Another power station delayed

Brendan Ryan | Tue, 15 Dec 2009 07:15

[miningmx.com] -- CIC Energy’s (CIC) Mmamabula energy project (MEP) to build a 1,200MW power station in Botswana has been held back yet again by South African regulatory requirements.

On Monday, CIC confirmed the latest delay which was first indicated as likely by former Eskom CEO Jacob Maroga to Miningmx in October.

Maroga commented at that time, " If I had my way I would sign agreements with IPPs (independent power producers) tomorrow on the basis that I had reached an understanding with Nersa (the National Energy Regulator of SA) that this is how the terms should look.

“However, Nersa has until the end of June 2010 to reach its final determination on Eskom’s application and finalisation of any PPA (power purchase agreement) could be delayed until then.”

This is the latest in a string of delays on finalising the commercial terms for CIC to go ahead with the coal-fired station which would sell the bulk of its power to Eskom.

The delay is bad news for TSX-listed CIC and also for South Africa. At best, it will lengthen the period during which Eskom will struggle to meet electricity demand and, at worst, it could lead to increased levels of load-shedding.

The setbacks to CIC, and other IPPs attempting to develop power projects in South Africa such as Ipsa Plc, are despite stated aims by Eskom and the South African government that they want to encourage private sector participation in the country’s power generation industry.

CIC announced that the latest information published by the Minister of Energy on December 3 has indicated that requirements for new generation capacity in terms of the first integrated resource plan (IRP1) would only cover the three year period from April 2010 to March 2013.

Requirements for new capacity beyond that are to be dealt with in a second integrated resource plan (IRP2) “which will be prepared following an extensive public consultation process that will commence in the first quarter of 2010 and is targeted for completion in mid-2010.”

CIC had initially hoped to bring Mmamabula on stream in 2013 but that target was revised in July last year. Reason was the on-going debate between Eskom and government over the terms for PPAs with IPPs.
Before CIC can proceed with Mmamabula it must sign a PPA with Eskom and it had hoped to finalise that agreement by September last year but this was pushed out to end-March 2010.

CIC president Greg Kinross commented, “ based on the company’s understanding of the regulations, an approval of the MEP by the Department of Energy will only be possible following the completion and gazetting of the IRP2 and then only for commencement of commercial operations no earlier than 2014 or such later period as may be indicated in the IRP2, once completed.”
Kinross added that CIC has reassessed its project development programme as a result of this development.
Instead of pushing for rapid achievement of financial close and start of construction CIC is going to defer most project development activities “until such time as the IRP2 has been completed”.

Kinross commented, “this will be implemented by the deferral of activities that are being performed by the financial consultants, legal consultants and engineering consultants who are assisting the company in the development of the MEP.
“While the slow pace of the regulatory process in South Africa is frustrating these spending deferrals and our C$41m treasury gives us the flexibility to weather this delay,” he added.

Any delay to CIC’s MEP will further worsen Eskom’s ability to meet future power demands because of delays to its own two major new power stations now under construction.

Eskom recently confirmed that the second of these stations - Kusile near Witbank – has been delayed by a year from its planned start up in 2013.
The first new station due to come on stream is Medupi – situated near Lephalale – which is supposed to start operations in April 2012.

According to Exxaro Resources - which will supply the coal to Medupi - construction of Medupi is running six months behind schedule but that is denied by Eskom which maintains Medupi is on track.

Published by: miningmx.com

First Nations looking at energy project opportunities

Dec 11 - 2009

OJIBWAYS OF GARDEN RIVER FIRST NATION – Anishinabek Nation Chiefs in Assembly passed an important resolution Nov. 24 giving the Union of Ontario Indians a strong mandate to advocate and support Anishinabek First Nations as builders and operators of transmission lines.

“We have to take advantage of every opportunity that comes our way,” says Grand Council Chief Patrick Madahbee.

“The Green Energy Act and the required expansion of Ontario’s transmission network present significant opportunities for First Nations,” said Isadore Day, Lake Huron regional chief and Serpent River chief. “Treaty, land rights and jurisdiction of First Nations in the Anishinabek Nation must be respected and form the basis of any energy or related infrastructure development within our territories.”

“The bottom line is we are advancing as proponents and are very encouraged by the Ontario government’s willingness to proceed with our First Nations in this manner,” Day said.

In addressing the Grand Council Assembly earlier in the day, Minister of Aboriginal Affairs Brad Duguid said “We are 100 per cent behind the First Nations on this development.”

“Transmission development will not occur without engagement and consultation of First Nation communities,” said Mike Penstone, Hydro One’s vice president of major project coordination and external relations.

The Anishinabek Nation incorporated the Union of Ontario Indians as its secretariat in 1949. The UOI is a political advocate for 41 member communities across Ontario, representing approximately 55,000 people. The Union of Ontario Indians is the oldest political organization in Ontario and can trace its roots back to the Confederacy of Three Fires, which existed long before European contact.

Asian power firms look to international markets for growth opportunities

Nov 30 - Datamonitor
Energy security concerns and business expansion plans are driving Asian power generation companies to venture into international markets. However, various technical, commercial and political risks pose significant challenges to these companies' plans to establish an international footprint.
Indian utility major National Thermal Power Corporation (NTPC) is working towards a proposal of building a 4,000-5,000MW gas-fired power plant in Iran at a cost of around $5 billion. In another development, NTPC is looking to develop a 500MW coal-fired power plant in Sri Lanka. Bharat Heavy Electricals Limited, India's leading power equipment manufacturer, won a contract for setting up a $100m, 120MW co-generation power plant in Indonesia. In addition, the company has formed a joint venture with National Hydroelectric Power Corporation, which is also looking to develop hydro plants in Bhutan and Myanmar, in order to venture into the central Asian markets.
Having gained confidence from watching Indian exploration and production firms successfully carry out international ventures, power sector firms in other Asian markets have started to follow suit. These strategies not only include providing engineering, procurement and construction services or supplying equipment, but also setting up power plants in non-domestic markets.
Chinese firm Huadian Group Power Operations Limited recently signed a contract with the Sri Lankan government through which it will set-up a coal-fired power plant. Also following this trend, Sri Lankan company Hydropower International Limited is helping East African countries like Tanzania, Rwanda and Burundi to set up small hydro power plants.

Revenue incentives, coupled with domestic energy security concerns, have prompted state-run players to take such initiatives. Along with earning supply or service revenues, power generation players are also mulling the option of importing a share of the power generated into their domestic market. As a part of NTPC's Iran power project, a share of the power generated will be brought to India through a 1,500km long, high-voltage transmission line. Domestic power generation firms are also deliberating the barter option, whereby they can import fuel in return for developing power generation facilities in international markets. One example of such an approach is NTPC's move to build gas and coal-fired power stations in Nigeria in return for three million tons per annum of reasonably priced natural gas.

As this international trade makes commercial sense, individual countries must look to mitigate the political risks involved, which are seen as the major threat to these expansion strategies. If the parties involved do not guard against such risks, projects are likely to suffer a fate similar to that of the proposed gas pipeline between India-Pakistan-Iran, which has been derailed due to unstable political relations between the countries involved. The current row between Russia and Ukraine over a gas pipeline is further proof that energy balances rely heavily on political stances between the countries involved.

Apart from political risks, power generation companies also face challenges at the execution level. The high cost of laying undersea transmission lines between Sri Lanka and India, or of laying overhead transmission lines on difficult terrain between Iran and India, highlights the technical and commercial difficulties in international energy commerce, especially in a geographically diverse Asia Pacific region. There has been very little private participation in such projects due to the high risks and costs involved. The execution of such projects is also impacted by the continued threat of terrorist activities across the region. Thus, although such projects have been successful in more stable regions such as Europe, companies must be pragmatic about their potential elsewhere, especially in Asia Pacific.
However, advances in technology may help to diminish such logistic hurdles for electricity transfers. Electricity storage and transfer technology, which is currently being developed by technology majors like General Electric (GE), would enable companies from energy deficient countries to import electricity in return for power generation services in fuel rich countries. GE has invested more than $150m in developing advanced battery technologies, including high energy-density sodium-based batteries that will provide energy storage for a variety of applications. GE envisages initially rolling out approximately 10 million cells, which translates into 900MW-hours of energy storage or transferring capacity. The successful implementation of high-voltage power links in Europe, like the 450kV, 580km-long NorNed link between the Netherlands and Norway (the longest undersea power link in the world), or the 450kV, 250km-long high-voltage direct current link between Germany and Sweden, further substantiate the role technology could play in overcoming international trade challenges.
Thus, backed by liberal power policies and technological advancements, Asia Pacific countries must overcome the political constraints and logistic challenges involved in international expansion and endeavor towards the expansion of mutual energy commerce between countries, thereby establishing the much needed energy balance across the region.

Published by: Energycentral.com

Should We Make Solar Energy Dirty?

Abengoa Solar has announced that they intend to build the first Solar Thermal installation integrated with a Coal Plant owned by Xcel Energy. The demonstration project is intended to increase power plant efficiency while lowering CO2 emissions. This is the first time that solar energy will be used to increase the efficiency and lower the emissions of a coal power plant in the United States.

The question that I have is should we be going down this road at all? By making the process more efficient and therefore able to produce cheaper electricity are we not undermining our efforts to get off of coal based generation all together? The combination of ultra clean solar thermal energy and coal combustion may reduce the overall CO2 released into the atmosphere but does it not pave the way to utilize even more of our coal reserves? We know that we are going to use all of our petroleum reserves , right to the last drop but if we resign ourselves to also using our coal reserves we will never halt the increase of global CO2. I believe that playing with this technology makes a slippery slope even slicker. Here is what the company has to say:

Abengoa Solar has been selected by Xcel Energy, Colorado’s largest electric utility company, to build a demonstration parabolic trough concentrating solar power (CSP) plant at its Cameo coal plant near Grand Junction, Colorado. The project is the first to integrate an industrial solar installation into a conventional electrical power plant.

Construction is expected to start within a month and the plant is expected to be operational by the end of the year. The project, awarded to Abengoa Solar by Xcel, is the first project under an Innovative Clean Technology program that has been approved for Xcel Energy by the Colorado Public Utilities Commission.

The goal of the project is to prove that the heat produced by a solar facility can increase the efficiency of a conventional power plant while also lowering carbon dioxide (CO2) emissions. Successful integration of this technology may enable future large-scale applications of this technology into other power plants.

“We continue to move forward in developing ways to help us reduce our impact on the environment,” said David Wilks, President of Energy Supply for Xcel Energy. “If this demonstration works, we may be able to implement this type of technological advance in other coal-fired power plants to help further reduce carbon dioxide emissions in Colorado and possibly other areas of our service territory.”

This four thermal megawatt solar installation will use state-of-the-art parabolic trough collectors developed by Abengoa Solar.

Ken May, Director of Abengoa Solar IST, emphasized the high potential of large-scale applications of the industrial solar installation technology: “Proper use of the solar thermal energy produced at these facilities can improve plant efficiency while lowering CO2 emissions. The successful integration of solar and coal technologies will encourage more widespread use throughout the utility sector.”

Parabolic Trough Technology for Industrial Solar Installations

Parabolic trough technology can be used for both electricity generation as well as for producing thermal energy for industrial processes. More extensive use of this technology could have a significant positive impact on the environment. Abengoa Solar’s industrial parabolic trough technology installation utilizes collectors that track the sun during the daytime in order to concentrate solar radiation onto a heat-absorbing pipe located at the focal line of the parabola. The heated fluid that circulates through the pipe reaches high temperatures and, by means of a heat exchanger, produces energy that can be used to generate steam, to heat water or air, or to run an absorption machine for an air conditioning system.

Published by: solarthermalmagazine.com

Mitsubishi Heavy to test CO2 Capture System

TOKYO, May 25, 2009
Mitsubishi Heavy Industries Ltd. (TSE:7011) said Friday that it will begin trials of its carbon capture technology at a U.S. power plant in 2011, aiming to create a marketable product by 2015.

Testing will take place at a coal-fired plant in the state of Alabama affiliated with Southern Co., a major U.S. utility. Five hundred tons of carbon dioxide a day will be removed from the plant's emissions and compressed for storage underground. Mitsubishi Heavy says it will be the largest undertaking of its kind at a coal-fired plant.

The Electric Power Research Institute Inc., an independent U.S. research body, will join the effort. Mitsubishi Heavy and others will invest a total of US$100- $150 million, or 9.4 to 14.1 billion yen.

Carbon capture and storage is receiving increasing attention as a means of combating climate change. In addition, coal is a common fuel for power plants in the U.S., China, and Eastern Europe.

Mitsubishi Heavy sees demand for capture technology increasing as carbon trading schemes expand. The industrial giant will also conduct tests at a German power plant starting in 2011.

Published by: TradingMarkets

APS to build 290 MW concentrating solar plant

22 May 2009 -- Arizona Public Service and Starwood Energy Group Global plans to build a 290 MW concentrating solar plant 75 miles west of Phoenix. Regulatory approval is required.

Scheduled for completion in 2013, Starwood Solar I will be owned by an affiliate of Starwood Energy with all the electricity sold to APS through a long-term purchase power agreement. Lockheed Martin will design, build and operate the facility.

Starwood Solar I will cover 1,900 acres and include 3,500 parabolic mirrors that focus solar thermal energy onto a heat transfer fluid. The hot fluid converts water into steam, which turns the plant's turbines. The plant also will use molten salt to store solar energy and continue producing electricity for up to six hours after the sun sets.

This is the third solar power announcement for APS in May. The company earlier announced the APS Community Power Project in Flagstaff and dedicated a new solar project at the Grand Canyon.

In February 2008, APS signed an agreement with Abengoa Solar for the power from the to-be-built 280 MW Solana Solar Plant. With Solana, Starwood Solar I and other contractual agreements, APS expects to have 800 MW of energy in its renewable energy portfolio in 2014.

Published by: PE