Daily News

Scottish & Southern Energy (SSE) has decided to reduce its existing power generating capacity in the UK by around 2,000MW during the 2013-2014 financial year, and to not invest in any new gas-fired capacity in the country until at least 2015.

The gas-fired Peterhead Project in Aberdeenshire, Scotland and the coal-fired White Rose Project in Yorkshire, England have been announced as the two preferred bidders for the UK's £1 billion Carbon Capture and Storage Commercialisation Programme Competition. The UK government will now seek to come to terms by the summer with the two preferred bidders for Front End Engineering Design (FEED) studies due to last 18 months, before a final investment decision is taken in early 2015.

Globeleq, a power company owned by Actis, has begun construction on a 139MW expansion for its existing Azito gas-fired power plant near Abidjan, Côte d'Ivoire. Completion of the project is expected in early 2015, at which point the nominal capacity of the plant will be 420MW.

Improvements in energy efficiency and changes in the manufacturing output mix have resulted in a significant decrease in energy intensity in the US. Total energy consumption in the American manufacturing sector decreased by 17 percent in the period from 2002 to 2010, despite only a 3 percent decrease in gross output, according to recently released data from the US Energy Information Administration (EIA).

New Zealand's Nova Energy, a subsidiary of the Todd Corporation, has opened its new gas-fired co-generation 100MW McKee Power Plant in Taranki on the country's North Island. The power plant is designed as a peak time plant and has a start up time of 15 minutes enabling it to respond quickly to changes in electricity demand, but can also operate in baseload mode if necessary.

Germany has emerged as a leader in the European Cogeneration market due to the country's strong commitment to energy efficiency, comprehensive policy promotion through the combined heat and power (CHP) support scheme and the government's decision to phase-out nuclear power is revealed in the recently released COGEN Europe report European Cogeneration Review – Germany.

Natural gas is set to remain important in transitioning the UK to a low-carbon electricity producer in the short term future, but can only play a more significant role beyond the 2020s if carbon capture and storage technology (CCS) is deployed on a commercial scale, according to a report from the London School of Economic’s (LSE) Grantham Institute on Climate Change.

Gas consumption in India has grown at an annual rate of 10 percent from 2001 to 2011 despite insufficient pipeline infrastructure. Natural gas mainly serves as a substitute for coal in electricity generation and with 45 percent of total use, the power sector is currently the largest user of natural gas in India, according to a country specific energy analysis from the US Energy Information Administration (EIA).

Natural gas fired power plants will continue to face severe difficulties to stay in the merit order in competitive OECD Europe power markets in such as Spain, Germany and the UK, as dispatch of coal plants stays more economic at current fuel and carbon emission prices, Dennis Volk, gas and power market analyst at the International Energy Agency (IEA) told Gas to Power Journal in an interview. 

"Under current market conditions, gas-fired plants have no longer a big role to play in much of OECD Europe ..."

The Cockenzie Power Station in East Lothian, Scotland has shut down all four of its turbines after using up all of its permitted running hours under EU regulation. Owner and operator ScottishPower already has planning permission, obtained in 2011, to build a new 1000MW gas-fired combined-cycle gas turbine (CCGT) power station on the site of the now shut down Cockenzie plant.

Wärtsilä has launched a new product called the GasReformer for turning gas associated with the production of oil into energy. Traditionally such gases would be flared and wasted but the GasReformer uses steam reforming technology to convert gases rich in hydrocarbons into a methane rich product which can be used as fuel in gas fuelled engines.

The use of natural gas to generate electricity in Japan was up by 15 percent in 2012 when compared to 2011, according to the US Energy Information Administration (EIA). Japan's use of all fossil-fuelled power generation was also up 21 percent in 2012 when compared to 2011, and now represents 90 percent of the country's energy mix.

Temporary energy provider Aggreko has signed Tri-Party Power Purchase Agreements (TPPA) with Mozambique utility Electricidade de Moçambique (EDM) and Namibian utility NamPower to provide them with up to 32MW and up to 90MW of gas fuelled power, respectively from its interm power plant at Gigawatt Park in Ressano Garcia, Mozambique.

As dispatch patterns shift, gas-fired power plants can now increasingly be described as intermittent energy sources, much in the same way as renewables, Richard Sarsfield-Hall, principal consultant at Pöyry Energy Consulting, said at this year's FLAME Conference in Amsterdam. Weather conditions impact the output of wind and solar installations and subsequently determine what levels of backup power is required from combined-cycle gas and coal plants on an intermittent basis. 

Most European power markets face an oversupply of fossil power plant capacity, Guido Custers, Managing Director at Delta Energy said at this year's FLAME conference in Amsterdam. In both the Netherlands and Germany, adverse market conditions and negative profit margins is prompting operators to consider either mothballing or even decommissioning existing gas-fired plants.

News in Brief

France imports more Russian gas

March 21 – Demand for Russian gas continues to grow in France, with Gazprom’s exports rising 5.4% last year to 12.9 billion cubic meters (bcm). The upward continued into early 2019 and provisional estimates show some 2.5 bcm of gas was exported to France from January 1 to March 14, 2019, a 1.9% increase on the previous year period, Gazprom CEO Alexey Miller noted when discussing contractual supplies with his counterpart at ENGIE, Isabelle Kocher.

Merger wave grips UK oil &gas sector

March 20 – Significant pressures are here to stay in the UK oil and gas sector, with the trade association Oil & Gas UK (OGUK) saying the industry is facing a “new reality” amid high levels of M&A activity and the related transfer of assets. The ongoing consolidation process forces the industry to embrace new forms of collaboration and business models.

Chevron Nigeria to supply gas to Dangote

March 19 – Chevron Nigeria has agreed to supply natural gas to Dangote’s fertilizer plant in Nigeria. The deal is part of the international oil major’s gas supply obligation to the domestic market under the Nigerian Gas Master Plan.

POSCO wins $100m CHP deal in Mexico

March 18 – POSCO Engineering & Construction, part of the leading South Korean steelmaker POSCO, has signed a $100 million agreement with Ener AB to build a 100-MW combined heat and power plant in Mexico. Situated in Coahila, the CHP will serve the energy needs of the nearby Magnelec chemical plant.

Wood to install Siemens turbine in North Carolina

March 15 – Wood Group has secured a contract from Siemens to install a HL-class gas turbine at a power plant in North Carolina. Construction works are estimated to involve 400 people and last for approximately 11 months, Wood Group said. Once installed, the turbine will add 400 MW to the plant's existing capacity 1,200 MW. Financial details of the deal were not disclosed.

J-series turbine passes 750000 hours

March 14 – Mitsubishi Hitachi Power Systems (MHPS) has announced their global fleet of J-Series gas turbines accumulated over 750,000 hours of commercial operation. The J-Series fleet now includes 39 turbines in commercial operation, with 28 of those exceeding 8,000 hours and the fleet leader having more than 45,000 hours of operation.

German gas prices up 9% in March

March 13 – Household energy prices in Germany have risen substantially in March 2019, compared to the same month in the previous year, according to the price comparison site Verivox.  Electricity prices increased 5% to a new record of 29.42 cents per kilowatt hour (ct/kWh) in March to date, up from 27.99 cents a year ago, while natural gas prices jumped 9% to 6.1 ct/kWh.

MAN turbines commissioned at Chinese CHP

March 12 – MAN Energy Solutions has installed and commissioned a MGT6000 gas turbine and a THM-series gas turbine at a combined heat and power (CHP) plant that replaces a coal-based power plant in Changsa, Hunan Province. Another MGT6000 just started commercial operation at a cogeneration plant, optimized to run on natural gas, at an industrial zone of Dongguan City in Guangdong Province.

Gazprom breaks ground on 200-MW CHP plant in Serbia

March 11 – Russia’s state-run Gazprom has started construction of a combined-cycle gas cogeneration plant near Pancevo Refinery in Serbia. The site is owned by Novi Sadpart, part of Gazprom Neft Group. The 200 MW plant will be Gazprom Energoholding Group’s first power project outside of the Russian Federation and is slated for commissioning in 2020

ABB pilots digital control rooms in Sweden

Jan 8 – Swiss-based ABB has launched a new digital solution for control centers that is being pioneered and tested in a pilot project by the Research Institutes of Sweden (RISE). The cloud-based application works in synergy with many other ABB Ability solutions, and provides a platform for information-sharing.

MHPS opens new office in Bangladesh in bid to boost sales

Jan 7 – Mitsubishi Hitachi Power Systems, Ltd. (MHPS) has opened a branch office in Dhaka, the capital of Bangladesh, to strengthen its regional sales capabilities for thermal power stations. With the economy growing 6% in recent years, the Bangladeshi government seeks to boost the nation’s power generation capacity from currently 17 GW to approximately 24 GW by 2021 and further to 40 GW by 2030. To reach this goal, Bangladesh has started importing LNG amid state supports for private sector investment in large scale LNG-to-Power projects.

Shell mulls sale of Mahanagar Gas stake

March 6 – Shell India, the local business of Royal Dutch Shell, is considering to exit its city gas distribution business by selling its 10% stake in Mahanagar Gas Ltd. Shell acquired the stake in connection with the BG takeover in 2016, and last year already offloaded most of shareholding two two bulk divestment deals.

Siemens buys KACO’s string inverter arm

Jan 5 – Siemens announced it will acquire the string inverter business of the KACO GmbH, a manufacturers of power electronics, for an undisclosed amount. Siemens said wants to integrate KACO in its new Smart Infrastructure Operating Company, and expects the deal to close in H1-2019.

Power gen dominates Rolls-Royce’s engine business

March 4 – For the first time, Rolls-Royce Power System has manufactured more engines for electric power generation than for marine propulsion, the UK-based company said when reporting solid full year results. Revenue surged 15% to a record €3.9 billion in 2018, with adjusted profit up at €358 million resulting in a 9.1% return on sales.

Siemens produces module batteries in Trondheim

March 1 – Siemens has invested in a battery module factory in Trondheim, northern Norway, equipping the factory with a robotizied and digitally supervised production line with eight 300 MWh stations. Up to 55 battery modules per shift can be assembled every day, for use mainly in the marine and offshore market.

GE CEO committed to reduce debt “soon”

Feb 28 – General Electric CEO Larry Culp, in his first letter to shareholders, has said the company has too much debt and needs to reduce it “thoughtfully and soon.” Seeking to rebuild the ailing manufacturer, Culp focuses on GE’s four core businesses: power, renewable energy, aviation and healthcare. By adopting a “disciplined financial policy,” he wants GE achieve an industrial net debt/EBITDA ratio of less than 2.5x and a dividend in line with peers over time.

IEA launches ESCOs directory

Feb 28 – The International Energy Agency (IEA) has launched a new web resource dedicated entirely to energy service companies (ESCOs). The value of the global ESCO market grew 8% to $28.6 billion in 2017, helped by an 11% expansion in China and continued strong growth in the U.S.