fuel options natural gas vs. lpg vs. coal - platts · fuel options natural gas vs. lpg vs. coal ......
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FUEL OPTIONSNATURAL GAS VS. LPG VS. COAL
Sampo Suvisaari
Regional Director, Wärtsilä Energy Solutions
20th Annual S&P Global Platts Central American Energy Conference
Panama City, Panama, June 15-16, 2017
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Best is not to use any fuel at all…
Renewables are quickly becoming the new baseload.
Characteristic of renewables Variable, non-dispatchable generation Reduce load of other power plants & distort the net load curve Forecast errors on generation side
Wind power
Follows weather patterns, not human daily life cycles
Minute-to-hourly output fluctuations ramping constraints
Accurately forecastable only 1...n hours ahead
Solar power Follows the human daily life & load pattern, except evening peak
Second-to-minute output fluctuations Rapid frequency deviations
Easier to forecast than wind power
NEED FOR FLEXIBILITY IN POWER SYSTEMS
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Practical impacts on power systems
• CCGT´s – first to suffer!
• Running hours drop from base load to intermittent.
• Average load drops. Inreasing number of (daily) starts and stops.
• Pulse-operation (uneconomical for CCGT).
• Forecasting operation cycles (planning) gets increasingly difficult.
• Coal and nuclear power plants – next in line to suffer...
• Not able to stop and start loss-making minimum load operation to
”hang on”.
• Main reason for renewable curtailment.
VALUE OF FLEXIBILITY IN POWER SYSTEMS
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INTERMITTENT
RENEWABLESSMART POWER
GENERATION
STORAGE
SYSTEMS
FUTURE POWER SYSTEMS
FLEXIBILITY
AFFORDABILITY
COAL
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A REMNANT FROM LAST CENTURY
• Coal on its own is a value proposition “from the last century” because:• More polluting than other alternatives• Higher CO2 production per MWh generated • Low efficiency Rankine cycle• Not a flexible technology• Not suitable for cycling• Does not combine well with increasing intermittent renewable generation
• Coal power plants are expensive to build:• High capex (4-6 times more than simple cycle gas engines)• Each power plant designed case by case, no standard solutions• Very long and unpredictable construction times
• Difficult to finance in today’s world
• Coal with biomass is a better proposition• Burn waste from sugar production (bagasse)• Emissions still a concern
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DENTON CASE
• City of Denton in Texas is closing down their coal power plant and replacing the capacity with quick starting gas engine power plant
• kWh generated by intermittent wind power are cheaper than coal
• Gas power plant will enable more renewables (from 41% to 70%) and decrease electricity rate for consumers
• For details see http://www.renewabledentonplan.com
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CITY OF DENTON CASE
Current mix After new gas power plant is installed
and coal plant closed down
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CITY OF DENTON CASE
• Ultra-flexible Smart Power Generationbased on Wärtsilä gas engines
• Simple cycle 225 MW
• Full load in less than 5 minutes
• Enables Denton to buy 70% renewableenergy
• Electricity costs go down
EXAMPLE DISPATCH CASES
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5 GW of wind power 8% of total peak load2007
GIBBONS CREEK COAL PLANT OPERATION PROFILE – ERCOT, TEXAS
GIBBONS CREEK COAL PLANT OPERATION PROFILE – ERCOT, TEXAS
16 GW of wind power 23% of total peak load2015
500 MW plant operating inefficiently at 200 MW and suffering from cycling
19 GW of wind power 27% of total peak load2016
GIBBONS CREEK COAL PLANT OPERATION PROFILE – ERCOT, TEXAS
COAL PLANT OPERATION PROFILE – SPP, NEBRASKA2007
2015
1.7 GW of wind power / 4% of peak load
6 GW of wind power / 11% of peak load
Rule of thumb: > 5 % renewables problems for non-flexible generation assets
LPGLiquefied Petroleum Gas
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ROATAN ELECTRIC RUNNING ON PROPANE
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ROATAN ELECTRIC RUNNING ON PROPANE
Smart Power Generation
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U.S. VIRGIN ISLANDS – GAS ENGINES ON PROPANE
Wärtsilä press release April 4, 2017
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0.608 USD/gal / 0.091 MMBtu/gal = 6.68 USD/MMBtu (FOB)
PROPANE SPOT PRICES UP OVER THE LAST 12-24 MONTHS
Source: www.eia.gov
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PROPANE VS BRENT
Source: BW LPG Annual Report
LNGLiquefied Natural Gas
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World LNG Report 2017 2016 2015
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LNG SUPPLY ALTERNATIVES FOR CENTRAL AMERICA
1. Supply agreement with a portfolio player
• Example Energia del Pacífico’s agreement with Shell
• More interest in smaller scale agreements
2. Reload from existing LNG terminals
• SPEC FSRU in Cartagena, Colombia
• AES Dominican Republic, later also AES Panama
3. Supply agreement with smaller scale regional liquefaction
facilities, such as Eagle LNG (Jacksonville, Florida)
• Direct supply from source
Smaller scale LNG deliveries are now possible and multiple options available.