Regulation & Policy

In a surprising gist, the South Korea President Moon Jae-in has signalled his readiness to accept findings of government advisors and restart mothballed nuclear reactors. LNG exporters are disappointed given that the President’s U-turn on his election promise means that there is unlikely to be the anticipated around 10 million ton (Mt) of extra LNG demand by 2030.

The Australian Prime Minister Malcolm Turnbull has made a political U-turn on energy, dismissing earlier instated 'clean energy targets' in favour of stipulating guarantees for reliable power supply and emissions reductions as the two new pillars of his new policy. Utilities will henceforth be obliged to deliver electricity at times of peak demand.

US manufacturers Koch Industries and Dow Chemical are lobbying against the plan of Energy Secretary Rick Perry to subsidize nuclear and coal as a fuel for power generation. In a letter to Congress, manufacturers dismissed the Department of Energy’s (DoE) plan as “anti-competitive” and said it could distort or “destroy competitive wholesale electricity markets and increase the price of electricity to all consumers.”

Voicing plans to shut down all coal-fired power stations by 2030, the incoming Dutch government has sent a dramatic signal to energy markets that investments in coal is no longer safe. The far-reaching approach of the new coalition is striking, given that RWE, Uniper and Engie in the past few years commissioned three of Europe’s most modern coal power units in the Netherlands.

“The war on coal is over,” were the words used by Scott Pruitt, head of the US Environmental Protection Agency (EPA), when he announced the Trump administration will put an end to the Obama-era plan aimed at reducing power plant emissions. Pruitt argues that the Clean Power Plan violated federal law by “setting emission standards that power plants could not reasonably meet.”

The Trump administration is adamant about dismantling former President Obama’s signature plan to reduce emissions from power plants. Rather than mandating states to change their energy mix by imposing emission quotas, President Trump is expected to give utilities some guidance on how to operate their power plants more efficiently.

Crops for bioenergy are the only renewable source able to produce heat, power as well as liquid and gaseous fuels. Planting second generation non-food bioenergy crops could, according to the Energy Technology Institute (ETI), not only helps electrify Britain, but also created new jobs in the farming and forestry sectors, post Brexit.

Commentators have openly rebuked US Energy Secretary Rick Perry’s proposal for a bailout of coal and nuclear power plants. In a letter to FERC, Perry had directed the regulator to set up a rule, offering plants that can store 90 day’s worth of fuel onsite some extra compensation. Critics dismissed this plan as “nuts” as it would interfere in America’s unregulated wholesale power market, effectively reducing the price of electricity generated from burning coal.

Black-yellow-green: a Jamaica coalition between the Conservatives, Liberals and the Green Party is now the sole option for Germany’s new government – after the Social Democrats decided for the opposition. With the Greens participating, the time is ripe for a fierce debate in parliament in about the feasibility of phasing out coal-fired power plants; in close succession to Germany’s nuclear exist.

Persistently high power prices and energy shortages along the East Coast of Australia could be solved by a trans-continental gas pipeline that connects the resource-rich Northwest to existing infrastructure in central Australia, says Colin Barnett former premier of Western Australia. Though the 3,000km interconnector costs an estimated $5billion, he stressed expenses need to be put in context with $49 billion spent for a national broadband project.

Southern Co. has rejected a revised offer on rates for the Kemper County power plant. The offer would have enabled Mississippi Power to collect an additional $100 million in assets. After abandoning efforts to complete the Kemper gasifier, Southern had to take up nearly $6 billion in losses on the $7.5 billion project – but the regulator say some of the costs it now wants to recoup are “unjustified.”

A draft policy paper published by South Korea’s energy ministry this week signals a strategy of adding between 5-10 GW to the county’s installed capacity, mostly from LNG-to-power projects and renewables. The envisaged new clean energy plants would expand Korea’s installed capacity by about 10%.

Page 17 of 71

News in Brief

Denmark paves the way for Nord Stream 2

July 7– Denmark on late Monday gave the Nord Stream 2 consortium permission to utilize pipe-laying vessels with anchors in Danish waters, paving the way for the Gazprom-led consortium to complete the interconnector. Construction of the 1,230-kilometre pipeline is nearly complete, except for a final stretch of about 120-kilometers in Danish waters. The project was halted in December when the Swiss-Dutch pipe-laying company Allseas suspended works over threats of U.S. sanctions.

EPRI tests early warning system

July 6– The Electric Power Research Institute (EPRI) is conducting trial tests with multiple utilities across the United States of an early warning system. It can detect an off-gassing event as a precursor to thermal runaway up to 30 minutes prior to a cascading failure. This gives plant operators time to mitigate the problem or shut down the system.

KKR buys stake in First Gen

July 3 – Valorous Asia Holdings, owned by KKR investment funds, has bought a 11.9% stake in First Gen through a voluntary tender offer. First Gen, one of the Philippines’ largest independent power producers with 3,492 MW installed capacity, is owned by First Philippine Holdings which is controlled by the Lopez family. KKR’s acquisition of the First Gen stake is worth nearly $192.3 million.

Gazprom’s ‘BBB’ rating affirmed

July 2 – S&P Global Ratings, Moody's Investors Service and Fitch Ratings have affirmed Gazprom's long-term credit ratings as part of their annual reviews. The ‘BBB’ ratings for Gazprom from S&P and Fitch are in line with the sovereign credit rating of the Russian Federation, while Moody's ‘Baa2’ rating is a notch higher.

MHIEC to refurbish WtE plant in Kushiro

July 1 – Mitsubishi Heavy Industries Environmental & Chemical Engineering Co (MHIEC) has received an order from the Kushiro Wide-Area Federation to repair and improve the core equipment at the local Waste-to-Energy plant in Takayama. The WtE plant has a capacity of 240 tonnes per day (tpd). Renovation will increase the energy efficiency of the fluidized bed type gasification and ash melting furnace facility, reducing emissions by around 15% annually. Works are due completed in September 2023.

Nigeria: Only two of six power projects on target

June 30 – Nigeria’s Bureau of Public Enterprises has disclosed that only two out of six privatized power plants were delivered on target. Only Transcorp Power Ltd and Geregu Power Ltd out of the six privatised electricity generation companies (GENCOs) were said to have met their performance targets since taking over.

German investors prefer solar over wind

June 29 – Energy infrastructure investors are keen to build solar power projects in Germany, but shun wind parks. In the latest solar power auction, investors offered to build almost 450 MW of capacity – more than four times the 96 MW of volume on offer– with the average successful bid at 5.27 cents per kilowatt-hour (ct/kWh). The wind auction, in contrast, was undersubscribed: The German network agency  (BNetzA) tendered around 826 MW, but successful bids only totalled 464 MW, at an average price of 6.14 ct/KWh.

MAN ventures into synthetic fuels

June 26 – MAN Energy Solutions has entered the hydrogen economy with the recent pro rata acquisition of H-TEC SYSTEMS, an electrolysis tech firm. The German OEM also committed itself to upgrading its gas turbines to run on 100% hydrogen by 2030.

Varegro starts using Cummins gas genset

June 25 – Belgian-based horticultural company Varegro, has started to use a Cummins HSK78G gas generator to power its greenhouses in Oostrozebeke, West Flanders. Varegro said it selected the Cummins HSK78G genset to produce combined heat and power (CHP) on its premises at a competitive cost for use in energy-intensive greenhouse facilities.

GE names Deloitte as independent auditor

June 24 – GE’s audit committee has selected Deloitte as the company’s independent auditor for the 2021 fiscal year, replacing KPMG. The selection of Deloitte concludes GE’s latest audit tender process.

Northern German states push for hydrogen pilot cluster

June 23 – Northern German states are pushing for greater hydrogen use with a pilot project cluster. Some 12 large demonstration plants for the production and use of green hydrogen are meant to be realised in Hamburg, Schleswig-Holstein and Mecklenburg-Western Pomerania. The aim is to demonstrate how 75% of CO2 emissions can be saved in the region by 2035.

Wärtsilä to design and equip battery-powered ferries

June 22– The Finish engine maker Wärtsilä has been awarded a contract to design and equip two new zero-emissions ferries on behalf of the Norwegian operator Boreal Sjö. For each ferry Wärtsilä will supply the thruster motors, batteries, onboard and shore-based battery charging equipment, the back-up generators, and various electrical systems. The equipment is scheduled for delivery to the yard in early 2021 for the ships to start commercial operations in autumn 2021.

Subsidy cut slashes Chinese wind turbine margins

June 19 – China’s wind turbine original equipment manufacturers (OEMs) could have their gross profit margins halved due to subsidy cuts, Wood Mackenzie forecasts. Commissioned onshore wind power capacity is expected to drop by more than 16% to 19 gigawatts (GW) from 2020 to 2021 as government subsidies were terminated. This could also lead to a 27% drop in turbine prices over the next five years, slashing OEMs’ gross profit margins by half.

PowerPHASE converts gas peakers into storage engine

June 18 – U.S. emergency power provider PowerPHASE has developed an upgrade to convert 7F gas turbine-based peaking plants (350 MW each) to a so-called Storage Engine (400 MW). The unit would be able to store 3500 MWh daily and discharge 4800 MWh daily. CEO Bob Kraft claims utility customers could dispatch the Storage Engine, despite its lower heat rate (4000), ahead of higher heat rate options (9000 for gas peakers) in a competitive market like ERCOT in Texas.

Cummins names Davis head of New Power unit

June 17 – Cummins has appointed Amy Davis as Vice President and President of the company’s New Power Segment, effective July 1. The new unit includes Cummins’ electrified powertrains, battery design and assembly, battery management, fuel cell and hydrogen generation.

GE powers USS Zumwalt

June 16 – The US Navy has taken delivery of the USS Zumwalt, its first full-electric power and propulsion ship, equipped by GE’s Power Conversion. The ship features a high-voltage system, propulsion drive trains with multi-phase VDM25000 power converters and advanced induction motors. Kevin Byrne, head of GE’s North America marine segment said “the full-electric power and propulsion ship has the flexibility to direct energy where it is needed on the platform.”

New England power prices down 40%

June 15 – Spot electricity prices in New England (NE) has fallen since winter 2019/20 when it stood at an average $28/MWh, down 40% from an average $47/MWh in the previous winter. Low natural gas prices, warmer-than-normal temperatures, lower loads, and reduced needs to run expensive peakload generators were the cause for the substantial drop in NE’s winter electricity prices, the U.S. Energy Information Administration (EIA) finds.