Planning and flexibility key to reducing plant design and construction costs

By Douglas J. Smith, IEng.

Feb. 4, 2003 — With capital for the construction and upgrading of power plants becoming more elusive and expensive, reducing the cost of design, construction and upgrading of power plants is critical.

Until quite recently almost all new electric power plants were custom designed to meet the specific needs of the utility. Unfortunately, customized power plants are expensive to design and construct.

From the developer’s point of view, a project’s cost, and time from initial concept to commercial operation, is very important. Developers are also concerned with optimizing the operation and maintenance of the plants once they become operational. Suppliers and developers of power plants, on the other hand, are more concerned with reducing risks and maximizing their profits.

Figure 1 (above) shows the drop in the cost of constructing new power plants, a drop of almost 50 percent, versus the increasing costs of supplier guarantees since 1991.

With today’s competitive electric power market, power plant developers are demanding reliability and short construction and startup times. In addition new plants must also:

• Comply with current emission mandates
• Be able to operate as a base load plant
• Be dispatchable.
• Possess operational and fuel flexibility.

Reducing construction times

A typical pulverized coal-fired (PC) power plant takes 4-5 years before it can be put into commercial operation. However, by reducing up-front costs during construction, the same designed PC plant can reduce construction time to less than three years. Shortening the construction time and up-front costs is possible by utilizing new techniques such as parallel design and field erection; partnering between owners, suppliers, engineering and construction companies; and using enhanced computer aided design.

Traditional PC power plants constructed in the 1970s and 1980s were typically designed with built-in redundancy with several layers of safeguards to prevent unplanned outages. Although redundancy and design margins decreased in later projects in an effort to reduce costs, the electric utilities still required no reduction in plant availability.

During the 1990s, developers further reduced construction schedules and design time by turning to “reference plants.” Reference plants, also known as modular plant designs, are standard packaged component designs. These designs enable power plant developers to choose a plant’s configuration from pre-designed modules, thus reducing the cost and time for engineering and design.

In recent years modular design, fabrication and construction of new power plants has become more widely accepted. Unfortunately standardized designs may not always meet the client’s criteria. Although it is possible to modify the standard design to closely fit the client’s requirements, these modifications should be limited to minor changes. One company that is very active in the modular design and construction of reference power plants is Siemens KWU.

Siemens has designed more than 100 modules for combined-cycle and coal-fired power plants. Each module’s design file contains P&I drawings, geometric information, bill of materials, isometric drawings and calculations and schedules. In many instances these modules are pre-fabricated before they are shipped to the site.

Using commercially available software Siemens has developed a computerized planning and logistics tool for use in designing the different modules, Figure 2 (below). The software program includes a data bank plus software for 2-D and 3-D graphics, plant construction and control, and communications and work flow management. According to a World Bank report, modular designed electric power plants can lead to significant reductions in project implementation time, cost and project risks.

Plant support systems

Although Calpine has cut back on the number of power plant projects under development, they are actively searching for ways to reduce the design and construction costs of new plants. Recently Calpine teamed up with Carlton Engineering, Inc. of California to develop a prototype facility that can be adapted to any location where Calpine plans to construct a new plant.

According to Jon Hamilton, project manager Carlton Engineering, a prototype design allows a power project developer to save capital without scrimping on efficiency and quality. Using a prototype design will allow Calpine to develop multiple plants at less cost than if each plant was designed separately.

Under the project with Calpine, Carlton Engineering has developed a prototype that includes one building which houses the warehouse, shop, control room and administration. With this prototype Calpine gives the contractor and design engineers a set of plans. Utilizing these plans the engineers are able to determine very quickly if the prototype design meets the local codes where the plant is to be constructed.

Hamilton says that the prototype design has been especially useful where sites are narrow or have unusual shapes. With the prototype design a plant designer is able to move the pre-designed building within the site to determine the best fit. Not only does this reduce the design time, it also reduces costs.

Putting theory into practice

InterGen, a joint venture between Bechtel Enterprises and Shell, is in the process of constructing three almost identical power plants: Cottonwood, in Texas; Magnolia, in Mississippi, and Redbud, in Oklahoma. These plants are InterGen’s first projects to be constructed in the U.S.

All three plants are natural gas combined-cycle plants with supplemental firing. To make replication easier, Bechtel specified a 1x1x1 configuration for the plant’s major equipment. Each generating unit comprises one combustion turbine generator, one heat recovery steam generator (HRSG) and one steam turbine. Cottonwood and Redbud will each have four 300 MW units and Magnolia will have three 300 MW units.

According to Ron Sigur, InterGen’s construction project manager at Cottonwood, building three projects simultaneously helps each plant to benefit from lessons learned at the other plants. Because the projects have dedicated on-site project managers, who talk with each other several times each week, problems experienced at one plant can be avoided at the other plants, says Sigur.

According to Bechtel, traditional fast-track construction of a single plant generally starts construction with only 10 to 12 percent of the engineering design having been completed. During the construction phase, the design stays a few months ahead of construction until the plant is completed.

However, with three identical plant designs, and by staggering the start of construction, the engineering design for the second and third plants progressively increases. By the time the third plant starts construction the design is significantly ahead of the first plant when it started construction.

As a consequence of having more of the design completed, the construction team is able to plan the sequence of staging, erection and location of heavy equipment more accurately. In addition, the major equipment and other supplies can be purchased and shipped to the site when they are required.

Additional savings are also possible by staggering the start of construction at the different sites. Project construction started at the Cottonwood plant in February 2001, at Magnolia in April 2001 and in August 2001 at Redbud. This facilitates information exchange among the plants and also allows key personnel to be moved from site to site to carry out and supervise identical tasks if required.

One area where staggered construction has benefited the InterGen project is with the installation of identical HRSGs. When the first HRSG was installed at the Cottonwood plant, the construction supervisors from the other two plants observed the installation. Construction personnel from the Magnolia and Redbud also observed and participated in lifting and installing the first Cottonwood HRSG.

Rather than using steel piping for the circulating water piping systems Bechtel chose to use pre-cast concrete piping with special end fittings. According to Bechtel, even though this design is more technically challenging in fitting and assembling the pre-cast piping and fittings, the installation is faster than using steel piping. The techniques used in the installation of the pre-cast concrete piping at Cottonwood were also shared with the other two plants.

The benefits of replication

Unlike most combined-cycle power plants that use 2x2x1 configurations, Bechtel made a strategic decision to use the simpler 1x1x1 design. According to Tom Jarboe, Bechtel project director for the Standard Plant Program, the 1x1x1 design can be constructed quicker than a 2x2x1 configuration. In addition, this configuration can easily be duplicated on an existing site if space is available and the electric grid has the capacity to support the additional power.

Using the 1x1x1 configuration reduces the construction and commissioning time of each plant by three to four months. Operations and maintenance costs are also reduced when all of the plants have a standardized configuration and design. In addition, the identical plants will enable InterGen to reduce spares inventory and optimize equipment maintenance.

A hybrid EPC approach

Despite higher risks and higher construction costs, many electric utilities are still using the conventional engineer, procure and construct (EPC) approach. However, a better approach is the Hybrid EPC method, according to HDR, Omaha, Neb.

Utilizing Hybrid EPC allows a utility to bid the power plant in parts instead of the plant as a whole. Not only does this create a climate for more competitive bids it also results in quicker construction of the facility and lower capital cost. Additionally, the Hybrid EPC method allows the utility to maintain better control throughout the project delivery process. The plant’s operating characteristics can also be established more quickly and accurately.

In conjunction with a consultant, a utility can establish the various plant components that should be put out to bid. A typical coal-fired plant would go out for bid on the boiler, steam turbine, air pollution control system, material handling system and auxiliary power plant equipment. According to Matt Clark, vice president, HDR, going out for bids on individual pieces of equipment reduces the risk to the utility.

HDR used the Hybrid EPC approach for the upgrading of air pollution control equipment at Southeastern Public Service Authority’s (SPSA) Portsmouth, VA, power plant. The plant fires refuse derived fuel (RDF), but coal is also burned. HDR performed the permitting, prepared the air pollution control bid package, prepared the specifications, and designed the balance of plant equipment.

They also managed the construction. According to John Hadfield, executive director, SPSA, although unable to quantify any savings, he was very pleased with the Hybrid EPC approach for the retrofit.

Whether it is an upgrade of an existing power plant, or the development of a greenfield project, electric utilities and their engineers will continue to develop more efficient ways for optimizing design and construction. To remain competitive in today’s environment, utilities will no longer require customized designs but will tend to go with standard designs. They will, however, still require high availability and operating efficiency.

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