Markets

Ammonia is set to become a novel zero-emission fuel for Japanese power plants as Woodside Petroleum and Marubeni strive to set up a supply chain to ship the green fuel from Down Under to Hokuriku Electric and Kansai Electric to co-fire their gas-fuelled power plants.

Despite early signs of a recovery, Wärtsilä has faced a 13% plunge in net sales to €2,078 million in the first half of this year as many investments in new power plant capacity continue to be postponed. The build-out of energy storage was “at a good level,” especially when linked to thermal balancing power units.

Despite a rapid build-out, renewables cannot keep up with the pace of global electricity demand growth which requires more fossil generation. After falling by about 1% in 2020 due to the pandemic, demand is set to grow by nearly 5% in 2021 and 4% in 2022, the International Energy Agency (IEA) finds.

Tough talks about Nord Stream 2 are held today during the visit of German chancellor Angela Merkel to US President Jo Biden. To find a “common position” on the Russia pipeline link, Merkel will have to guarantee that Germany would cut it off if Gazprom stops deliveries through Ukraine.

A blistering heat wave and wildfires are forcing evacuations in northern California and severely damaged three interstate power transmission lines. California ISO issued a ‘flex alert’ as it misses out of 10% or 5,500 MW of electricity imports. Emergency gas gensets still prevent the worst.

Electrification of transport and industry is likely to push up Germany’s power demand by 18.7% on 2020 levels to 665 Terrawatt-hours (TWh) by 2030, economy minister Peter Altmaier disclosed today. This implies a renewables and hydrogen build-out, if Germany wants to meet its green energy target.

Utilities in the United States switch to burning thermal coal as gas deliveries to power stations get more expensive amid rising Henry Hub prices, currently around $3.22/MMBtu. Coal power consequently gained 4% in market share to 24% while the share of gas power fell 3% to around 36%, according to US government analysis.

Industries in Guangdong, southern China’s manufacturing hub, are forced to ration their electricity use as China Southern Power Grid, the regional TSO, is struggling to meet demand. Export-orientated manufacturers in the province staged 30% growth the first five month of 2021 alone, though supply of coal-fired and imported power from Yunnan is limited.

This summer season will be “the tightest in several years” in terms of LNG supply, Japan’s largest utility JERA warns. To avert fuel shortages and potential blackouts, JERA developed precautionary measures to ensure the dispatch of its 70 Gigawatt (GW) installed power gen capacity.

A rebound in gas demand through 2024, following the pandemic-related plunge lasts year risks to undermine the world’s goal of reaching net zero emissions by 2050, the International Energy Agency (IEA) warned. Gas demand in 2021 is forecast to rise 3.6% as global economies recover from the coronavirus crisis.

Only Asia has seen LNG imports rise despite the pandemic, largely due to the Chinese government’s coal-to-gas switching policies which pushed up imports by 1.0 billion cubic feet per day (Bcf/d) in 2020. India’s LNG imports increased 0.4 Bcf/d amid low prices for spot cargoes in spring and summer.

Williams, the owner of the largest US gas pipeline Transco, has increased its marketing footprint to over 8 Bcf/d through the $50 million acquisition of Sequent Energy from Southern Company Gas. The gas marketer Sequent reportedly made $200 million during the cold freeze in Texas in February.  

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News in Brief

Growth in turbine air filtration tops 3%

July 22 – The turbine air filtration market is expected to grow 3.27% annually from $1.92 billion in 2020 to reach $2.29 billion in 2026. Demand from the oil & gas industry and electric utilities had plunged during the corona crisis and subsequent economic downturn, but the latest trend towards clean energy is driving robust growth for turbine air filtration which can be widely and easily applied in the power sector.

US oil exports stay high

July 21 – Despite volatile prices, U.S. crude oil exports reached a record high in 2020 and remained strong this year, averaging 3.51 million barrels per day (b/d). Expanded ports at Houston and Corpus Christi allow for oil to be exported from the Permian Basin and Eagle Ford Basin.

CVEC to be converted to hydrogen

July 20 – Cricket Valley Energy Center (CVEC) is taking steps to run the  combined-cycle plants on hydrogen. Works to convert the plant will be carried out by GE and are scheduled to start in late 2022. One of three GE 7F.05 gas turbines at CVEC will be introduced to a 5% hydrogen blend with natural gas.

MAN ETES labelled solar impulse efficient

July 16 – MAN Electro-Thermal Energy Storage (ETES) was attributed the “Solar Impulse Efficient Solution” label by independent auditors. In January, the German manufacturer supplied to ETES heat pumps to DIN Forsyning for a heat and power plant in the Danish port city Esbjerg.

Electricity sales to US industry rebounds

July 14 – Economic recovery has caused a 5.1% rise electricity sales to US industry this year, dwarfing 2.8% more retail sales and a 2.1% rise in the commercial sector as many office workers continue working from home. The US Energy Information Administration’s (EIA) acting administrator, Steve Nalley, called the rebound in electricity sales to industry a “strong sign of rising levels of economic output as the Covid-19 pandemic recedes.”

Solar PV to triple in Asia by 2030

July 13 – Asia Pacific solar photovoltaic capacity could triple to 1,500 gigawatts (GW) by 2030. According to Wood Mackenzie estimates, China will add 619 GW of mainly utility-scale capacity while most other nations in Asia prefers distributed solar due to land constraints. Solar PV tends to be backed up by flexible gas gensets and energy storage, forming hybrid power units.

Kinder Morgan closes on Stagecoach assets

July 12 – US energy infrastructure major Kinder Morgan has closed its acquisition of Stagecoach Gas Services. The deal include 4 gas storage facilities with a 41 bcf working gas capacity and a transmission network with multiple interconnects to major interstate pipelines, including Tennessee Gas Pipeline. The Stagecoach assets add to Kinder Morgan’s approximately 83,000 miles of pipelines and 144 terminals.

Dortmund cancels electrotechnik fair

July 9 – The elektrotechnik fair, planned for 29 September to 1 October 2021, will now not be taking place in Dortmund due to requests from the industry. The next trade fair for building, industrial, energy and lighting technology will now open its doors again in spring 2023.

Hitachi to change name of ABB Power Grids

July 7 – Hitachi ABB Power Grids will become Hitachi Energy in October. The Japanese manufacturer bought a controlling stake in ABB’s grid business a year ago and is about to fully take the name of the merged company while expanding its direction towards e-mobility and data centres.

Tapping wind energy for hydrogen

July 6 – Spanish utility Naturgy and the gas grid operator Enagás are evaluating the use of 350 MW offshore and onshore wind capacity to produce green hydrogen. The fuel will be used to decarbonise the steel industry and shipyard in northwest Spain.

EU seeks to expand Green Deal to Africa

July 5 – The European Green Deal should be expanded to also include African states as partners, the German development minister Gerd Müller said. Green hydrogen production in Africa, in his view, should be a “cornerstone for economic cooperation with the Europe.”

Decom Engineering updates PCR

July 2 – Northern Ireland-based Decom Engineering has invested more than £700,000 to develop tools for repurposing and clean decommissioning of energy infrastructure. Through updated Pipe Coating Removal (PCR) equipment, decommissioned or surplus pipelines can be cleaned of multiple coatings, so they can be repurposed for used on other projects.

Cummins buys half of Momentum Fuels

July 1 – Cummins has signed a letter of intent to acquire a 50% equity interest in Momentum Fuel Technologies from Rush Enterprises. The transaction is expected to close before year-end, and the combined venture will produce Cummins-branded natural gas fuel delivery systems for the commercial vehicle market in North America.

Gazprom evaluates cost of grey hydrogen

June 30 – Scientific studies by Gazprom and the Russian Academy of Sciences (RAS) seek to solve technical challenges in producing grey hydrogen through steam reforming in the most cost-efficient way, as well as transporting the fuel to end-users. The findings of the studies will be factored into Gazprom's sustainable development scenarios up to 2050.

Redox about to overtake Li-ion batteries

June 28 – Li-ion batteries have dominated the energy storage field, but are expected to lose their leading role in stationary applications. According to IDTechEx findings, Redox flow batteries are gaining traction and are likely to overtake the installed Li-ion battery energy capacity before the end of 2030.

B&W proceeds with waste-to-energy projects

June 25 – Babcock & Wilcox’s (B&W) renewable segment has received limited notice to proceed for a waste-to-energy project in Europe as it finalizes terms for a $24 million contract with the customer. Ohio-based B&W said it looks to capitalize on an estimated addressable market of more than $7 billion in Europe over the next three years.

Japan’s gas-burn on the rise

June 24 – LNG imports for power generation in Japan have rebounded with steady volumes from the Middle East and Australia and higher cargo numbers from Russia and the US, though LNG deliveries were outpaced by thermal coal shipments. The May 2021 LNG shipments amounted to 4.95 million tonnes, or around 73 cargoes, a 8.2% rise on volumes received in May 2020, according to trade figures by the Japanese finance ministry.

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