December 15, 2007

Global Monitor (December 2007)

POWER digest

News items of interest to power industry professionals.

ConocoPhillips and Peabody studying coal-to-gas prospects. ConocoPhillips and Peabody Energy have announced their selection of a site in Kentucky for studying the feasibility of developing a commercial-scale coal-to-gas facility. The optimal facility would be a state-of-the-art mine-mouth gasification plant that uses ConocoPhillips’ E-Gas technology to produce as much as 1.5 trillion cubic feet of natural gas from coal over its lifetime. The feasibility study will vet several possible designs and sites and will continue into 2008.

The study will focus on assessing designs that meet or exceed state and federal environmental protection regulations and technologies for reducing carbon footprints. For example, the two firms plan to work with the Midwest Geological Sequestration Consortium and the Kentucky Geological Survey to examine carbon capture and storage options.

GE lands big wind turbine deal with EDP. GE Energy has signed a $730 million contract to supply Energias de Portugal, SA (EDP)—the world’s fourth-largest wind farm developer—with 281 wind turbines totaling more than 500 MW of capacity for wind projects to be built during 2008 and 2009 in Europe and the U.S.

Under the terms of the contract, GE will supply Neo Energia, the European renewables subsidiary of EDP, with 80 wind turbines rated at 2.5 MW each for projects in Europe, and Horizon Wind Energy LLC (EDP’s American subsidiary) with 201 turbines rated at 1.5 MW for projects in the U.S. at sites yet to be determined. EDP purchased Houston-based Horizon earlier this year as part of an expansion into the North American wind energy market.

All of the U.S. projects will be owned by Horizon Wind Energy or affiliates. Sixty-seven of their turbines, and 30 of the turbines for the European projects, are expected to be commissioned before the end of next year.

The wind industry is well established on the Iberian peninsula. According to the European Wind Energy Association, Spain had 11,615 MW of installed wind capacity at the beginning of 2007. That puts it in third place globally—behind Germany and the U.S. Portugal ranks much lower, with 1,716 MW.

Basin Electric to build new CC plant in South Dakota. An area near White, S.D., has been selected as the site for a new Basin Electric Power Cooperative combined-cycle power plant with a capacity of about 300 MW to be fueled by natural gas. The proposed plant has been named the Deer Creek Station and is scheduled to be operational in 2012, pending permit approvals. White is about 12 miles northeast of Brookings in the eastern part of the state.

The additional capacity is needed to meet member load requirements and will serve as an intermediate power supply, said Dave Raatz, manager of marketing and power supply planning. Intermediate power supply is categorized as somewhere between baseload and peaking capacity, he explained. It is designed to “cycle” with demand, typically running about 12 to 16 hours a day when demand for electricity is higher.

This new generating resource is the best fit for Basin Electric’s members, Raatz explained, because of the site’s proximity to fuel supply and transmission. The plant’s fuel will be supplied by Basin Electric’s Dakota Gasification Co. via the Northern Border Pipeline.

Proposed Canadian project to feature CO2 recovery. GE Energy and Bechtel Overseas Power Corp. have signed an agreement with Calgary-based TransCanada Corp. to develop the first polygeneration facility in Canada capable of using petroleum coke as a feedstock and incorporating carbon capture and storage.

The proposed facility, to be located in Belle Plaine, Saskatchewan, would convert pet coke to hydrogen, nitrogen, steam, and carbon dioxide for fertilizer production and enhanced oil recovery. It also would have an installed electricity generation capacity of about 300 MW.

The plant would use GE Energy’s gasification and flexible-fuel technology to generate power and support local industrial processes. GE’s scope of supply is the gasification island and the power island equipment, which includes two GE Frame 7FB gas turbines designed to run on syngas with high hydrogen content.

Under the agreement with TransCanada, GE and Bechtel Overseas Power Corp., which have already done the project’s preliminary engineering, will advance to the next engineering phase early next year. If studies indicate that the project is economically viable, detailed engineering design would follow. Assuming timely receipt of construction and environmental permits, the polygeneration plant could come on-line as soon as 2013.

Foster Wheeler considers capturing Spanish CO₂. Foster Wheeler Ltd. recently announced that the Spanish subsidiary of its Global Power Group has signed an agreement with Fundación Ciudad de la Energía (CIUDEN) to develop an oxy-combustion process and CO₂ capture solution for a coal-fired demonstration facility in Spain.

The agreement hires Foster Wheeler to handle the initial phase of this project (including providing engineering services and technical specifications) and to review CIUDEN’s conceptual and basic design for the demo plant’s combustion island. The island will incorporate both pulverized-coal and circulating fluidized-bed technologies. The demonstration plant is scheduled to become operational in mid-2009.

First Chinese CC plant fired by blast furnace gas. GE Energy has signed a multimillion-dollar contract with Wuhan Iron and Steel Co., Ltd. to supply two combustion turbine-generators and associated blast furnace gas (BFG) compressors for a combined-cycle power plant in China. Each package will comprise one Frame 9E gas turbine, one generator, and one BFG compressor.

BFG is created during the production of pig iron in steel mills and as a by-product of coke combustion and iron ore melt in blast furnaces. It can be recovered and used as fuel in a combined cycle with higher efficiency and lower emissions than a traditional BFG boiler power generation system.

Delivery of the gas turbines is scheduled for late 2008. The plant is slated to be commissioned in late 2009.

AEP buys unfinished Dresden plant. American Electric Power says it has completed the purchase of a natural gas–fired combined-cycle power plant still under construction near Dresden, Ohio, from Dresden Energy LLC, a subsidiary of Dominion, for $85 million.

Construction of the 580-MW Dresden plant began in 2001 after its major equipment began arriving on-site. AEP expects to finish the plant in 2009 or 2010 and add to its generation portfolio.

Covanta NSPS waste-to-energy plant debuts. In late October, Covanta Holding Corp. announced that it has begun operating the first waste-to-energy unit built in compliance with the U.S. Environmental Protection Agency’s New Source Performance Standards.

The new unit expands the Lee County Solid Waste Resource Recovery Facility in southwest Florida, which entered commercial service in December 1994. Before the $120 million expansion, Lee County was able to convert 1,200 tons per day of solid waste into up to 39.7 MW of generating capacity, for sale to Seminole Electric Cooperative. Now it can process an additional 636 tons daily and produce an additional 18 MW.

Notably, the facility uses the secondary sewage treatment effluent from a nearby waste treatment plant for the majority of its process water. It uses both ferrous and nonferrous recovery systems to remove all metals from the residue.