POWER Digest [March 2019]

News briefs from around the world: Europe’s power sector’s newest frontier, amid its transition to low carbon energy, is its distribution system; Taiwan’s government will phase out nuclear power despite a referendum in November; ExxonMobil and Vietnamese firms are exploring a natural gas–to-power production project that could fuel up to 3-GW of new gas power; Japanese firms have abandoned plans for a 2-GW coal plant; and Canada will fund the country’s first geothermal power facility. 

The Distribution System Is Newest Energy Transition Frontier in Europe. The European power sector is urging member states and regulators within the European Union (EU) to speed up development of “fit-for-purpose” power distribution system operators (DSOs). According to Eurelectric, a trade group that represents 3,500 electric companies, more than half of Europe’s power is expected to come from renewable assets by 2030. During the same period, transport legislation, which EU states have agreed to, will add more than 40 million electric cars to the road, and use of connected electric heat pumps, batteries, and other grid edge technologies will also rise steeply. “These developments will result in a much more decentralised electricity system and require the European power distribution companies to move way beyond their traditional role of ensuring network connection and reliability,” the group said. DSOs are becoming “neutral market facilitators, acting as platforms for all network customers, by leveraging flexibility resources and facilitating the non-discriminatory access to the energy system,” it noted. However, the Clean Energy Package, the EU’s new energy legislative framework that will soon be adopted, leaves several provisions concerning the new activities of DSOs open to national interpretation, and a uniform implementation “is important for companies operating in several countries and regulatory barriers to innovation should be minimised,” it said. But DSOs, it noted, must increase their agility within the next five to 10 years, a feat that will require massive investment. “This includes, among others, updating their capabilities and investing in new ones, increasing the sophistication of their assets management, integrating digital solutions, building new skillsets and changing the mind-sets.”

Taiwan to Phase Out Nuclear, Despite Referendum. Taiwan’s government on Jan. 31 announced it would continue to phase out nuclear power by May 2025, though voters opposed the policy in a referendum held last November. Taiwan has six reactors, but only four are operable, producing about 15% of the island’s power generation. Last December, state-owned Taiwan Power Co. (Taipower) said it plans to decommission Unit 1 at the Chinshan nuclear power plant following the expiration of the reactor’s operating license after 40 years of operation. Unit 2’s license will expire this July. Licenses for the two-unit Kuosheng plant will expire by 2023, and at the two-unit Maanshan plant, by 2025. At a press conference “to explain the results of the referendum on energy issues,” Minister of Economic Affairs Shen Jong-chin said “there would be no extension or restarts of nuclear power plants in Taiwan due to subjective and objective conditions, as well as strong public objection.” Two 1,350-MW Advanced Boiling Water Reactors have been under construction at Lungmen since 1999, but owing to cost-escalations and lengthy delays, TaiPower has ruled out the plant’s completion. The company said in February it would take at least six or seven years to start commercial operations at the plant, which was mothballed in July 2015 amid public opposition. Jong-chin noted that Taiwan, which will now face a power crunch by 2021, will continue to reduce thermal power generation by 1% a year. While no new coal plants will be built, as required by the referendum, he urged Taiwanese citizens to support development of solar photovoltaic, wind power, gas generation, and natural gas infrastructure.

EDF to Close Uneconomic 2-GW Coal Plant in UK. EDF Energy said on Feb. 7 it will shutter its 2-GW Cottam coal-fired power plant in North Nottinghamshire, a county in England’s East Midlands region, on Sept. 30, citing “challenging market conditions over the last few years and the context of the drive to decarbonise electricity generation.” The company, a subsidiary of the French power giant, said the plant will not be economically viable beyond the end of September. EDF Energy, however, will continue to honor capacity agreements until the end of September 2021 for its only other coal plant in North Nottinghamshire, the 2-GW West Burton A plant. EDF will “review the future of that station beyond that date,” it said. Meanwhile, the company will continue to invest in and operate nuclear and renewables facilities and invest in battery storage. EDF Energy’s only gas-fired power plant, the three-unit 1.3-GW West Burton B combined cycle gas turbine facility, which began commercial operation in 2013, is located in the region.

Massive Gas-for-Power Project Advances in Vietnam. Oil and gas giant ExxonMobil and joint venture partners PetroVietnam and PetroVietnam Exploration Production Corp. on Jan. 30 said they awarded a contract for front-end engineering and design that could lead to construction and operation of a project that will produce natural gas from the Ca Voi Xanh field offshore Vietnam, transport it via pipeline, treat it, and feed it to third-party power plants. Vietnam Electricity, PetroVietnam, and Sembcorp are in discussions to build and operate the power plants. The proposed base development is expected to generate 3 GW of power—equivalent to about 10% of Vietnam’s current total power demand. ExxonMobil is now filing appropriate permits, planning applications and other preparatory work for the proposed development. A final investment decision, targeted in 2020, is based on regulatory approvals, government guarantees, executed gas sales agreements, and economic competitiveness, the companies said.

Japanese Firms Scrap Plan for 2-GW Coal Plant. Oil refiner Idemitsu Kosan Co., power utility Kyushu Electric Power Co., and gas retailer Tokyo Gas Co., on Jan. 31 ended a joint feasibility study for a 2-GW coal-fired power plant at an unused Idemitsu-owned industrial site in Sodegaura, in the Chiba Prefecture of Japan. The partners proposed to use ultrasupercritical technology and a mix of coal and biomass at the project. The companies concluded the project could not yield “initially expected investment returns,” but industry observers suggested the decision was also likely influenced by new rules introduced under Japan’s energy conservation act in April 2016, which requires new coal power plants to achieve efficiencies of 44.3%. However, Kyushu and Tokyo Gas said they would continue a feasibility study of a liquefied natural gas–fired thermal plant, which could entail combined cycle gas technology, at the same location.

Canada Gears Up for First Geothermal Power Plant. Canada on Jan. 11 said it will provide CA$25.6 million ($19.28 million) to fund the country’s first geothermal power facility. The 5-MW project under development by Deep Earth Energy Production Corp. (DEEP) is located near Estevan, Saskatchewan. The announcement came the same day DEEP revealed it had successfully drilled its first geothermal test well. The vertical well, managed by Frontier Project Solutions and drilled by Horizon Drilling, reached its target total depth of 3,530 meters. Preliminary data to facilitate assessment of the geothermal reservoir—which DEEP acquired with support from its geological and reservoir engineering teams, RESPEC and Force Reservoir Management—appears promising. Open hole logging tools indicate bottom-hole temperatures exceed 125C. Drill stem test results were also positive, indicating reservoir pressure and permeability could exceed the minimum threshold for project feasibility. ■

Sonal Patel is a POWER associate editor.