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Natural Gas Seen AS Stabilizing the Texas Wind Fleet

Issue 2 and Volume 112.

Tightening reserve margins are increasing the need for additional quick-start power to provide both spinning and non-spinning generation reserves as well as voltage support and other ancillary services to grid operators. That need is exacerbated by the increasing volume of intermittent wind generation coming on line across the United States. The need may be especially intense in Texas, which now leads in wind generation and continues to add capacity.

In partial response, Wärtsilä will supply 202.5 MW of gas-fired capacity to provide ancillary and other grid support services to the Electric Reliability Council of Texas (ERCOT) for South Texas Electric Cooperative (STEC), a non-profit generation and transmission power provider. The contract is valued at more than $100 million.

The Pearsall Power Plant will be 50 miles southwest of San Antonio on a brownfield site. It will be equipped with 24 Wärtsilä 20V34SG reciprocating engines fueled by natural gas. Burns & McDonnell is providing engineering, permitting and construction management services. The plant will be connected to ERCOT and supply power and ancillary services to STEC’s eight cooperative members helping serve their 750 MW peak load. Pearsall is expected to run about 4,000 hours a year. The first 75 MW is expected to enter commercial operation late this year with the remaining 128 MW beginning commercial operation by the end of 2010.

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For the third consecutive year, Texas led the United States in wind capacity additions in 2007. Nearly $3 billion worth of wind capacity was installed there, increasing the state’s wind capacity by almost 60 percent over 2006 levels. The 1,618 MW of new installations was more than double the amount added in any other state. Texas now has 4,356 MW of the 16,818 MW currently installed in the United States. The need for ancillary services has intensified in Texas due to that rapid growth.

Wärtsilä began offering arrays of natural gas-fired reciprocating engines several years ago, marketing them primarily to small utilities, especially municipals. The initial appeal was to provide rapid backup power in times of grid problems. But an additional value emerged.

“We discovered that utilities that acquired these plants had learned that the quick start, variable loading, spinning reserve capabilities of these engines gave them the ability to provide services to enhance grid stability,” said Frank Donnelly, president of Wärtsilä North America. In some grids, those ancillary services are traded on an open-market basis. While all utilities must provide ancillary services, open markets reveal just how much monetary value they have. “Companies see they can actually sell capacity power to provide grid stability,” he said.

Wind power’s rapid growth has increased the need for additional ancillary services to support it. The influx of renewables in such states as Texas, California and Colorado has increased the need for these grid support services, said Donnelly. An unfortunate consequence of renewables is that they add instability to the system. “You may already have a certain level of instability because of things like a weak grid and load pockets where you can’t get enough power in,” he said. “Now we see the renewable wave coming in on top of that—and not just a couple hundred megawatts of wind in Texas but thousands of megawatts. And as it keeps growing, stability becomes a bigger challenge.”

The ability to provide capacity support is increasingly helping justify the capital investment to acquire it, Donnelly said.

Wärtsilä’s plants can reach full plant output in eight minutes and provide 25 percent power in two minutes, one of the highest simple cycle efficiency levels available. They also offer rapid response to varying grid conditions. Pearsall will be able to run at as little as 8 MW with a competitive heat rate. This feature also increases the amount of spinning reserve available to the customer, thereby increasing the plant’s value. Wärtsilä’s flexible power plant can supply many commercially traded ancillary services including black start capabilities. —Steve Blankinship


German Firms Take on Carbon Capture Issues

Another of the world’s largest power sector original equipment manufacturers has joined the hunt for carbon capture technology to allow coal and natural gas-fired power plants to continue supplying power while limiting the release of carbon dioxide to the atmosphere.

Siemens and German-based utility parent E.ON have agreed to cooperate on a carbon capture power plant technology aimed at developing and commercializing an economic and efficient method for carbon capture, thus allowing building low-carbon coal power plants along with a method to retrofit carbon capture on existing coal and natural gas-fired plants.

The starting point is a solvent with special characteristics that provide the basis for a new process to capture CO2 from power plant flue gases. A pilot installation on an E.ON power plant in Germany is expected to be operational by 2010. Further developments would follow until 2014. The mid-term target is to develop the CO2 capture process for large-scale, commercial deployment by 2020.

Nearly one-fourth of all global CO2 emissions come from electric power generation. Some experts believe that viable large-scale carbon capture and sequestration (CCS) technologies will someday capture about 90 percent. Mandatory CCS after 2020 is currently being debated within the European Union.

One potentially promising CCS strategy would employ post-combustion CO2 capture. Tobias Jockenhoevel, head of the innovative power plant concepts division and project manager at Siemens Energy, said the partnership’s research goals include developing advanced ecologically compatible CO2 solvents, optimizing the capture process and achieving intelligent power plant integration. “The real challenge is to attain high power plant efficiency and to avoid negative impact on the environment, for example, by emitting solvent,” he said.

The new process and the energetically optimum integration into conventional power plants are expected to be verified in 2010 in a small pilot plant under real operating conditions, with particular considerations of the significance for a full-scale plant. —Steve Blankinship


Business Briefs

The U.S. wind energy industry installed 5,244 MW of new capacity in 2007, increasing the total generating capacity by 45 percent. The growth represents a total investment of over $9 billion, said the American Wind Energy Association (AWEA). The wind projects make up about 30 percent of all new power-producing capacity added in 2007. The U.S. wind power fleet generates 16,818 MW of electricity and spans 34 states. American wind farms are expected to generate an estimated 48 billion kilowatt-hours of wind energy in 2008, just over 1 percent of U.S. electricity supply. According to AWEA, states with the most cumulative wind power capacity installed are: Texas, 4,356 MW; California, 2,439 MW; Minnesota, 1,299 MW; Iowa, 1,273 MW; and Washington, 1,163 MW.

Google has invested $10 million in eSolar, a California-based company specializing in solar thermal energy, as part of its pledge to use some of its profits to “develop renewable energy cheaper than coal”.

Atomic Energy of Canada Ltd (AECL) and the Nuclear Power Institute of China (NPIC) have signed an agreement to work on developing low uranium consumption Candu technologies in China. Cooperative research and development is to include work on advanced nuclear fuel cycle technologies such as recycling uranium from used fuel from pressurized water reactors (PWRs) and Generation IV systems. CNNC and AECL worked together to build two Candu reactors at the Qinshan Phase III power plant. The units were built on a turnkey basis and started up in 2002 and 2003 respectively.

FPL Energy told North Dakota regulators it plans to build a 200 MW wind farm, which would include 133 turbines. The farm will cost an estimated $350 million (or around $1,750 a kilowatt). FPL Energy said in a letter to regulators that it hopes to file a formal permit application by Feb. 5. It wants a permit by May 1 to finish work by year’s end to qualify for a federal tax break for the project.

The Federal Energy Regulatory Commission (FERC) approved eight mandatory critical infrastructure protection reliability standards to protect the nation’s bulk power system against potential disruptions from cyber security breaches. These reliability standards were developed by the North American Electric Reliability Corp., which FERC designated as the electric reliability organization.

Exelon Nuclear’s 17 generating units produced a total of 132.3 million net MWh of electricity in 2007, the highest annual production ever for the operator. The fleet also achieved an average capacity factor of 94.5 percent, an all-time record for the company and the fifth consecutive year over 93 percent. The industry average capacity factor in 2006, the latest year for which figures are available, was 89.9 percent.


People & Personnel

Pacific Gas and Electric Co.’s board elected Jack Keenan as chief operating officer. He assumes the role previously held by William T. Morrow who has been the utility’s president and CEO since July 2007. Keenan previously was senior vice president of generation and chief nuclear officer. Keenan was vice president of fossil generation for Progress Energy in North Carolina. John Conway, currently site vice president of Diablo Canyon Power Plant will assume on an interim basis Keenan’s role as CNO.

Brenda Boultwood has been appointed senior vice president and chief risk officer at Constellation Energy. She will lead risk management activities for Constellation Energy and its businesses, including defining and assessing enterprise-wide business risks and facilitating proactive decision-making to effectively manage the risks associated with each business line. Prior to joining Constellation Energy, Boultwood served as global head of strategy, Alternative Investment Services for J.P. Morgan Chase & Co., where she was responsible for developing strategy for the company’s Hedge Fund Services, Private Equity Fund Services, Leveraged Loan Services and Global Derivative Services business lines.

Energy Future Holdings, formerly known as TXU Corp., hired former Exelon executive John F. Young as its CEO. Young most recently was executive vice president of finance and markets. He also managed Illinois-based Exelon’s nuclear, fossil and hydro operations. Before working at Exelon, Young was senior vice president of Sierra Pacific Resources Corp.

Henry B. Barron, Duke Energy group executive and chief nuclear officer, is retiring, effective March 31. He served as chief nuclear officer since 2004. Dhiaa M. Jamil, Duke Energy’s senior vice president of nuclear support, will assume the group executive and CNO role. Jamil joined Duke Power in 1981 as a design engineer. He has worked at all three Duke Energy nuclear stations, serving as vice president of the McGuire and Catawba stations.

W. Paul Bowers was named executive vice president and chief financial officer of Southern Company. He currently is president of Southern Company Generation. Thomas A. “Tom” Fanning is now chief operating officer of Southern with responsibility for Southern Company Generation.