Scottish Powers' Director of Regulation, Rupert Steele has called on the UK Department of Energy and Climate Change (DECC) policy to "maintain momentum" to deliver a workable scheme for a Capacity Mechanism and Contracts for Differences (CfDs) in 2014, though he strongly opposed a Carbon Floor Price.
The European Commission has warned Ireland that it must fully transpose the Electricity Directive of the third energy package into law or face referral to the European Court of Justice (ECJ). The directive contains provisions for the proper functioning of European Union electricity markets such as rules on the unbundling of networks, rules strengthening the independence and powers of national regulators and rules on the improvement and functioning of retail markets.
Germany's 'green' energy policies are failing to provide their intended emissions reductions , says John Rhys, Senior Research Fellow at the Oxford Institute for Energy Studies (OIES), arguing that phasing out nuclear will continue to increase coal use significantly. "Germany does not promote CCS (...) and it is also foregoing gas," he said in an opinion piece published by the Institute, claiming "Germany's simultaneous capitulation to anti-nuclear prejudice and willingness to compromise on cheap high CO2 emissions coal is therefore a disappointment to British supporters of EU ambitions to lead on climate change".
A coalition of 10 US states and 5 cities lead by New York Attorney General Eric T. Schneiderman has filed a court brief urging the US Supreme Court at the request of the Environmental Protection Agency (EPA) to review and reverse a lower court decision that invalidated an EPA rule requiring substantial cuts in the interstate transport of air pollution.
Gas-fired distributed power projects in the UK will benefit from specific support schemes, including capacity mechanisms, which are forthcoming as part of a new regulatory package stipulated under the Electricity Market Reform, says Dr. Jim Fitzgerald, Associate Partner at The Advisory House.
"Contracts for Difference (CfD) will differentiate on technology, with different auction prices for each low carbon technology. We expect a specific capacity mechanism to be put in place to enhance support available for distributed gas fired power generation projects," he told Gas to Power Journal in an interview.
Unless new efficient policy measures are implemented, about 40 percent of Spain's installed Combined Heat and Power (CHP) capacity is at risk of being shut-down in 2015, Javier Rodríguez Morales, Director General of Spain's Cogeneration Association (Acogen) told Gas to Power Journal. "At the moment, there is a moratorium in place to install new cogeneration capacity since 2012, as well as uncertainty about the actual regulatory framework reform and new energy taxes applied since 2003 which are deeply impacting CHP," he said.
Selling heat in addition to electricity has made new combined-cycle power plants (CCPPs) economically feasible in Germany, Norbert Wenn, Director of Sales Support and Product Line Management at Siemens told Gas to Power Journal at this year's COGEN Europe annual conference in Brussels. "The renewed German CHP law and incentive scheme has made a business case of the Lausward plant currently being built in Düsseldorf, which would have never happened had it been planned as a pure condensing plant," he said.
Long-term regulatory stability is key for helping make new cogeneration developments more attractive for European industry, Dave Brownell, Refinery Manager at ExxonMobil told Gas to Power Journal at this year's COGEN Europe annual conference in Brussels. "In Europe, we're looking for stability in the rules of the game; stability in terms of regulations. A large cogen plant is an investment of hundreds of millions of euros, typically takes four to six years of project development and the operational life of the unit exceeds 30 years," he said.
The EU's 2004 CHP Directive has played an important part in the encouragement and recent introduction of CHP incentives across several member states, according to an International Energy Agency (IEA) report on Cogeneration and District Energy. The Directive establishes general principles for CHP policy but leaves detailed implementation to member states.
The introduction of Capacity Payment Mechanisms (CPMs) as suggested under the UK Electricity Market Reform may solve immediate problems of renewable output increasing revenue volatility for operators of coal- and gas-fired power plants, but could introduce many more, says James Marshall, Senior Consultant, Pöyry Management Consulting. "Conventional generation must expect to rely on a smaller number of hours to cover fixed and capital costs, with the timing largely determined by weather patterns with only short-term predictability," he told Gas to Power Journal.
Stricter emissions regulations from the US Environmental Protection Agency (EPA) could make many of the country's coal-fired power plants just as expensive to run as gas-fired plants, even at much higher prices for natural gas, Lincoln F. Pratson, professor at Duke University told Gas to Power Journal, commenting on a study under his lead from Duke's Nicholas School of the Environment.
News in Brief
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.
Calpine closes $1.1bn in financing for Geysers Power
June 12 – Calpine Corp has closed $1.1 billion Climate Bonds Certified financing for its subsidiary, Geysers Power, the largest complex of geothermal power plants in the U.S. Geyers will use the proceeds to repay some debt it owes to Calpine and to fund ongoing operations and maintenance.
UK coal-free for two months
June 11 – The UK managed to keep the lights on without using coal for power generation for two months by now, National Grid figures show. Lower demand due to lockdowns and a rising contribution from gas and renewables has rendered less-efficient coal power units uneconomic. All unabated coal power stations are mandated to close by 2025, though Britain’s largest fossil power station Drax has converted its coal units to biomass.
Valmet transforms landfill gas into fuels
June 10 – Valmet, developer of process technologies for the energy industry, has won an order by the Dutch company CarbonOrO to supply and install a gas clean-up system at Viridor’s Dunbar Landfill site in East Lothian, Scotland, UK. Thy system will transforms landfill gas into transport fuels while capturing carbon.
