in greater auxiliary power consumption at
the power plant, even with a reduction in coal equipment use.
Turbine heat rate: Changes in sootblowing steam use, steaming
rate and final steam temperatures, and spray flows can result in
changes to the net turbine heat rate.
Figures 2, 3, and 4 demonstrate some potential heat rate effects
of biomass combustion at a pulverized coal power plant studied
by Black & Veatch.
plan is to convert three of the six units at
Drax to being exclusively biomass by 2016;
the Unit 2 conversion is already complete.
Biomass Cofiring Project
Challenges and Pitfalls
Biomass utilization at existing coal-fired
power plants can be implemented by several
methods, from cofiring biomass and coal si-
multaneously to complete unit conversions to
biomass combustion. Less-common methods
of utilizing biomass include substituting B99
biodiesel for startup fuel oil, using a gasifier to
feed hot fuel gas into an existing boiler, or even
employing a separate standalone biomass unit
to supply heat to the coal units steam cycle.
In the last two decades Black & Veatch
has studied the barriers to and concerns over
utilizing biomass at more than 70 fossil-fired
units (see sidebar). The following details
some of the most common challenges we
have encountered.
Biomass Supply. Finding a suitable bio-
mass fuel supply at a competitive price is
difficult for most power plants. Suppliers are
often small mom and pop companies and
geographically remote from the power plant.
Supplies can be variable from a single ven-
dor, mandating contracts with scores of small
biomass suppliers, which greatly complicates
the biomass procurement process. Some-
times biomass suppliers will promise to meet
a demand for biomass at a reasonable price
during a study, but once the project appears
to be proceeding toward a test burn, suddenly
the price will increase by 50% or more.
One solution to these problems is for the
utility to take ownership of its biomass fuel.
Such is the case with Drax Power, which is
building biomass pellet plants in Louisiana
and Mississippi and shipping pellets back
to North Yorkshire, England. Designed to
produce more than 900,000 tons per year of
wood pellets, these pellet plants are a first
step toward Draxs ultimate goal of produc-
ing 2 million tons per year.
Biomass storage and handling logistics can
be a serious concern for power plants with
limited fuel yard space. Given a woody bio-
mass of a typical moisture content, one rule
of thumb is to assume that 1 ton per hour of
biomass will be required for 1 MWh of power
generation (less for pellets or torrefied bio-
mass and more for wet, herbaceous biomass).
88
88
87
87
86
86
85
85
10,550
10,500
10,450
10,400
10,350
10,300
10,250
10,200
10,150
10,100
0 5 10 15 20 25 30 35 40 45 50
Cofire level % of heat input
N
P
H
R

(
B
t
u
/
k
W
h
)
B
o
i
l
e
r

e
f
f
i
c
i
e
n
c
y

(
%
)
Boiler efficiency Net plant heat rate
2. Impact of increasing biomass use. As biomass replac-
es coal, the plant heat rate can suffer significant changes. In this ex-
ample a single woody biomass fuel with 20% moisture content was
comilled with the baseline Illinois Basin coal. Source: Black & Veatch
90
88
86
84
82
80
78
76
74
72
70
13,000
12,500
12,000
11,500
11,000
10,500
10,000
0 5 10 15 20 25 30 35 40 45
B
o
i
l
e
r

e
f
f
i
c
i
e
n
c
y

(
%
)
N
P
H
R

(
B
t
u
/
k
W
h
)
Wood moisture content (%)
Boiler efficiency Net plant heat rate
3. Impact of increasing biomass moisture. As bio-
mass moisture content increases, boiler efficiency and other losses
increase. In this example a single woody biomass fuel with a mois-
ture content ranging from 5% to 50% was blended with the baseline
Illinois Basin coal. Source: Black & Veatch
11,200
11,000
10,800
10,600
10,400
10,200
10,000
Coal
N
e
t

p
l
a
n
t

h
e
a
t

r
a
t
e

(
B
t
u
/
k
W
h
)
Torrefied
wood
Straw
pellets
Dried
wood
Bagasse Sewage
sludge
Raw
wood
Arundo
donax
Tree
trimmings
4. Impact of different biomass products. Biomass prod-
ucts can have an even greater variability in their quality than coal. In this
example, eight different biomass fuels were studied when comilled at
20% with the baseline Illinois Basin coal. Source: Black & Veatch
|
May 2014 52
RENEWABLES
Biomass is typically delivered by truck, and
a typical biomass truck can hold from 25 to 35
tons of biomass. Trucks tend to operate on a
10-hour schedule for six days a week; there-
fore, converting 10% of a 250-MW power
plant to biomass will require about two to
three biomass truck deliveries per hour. Local
residents may object to that much truck traffic
on the roads, and as a result the utility may be
asked to pay for upgrading bridges and roads.
Trucks will require a rapid dumping sys-
tem in order to avoid traffic congestion at the
plant and may require a staging area be
built by the plant entrance to hold trucks dur-
ing temporary outages (Figure 5).
Biomass Storage. Biomass storage is
often problematic at coal-fired power plants.
Because biomass fuels come in a variety of
types and sizes, plant owners must design
their storage and reclaim systems with care.
Covered biomass storage is recommended
or required for most fuels to reduce reclaim
efforts and to protect the biomass from de-
grading. Pelletized biomass is often touted
as being rain-hardy, but experience has
shown that a single rainstorm can sometimes
transform a pile of biomass pellets into a
mountain of sludge. Thus, covered storage is
highly recommended.
Another concern with biomass storage is
the high levels of dust created during han-
dling, especially at transfer points. Biomass
dust is generally less harmful to humans and
the environment than coal dust, but it can be
susceptible to hazardous mold accumulation,
which can affect the health of both the fuel
yard staff and nearby residents. Compared to
coal, biomass dust is significantly more fire-
prone due to its relatively low ignition temper-
atures. This risk was exemplified by the 2008
biomass dust explosion at the Ontario Power
Generation Atikokan plant. Four years later, a
biomass fire among the wood pellets stored in
600metric ton hoppers at the Tilbury B pow-
er plant in the UK led to that plant being out of
service for nearly four months.
Although coal demand will decrease as it
is replaced with biomass, biomass fuel has
a much lower energy density than coal, and
more of it is required for the same net genera-
tion. For a unit currently burning an 11,000
Btu/lb coal, cofiring just 5% straw biomass
containing 40% moisture will require a bio-
mass storage area 80% as large as the current
coal pile!
Comilling and Direct Injection. Many
technologies are available for introducing
biomass into a coal-fired boiler. Direct injec-
tion of ground biomass into the furnace via
dedicated ports is one of the safest methods
for cofiring, although it is also one of the
most expensive.
For small quantities of biomass fuel (1%
to 5% by energy content) comilling can be
the best choice, provided your mills are up
to the task. Due to the slippery and plastic
nature of biomass materials, milling with a
roll-wheel mill or ball tube mill can be prob-
lematic. Although the Hardgrove Grindabil-
ity (HGI) test is not intended to measure the
grindability of biomass materials, a rule of
thumb is to assume herbaceous biomass has
an HGI of 20 to 25.
As part of a biomass project that Black
& Veatch was involved with in conjunction
with Genesis Energy, New Zealand, at its
Huntly power station, the engineering and
corporate staff showed exceptional diligence
in planning for comilling of up to 20% bio-
mass. Here are some of the recommendations
of that study:
Biomass fuel can stick in bunker hop-
pers and clog feeders, requiring vibratory
shakers or even redesign of the hoppers. In
some cases biomass fuel can jam feeders
and trip a mill.
Increased housekeeping should be imple-
mented to control dust and spilled fuel
from the tripper to the feeders. Improved
fire detection and suppression systems
may be needed for the coal conveyors,
tripper room, and bunkers.
Mill roll wheels can be modified with slots
cut into them, to give the wheels more
bite into the biomass fuel. Roller spring
adjustments may also be required.
Ball tube mills may find many biomass
fuels problematic and, therefore, may re-
quire additional vigilance to ensure that
the fuel and balls dont conglomerate to-
gether into a solid mass.
Classifier settings will need adjustment
for biomass use, with some plant engi-
neers opting to open up classifiers to avoid
accumulating stringy, oversized biomass.
Mill air flow must be checked, and air
gaps closed, to prevent under-bowl fires.
Primary air ducts should be checked to en-
sure light biomass dust does not backflow
and accumulate in expansion joints, lead-
ing to a potential fire or explosion risk.
Mill inerting and fire detection systems
are necessary for any long-term biomass
comilling program. Special care should be
taken to sweep mills clean of biomass ma-
terial during shutdown.
Direct injection of biomass can be into the
existing coal pipes downstream of the mill
or be introduced directly to the furnace via
ports or burners. In the former method, no
new furnace penetrations are required, the
unit maintains its full coal capacity, and the
capital cost is modest. In the case of direct in-
jection into the furnace, the greatest concerns
are triggering New Source Review by cutting
new fuel ports into the walls, and potential
space limitations that prevent optimum bio-
mass port or burner placement.
Whether biomass direct injection occurs
in the coal pipes or the furnace proper, it is
important to try to maintain a consistent bio-
mass quality and quantity entering the fur-
nace, so operators are able to keep the units
tuned for the best balance of unburned car-
bon, CO, NO
X
, and furnace deposition.
Boiler Concerns. Many biomass fuels can
reduce boiler maintenance activities by hav-
ing a low, nonabrasive ash content. Some bio-
mass ash has a lower melting point than coal
5. Rapid dumping. Parallel unloading systems may be required to avoid traffic congestion
from biomass trucks. Source: Black & Veatch
May 2014
|
RENEWABLES
ash, which can result in slagging on water wall
surfaces. Biomass ash with a high potassium
or sodium content can significantly foul heat
transfer tubes in the upper furnace region.
Due to biomass having a lower energy
density than most coals, introducing signifi-
cant amounts of biomass fuel into a furnace
can result in increased flue gas velocity and,
potentially, more tube erosion in the close-
spaced primary superheater and economizer
tube bundles. Excess tube corrosion can oc-
cur with high-chlorine biomass fuels, espe-
cially those with a dry-basis chlorine content
of 0.18% or greater.
Ash-Handling Equipment. Dry ash-han-
dling systems can benefit from the relatively
low ash content of biomass. However, bio-
mass ash that contains high levels of calcium
and magnesium can encourage cementation
in wet ash systems.
Another potential problem concerns pow-
er plants that sell their fly ash for concrete
use. Currently, the ASTM C618-12a standard
for fly ash used in concrete does not allow the
introduction of biomass ash to the mix. In ad-
dition, the chemical requirements of ASTM
C618-12a may not allow biomass ash to be
classified as Class N, C, or F fly ash.
In one biomass cofiring study at large coal
power plant, it was quickly discovered that if
the utility must pay to have its ash landfilled,
as opposed to selling nearly all of its ash, the
differential cost to the plant was a loss of
more than $5 million per year.
Emissions Controls. At biomass co-
firing levels of 10% or less by heat input,
most electrostatic precipitators (ESPs) can
successfully collect biomass ash. However,
some biomass produces ash that has either a
very high or very low resistivity, thus making
it difficult to collect.
This is often the case in studies at power
plants designed for high-sulfur coals, and sig-
nificant levels of biomass cofiring may require
either ESP upgrades or chemical injection.
Furthermore, unless the furnace combustion
and milling systems are well tuned for both
the coal and biomass, boiler fly ash unburned
carbon can greatly increase. This is a problem
for two reasons. First, high levels of unburned
carbon can change the ash resistivity and in-
crease ash re-entrainment after being collected
in the ESP. Second, biomass ash with high
amounts of unburned carbon can accumulate
in hoppers or in fabric filter baghouses, lead-
ing to sometimes destructive fires.
Although biomass combustion often re-
duces NO
X
emissions, selective catalytic
reduction (SCR) catalysts can be very sensi-
tive to heavy metals and alkaline earth ele-
ments contained in biomass. If the biomass
in question includes a significant amount of
post-industrial waste, it can sometimes con-
tain arsenic, lead, cadmium, potassium, and
other items harmful to catalyst life. Where
high levels of ammonia slip are encountered
with either an SCR or a selective noncatalytic
reduction system, biomass ash can agglomer-
ate and form tenacious deposits on air heaters
downstream (Figure 6).
Flue gas desulfurization scrubbers are not
normally sensitive to biomass ash, unless the
ash contains excessive amounts of chlorine.
Some herbaceous biomass ash can contain
more than 0.5% chlorine, whereas many
scrubbers have a fuel-based chlorine limit of
less than 0.2%.
Greenhouse Gas Emissions. Biomass
fuel is rarely 100% carbon neutral, and cal-
culating the life-cycle GHG emissions from
biomass cofiring or conversion can be quite
difficult, especially when one considers all of
the possible feedstocks.
The planting and growing cycle, fertilizer
use, harvesting, transportation, milling and
processing, and transportation to the power
plant all contain numerous assumptions that
will differ from study to study. A review of
12 studies published in the past three years
regarding the net change in GHG emissions
at cofiring facilities found that the carbon
neutrality of biomass fuels ranged from 40%
to 96.5%. Clearly, a life-cycle assessment is
required for any proposed biomass cofiring
or conversion scheme.
Engineered Biomass Fuels
Most biomass fuels suffer from three fuel
properties that limit their use at existing coal-
fired power plants: low energy density, high
moisture content, and poor grindability. All
of these limitations can be addressed via the
use of engineered biomass fuels. Engineered
biomass fuels can be created by many differ-
ent processesincluding torrefaction, steam
exploding, and processing with waste heat
but the net results are very similar.
Typically, a large amount of moisture is
driven off the fuel, significantly increasing
the heating value, while the chemical struc-
ture of the fuel itself is altered such that the
biomass becomes more friable and easy to
grind in a coal mill. Some processes even
promise sulfur, chlorine, and heavy metal re-
moval as part of the upgrading.
The primary drawbacks to engineered
biomass fuels are their price and availability.
Availability is a function of the market be-
ing in its infancy, and price is a result of both
handling the fuel twice and the energy and
materials used in the upgrade process. Unfor-
tunately, in most cases, engineered biomass
products cannot compete with coal without
some special legal, environmental, or politi-
cal incentive at work.
EPRIs OConnor is bullish on upgraded
biomass. Torrefied, steam-exploded, and
other upgraded biomass products can usu-
ally be burned at existing coal-fired power
plants with relatively minor modifications.
The problem is operating costfinding an
upgraded biomass which can meet environ-
mental goals economically. But, OConnor
cautions, ensuring sustainable biomass is the
critical thing. A lot of the pellet production
is from waste wood or wood unsuitable for
other uses. Biomass resource planning needs
a sound strategy for sustainability to keep the
process as carbon-neutral as possible.
Can Biomass Blossom?
Although several potential pitfalls have been
discussed in this article, few should be con-
sidered fatal flaws in a plan for biomass cofir-
ing or biomass conversion. Though it is true
that cheap natural gas currently dampens the
enthusiasm for biomass, many power plants
have no suitable gas supply options. Further-
more, many power plants located in remote
regions or on island nations operate in cir-
cumstances where even engineered biomass
fuel is less expensive than imported fossil
fuels. Some power plants are located near
plentiful biomass sources, and others have
the ability to produce their own fuel.
So, despite the pitfalls, the net effect is that
biomass use is increasing for electrical gen-
eration, even in the U.S. According to FERC,
219 MW of biomass capacity were added in
2013. Should a GHG emissions or carbon tax
be levied in the future, or the price of gas in-
crease significantly, then using biomass may
be an option a utility cant ignore.
Una Nowling, PE (nowlinguc@bv.com)
is a project manager and technology
lead for fuels at Black & Veatch. She
has worked on fuels-related issues and
analyses at more than 550 different units
over 20 years, specializing in coal, natural
gas, and biofuels. She is also an adjunct
professor of mechanical engineering at
University of Missouri-Kansas City.
6. Air heater fouling. High levels of
ammonia slip can agglomerate biomass ash
on air heater baskets. Controlling ammonia
distribution to the furnace or selective cata-
lytic reduction system is critical for avoiding
this problem. Source: Black & Veatch
|
May 2014 54
RENEWABLES
Despite Challenges, India Banks
on Renewable Energy
Wind and solar energy in India were once considered among the most exciting
growth industries in the world, but policy uncertainty and abrupt changes in
the macroeconomic framework governing the renewables sector have derailed
them in the past two years. Corrective measures are now being taken to help
wind and solar regain their lost glory.
Sarosh Bana
E
nergy-starved India has been diversify-
ing increasingly into renewable energy
(RE), becoming in the process one of
the worlds most vibrant markets for this sec-
tor. This bodes well for a country that has of-
ten seen its industrial and economic growth
inhibited by a truncated supply of conven-
tional power.
Grid-connected renewable power (there is
yet very little off-grid renewable) accounted
for as much as 29.463 GWor 12.6%of
the countrys 233.939 GW of installed power
capacity, as of December 31, 2013 (Figure 1).
The share of wind was 20.150 GW (68.4%)
and solar photovoltaic (PV), 2.2 GW (7.5%).
India is said to be the only country to have
an exclusive ministry for renewable power,
and its Ministry of New and Renewable
Energy (MNRE) also provides various RE
systems for decentralized generation of elec-
tricity that has electrified 10,752 of the coun-
trys 640,867 villages so far. About 255,000
solar street lights, 993,000 solar home light-
ing systems, 939,000 solar lanterns, and 138
MW of distributed solar power plants have
been installed. (See the May 2009 feature
Powering the People: Indias Expansion
Plans at powermag.com for details of the
countrys goals to reduce poverty by increas-
ing energy access.)
Coal-fired power, however, still has the
major share138.213 GW, or 59.1%of In-
dias installed capacity (Table 1). Volatility in
coal costs, wavering fuel linkages, and lack
of policy clarity have, however, been causing
prolonged turmoil in the Indian power gener-
ation sector, with work suspended on several
thermal power plants across the country.
With unreliable coal and gas supplies thus
denting capacity targets, solar, wind, and bio-
mass energies have found increased favor. In-
dia has become the fifth-largest wind power
producer in the world, after China, the U.S.,
Germany, and Spain. Its wind power industry
has matured, being now equipped to provide
direct-drive, stall-controlled, and pitch-con-
trolled turbines ranging from 250 kW to 2.1
MW with hub heights and rotor sizes up to
100 meters (m). The manufacturers (Table 2),
almost entirely from the private sector, have
the capacity to produce over 9,000 MW per
year and have more than 40 models on offer,
including turbines designed to harness ener-
gy even in low and medium wind regimes.
The country also crossed a major mile-
stone in solar power last year when it added
just over 1 GW of solar energy to its electri-
cal grid, nearly doubling its overall solar ca-
pacity to 2.21 GW. The tally had been a mere
47 MW in 2010. After a slow start last year,
solar installation picked up rapidly, striding
towards the solar capacity targets of 10 GW
by 2017 and 20 GW by 2022.
Kick-starting this for 2014 was the launch
on Feb. 26 of a 130-MW solar power plant,
currently the largest in India, in the central In-
dian state of Madhya Pradesh. The plant has
been built by Welspun Energy Ltd. (WEL),
a leading independent RE player that is part
of the $3.5 billion Mumbai-based Welspun
Group. Set up on 305 hectares of land at a
cost of Rs1,100 crore ($177.4 million), it will
supply power at Rs8.05 ($0.13) per kWh.
India, in fact, is planning to build the
worlds biggest solar PV power plant, of
4,000 MW, on 48 square kilometers of salt
plains in the desert state of Rajasthan. Six
public sector companies will partner in set-
ting up this $4.4 billion project that will
annually supply 6.4 GWh of energy. It will
use PV modules based on crystalline silicon
technology and will be developed in phases
over seven years; the first, of 750 MW, is ex-
Waste to power
Biomass
Solar Power
Bagasse cogeneration
Small hydro
Wind
0 5,000 10,000 15,000 20,000 25,000
99
1,285
2,180
2,513
3,763
20,150
MW
1. Total renewable capacity. Although Indias Central Electricity Authority provides
29,462 MW as the total renewable capacity at the end of December 2013 (as cited in the text)
and the Ministry of New and Renewable Energy (MNRE) finds a total of 29,989 MW, the vari-
ance is small. Numbers in the chart are rounded. Source: MNRE
May 2014
|
RENEWABLES
pected to cost $1.09 billion and be set up in
three years.
MNRE has planned four more ultramega
solar PV projects, of 500 MW each, for the
coming fiscal year, 201415, one each in the
adjoining states of Rajasthan and Gujarat
and two in the state of Jammu and Kashmir
in the north.
Legislative Backing Spurs Smaller
Companies
The development of grid-connected renew-
able power took off in India with the coming
into force of the Electricity Act of 2003. The
legislation, which provides for regulatory
interventions such as determining tariffs,
specifying renewable purchase obligations
(RPOs), facilitating grid connectivity, and
developing the market, essentially spurred
the advent of grid-connected wind energy.
Solar power debuted only in January 2010
with the launch of the Jawaharlal Nehru Na-
tional Solar Mission (JNNSM) that aims at
promoting grid-connected solar power ad-
equately enough to bring the cost of solar
power to grid-parity levels.
But with wind power marred by several is-
sues of late, the government is seeking winds
uplift with the launch of the first National
Wind Energy Mission (NWEM) by the middle
of this year. The NWEM will act as a facilita-
tor to incentivize investments, ease land clear-
ances, and regulate tariffs, but unlike JNNSM,
it will not involve bidding for projects. The
NWEM came after the Solar Mission because
wind energy had been progressing very well,
while solar required a fillip. MNRE estimates
the installable wind power potential in India
for 50-m towers at 49,130 MW and for 80-m
towers at 102,788 MW.
The growth of RE has changed the en-
ergy business in India, notes New Delhi
based policy research and advocacy group,
Centre for Science and Environment (CSE),
in its just released citizens report on the
State of Renewable Energy in India. It has in
many ways democratized energy production
and consumption in the country. Before the
renewable sector became a significant player,
the energy business was all about fossil fuel
based big company and grid-connected pow-
er that dominates even today. But now there
is an alternate energy market in which thou-
sands of small companies, nongovernmental
organizations, and social businesses are in-
volved in selling RE products and generating
and distributing renewable-based energy, it
points out.
Unwelcome Changes
However, while wind and solar energy in
India were once considered among the most
exciting growth industries in the world, they
have declined steadily over the past two
years. While 6,761 MW of grid-connected
renewable power was added during the 10th
Five Year Plan (200207) against a targeted
3,075 MW and over 13,000 MW was added
during the 11th Plan (200712) against a
target of 12,230 MW, the decline has been
visible from the year after 201112, the last
year of the 11th Plan, when 4,943 MW of RE
capacity was installed.
New RE capacity dropped to 3,163.17
MW in 201213, and in the nine months of
the current 201314 fiscal year ending in
December 2013, just 1,921.98 MW (44%)
was commissioned against a full-year target
of 4,325 MW. This included 1,097 MW of
wind energy, or 47%, of a full-year target of
2,500 MW; 495 MW of solar, or 45%, of a
targeted 1,100 MW; and 131 MW of small
hydro, or 44%, of 300 MW.
The 12th Plan (201217) now aims for
RE capacity additions of 29,800 MW, with
15,000 MW of wind, 10,000 MW of solar,
2,100 MW of small hydro, and 2,700 MW of
biopower, including waste to energy (WTE).
JNNSM is also looking to add 20,000 MW of
grid solar power, 2,000 MW of off-grid solar
applications, and 20 million m
2
of solar ther-
mal collector area by 2022.
The 12th Plan allocates Rs135,100 crore
($21.8 billion), or 9.84%, for REwind,
solar, biomass, and small hydro projects
of the total outlay of Rs1,372,580 crore
($221.38 billion) for the energy sector. This
is not enough, observes the CSE report.
Largely because of policy uncertainty
some say paralysiswithin MNRE, the past
two years were a complete washout for the
RE sector in India, with investments dipping
significantly from $13 billion in 2011 to $6.5
billion in 2012.
This perception is shared by just about all
stakeholders in the RE sweepstakes. They
believe the decline has been brought about
as much by the general recession as by
policy uncertainty; an inattentive, even in-
different, MNRE; and the inexplicable with-
drawal of incentives and abrupt changes in
the macroeconomic framework governing
the RE sector.
After successfully implementing Phase I
of the Solar Mission, the needless delay in
communicating Phase II until the beginning
of 2014 created stagnancy in the solar indus-
try. MNRE also flip-flopped on wind power,
throwing the industry into disarray by abrupt-
ly revoking both the accelerated depreciation
(AD) and generation based incentive (GBI)
benefits at the beginning of the 12th Plan.
Both benefits had been introduced in 2009 as
being complementary to each other.
The GBI aimed at attracting large inde-
pendent power producers (IPPs) and foreign
direct investors to the wind power sector. It
gave the wind power developers a benefit of
5 paisa (0.08 cents) for every kWh of elec-
tricity they sold to the distribution com-
panies, with a cap of Rs1 crore ($161,290)
per MW over four to 10 years. For solar, the
GBI was intended to support small (below 33
kV) distribution grid-connected projects by
providing Rs12.41 ($0.20) per kWh to state
utilities on direct purchase of solar power
from the project developers. Projects rang-
ing between 100 kW and 2 MW and con-
nected to the high-tension grid below 33 kV
Dec. 31, 2012 capacity
(MW)
Dec. 31, 2013 capacity
(MW)
Capacity added
(MW)
Renewables 25,856 29,463 3,606
Coal 120,873 138,213 17,340
Gas 18,903 20,381 1,478
Diesel 1,200 1,200 0
Nuclear 4,780 4,780 0
Hydro 39,339 39,893 554
Total 210,952 233,930 22,978
Table 2. Market share of wind turbine suppliers in India (as of March
31, 2013). Source: CLP India Pvt. Ltd.
Table 1. Indias installed capacity. Source: Central Electricity Authority
Supplier
Cumulative capacity end
201213 (MW)
Capacity added in
201213 (MW)
Cumulative marketshare
(%)
Suzlon 7,829.80 414.8 41
Wind World 4,109.60 453.6 22
Vestas 1,853.20 25.2 10
Regen 883.5 268.5 5
Gamesa 657.5 99.5 3
|
May 2014 56
RENEWABLES
were also eligible for GBI. GBI is over and
above the tariff approved by respective state
electricity regulatory commissions (SERCs)
and disbursed on a half-yearly basis through
the Indian Renewable Energy Development
Agency (IREDA).
The AD benefit, intended to promote wind
capacity additions during the initial growth
phase, and which is still available for solar
power producers, had enabled wind farms to
claim 80% depreciation of equipment cost in
the first year. Following its repeal, they can
now claim only the standard 15%. Heeding
the resentment, the GBI was reintroduced a
year ago, but AD, which had driven 70% of
the wind installations, has not yet been rein-
stated, though MNRE has been persuading
the Finance Ministry to do so.
Mahesh Makhija, director of business de-
velopment (renewables) at CLP India Pvt. Ltd.
(Figure 2), the wholly owned subsidiary of
Hong Kongbased CLP Holdings, says AD,
alongside the turnkey development model,
had attracted many high-net-worth inves-
tors not directly in the business of electricity
generation, but who contributed to the initial
growth of the wind industry. They, however,
dropped out after AD was withdrawn, and it
was expected that IPPs would move in instead.
But prolonged indecision on the continuation
of the GBI deterred IPPs too. Makhija says
these drawbacks retarded capacity additions,
with several under construction and planned
wind projects coming to a near standstill as
their developers had factored the GBI in when
finalizing their projects.
Amit Kumar, executive director for En-
ergy & Utilities, PricewaterhouseCoopers
Pvt. Ltd. (PwC), based in Gurgaon, near New
Delhi, says the high-net-worth beneficiaries
of the AD scheme had been manufacturers of
textiles, cement, steel, and automobiles who
used RE as captive power for their power-in-
tensive industries. They enjoyed the benefits
on their host business and were less con-
cerned about improving power generation
and plant load factor (PLF).
A few other companies invested in wind
turbines to avail AD benefits to minimize their
income tax liabilities, and these included small
investors with ownership of one or two wind
turbine generator installations. Projects were
set up in areas of low wind density and this
resulted in low generation, he points out. In
short, the focus was more on earning profits
and less on improving generation.
A New Era?
Kumar adds that there is a discernible shift
from tax benefitbased investment to the
IPP-based model for wind power that will
represent the next generation growth phase
for the sector. IPPs are keen now to invest in
this matured market that also has access to
proven technology and skill sets. They thus
have much less riskier investment options
and are now increasingly developing wind
farms, each of an installed capacity of 50
MW and above. IPPs also have a choice of
revenue models, including options with mul-
tiple revenue streams. They can be assured
impressive returns on investments with the
right kind of strategy and revenue model.
Ashwin Gambhir, senior research associate
at Pune-based Prayas energy consultancy, also
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|
RENEWABLES
believes that India is entering the next phase of
renewable power development, where instal-
lations will pick up mainly on economic con-
siderations and not on incentives. Strict RPO
compliance will further help the industry, he
says. However, wind power prices need to be
discovered through competitive bidding, like
it is done in solar, to discover true prices and
help increase targets. For wind, there is no
competitive bidding involved, and develop-
ers are free to install projects with the feed-in
tariff (FIT) or RE certification (REC) route
as long as the utilities are willing to buy that
power to meet their RPOs. For solar, most
states and the central process select projects
on the basis of competitive bidding for a pre-
decided capacity.
Fund-raising too has become easier for
both wind and solar. Financing had been a
problem during the first phase of bidding
under JNNSM in 2012, but with the country
having since seen fair capacity additions, fi-
nancial institutions have been more open to
funding if the project developers have sound
basics (see sidebar).
Kumar maintains, however, that though
the GBI has been reinstated, investments
are still not very forthcoming, as there is no
clarity on issues such as value, subsidy cap
per MW, depreciation rate and term period,
and maximum capacity for which the benefit
is available. RPO enforcement too remains
weak, he says. Lenders may now stop fund-
ing projects taking the REC route, unless the
situation is rectified.
Makhija says that apart from the GBI and
AD imbroglio, it has also been over five years
since a National Action Plan on Climate
Change document was released. Other set-
backs, according to him, have been the man-
datory forecasting for projects, with severe
penalty for deviation from scheduled gen-
eration, increased credit risk due to delayed
payments by state distribution companies,
lower-than-expected increase in FITs in some
states, severely capacity-limited transmission
lines, and the steep rupee depreciation that
has affected foreign currency borrowings and
cost of turbines using imported components
and raw material.
Moving with FITs and Starts
An RPO is a measure to mandate renew-
able procurement by state electricity boards
(SEBs), open access consumers, and captive
plants, coupled with FITs. CSE mentions
that, while most states introduced their own
RPO targets in 2010, none of them abided
by them. States with insufficient renewable
resources face difficulty in meeting their
RPO targets. For instance, Rajasthan reduced
its target from 8.5% to 6%. But Tamil Nadu
reduced its target from 14% to 9%, despite
drawing 9.5% of its electricity from renew-
ables. CSE urges guidelines for states to fix
their RPOs, as currently, different states have
different rules of thumb on this issue.
Long-term FIT orders have been issued
by SERCs to ensure financial obligations of
RE developers, as a FIT is the worlds most
successful policy mechanism for stimulating
the rapid development of renewables. Indias
FIT was introduced in 1995 when the Min-
istry of Non-conventional Energy Sources,
the precursor of MNRE, specified uniform
FIT of Rs2.25 (3.63 cents)/kWh, with an es-
calation of 5% per year for all types of RE
sources. The National Tariff Policy empow-
ers SERCs to determine preferential tariff for
RE sources after taking into account their po-
tential and impact on retail tariffs.
The regulation of RECs is notified by the
Central Electricity Regulatory Commission
(CERC), the certificate being a market-based
instrument to promote RE and facilitate the
RPO portfolio by interstate exchange of
RECs. The REC mechanism seeks to ad-
dress the mismatch between RE availability
and utilities requirements to meet their RPO
through a national-level market. One REC is
treated as equivalent to 1 MWh.
Ajay Goel, CEO of Bangalore-based Tata
Power Solar, says that solar projects, starting
from JNNSM Phase I, have been auctioned
via a reverse bidding mechanism (companies
selected on the basis of quoting the lowest
FIT), rather than a predictable FIT that is
used all over the world and in India for wind
energy projects. Reverse bidding mecha-
nisms have gained popularity even at the state
level, with some notable exceptions, he indi-
cates. For instance, Gujarats solar program
was funded through a FIT mechanism and is
considered by many as the most successful to
date, and incentive systems should hence be
made predictable for solar projects through
FIT at both the central and state levels.
Renewable Industry Growth
Scenario
Venkataraman Rajaraman, director of in-
frastructure and project finance at Chennai-
based India Ratings & Research (a Fitch
Group company), says India has pushed
ahead relatively successfully on RE. Most
global original equipment manufacturers
have set up manufacturing units in India, and
land has not been a major constraint, as the
different states help in its acquisition. But he
says the sector is constrained by high costs of
importing capital equipment, which is heav-
ily debt funded. Many developers have not
hedged these exposures, thus exposing them
to the vulnerability of exchange and interest
rates, he says. Universally, solar power is
expensive and unviable but for policy sup-
port from the governments, and availability
of debt too is generally more difficult than for
other renewables.
Ramesh Kymal, chairman and managing
director of Gamesa India, the subsidiary of
Spains Gamesa Corporacin Tecnolgica
SA, believes that boosting wind power can
have a huge macroeconomic impact as it can
reduce Indias foreign exchange burden by
offsetting the high cost fuel imports. Wind
power is already competitive with new con-
ventional power in some states and may be-
come further competitive on issues like fuel
availability and the incremental cost of im-
ported fuel, he explains. In recent years,
wind PLF has risen to 25% to 30%, primar-
ily due to the new-generation large-capacity
turbines and efficient wind park manage-
ment strategies.
He says that though constraints like land
availability and grid infrastructure are more
or less universal for wind, a comprehensive
long-term policy framework in Europe en-
sures a common grid on the continent to be
shared by power deficit and surplus coun-
tries. The availability of attractive finance
Biggest Renewables
Developers
With an investment of around $1 bil-
lion, CLP India is the largest investor
in Indias wind sector, having built up
a portfolio of 12 wind farms of a cu-
mulative capacity of 1,051 MW. It will
be investing an additional $1 billion to
$1.2 billion to raise the total capacity
to 2,000 MW by the end of 2016.
Tata Power Solar is a fully owned sub-
sidiary of Tata Power Ltd., Indias larg-
est private sector power utility, with
a gross generation capacity of 8,521
MW. Of this, hydro, wind, and solar ac-
count for 1,112 MW, a 13.1% share that
is proposed to be extended to 20% to
25% from a mix of clean power sources
like hydro, solar, wind, geothermal, and
waste gas generation.
Country PV capacity
Germany 36
China 20
U.S. 1112
Spain 67
India 2
Table 3. Installed solar PV capaci-
ties (GW). Values are approximate. Source:
Sterling & Wilson
|
May 2014 58
RENEWABLES
mechanisms and competitive interest rates
for wind projects are specific to certain loca-
tions, in particular, India, he adds.
According to Goel, there is a lot more
interest in and acceptance of solar-powered
products all over the world, including in
India, where solar energy is destined to be-
come a mainstream source of power genera-
tion. But he feels it is favorable strategies
that will help augment installations. The
biggest difficulty in building solar capaci-
ties in India arises from a disinclination by
companies to invest in manufacturing in the
absence of long-term policy support that
can make these businesses and capacities
viable, he told POWER. Favorable policy
support can also increase demand and ac-
cess to financing options.
Bikesh Ogra, president (solar) of Mum-
bai-based Sterling & Wilson, says Indias ad-
vantage is that its solar sector is incipient and
hence has enormous potential for growth,
whereas countries like Germany and Spain
have reached maturity (Table 3). Solar in In-
dia is, however, troubled by a slow and poor
implementation of policies, and difficulty
in accessing project financing, he remarks.
Sterling and Wilson, an associate company of
the $2.5 billion 148-year-old Shapoorji Pal-
lonji Group, is the largest solar engineering,
procurement, and construction company in
India and 20th globally. It has commissioned
over 200 MW of solar projects in India and
is building about 200 MW of solar PV across
the world.
Asset finance and the public market domi-
nate RE financing in India, with venture capi-
tal and private equity transactions still limited
due to risks associated with renewable tech-
nologies. Domestic commercial banks had
been hesitant in lending to renewable proj-
ects, but this is changing owing to growing
awareness and more favorable government
policies and targets. State agencies IREDA,
the commercial arm of MNRE, and Power
Finance Corp. Ltd. have backed the industry
as a stable market with assured offtake and
no marketing challenges. As capital costs in
India are also among the lowest, the country
is emerging as a vibrant hub for the supply of
towers, blades, generators, and convertors.
Underscoring the high investor interest in
Indian solar, 68 companies vied for the latest
tender issued under JNNSM Phase II by bid-
ding for 122 projects of a cumulative 2,170
MW, oversubscribing almost three times the
allocation target of 750 MW. They included
the U.S.s Azure Power (200 MW), South
Africas SolaireDirect and Indias Welspun
Energy Ltd. (160 MW), Infrastructure Leas-
ing & Financial Services Ltd. (150 MW), and
Essel Infra (100 MW). The tender, floated
by state-owned Solar Energy Corp. of India
(SECI), makes available capital grants from
the government, or Viability Gap Funding.
Winning bidders will be those who seek the
least amount of funding for selling their pow-
er to SECI at a fixed tariff of Rs5.45/kWh
and Rs4.75 with AD benefit.
Solar and wind tariffs in India are said to
be highly competitive (Table 4), with solar
PV down from Rs18.44/kWh five years ago
to Rs5.45/kWh at present, while that for so-
lar CSP has averaged Rs12-13/kWh. Wind
power tariffs, as per orders of the central
or state electricity regulatory commissions,
range from Rs3.51 per kWh in Tamil Nadu
for windmills commissioned after July 2012,
to Rs5.92/kWh in Madhya Pradesh fixed for
25 years without any escalation.
Transmission Challenges
Another bugbear for both renewable and
conventional power in India has been insuf-
ficient transmission capacity, whereas most
countries have been promoting renewables by
giving them priority grid access. The extrem-
ities in power surplus and deficit across India
render it imperative for timely and complete
transmission of the power generated.
Over a third of the nations grid electricity
is lost to power theft and inefficiencies, and
daily blackouts are a common occurrence.
But while generation and distribution gained
due focus, transmission, the critical link of
power supply with no fall-back option, got
downplayed. India has installed capacity of
234 GW yet is able to meet peak demand
of only 123 GW, a key reason being lack of
transmission lines.
To meet the planned 103 GW capac-
ity addition during the 12th Plan period, the
government has allocated Rs180,000 crore
($29 billion) for transmission, apart from
Rs306,235 crore ($49.39 billion) for distri-
bution. Overall, the plan requires an addition
of 90,000 circuit kilometers of 765-220 kV
lines, 154,000 MVA of substation capacity,
and 27,350 MW of national grid capacity.
Power Grid Corp. of India Ltd. (PGCIL) will
be contributing 54% of the investment for
transmission, while the balance 46% will be
secured from private players.
Makhija points out that resource variabil-
ity and grid connectivity have been common
issues across the world for developing wind
energy projects. In some European coun-
tries, wind projects are also facing com-
munity issues such as flickering shadows,
impact on landscape etc., he notes. But in
India, despite having policy provisions for
ensuring grid connectivity to RE projects,
utilities are unwilling to lay transmission
lines due to their low utilization during lean
periods and delays in getting budget approv-
als from the government. During the high
wind season in 2013, 2,200 million kWh
or 40% of the total annual generation, were
lost in Tamil Nadu due to transmission ca-
pacity constraints and backdown (ramping
down) carried out by the utility.
The government has newly proposed a
Rs43,000 crore ($7 billion) green energy
corridor to synchronize 42 GW of incremen-
tal RE capacity with conventional power sta-
tions in the grid by 201617. Expected to be
developed in three phases, the corridor will
be made dynamic to handle the variations in
voltage and supply of RE. Intrastate grid up-
grading will be the purview of PGCIL, while
state utilities will develop the interstate net-
work.
Kymal indicates that the plan includes
other related infrastructure such as dynamic
reactive compensation, energy storage, smart
grid applications, forecasting of renewable
generation, real-time monitoring, establish-
ment of RE management centers, electric
vehicles, investment, and more. If the pro-
posed transmission corridor comes online as
per the plan, it will remove all bottlenecks at
intrastate as well as interstate transmission of
RE, says Makhija.
Balancing Factors
It would be unfair to discriminate against RE
sources on the basis of low PLFs and high
cost of production. The advantages and dis-
advantages of increased penetration of RE
sources must be assessed vis--vis continu-
ing with the conventional sources of energy
generation by comparing both on parameters
like energy security and independence, en-
vironmental effects, and, most importantly,
life-cycle costs of electricity generation.
Renewable energy is hence destined to
take its place alongside coal and gas in India
and penetrate ever deeper into the country. Its
unexploited resource availability has the po-
tential to sustain its growth for years to come.
After all, the nations, and its 1.2 billion peo-
ples, energy security depends on it.
Sarosh Bana (sarosh.bana@gmail.com)
is executive editor of Business India.
Country Wind Solar
U.S. 6 7
Germany 7 9
India 8 9
China 8 12
Spain 5 12
Table 4. Average wind and solar
tariffs (wholesale price), in euro
cents/kWh. For Spain, the values are
those before the feed-in tariff withdrawal by
the Spanish Government. Source: Bloomberg
New Energy Finance, public sources
May 2014
|
David Crane and the Coming
Electric Utility Apocalypse
The hyperbole in the headline comes not from the author but from those nipping
at the heels of the traditional electric utility industry. Hyperbole aside, several
recent and likely future developments have set the stage for a new set of in-
dustry players.
Kennedy Maize
S
everal years ago, Jean and Bob Galey
of Catoctin Creek Farm in rural west-
ern Maryland installed solar photovol-
taic (PV) panels on the south-facing roof of
one of their outbuildings. Since then, theyve
generated up to half of the electricity they use
on their small sheep farm.
The Galeys have cut their electricity costs
even further by taking advantage of Mary-
lands net metering program. That allows
them to sell excess power that they cant use
to their local electric distribution company,
Potomac Edison, a FirstEnergy company.
They get paid the full retail rate for the excess
electricity they sell to the grid.
This is an increasingly common story. The
Galeys are semi-connected to the convention-
al electric distribution grid, as are hundreds
of thousands of other Americans (although
a vanishingly small number have chosen to
completely disconnect from the utility grid).
The Solar Electric Power Association in 2012
estimated that there were some 200,000 roof-
top solar customers, with aggregate capacity
of around 2,400 MW, in the U.S. The number
has certainly grown substantially since then.
Conventional utilities are not happy with
these developments. Regulatory battles over
the size, scope, and spread of rooftop solar
flared up across the U.S. last year. The most
prominent conflagrations occurred in Arizona
and Colorado, as conventional utilities claimed
that they and their completely connected cus-
tomers were subsidizing the solar, off-grid (or
partially off-grid) adventurers (Figure 1).
Although the number of rooftop solar
customers today represents only a tiny slice
of the customer base of traditional utilities,
less than 1%, it presents at least a theoreti-
cal threat to the business model. The utilities
take that seriously. Some in the industry re-
gard it as an existential threat.
Distributed generationwhich in this
case refers to generation that is not under
the utilitys controlmay be a more di-
rect challenge as time goes on. A January
2013 report from the investor-owned utility
lobby Edison Electric Institute (EEI), Dis-
ruptive Challenges: Financial Implications
and Strategic Responses to a Changing Re-
tail Electric Business, lays out the case for
the angst of utilities: Recent technologi-
cal and economic changes are expected to
challenge and transform the utility industry.
These changes or disruptive challenges
arise due to a convergence of factors, in-
cluding: falling costs of distributed genera-
tion and other distributive energy resources
(DER); an enhanced focus on development
of new DER technologies; increasing cus-
tomer, regulatory, and political interest in
demand-side management technologies;
government programs to incentivize se-
lected technologies; the declining price
of natural gas; slowing economic growth
trends; and rising electric prices in certain
areas of the country.
Taken together, says the EEI report,
These factors are potential game chang-
ers to the U.S. electric utility industry
and are likely to dramatically impact
customers, employees, investors, and the
availability of capital to fund future in-
vestment. That, says the EEI, could spell
the end of the electric utility industry as
we know it today.
Disruption or Death Spiral?
While the prospect of a disassembled grid ap-
pears somewhat farfetched, the electric utility
industry is mindful of developments in other
industries that, decades ago, looked equally
1. Power pioneers. Just as the earliest North Americans relied upon local sources of en-
ergy (think dried buffalo chip cooking fires), many of todays homeowners are opting to produce
at least some of their own electricity. These Californians are using local solar energy. Source:
POWER/Aaron Larson
|
May 2014 60
impervious to fundamental change. Says the
EEI report, In the late 1970s, deregulation
started to take hold in two industries that
share similar characteristics with the electric
utility industrythe airline industry and the
telecommunications industry. Both airlines
and telecom are capital-intensive. They were
price-regulated and largely free of competi-
tion, notes the EEI report. Both no longer
look as they did when the regulatory winds
of change arrived.
Todays landscape for regulated businesses
such as electric utilities looks a lot like that of
the dying days of airlines and telecom, notes
the EEI report. That scares the heck out of
many in the electricity business.
Enter David Crane (see sidebar Who
Is David Crane?). Crane, 54, is CEO of
NRG Energy, one of the earliest and big-
gest of the non-utility generators, created
in the mid-1990s when it became apparent
that generation of electricity to supply the
transmission and distribution grid was not, as
long perceived, a natural monopoly. Indeed,
generation was and has become an intensely
competitive market. That was a truly disrup-
tive set of circumstances, still sinking in, for
the electricity business.
Over the years, NRG has invested billions
of dollars in conventional power plants not
owned by vertically integrated utilities, sell-
ing the power output into merchant markets
such as the PJM Interconnection, the Mid-
continent Independent System Operator, the
California Independent System Operator, the
Electric Reliability Council of Texas, and
other organized wholesale markets. NRG is
also pushing utility-scale merchant solar, as
one of the major owners of the new Ivanpah
solar power tower in California.
But Crane is looking well beyond the con-
ventional utility paradigm of how to generate,
sell, and distribute electricity. He predicts that
electricity will go the way of the airlines and
telecom in the last century. His predictions
and his companys investmentshave many
utilities trembling. Crane wants to take down
their businesses, starting from the roofs of
their customers homes, one roof at a time.
Speaking at a Wall Street Journal con-
ference late last year, Crane said that con-
ventional integrated utilities realize that
distributed solar is a mortal threat to their
business. The problem they face, he ex-
plained, is that as the utilities lose customer
load, they still face the enormous investments
they have made in generation, transmission,
and distribution. They cant cut costs, so
they will try to distribute costs over fewer
and fewer customers, said Crane. Those
rate increases will drive more customers
away from the integrated utility (or even the
distribution utility that buys its power from
competitive wholesale suppliers). It could
be an economic death spiral.
Death spiral is a term that Crane em-
braces. In an interview in The Atlantic last
November, he said, I completely agree that
the distributed future will be utterly destruc-
tive of the utility model that we now have. No
one wants to spend more on electricity than
they have to. If you can monetize the solar
value of your own real estate put solar pan-
els on your roof to produce your own power
and do that more cheaply and reliably and
add capital appreciation to the value of your
own home, why wouldnt you do that?
The research investment firm Morning-
star earlier this year identified distributed
generation as posing the most significant
threat to conventional electric utilities, al-
though it could be a decade or more before
the impact becomes substantial. According
to the Morningstar analysis, utilities with
big investments in baseload nuclear and
coal face the greatest threat.
The Stranded Cost Canard
Harkening back to the days of electric util-
ity restructuring in the mid-to-late 1990s,
the specter of distributed generation to utili-
ties is the possibility of stranded costs,
which the EEI report cites specifically. The
EEI report notes that tariff structures in
most states call for non-DER customers to
pay for (or absorb) lost revenues. As DER
penetration increases, this is a cost-recovery
structure that will lead to political pressure
to undo these cross subsidies and may result
in utility stranded cost exposure.
A Clemson University website (http://
bit.ly/NseENV) discusses the issue of strand-
ed costs. The term stranded costs has
emerged as an issue only in the context of
electricity deregulation, says the Clemson
analysis. It has no roots in economic theory.
For instance, there was little or no attention
Who Is David Crane?
David Crane, 54, the iconoclastic head of
non-utility generating company NRG Ener-
gy, based in Princeton, N.J., has been the
CEO and board chairman since 2003. Before
that, he worked as a key executive for non-
utility wholesale generator International
Power PLC, based in London. His work for
independent power generators in the U.S.
and the UK goes back some 25 years.
According to his official NRG biogra-
phy, Crane has an undergraduate degree
from Princeton Universitys Woodrow
Wilson School of Public and Interna-
tional Affairs. He then earned a law de-
gree from Harvard Law School.
He began his career at the international
law firm of White & Case, and then became
a power plant developer for ABB Energy
Ventures. That led to a gig as an invest-
ment banker with Lehman Brothers, work-
ing on power plant development projects.
Crane worked extensively in Asia and, in
his late 20s, he started a successful Hong
Kong bar, Graffiti, which was open from
1987 to 1996.
Under Cranes leadership, NRG has dou-
bled its non-utility generating capacity to
about 24 GW as of mid-March, making it
the leading non-utility generator in the
U.S. He has led the company to aggres-
sively pursue new generating options, not
all of which have panned out.
NRG was the lead investor in the failed
expansion of the South Texas nuclear proj-
ect. The two new units would have been
merchant nuclear generators. The eco-
nomic environment for merchant nuclear
generation in the competitive Electric Re-
liability Council of Texas wholesale market
resulted in NRGs South Texas project being
an economic loser. Crane then abandoned
the idea, writing off some $331 million in
sunk development costs.
As the South Texas nuclear expansion proj-
ect tanked, Crane told the New York Times
that if the plant goes forward, it will have to
be funded by somebody elses resources.
David Crane
May 2014
|
paid to stranded costs in the discussions on
airline deregulation, trucking deregulation,
and most oddly, the breakup of AT&T. Yet
analysts looking at the potential of distrib-
uted electric generation are also citing the
experience of the airlines and the telecom-
munications business.
The Clemson article continues: What are
stranded costs, and why have they received
such scant treatment in the economics litera-
ture? A general definition is that they are any
investment that will be less valuable under
competition than under regulation. Two of the
academic writers on this topic say that strand-
ed costs are those costs that the utilities are
currently permitted to recover through their
rates but whose recovery may be impeded or
prevented by the advent of competition.
Based on its January 2013 Disruptive
Challenges report, the EEI and its mem-
ber utilities last year launched a major
political campaign with this somewhat-
veiled call to action: Revising utility tariff
structures, particularly in states with po-
tential for high DER adoption, to mitigate
(or eliminate) cross subsidies and provide
proper customer price signals will support
economic implementation of DER while
limiting stress on non-DER participants
and utility finances. This is a near-term,
must-consider action by all policy setting
industry stakeholders.
Disputes over DER
In mid-year 2013, the Wall Street Journal
reported, Legislatures in half the states that
require electric utilities to buy renewable en-
ergy are considering proposals to roll back
those mandates. While most of that activ-
ity focused on altering or eliminating state
renewable energy purchase mandates, chal-
lenges also arose to state net metering pro-
grams encouraging rooftop solar and other
distributed technologies. Among the states
where attacks on net metering occurred: Ari-
zona, California, Colorado, Kansas, North
Carolina, and Utah.
The biggest battle came in Arizona. The
dominant investor-owned utility, Arizona
Public Service, asked the Arizona Corpora-
tion Commission (ACC), the states util-
ity regulatory agency, to eliminate Arizonas
generous net metering requirement in a state
that gets a lot of sunshine year round. The
utility said the program was shifting costs to
conventional customers, representing a sub-
sidy to well-off rooftop solar customers. The
solar industry responded that the utility was
juggling its numbers because it feared losing
captive customers.
In the middle of the dispute, the Rocky
Mountain Institute (RMI) in Colorado
weighed in with a useful study, A Review
of Solar PV Benefit & Cost Studies (http://
bit.ly/OuoRuy). The RMI report found a
decided lack of data to support either side
of the dispute over the effects of net meter-
ing. No study comprehensively evaluated
the benefits and costs of distributed pho-
tovoltaics, or DPV, the authors reported,
although many acknowledge additional
sources of benefit or cost and many agree
on the broad categories of benefit and cost.
There is broad recognition that some bene-
fits and costs may be difficult or impossible
to quantify, and that some accrue to differ-
ent stakeholders.
Ultimately, the Arizona regulators adopted
a Solomonic, split the baby, solution. By a
3-2 vote, the ACC commissioners imposed a
modest 70/kW monthly fee on new rooftop
solar installations to offset the putative costs
to the utility. That amounts to about $4.20/
month for the average new installation. The
states existing 18,000 PV installations would
not be affected.
Last years skirmishing over the impact
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May 2014 62
of distributed generation may not occur this
year. In February, the EEI and the Natu-
ral Resources Defense Council (NRDC),
a leading national environmental group
with a decades-long interest in electric-
ity policy, signed what some have called a
peace treaty on a number of regulatory is-
sues that have divided the industry and the
environmental movement over the years.
The agreement encompasses issues such as
decoupling sales and revenues, real-time
pricing, and cost-recovery of smart meters
and smart grid technologies.
The EEI-NRDC accord includes a state-
ment on distributed generation. Net metering
programs for distributed generation such as
rooftop solar, are positive for society, the two
groups agreed. But that does not reduce a
grids need for central station generation and
other infrastructure, and typically does not
eliminate the owner of the generating assets
need for grid services. For example, solar
generation at a residence typically does not
align perfectly with the occupants energy
use, requiring some use of the grid as the
equivalent of a battery.
That may represent a short-term resolution
to the tension over distributed generation.
But it may not turn out to be significant in
the long run.
A Different Sort of Grid
Heres where NRGs David Crane comes
into the picture again, with a typically dis-
ruptive notion. He wants to use the natural
gas distribution network to replace reliance
on the electric utility grid. Noting that some
34 million American homes have a natural
gas line into their home, Crane told The
Atlantic, All we need is a technology that
converts that natural gas into electricity in
your basement and then solar has the partner
it needs for me to tell the owners of the grid
to just shove off and disconnect my wire.
The day is coming when people are going to
be converting natural gas into electricity in
their own home.
To advance that day, NRG is working with
Deka Research of Manchester, N.H., a firm
headed by legendary inventor Dean Kamen
(the father of the Segway and inventor of
medical infusion pumps) on a Stirling cycle
engine (see sidebar), called the Beacon 10,
which can generate up to 15 kW of power.
The DEKA Stirling cycle generator is about
the size of a home washing machine and is
largely silent (as it requires no combustive
explosions to generate the movement of a
piston to turn a turbine).
NRGs idea is to integrate the Beacon
gas-fired generator with rooftop PV. Crane
says that for the disconnected-from-the-grid
home of the future, power first comes from
solar on the roof because thats the lowest
marginal cost. The Dean machine also has
a battery so you decide how much or little
natural gas you want to use. When theres
not enough solar, you turn on the Beacon 10.
Then, ideally, the grid itself would just be the
ultimate backup. Its the coolest thing Ive
ever seen.
As Crane envisions it, the gas-solar sys-
tem would be leased to customers, using the
successful financial model of SolarCity that
has helped spread rooftop PV systems across
the country. And NRG would also be able to
control the machines that it would own. The
way we are envisioning this is that if we had
10,000 of these machines just in the greater
New York City area and we as a company
had control of the machines, Crane said,
that becomes a 100-MW peak power plant
as well.
How far into the future is Cranes vision
of the electric utility apocalypse? He says the
conventional electric utility business model is
about where telephony was in 1985. That was
not long after federal Judge Harold Greene
signaled the end of the long-distance, fixed
land-line monopoly of AT&T, widely known,
sometimes affectionately and sometimes not,
as Ma Bell.
As part of his order breaking up the AT&T
land-line monopoly, Greene offered AT&T
control over the nascent cell phone business.
Ma Bell, figuring that cell phones were a
fad, declined the offer. Instead, the business
went to Seattle entrepreneur Craig McCaw
and his company, McCaw Cellular, for a pit-
tance. Less than 10 years later, McCaw sold
the business to AT&T for over $11 billion.
Now, land lines are an anachronism and cell
phones are ubiquitous.
Lets just call it game over, cell phones
won, Crane said. But it took 25 years.
Kennedy Maize is a POWER contribut-
ing editor and blogger at
powermag.com/blog.
What Is a Stirling Cycle Engine?
In 1816, some 40 years after the revolutionary Scottish inventor
James Watt came up with the steam engine, kicking off the 19th
century industrial revolution, another Scottish inventor, Robert
Stirling, devised a much more efficient external-combustion engine.
But it never really caught on and was taken over by diesel and gaso-
line engines for stationary power.
Nevertheless, the efficiency of the Stirling cycle, and its added
benefits of being silent and compact, have continued to beguile
technologists. The physics of the Stirling cycle are complex, but, to
oversimplify, they involve using external heat to expand and con-
tract a fluid inside a chamber in the engine containing a piston that
moves up and down. As in all conventional piston technologies, the
piston converts its horizontal motion into a rotary motion through
a crankshaft and flywheel. In the case of electrical power, the rotary
movement turns a turbine-generator.
Dean Kamens DEKA Research & Development Corp. (Figure 2),
working with NRG Energy to develop a new approach to electric-
ity, says, Stirling engines are a promising 19th century idea finally
coming to fruition in the 21st century. They can convert almost any
fuel into electrical power, and properly implemented, they may do so
in a system that is clean, quiet, easy to use, easy to maintain and
has a long operating life. For applications that need both electricity
and clean heat, the Stirling engine is exceedingly efficient.
2. A technology whose time has finally come? This
Stirling engine is under development as a partner to distributed
solar photovoltaic generation. Courtesy: DEKA Research & Devel-
opment Corp.
May 2014
|
POWER POLICY
UK Struggles to Attract
Low-Carbon Investment
Inflation-busting retail electricity price rises are doing little to encourage the power
plant investment Britain needs to keep the lights on. Offshore wind projects are
stumbling as technical and financial risks bite, a carbon tax has failed to achieve
its aims, and the European Union is threatening to ban the financial support
mechanism that seems to be the only hope of attracting new nuclear capacity.
Charles Butcher
A
fter years of dithering on energy poli-
cy, the UK government has nearly fi-
nalized its plans for electricity market
reform. Guaranteed prices for low-carbon
power, plus a carbon floor price to discour-
age the use of coal, are the pillars of an En-
ergy Bill published at the end of last year.
The UK faces a capacity shortfall as old coal
and nuclear plants are retired. It also needs to
stay on track with a binding commitment to cut
greenhouse gas emissions by 20% by 2020to
be followed up by a 40% cut by 2030 under
European Commission (Commission) plans
announced in January. The UK has come round
to supporting the Commissions new target of
27% renewable energy by 2030, though this
will not translate into national law.
But despite its subsidies, the Energy Bill
is not a magic wand. By offering double the
current wholesale price, with contracts to last
35 years, the Department of Energy and Cli-
mate Change (DECC) has persuaded three
consortia to agree to build much-needed
new nuclear capacity. Even without further
project slippage, however, none of this will
be online before 2023. Meanwhile, several
gigawatts of planned offshore wind capacity
have been canceled as developers face up to
narrow margins and technical challenges.
The Commission is also looking hard at
energy subsidy mechanisms across Europe,
and seems set to come down hard on the
UKs first new nuclear plant. The UK fund-
ing scheme was drawn up with European
Union (EU) competition policy in mind, so
all will probably come right in the end, but
there may be long delays.
Power Prices, Fuel Poverty, and GDP
For more than a year, energy prices have
rarely been out of the news.
According to the Office for National Sta-
tistics (ONS), inflation-adjusted household
spending on energy has risen by 55% in a de-
cade, even as energy use fell by 17%. Elec-
tricity, gas, and other household fuels cost a
typical household 106 (US$176) per month
in 2012, up from 69 per month in 2002, the
ONS said (Figure 1).
Tom Lyon of price comparison website
uSwitch.com said that consumers are having
to ration their energy use, with more than a
third saying that the need to cut back on heat-
ing has affected their quality of life or health.
Unprecedented flooding over the winter
has popularized the idea, even in the right-
wing press, that climate change is a real
threat. With flood cleanup costs reported at
up to 1 billion, more people are coming to
believe that it is worth spending money on re-
newables. Yet when they receive their energy
bills, many squeezed householders and busi-
ness owners complain about the impact of
green levies, believing that these are largely
responsible for the price rises.
In fact, the ONS figures show that most of
the cost increases in the last decade occurred
between 2004 and 2009. According to the
DECC, green levies in 2013 accounted for
4% of a typical household energy bill, with
support for vulnerable households and ener-
gy efficiency schemes adding a further 5%.
Energy Secretary Ed Davey has accused
utility companies of making excessive profits,
and called on independent energy regulator
Ofgem to consider breaking up the large utili-
ties. The big six firms claim that the UK has
a thriving and competitive power market.
Wind Is Key to a Low-Carbon
Future
The UKs northerly location, exposed coast-
line, and large tidal range make wind and
marine sources the obvious choices for large-
scale renewable energy.
With wave and tidal power going nowhere
at the moment, wind is the key. The poten-
tial is huge: The UKs total practical offshore
1. Where the money goes. All figures in this breakout of components of the typical
2013 UK household energy bill use real 2012 prices. The chart is based on consumption of 14.8
MWh [equivalent] gas (50.5 million Btu) and 3.8 MWh electricity. Figures may not add up due
to rounding. The wholesale energy costs exclude carbon costs. Source: Department of Energy
and Climate Change
|
May 2014 64
POWER POLICY
wind resource has been estimated at 120 GW,
more than twice the nations peak demand of
50 GW to 60 GW.
Current UK installed wind capacity is
7.1 GW onshore and 3.7 GW offshore, and in
December 2013 wind supplied a record 10%
of UK power demand.
Onshore, the year to June 2013 saw 1.3 GW
of new wind capacity added. This growth must
top out soon, however. Many prime sites in
Scotland, Wales, and northern England are
now taken, and developers are finding it hard-
er to gain planning approval in the midlands
and south of England, where wind speeds are
lower and political opposition is stronger.
With a high density of civilian and military
aircraft in UK skies, potential interference to
air traffic control radar seriously restricts the
siting of wind turbines. A technical modifi-
cation to Raytheon radar systems announced
in February could eventually unlock a further
2.2 GW of onshore wind capacity, said trade
body RenewableUK.
In 2012, the Electricity Networks Strategy
Group (ENSG), which sets out the views of
the DECC and the grid operators, estimated
11.2 GW of onshore wind capacity by 2020.
Offshore Wind Ambitions Falter
Offshore wind, on the other hand, until very
recently seemed to be getting into its stride
again after the global financial crisis, which
triggered a slump lasting into 2012. The 12
months to June 2013 saw 1.5 GW addeda
growth rate that overtook onshore wind for
the first time. In 2012, ENSG estimated
16.6 GW of offshore wind capacity by 2020,
and last November, Energy Secretary Davey
confirmed a plan for up to 39 GW by 2030.
Since then, things have again looked less
rosy. As they gain offshore experience, de-
velopers have come to appreciate the chal-
lenges and risks of placing turbines far from
shore and in water more than 25 meters deep.
The need to protect marine wildlife, includ-
ing rare sharks and birds, has also affected
several projects. As a result, developers have
withdrawn from more than 5 GW of planned
capacity since November 2013.
The abandoned and down-scaled proj-
ects (Figure 2) include the Argyll Array
(Iberdrola subsidiary ScottishPower Re-
newables), Atlantic Array (RWE npower),
London Array 2 (DONG Energy, E.ON
UK Renewables, and Masdar), and Dogger
Bank Zone (Forewind, composed of RWE,
SSE, Statkraft, and Statoil).
The UKs largest generator of renew-
able electricity, SSE, said in January that it
would carry out a wide-ranging review of its
offshore wind plans. Prospects for invest-
ment in generation assets in Great Britain
are not encouraging, the firm said, and its
investment after 2015 would be lower than
in previous years.
With such a pessimistic outlook from the
energy companies, the DECC now admits
that the 2020 offshore wind total could be as
low as 8 GW, with up to 41 GW by 2030.
The department says it is still committed to
keeping the UK a leader in this sector, but
cost could be the killer as concern over en-
ergy prices mounts.
Industry heads agree that offshore wind
costs must fall, but the question is how far
and how fast. At the moment, offshore wind
producers are guaranteed a price of 155/
MWh, falling to 140/MWh by 201819.
The latter figure is one that the industry can
probably live with, and is actually higher
than the 135/MWh expected last year in the
run-up to the governments new Energy Bill.
Beyond that, however, the savings must ac-
celerate: The DECC says it wants to reach
100/MWh by 2020.
Benj Sykes, director of wind power in the
UK for Danish generator DONG, was wide-
ly reported when he said in March 2013 that
he expected projects approved in 2020 to be
down to 100/MWh (84 or $139/MWh).
DONGs average offshore wind cost in
2012 was 160/MWh (134 or $222/MWh),
Sykes said.
Other offshore industry bosses and analysts
have commented that the 100/MWh figure
will be hard to meet by 2020. It is not yet clear
what will happen to UK offshore wind if costs
remain above this level, but given the critical
importance of wind in meeting carbon targets,
and the current slowdown even at 155/MWh,
the signs do not look good.
Solar Mini-Boom
Despite often-cloudy skies, the UK is seeing
a mini-boom in solar photovoltaics (PV).
Until the last couple of years PV was the
rooftop preserve of middle-class household-
ers attracted by a residential feed-in tariff of
14.9 pence/kWh ($0.25/kWh). More recent-
ly, around 250 sites on farms and disused
World War II airfields have sprouted PV
plants of up to 33 MW, with 50-MW proj-
ects in the pipeline.
Current installed PV capacity is now ap-
proaching 4 GW, and in October 2013 the
DECC forecast 10 GW by 2020. Energy Min-
ister Greg Barker said he believed this figure
to be too low: I think that up to 20 GW of
deployed solar is achievable within a decade.
Barker may be overoptimistic. Much of
this new solar capacity would be built in the
Conservative heartland of southern England,
which has more sunshine and higher property
prices than the north of England, Wales, or
Scotland. Many rural voters are now show-
ing that they object to commercial-scale solar
power almost as much as to wind turbines.
Even 20 GW of solar plants would provide
just 2 GW of actual generation at the 10%
capacity factor typical of UK latitudes.
Nuclear Renaissance at Last
The UK currently has 9 GW of nuclear gen-
erating capacity from 16 reactors at nine
sites. Together they provide about one-sixth
of the nations power.
All but one of these reactors (Sizewell B)
2. London Array. The 630-MW London Array offshore wind farm Phase 1, the worlds larg-
est, went online in April 2013. Plans for Phase 2 were cancelled in February 2014 in the face of
environmental uncertainties. Courtesy: Siemens
May 2014
|
POWER POLICY
are slated to close in the next decade as they
reach the end of their lives. (See UK Uses
Lead and Learn Strategy for Magnox Re-
actor Fleet Decommissioning in the April
2014 issue at powermag.com.) To meet its
carbon reduction emissions target, the UK
will need to replace all this lost capacity;
the 2012 ENSG report assumed 12.3 GW of
nuclear power in 2020.
Finding commercial partners for such a
large program has been challenging, but the
future now looks promising. Up to 15 GW of
new capacity looks reasonably secure in the
hands of three different consortia.
Furthest along is a reactor to be built by
EDF, with Chinese backing, at the exist-
ing Hinkley Point nuclear site on Englands
west coast. If all goes well, the 1,650-MW
EPR reactor will be followed by three more:
a second Hinkley Point reactor plus two at
Sizewell, another existing nuclear site. Brit-
ish utility company Centrica dropped out of
the Hinkley Point project last year.
In May 2012, German utilities RWE and
E.ON announced that their Horizon Nuclear
Power group would abandon its plan to build
new reactors at two existing sites: Wylfa and
Oldbury. By November 2012, however, Hori-
zon had been acquired by Hitachi, which now
plans to build two 1,300-MW Advanced Boil-
ing Water Reactors at each of the two sites.
The third consortium, NuGen, wants to
build two or three reactors near Sellafield
Britains oldest nuclear site, though it has not
had a power reactor for many years.
NuGen began as a joint venture between
GDF Suez, Iberdrola, and SSE. SSE left
the consortium in 2011. In December 2013,
Toshiba said it would buy out Iberdrola, leav-
ing it with 60% of the consortium and GDF
Suez with the remaining 40%.
NuGen, which originally described itself
as technology-neutral, had by 2013 narrowed
its reactor choices to either AREVAs EPR (2
x 1,650 MW) or the Westinghouse AP1000 (3
x 1,100 MW). Toshibas ownership of West-
inghouse has settled the matter, and the first
of the three AP1000 reactors is scheduled to
come on stream in 2024.
Nuclears High Cost
Getting this far was a struggle. The govern-
ments current Energy Bill, introduced to
Parliament last November and currently be-
fore the House of Lords, has essentially the
sole purpose of getting new nuclear and re-
newable capacity built by guaranteeing mini-
mum prices for producers.
The price-setting mechanism, known as
Contracts for Difference (CfD), sets out a
strike price for each generating technology.
Producers will receive the strike price for as
long as this remains above the wholesale price.
In the case of nuclear it took a strike price
of 92.50/MWharound twice the whole-
sale power priceto get EDF to agree to go
ahead with the 16 billion Hinkley Point C
project. The other nuclear consortia were not
involved in the detailed negotiations, so the
need for a timely agreement gave EDF an ef-
fective monopoly. (If Sizewell C goes ahead,
the strike price will fall to 89.50/MWh.)
Nuclear has broad support across the UK
political spectrum, and the Labour Party has
said that if it wins power next year, it will
honor the agreement with EDF. Many of those
on the left still distrust nuclear on grounds of
safety and cost but believe it is essential to
meet carbon emissions targets for the next few
decades. Most Conservatives believe nuclear
is cheaper and more acceptable than wind.
Brussels Strikes Back
In the run-up to the Energy Bill, Energy Secre-
tary Davey said he would not sign any nuclear
deal unless it was affordable, gave value for
money, and met the coalition governments
promise that there should be no public sub-
sidy. Yet critics believe the high strike price
(which will soon be above that paid for on-
Now you can have a collection of
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Missing Marmaduke?
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seemingly intractable plant problems remain timeless.
This anthology, first published in 1979, highlights many of
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(pre-WW I) through the 1960s.
Surfaceblows knowledge comes from hands-on
experience operating steam power plants and all manner
of machinery. Later in the series a son, Guy Newcomen
Surfaceblow, was introduced. He is a university-trained
engineer who also has field experience that gives him
credibility when working with hard-boiled characters
in the boonies. The characters name was coined from
Marmaduke, a Scottish name, and Surfaceblow, which is
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Here, you will find all of Surfaceblows adventures
consolidated into a single volume. Many of the stories were
inspired by actual events.
|
May 2014 66
POWER POLICY
shore wind), plus loan guarantees and liability
insurance provided by the government, looks
very much like a subsidy. Whats more, the
strike price is guaranteed for 35 years.
Last October, EDF said it expected to take
the final investment decision by July, subject
to final negotiations with the British govern-
ment and agreement from the Commission
on rules about state aid.
Yet the Commission seems to agree that
there is something fishy about the Hinkley
Point contract, and an initial report published
in January suggests that the approval process
will not be an easy ride. It is not clear to the
Commission that nuclear technology is im-
mature enough to warrant state aid, the re-
port says, pointing out that the total subsidy
of 5 billion to 18 billion could be more
than the cost of the plant.
Dogged by delays to its EPR project at
Flamanville in France, EDF is still maintain-
ing publicly that Hinkley Point C can start up
in 2023. It seems unlikely, however, that the
Commission will deliver its ruling before the
autumn, and the process could take as much
as two yearsgiven European Parliament
elections in May, a five-yearly reshuffle of
the Commission in October, and a UK gen-
eral election in 2015.
Carbon Price Floor Widely Reviled
Charging companies to emit carbon diox-
ideeither as a direct tax or by allocating
a limited number of tradable certificates
is widely seen as key to shifting generation
from high-carbon to low-carbon sources.
The EUs pioneering emissions trad-
ing scheme (ETS) has failed in this respect.
Though the EU ETS carbon price has peaked
at 25/metric ton (t) CO
2
, which should be
enough to promote low-carbon investment,
it is generally much lowerdown to around
4/t CO
2
currently. A reform of the scheme is
overdue, but to date has proved difficult.
So as part of its electricity market reform,
in April 2013 the UK government introduced
a carbon price floor. This is currently set at
16/t CO
2
, rising to 25/t CO
2
in 2017 and
30/t CO
2
by 2020. UK companies must pay
to the Treasury the difference between this
price floor and the EU ETS price.
In its first year the carbon tax raised
almost 1 billion, and by 2015/16 it will
be adding 30 to 60 to the average annual
household electricity bill.
The carbon tax is widely unpopular. Power
generators and fuel suppliers say it needless-
ly increases costs to consumers, encourages
coal-fired generation to migrate from the
UK to the rest of Europe, and destabilizes
the investment climate because the tax could
be changed or scrapped at any time. Green
campaigners believe it is ineffective, with the
money disappearing into government coffers
rather than being used to support renewable
energy directly. Consumer champions and
fuel poverty campaigners hate the carbon tax
because it hits poor people hardest.
In response to criticism over rising house-
hold fuel bills, the government recently car-
ried out a detailed review of its various green
levies. Although the carbon tax has so far
survived this scrutiny, in his budget of March
19, Chancellor George Osborne announced
that he will freeze it for one year. By 2015
the carbon price will have risen to 18/t CO
2

and this level will remain through 2016.
From Coal to Biomass
In 2012, the UK saw a marked rise in coal use
for power generation, as low international coal
prices and collapsing EU ETS carbon permit
prices prompted generators to switch from
gas. DECC figures show that in 2011 the UK
got 30% of its power from coal and 40% from
gas. In 2012 these figures were effectively re-
versed. Including other industrial and house-
hold use, UK coal consumption climbed by a
quarter over 2011, and CO
2
emissions rose by
about 4%, after years of steady falls.
Final figures for 2013 are unlikely to be
much different when they are published later
this year, though the DECCs preliminary data
for the third quarter of 2013 shows coal down
to 33% and gas down to 27%. A generation
mix containing 40% coal is not sustainable
in the long term, given that it implies about
18 GW of production from coal; now that the
shutdown of the UKs oldest and dirtiest coal-
fired plants under the EU Large Combustion
Plant Directive is almost complete, the UK
has only about 20 GW of coal capacity.
Under new emissions performance stan-
dards introduced in the Energy Bill, any new
coal plant would have to use carbon capture
and storage (CCS), as in the U.S. under new
Environmental Protection Agency regula-
tions. Since that is unlikely any time soon,
demand growth in the next few years will re-
quire a shift back to gas, if it cannot be met
by an expansion of wind.
Converting coal-fired plants to burn bio-
mass gives power companies a guaranteed
price of 105/MWh as well as avoiding the
carbon tax. This is a good deal, given that ded-
icated biomass power plants get 120/MWh.
Not all conversion projects gain government
approval, however. In December, the DECC
said it would not approve funding for Eggbor-
ough power station, which planned to convert
one of its four 500-MW units to biomass.
The UKs largest power plant, Drax, has
fared better (Figure 3). In 2012, Drax Pow-
er canceled plans for a dedicated 290-MW
biomass plant, but it still wants to become
a predominantly biomass-fueled generator.
The plant has six 660-MW generating units
for a nominal capacity of 4 GW and supplies
around 7% of the UKs electricity.
Drax converted one unit to biomass last
year. Two further conversions are planned
for 2015; in advance of the conversion, one
of these units will cofire biomass from May
2014. (For more on cofiring, see Utility
Coal-Biomass Cofiring: Turning Over a New
Leaf? in this issue.) The plans won govern-
ment support in 2012 under the old Renew-
ables Obligation mechanism and now have
the option to switch to the new CfDs.
Drax Chief Executive Dorothy Thompson
is not happy with a freeze on the carbon tax,
claiming that the economics of the project
were calculated on the basis that power prices
would continue to rise in line with the carbon
floor price. However, she admitted that the
losses at Drax could be more than offset by
savings on the carbon tax paid by those units
that continue to burn coal.
The European Commission is also look-
ing into whether a government guarantee on
a 75 million loan for the conversion project
breached EU rules on state aid. The case was
raised by Friends of the Earth, which believes
it makes no sense to run the Drax boilers on
biomass imported from North America.
CCS: Still Years Ahead
Drax is also home to the White Rose project,
one of only two carbon capture and storage
projects now being funded by the DECC.
White Rose partners Alstom, Drax, and BOC
are now carrying out a front-end engineering
study for coal CCS, while Shell and SSE are
doing the same for gas at Peterhead in Scot-
land. The two projects will then compete for
up to 1 billion in construction funding, while
two other previously rejected projects seek
funding through other means. The DECC
program is running late, and the White Rose
and Peterhead projects are unlikely to come
on stream before the early 2020sif they get
off the ground at all.
Charles Butcher is a UK-based
contributing editor.
3. Fuel shifting. The six-unit Drax Power
Station converted one unit to biomass in 2013
and plans to convert two more in 2015. Starting
in May 2014, one of those units will cofire 85%
biomass with 15% coal. Courtesy: Drax Power
May 2014
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May 2014 68
Tom Haarala
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May 2014 70
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Transforming the Grid
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Chills Turbine
Power Loss
Fast-Start HRSGs
New Build or Repower?
Troubleshooting Control Loops
Developing Skilled Craft Workers
Dealing with
Drought
2013 Plant of the Year:
AEPs John W. Turk, Jr.
Top Plants: Five Exemplary
Coal-Fired Plants
Top Plants: Three
Exemplary Nuclear Plants
South Korea Works to Meet
Supply Challenges
V.C. Summer Construction
Update
Water Management Plans
Have Multiple Benefits Top Plants: Five Exemplary
Renewable Plants
BUYERS GUIDE 2014
Integrating Renewables in
China
Using SCR Catalysts for
Mercury Co-benefits
PV Modules Cast a Shadow
over CSP
Top Plants: Five Exemplary
Gas-Fired Plants
Leveraging
Low-Grade
Fuels
Cover Stories
Fmerg|ng Techno|og|es Fnab|e ho 8egrets" Fnergy Strategy
Layup Pract|ces for Foss|| P|ants
why Aren't 0onstruct|on and 0emo||t|on wastes
0ons|dered 8|omass Fue|?
TVA's Parad|se Un|t 2 Sets hew 0ont|nuous 0perat|ons 8ecord
0ntar|o 0oes 0oa|-Free |n a 0ecade
water |ssues 0ha||enge Power 0enerators
Features
0oa| 8attered Far|y, Later 8ebounds
0|str|buted 0enerat|on: 0a||forn|a's Future
Sed|ment Pond Fff|uent pH 0ontro|
hatura| 0as-F|red P|ants 0ont|nue 8o||ercoaster 8|de
The F|ectr|c 0r|d: 0|v|||zat|on's Ach|||es Hee|?
The 8uss|an Power 8evo|ut|on
Top Plants
H|nts of what's hext from 0F on the Techno|ogy Front
Potent|a| So|ut|ons for F800T's 0ha||enges
0uantum 0ryptography Prom|ses Un-Hackab|e
|ndustr|a| 0ommun|cat|ons
what You heed to Know (and 0on't}
About the AU808A Vu|nerab|||ty
huSca|e Puts S|ng|e-N|nded Focus on Sma|| Nodu|ar 8eactor
Pract|ca| 0ons|derat|ons for 0onvert|ng 8o||ers to 8urn 0as
New Products
An Fvo|ut|on |n 8o|t Secur|ty
Fxp|os|on-Proof 0arted LF0 L|ght
Handhe|d Laser Scanner
8otary Per|sta|t|c Pump
Nu|t|process Power Source
H|gh-0apac|ty Safety Va|ve
Focus on O&M
0ontro|||ng Fug|t|ve 0ombust|b|e 0oa| 0ust
0rum Leve| |nstrumentat|on Update
0|oba| Non|tor
F|oat|ng So|ar-on water
8att||ng wh|te 8ust
Performance-0r|ven Na|ntenance
Global Monitor
F|rst U.S. U|trasupercr|t|ca| Power P|ant |n 0perat|on
8raz|| 0rought Threatens Power Supp||es
Hungary |naugurates Subsurface 8epos|tory f
or huc|ear P|ant waste
Japan 8anks on Lh0
F|rst Power for 1-Nw T|da| Stream Turb|ne
|nd|an VVF8 8eactors 8eady for Startup
|
May 2014 72
COMMENTARY
Greenhouse Gas Emissions
Are Not Our Only Problem
Marilu Hastings
W
ith all the recent scientific studies, media coverage, and
policy decisions about reducing greenhouse gas (GHG)
emissions, one might think that the emissions issue is
the only challenge that results from our demand for electricity.
Years of successful advocacy funded by philanthropists and the
public concerned about climate change has resulted in action
to address the sources of these emissions. President Obama an-
nounced his Climate Action Plan on June 25, 2013, that in-
cluded, among other elements, a direction to the Environmental
Protection Agency (EPA) to issue a draft rule for controlling car-
bon dioxide emissions from existing power plants. The EPA also
proposed a carbon pollution standard for new power plants.
On March 28, 2014, the president directed federal agencies
to study ways to cut methane emissions from various sources.
At the same time, the energy efficiency, renewable energy, and
clean technology industries in many states have won victories in
the establishment of policies and incentives that launched a new
generation of low-carbon, clean energy markets.
With carbon and methane emissions being addressed and a
clean energy industry launchedand whose establishment is
predicated on the need to reduce GHG emissions from electricity
productionit is past time to address an equally critical, more
tangible, and more urgent issue than even GHG emissions. We
must recognize that reduction in water consumption associated
with the entire lifecycle of electricity generation is as important
as reduction of GHG emissions.
Water Availability Could Limit Generation
Reliable water supplies are a growing constraint on the genera-
tion of reliable electricity. In water-constrained areas, including
most of the western U.S., difficult trade-offs are being made
between power plants, agriculture, and municipal uses, as illus-
trated recently in Texas. The Electric Reliability Council of Texas
(ERCOT) has stated that continued drought may limit electric
output from power plants due to lack of cooling water for coal-
fired plants.
Overall water consumption, the portion of total water with-
drawals by electricity generators that is not returned to the hy-
drological cycle, is about 3% of national water consumption.
Some fuel types and generation technologies are more water
intensive than others, according to Dr. Michael Webber and his
colleagues at the University of Texas. The most water-hungry
technologies are second-generation nuclear, concentrated solar,
coal, and natural gas steam generators. The technologies that
use the least amount of water are natural gas combustion tur-
bine, solar photovoltaics, natural gas combined cycle, and wind.
Of course, energy efficiency and other demand reduction strate-
gies require no water resources.
Webber also found that, when the water consumption analysis
includes the complete lifecycle of coal and natural gas, from min-
ing to generation and hydraulic fracturing to generation, natural
gas still results in a net water savings over coal. While hydraulic
fracturing might withdraw less than 1% of water on average, this
use can account for greater than 25% of water at the local or
watershed scale. And the water used for shale development is, in
most cases, not returned to the hydrological cycle.
Since most shale development occurs in drought-prone areas
of the country, losing 25% of water resources will eventually
become an obstacle to further shale development.
Managing Water and GHGs
Reducing GHGs and water consumption by the electricity sector
are not mutually exclusive goals. In fact, when Webber ranked
fuel type and generation technology by carbon emissions and
water consumption, the lowest emitters and water leanest tech-
nologies were generally the same.
In terms of lowest emissions and water consumption, solar
photovoltaics and wind were the best performers. Nuclear small
modular reactors also emit no carbon dioxide and use only about
50 gal/MWh of water. Natural gas combustion turbines use neg-
ligible water but produce about 1,200 lb/MWh of carbon dioxide.
On the other end of the spectrum, the worst performers were
natural gas steam generators, coal with carbon capture and se-
questration, second-generation nuclear, and concentrating solar
power, due to associated water use.
Clearly, there are options for promoting a diverse energy mix
that minimizes or eliminates carbon emissions and water use. We
need to continue our drive toward these technologies while also
calling for their continuous improvement. Effective strategies
can help accelerate fuel switching toward renewables, certain
natural gas generation types, and small modular nuclear reac-
tors. These approaches include:
Require shale developers to disclose the amount and source of
water they use in the hydraulic fracturing process and the fate
of these resources.
Establish policies to reflect the true value of water resources
to shift resource use decisions and technology development
toward conservation.
Engage as heavily in water conservation as we have in energy
efficiency by designing innovative water-smart metering and
design and adoption of incentives for conservation.
Invest in research and development for advanced electricity
generation technologies, including deployment of small mod-
ular nuclear reactors.
While designing GHG emission rules for power plants, include a wa-
ter conservation standard to drive choices toward conservation.
Incentivize shale developers to accelerate the use of water
substitutes or no-water hydraulic fracturing.
While addressing GHG emissions is important, we have ignored
the water issue as it relates to fuels and electricity generation
for far too long. It is time that we vigorously address this issue
that is already upon us.
Marilu Hastings (@MitchFound) is Sustainability Program Direc-
tor for the Cynthia and George Mitchell Foundation (www.CGMF.org).
Register now to reserve your seat at
www.energyocean.com
VIP Code:
23050
Every year, hundreds of the most infuential players in the industry attend Energy Ocean to
strategically collaborate on new technologies, regulation, fnancial opportunities, case studies and
research to work towards the advancement of ocean energy.
You should be there too.
Across 3 days, youll gain access to:
Cutting-edge presentations led by speakers from key offshore renewable energy development
projects and organizations such as Flumill, BOEM, Schottel Tidal and the Cape Wind Project.
Premier exhibitors showcasing the newest innovations in products and services for the industry.
A highly interactive format to deliver unprecedented networking opportunities between thought
leaders, executive-level attendees and industry leading companies.
Take advantage of this once a year opportunity and come join the industry on June 3-5, 2014 to
discover whats next.
June 3-5, 2014
Atlantic City, NJ Sheraton Atlantic City Convention Center Hotel
Dedicated to the Advancement of the
Offshore Renewable Energy Market
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