Markets

UK utility Centrica's share of nuclear output has increased 8% year-on-year in the first quarter to 4.2 TWh, while low spark spreads – the profit margin for gas-fired power producers – " are continuing to make market conditions challenging for our CCGT fleet," it said in an interim management statement on Monday.

Canada's natural gas industry is in a "holding pattern" as low prices of around $3.00/MMBtu in Western Canada are stifling new equity investment for gas producers, a report by Canada's National Energy Board (NEB) finds. Low gas prices have displaced "significant amounts" of coal-fired in favour of gas-fired generation but it is unclear if demand can be retained long enough to move prices into the $5.00/MMBtu level necessary to resume substantial investment in dry natural gas drilling.

Costs for power transmission rises following the construction of new electricity grid lines which is expected to spur growth in Alberta's cogeneration market, Vittoria Bellissimo, Executive Director at the Industrial Power Consumers Association of Alberta (IPCAA) told COGEN Canada's annual seminar in Calgary.

"With transmission costs predicated to go up, cost sensitive industrial customers will need to consider their options. This could mean out of province investments but could also mean an increase in onsite generation. Customers with large thermal requirements will inevitably be looking at this option," she said.

'Reliability' has once again been rated as the 'top issue' and cause of concern in Black & Veatch's seventh annual U.S. electric utility industry report, compiled to reflect "views and outlooks of an industry in transition," according to Dean Oskvig, President of company's global energy business.

E.ON said it "seriously considers" mothballing the 430 MW gas-fired power plant Malcenize in Slovakia, the Essen-based utility said in charts published on the company's website.

China's economic slowdown combined with policy goals to reduce the energy intensity of GDP growth has led Deutsche Bank analysts to forecast softer Chinese coal demand growth both for power generation and industrial use.

Electricity prices are of prime importance when it comes to investment in combined heat and power (CHP) facilities by Alberta's oil sands developers, W. Dale Hildebrand, President of Desiderata Energy Consulting told this year's COGEN Canada annual seminar in Calgary.

"The most important factor for oil sands developers that are considering cogeneration is the price of electricity: can they generate it cheaper on site compared to buying it for the grid?" he said.

Lifetimes of most operational gas-fired power plants in Europe will "hopefully outlive" the current political vacuum that depresses the carbon markets, CEZ's head of trading, Michal Skalka, told investors in a conference call on the group's Q1'2013 financial results.

The utilization of combined heat and power (CHP) catered for over 30 percent of Alberta's electricity demand last year, Sandra Locke, Assistant Deputy Minister, Electricity, Alternative Energy & Carbon Capture and Storage at Alberta's Department of Energy, told COGENCanada's Annual Seminar in Calgary. "Cogeneration has become an integral part of the province's electricity market providing over 30 percent of total generation output in 2012. That's approximately 23 000 GWh of electricity," she said.

Singapore's first regasification LNG terminal officially started operations today, the Energy Market Authority confirmed. Natural gas is already fuelling 80 percent of Singapore's power generation assets, so the launch of the LNG import terminal enables power producers to diversify supply sources beyond importing pipeline gas.

German industrial conglomerate Siemens AG today reduced its profit forecast for the year, after revenue declined seven percent and net income from continuing operations has come in near the low end of its 4.5 billion euro target. The energy sector, however, remains the companies' biggest revenues driver.

EDF Energy's Director of Strategy, Steve Hargreaves, has suggested that a balanced generation mix with a contribution of intermittent generation of around a 20 percent market share can help limit the cost impact of intermittency to about £10/MWh on top of the levelised cost of wind power generation.

Intermittency and remoteness of wind generation are "the two technical characteristics that impose additional costs on the rest of the UK power system," he told Gas to Power Journal.

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News in Brief

BelGAS launches new pressure regulator

May 29 – BelGAS has introduced its new P1098 High-Capacity Pressure Reducing Regulator, a large-volume regulator for natural gas, propane and other fuels. The pilot-operated device has a large-area actuator diaphragm, allowing for fast and accurate response to modulating gas flow conditions. It is adaptable for low to extra-high pressure—up to 400 psi main valve inlet.

GE to sell lightning business

May 28 – GE has signed a definitive agreement to sell its lighting business to Savant Systems, a provider of smart homes. CEO H. Lawrence Culp called the divestment “an important step in the transformation of GE into a more focused industrial company.” The transaction is expected to close in mid-2020.

China’s fuel demand recovers

May 27 – The Chinese government has lifted restrictions on private travel since April which pushed up demand for transport fuels. Gasoline demand has recovered particularly fast and is expected to return to last year’s levels by June 2020. Wood Mackenzie estimates gasoline consumption to reach 3.4 million barrels per day (b/d) in the second quarter, down just a 0.8% year on year. Diesel or gasoil demand is expected to reach 3.4 million b/d in Q2 2020, a 3% decline year-on-year. Overall, China’s oil demand is seen rise a “modest” 13.6 million bpd, or 2.3%, in the second half of 2020.

Wärtsilä to retrofit CHP in Spain

May 26 – The Finish engine maker Wärtsilä has bagged an order to supply and install a 34SG gas-fuelled engine generating set for Rofeica Energia's combined heat and power plant in Barcelona, Spain. The installation of the gas engine will allow Rofeica to switch the CHP from heavy fuel oil to gas-fuelled operation, reducing emissions.

New York body rejects William’s plans for gas pipeline expansion

May 21 – New York’s and New Jersey’s state bodies for environmental conservation have rejected Williams’ plans for the Northeast Supply Enhancement project, designed to transport 400 million cubic feet per day of gas from Pennsylvania to New York. The state bodies had already denied wetland permits in 2019, but Williams pipeline subsidiary Transco filed another application with the U.S. Federal Energy Regulatory Commission (FERC), arguing firm services under the project were agreed with UK’s National Grid for customers in New York City districts of Brooklyn, Queens, Staten Island and Long Island.

UK inflation at 4-year low amid falling energy costs

May 20 – The rate of inflation in the UK has fallen to a four-year low as the pandemic pushed down global oil and fuel prices which translate into lower wholesale power prices. The consumer price index fell to an annual rate of 0.8% in April, down from 1.5% in March, according to the Office for National Statistics.

Deficit grows in German green energy fund

May 19 – German regional grid operator TransnetBW has warned of a growing shortfall in the country’s fund for green energy sources, financed under the so-called renewable energy (EEG) levy. TransnetBW, the TSO in southwest Germany, said “due to the EEG cost allocations defined for 2020, we anticipate there will be a negative year end bank account balance in the high three-digit million euro range for 2020.”

Spanish gas companies ‘resilient’

May 18 – Spain’s regulated gas companies “should prove to be resilient” to external shocks arising from coronavirus containment measures, Standard & Poor’s analysis finds, calculating with an average drop in EBITBA at less than 3% in 2020. A new remuneration framework for 2021-2026, recently enacted by the Spanish government, provides enhanced visibility rated grid operators amid the pandemic.

German electricity prices second highest in EU

May 15 – Taxes and the renewable energy surcharge have pushed up Germany’s household electricity prices to the second highest level in Europe, topped only by prices in Denmark. While Danish households paid 29.2 Euros per 100 kWh on average in the second half of 2019, prices in Germany averaged 28.7 Euros, according to the EU statistics office Eurostat.

Calpine’s Q1 earnings fall

May 14 – Calpine, America’s largest generator of electricity from gas and geothermal, has reported a net income of $128 million for the first quarter of 2020, down from $175 million in the prior year period. Lower commodity margins and unfavourable change in income taxes were partially offset by earnings from hedge positions for the three month ending March 31.

Siemens to supply hybrid plant in the Philippines

May 13 – Berkley Energy has contracted Siemens Energy to build a hybrid power project on the island of Mindoro in the Philippines. The project links 16 MW wind power with battery storage, stabilizing energy supply in a remote location with a weak link to the grid and reducing its dependence on diesel.

U.S. energy emissions fall

May 12 – Energy-related carbon emissions in the United States have fallen more than energy consumption, down 2.8% over the course of last year to 5,130 million metric tons (MMmt). Power sector emissions were down 145 MMmt, due to a switch from coal to gas and renewables. In April 2020, emissions experienced another unprecedented fall in due to Covid-19 lockdowns.

MAN expands Omincare concept

March 11 – MAN Energy Solutions’ service brand has extended its ‘PrimeServ Omnicare’ concept from turbomachinery to the marine and power segments. The one-stop service solution is now also applicable for maintenance of third-party machinery, including engines, turbochargers and related auxiliaries.

MIVOLT launches cooling fluid

May 7 – MIVOLT, part of the British company M&I Materials, has launched two specialist fluids to improve cooling efficiency at data centres. The electricity demand of data centres is forecast to rise to 20% of global supply to accommodate lifestyle changes like 5G internet network, autonomous vehicles and bitcoin mining.

Germany adds 1,300 km to power grid

May 6 – Germany has made progress in expanding its strained power grid. According to the Federal Network Agency (BNetzA), over 1,300 kilometres of new power transmission lines have been built and another 830km approved. A further 3,600km are planned to be built by 2030 to alleviate grid bottlenecks and allow transporting rising volumes of offshore wind southbound.

 

 

 

Oman nationalizes first IPP

May 5 – Manah Power, the first privately-run Independent Power Project (IPP) in Oman, has been transferred to state ownership, following the expiry of a Power Purchase Agreement (PPA) between United Power Company and state-owned OPWP. Manah IPP was developed under Build-Own-Operate-Transfer (BOOT) model, which stipulates an eventual nationalization of the assets – a feature absent in subsequent IPPs.

U.S inventories at record highs

May 4 – Inventories for crude oil and natural gas have reached a new record high in the United States, as fuel demand declines both for transport and the electric power sector. From March 13 – when a national emergency was declared due to the Covid-19 pandemic – to April 24, U.S. commercial crude oil inventories increased by 74 million barrels, or 16%, according to government figures. The acute scarcity of crude storage on April 20 led to a sell-off of future contracts at negative prices.