POWER Digest (July 2012)

UK Unveils Draft Energy Reform Bill. A draft energy bill unveiled by the UK’s Department of Energy and Climate Change on May 22 seeks to attract £110 billion ($168 billion) of investment to build new nuclear, renewables, and carbon capture and storage (CCS) plants to replace nearly a fifth of the country’s total power capacity, which will be retired over the next decade. Under the bill, grid operator National Grid will be appointed as the delivery body for the electricity market reform, administering two new market mechanisms. These include a feed-in tariff with contracts for difference (whereby generators receive payments when a nominal electricity market price falls below a price in the contract), which the UK government said will make investment in renewables more attractive by removing long-term exposure to electricity price volatility, and a capacity market to ensure sufficient capacity and reduce the likelihood of future blackouts.

The mechanisms will be supported by an emissions performance standard—a regulatory backstop to prevent construction of new coal capacity without CCS—and a carbon price floor, which places an initial value on the price of carbon of around £16 ($24.5)/metric ton (mt) of CO2 (2009 prices) in 2013. The price will rise to £30/mt of CO2 (2009 prices) by 2020. The draft energy legislation also contains proposals to create an independent, industry-financed statutory regulator, the Office for Nuclear Regulation. The bill could achieve Royal Assent and become law by 2013.

New Nuclear Plant Approvals in China to Continue. China’s State Council on May 31 passed a preliminary five-year plan on nuclear security and radioactive contaminant treatment that paves the way for resumption of approvals for new power plant construction, which were suspended after the Fukushima Crisis in March 2011. Over the 14-month safety assessment process, work on most of the country’s 26 reactors under construction continued. Changes to China’s nuclear policy now explicitly include that Chinese regulations must fully incorporate safety standards of the International Atomic Energy Agency. State media have indicated that China will likely scale down its 2020 nuclear power generation capacity target from 80 GW to between 60 GW and 70 GW.

Report: Turkey, Indonesia, Kenya Poised for Significant Geothermal Growth. An international market overview report released by the Geothermal Energy Association on May 22 finds that the U.S. continues to lead the world with 3,187 MW of geothermal capacity, compared with 11,224 MW of geothermal capacity installed around the world as of May 2012. But the international market is poised for significant growth, particularly in countries like Turkey, Kenya, and Indonesia. By 2015, Turkey will have 500 MW of installed capacity online, up from the current level of around 100 MW, and 14 geothermal sites have been identified in Kenya, whose geothermal potential has been estimated at 7,000 MW. Indonesia, whose geothermal potential is 27,510 MW, has set a goal to increase its installed capacity to 5,000 MW by 2025.

Global geothermal growth can be attributed to economic growth, rural electrification, new technologies, and favorable national policies, the report said, noting that federal tax credits in the U.S. will expire at the end of 2013.

Dominion Breaks Ground on 1,329-MW Gas Plant. Dominion Virginia Power on May 31 broke ground for its $1.1 billion Warren County Power Station, a 1,329-MW natural gas plant, at a 39-acre site in the Warren Industrial Park, approximately 3 miles north of Front Royal. The station will have three combustion turbines and a steam turbine, and when commercially operational in late 2014 or early 2015, it will serve a growing, high-demand region in Northern Virginia, the company said.

California Regulators OK 558-MW CCGT. The California Energy Commission on May 31 approved construction of a proposed 558-MW combined cycle gas turbine (CCGT) power plant in Carlsbad proposed by Carlsbad Energy Center LLC, an indirect wholly owned subsidiary of NRG Energy. The project is scheduled to be built on a 23-acre portion of the existing Encina Power Station in Carlsbad and will support San Diego Gas & Electric’s local load and provide overall system reliability. NRG plans to retire existing steam boilers at Units 1, 2, and 3 at Encina when the $500 million Carlsbad project is operational in the summer of 2016.

B&W Gets Contract for Wisconsin Power Plant. The Babcock & Wilcox Co. (B&W) announced on April 30 that its subsidiary Babcock & Wilcox Power Generation Grou p (PGG) was awarded a $150 million contract to design, supply, and erect environmental equipment for Alliant Energy subsidiary Wisconsin Power and Light Co.’s coal-fired Columbia Energy Center in Pardeeville, Wis. B&W will engineer and supply four spray dry absorber systems, two pulse jet fabric filters, a lime preparation system, ash recycle systems, and related equipment for Columbia Units 1 and 2. B&W PGG’s subsidiary Babcock & Wilcox Construction Co., Inc. will erect and install the environmental equipment.

ABB Bags Transmission Line Expansion Contracts in Brazil. Under a contract booked in the first quarter of this year, ABB said it would design, supply, install, and commission two new 230/69 kV substations at Miramar and Tucurui and a 230/138 kV substation at Nobres for Eletrobras Eletronorte in northern Brazil. ABB will also construct a new 230/138 kV substation at Umuarama and extend the existing substation Cascavel Oeste for Costa Oeste Transmissora De Energia S.A., a special purpose company of Copel Transmissao and Eletrobras Eletrosul, utilities serving southern Brazil. In two other projects awarded by Eletrobras CHESF, ABB will install a new 230/69 kV substation (Teresina III) and extend other existing 230 kV and 500 kV substations in northeast Brazil.

GE Aeroderivative Gas Turbines to Power Mexican Cogen Project. GE on May 22 said its LM6000 aeroderivative gas turbine technology has been selected for the ALPEK Cogeneration project at Petrotemex’s site in Cosoleacaque, Veracruz, Mexico. Supporting the Mexican government’s initiative to encourage more efficient power generation, the cogeneration plant will produce more than 85 MW of electricity and all the site’s steam requirements. The gas-fired facility will begin commercial service in the first quarter of 2014.

Alstom to Supply Boilers, Gas Turbines to Chinese Firms. Alstom’s largest utility boiler manufacturing partner, Wuhan Boiler Co., in mid-May signed a contract with Shandong Weiqiao Pioneering Group Co. Ltd. to supply four 350-MW subcritical pulverized coal-fired boilers for a cogeneration power plant located in Shandong Province, China. Delivery of the boilers will be completed by 2013.

Also in May, Alstom said it had secured an equipment supply contract from Harbin Turbine Co. for a combined cycle plant owned by Shenzhen Nantian Electric Power Co. in Shenzhen, China. Alstom will supply a GT13E2 gas turbine and associated generator for the plant. Additionally, it entered into an exclusive long-term service agreement with the power company that covers three maintenance cycles for the new turbine, plus another GT13E2 generator that has been in operation at the plant since 1995.

EDF Luminus Inaugurates New Peaking Plant in Belgium. Two Rolls-Royce Trent 60 gas turbines entered service on May 15 at EDF Luminus’ new peak-load power plant at Angleur, in the city of Liège, Belgium. The Trent 60 gas turbines, each capable of producing 64 MW, achieve startup in 9 minutes and can operate on either liquid or gas fuel. Each features wet low emissions and advanced inlet spray inter-cooling technologies to reduce emissions and ensure that maximum power output is maintained over a wide range of temperatures. Because of its location in the heart of the city, the plant has been fitted with silencers, and its building’s walls consist of a “triple skin” boarding almost a foot thick to ensure optimum sound-proofing.

E.ON AG to Become E.ON SE. Shareholders of Europe’s largest investor-owned energy company, E.ON AG, in early May voted to transform the firm into a European company, changing its name from E.ON Aktiengesellschaft (AG, a term used in Germany to denote an investor-owned company) to E.ON Societas Europea (SE, a stock corporation under European Union law). The measure was proposed because more than half of E.ON’s employees, customers, and shareholders live in European countries outside Germany, the firm said. The transformation of the company to a supranational form of incorporation could be completed toward the end of this year.

Sonal Patel is POWER’s senior writer.

SHARE this article