GE Power Inks Its Largest Services Deal Ever

GE Power signed a landmark deal to provide operations and maintenance (O&M) services for 10 power plants with a combined capacity of 11 GW. Sonelgaz SPE, a state-owned utility in charge of electricity and natural gas distribution in Algeria, owns the facilities.

The agreement includes technology upgrades designed to enhance energy efficiency—allowing more than 420 MW of additional power to be delivered to the grid—and the introduction of GE’s digital solutions. With the plant efficiency and productivity improvements, Sonelgaz expects to save up to $2 billion in fuel costs.

“This is a milestone for us in terms of the new Power Services suite of offerings and what we can do when we collaborate with customers to drive significant performance improvements,” Paul McElhinney, president and CEO of GE’s Power Services, told POWER during an exclusive interview.

Building Local Capabilities

The signing ceremony took place on April 24 at the GE Algeria Turbines (GEAT) plant in Ain Yagout, a joint venture created in 2014 by GE and Sonelgaz. The GEAT facility will manufacture gas turbines and steam turbines for Sonelgaz’s power generation needs.

“Algeria is focused on building a diversified economy and strengthening the operational efficiency of its power sector and natural gas generation and distribution assets,” said Mustapha Guitouni, president and CEO of Sonelgaz. “The opening of GEAT and the digital industrial transformation of our plants are significant steps forward in achieving our economic vision of industrial diversification, boosting productivity, and maximizing asset utilization. GE’s advanced suite of digital technologies will help transform our power plants, build local talent, and strengthen the culture of localization.”

GE intends to work with engineers from Algerian Engineering Services Co. to effect local repairs to 9FA gas turbines. GE will also train Sonelgaz field engineers and operators on industry best practices to strengthen their expertise and competitiveness. Sonelgaz is seen as a potential collaborator with GE on future O&M projects in Africa.

The agreement is expected to drive the development of a local supply chain too. MEI, an affiliate of Sonelgaz, will be qualified by GE to manufacture turbine spare parts, as early as this year, and it will become part of GE’s international supply chain.

“The Algerian government and Sonelgaz have a clear vision for the future of the country’s power sector,” Steve Bolze, president and CEO of GE Power said. “The emphasis on building industrial capacity and the focus on the digital transformation of power plant assets are long-term investments in the future of the country. GE is honored to strengthen our collaboration with Sonelgaz and help create a vibrant local ecosystem for the power sector that will help meet the needs of people and various industries across Algeria.”

Broad-Based Offerings

Sonelgaz has selected GE’s Asset Performance Management and Operations Optimization software applications to monitor and analyze data drawn from thousands of sensors throughout its power plants. The software leverages advanced data analytics to predict and eliminate unplanned downtime, and improve power plant productivity. GE’s software is built on Predix, a data platform purpose-designed for the scale and complexity of industrial data.

McElhinney noted that GE will upgrade Sonelgaz’s 34 9FA gas turbines, but he said that is only one aspect of the deal.

“We’ve also got a commitment to improve their boiler performance, their steam turbine performance, their generator performance, to improve the balance of plant performance across the entire power island, and O&M advisory services,” McElhinney told POWER. “This is a real expansion of our core service offerings.”

Aaron Larson, executive editor (@AaronL_Power, @POWERmagazine)