Power-GEN Middle East Flexibility In A Changing Fuel Landscape Jeffrey Goldmeer, Ph.D. and Aileen Barton Abu Dhabi, UAE | 12-14, October 2014 © 2014, General Electric Company. Proprietary information. All rights reserved. GE Power & Water © 2014, General Electric Company. GE Proprietary Information - The information contained in this document is General Electric Company (GE) proprietary information. It is the property of GE and shall not be used, disclosed to others or reproduced without the express written consent of GE, including, but without limitation, in the creation, manufacture, development, or derivation of any repairs, modifications, spare parts, or configuration changes or to obtain government or regulatory approval to do so, if consent is given for reproduction in whole or in part, this notice and the notice set forth on each page of this document shall appear in any such reproduction in whole or in part. The information contained in this document may also be controlled by the US export control laws. Unauthorized export or reexport is prohibited. All relative statements are with respect to GE technology unless otherwise noted. 2 © 2014, General Electric Company. Proprietary information. All rights reserved. Agenda • Market dynamics and outlook • Fuel flexibility and economic drivers • Case studies • Summary 3 © 2014, General Electric Company. Proprietary information. All rights reserved. Growing economies … what is the economic cost of traditional power generation? Compound average annual growth in energy use (‘85-’10) On average, 1.3 bbls of oil = 1MWhr of electricity; Opportunity cost of 0.139 USD/kWhr Source: A roadmap for Renewable Energy in the MENA, Jan 2014 © 2014, General Electric Company. Proprietary information. All rights reserved. 4 Hydrocarbons to electricity … what is available to meet the demand? Hydrocarbon substitution predicted in the OECD (Organization for economic co-operation and development) Source: BP 2013 © 2014, General Electric Company. Proprietary information. All rights reserved. 5 Momentum is building … driven by cost and availability 2013 Global GW 30 CN shale U.S. shale 25 Russia Shale & CBM CN LNG Poland & EU shale China CBM & shale KSA 20 GW to fuel spec 15 Algeria shale India shale 10 Columbia shale Indonesia CBM & shale CBM to LNG Argentina shale S.Africa shale & CBM Australian Shale GW with Non-Trad fuels 5 0 H Class F Class B/E Class Tight oil shale Unconventional gas Unconventional gas and oil sources Over 50% of new capacity is evaluating “opportunity fuels” 6 © 2014, General Electric Company. Proprietary information. All rights reserved. Fuel flexibility … key to economics Sour gas $16.5/MMBTU $3.5/MMBTU US $28/Mt $2.4/US gal $106/bbl $860/Mt $890/Mt $107/bbl $386/Mt $108/bbl $622/Mt … with little or no change in the availability and reliability associated with traditional natural gas operated units 7 © 2014, General Electric Company. Proprietary information. All rights reserved. Case Studies © 2014, General Electric Company. Proprietary information. All rights reserved. Using natural gas variation to an advantage Not all natural gas is the same • MWI • Price Variation causes • Multiple fields into single pipeline • Blending NG, shale gas, LNG due to economics • Source … regional profile, transportation costs, availability 9 © 2014, General Electric Company. Proprietary information. All rights reserved. Accommodating natural gas variation 1150 Heating value (Btu/SCF) 1 The gas turbine handles the variation without trips, emissions deviations or performance shortfalls Monthly gas heating value variability (May 1-31, 2013) 1000 Source: Pipeline and Natural Gas Journal, July 2011 Output remains stable ~70 Btu/SCF (~7% MWI) change in ~30 min 10 © 2014, General Electric Company. Proprietary information. All rights reserved. Gas turbine response during rapid fuel Wobbe transient Event overview 46.5 MW I 45.5 9.0 MW I 8.8 NOx 8.6 45.0 8.4 44.5 8.2 44.0 8.0 43.5 7.8 43.0 7.6 42.5 7.4 42.0 7.2 41.5 11:24 AM NOx (ppm @ 15% O2) 46.0 7.0 11:38 AM 11:52 AM 12:07 PM 12:21 PM Time 90 80 47 Frequency 1 Frequency 2 MWI 46 46 70 45 60 45 50 44 40 44 30 43 20 43 10 42 0 11:24 AM 42 11:38 AM 11:52 AM 12:07 PM 12:21 PM MWI 100 Combustion Dynamics Amplitude (% Target) 1 Can the gas turbine handle the variation without trips, emissions deviations or performance shortfalls ? • LNG terminal less than 200 km from 2x7F.03combined-cycle power plant • LNG storage tank originally purged with CO2 … not all CO2 removed before LNG was introduced to tank • CO2 / LNG entered pipeline and reached site at 11:24 am • Initial Modified Wobbe Index (MWI) value decreased 5.6% due to presence of CO2 in fuel • MWI increased 8.7% due to LNG • Maximum rate of change in MWI reached 9.5%/minute • The control system enabled with AutoTune maintained acceptable emissions and dynamics levels throughout event … no runback/trip Time 11 © 2014, General Electric Company. Proprietary information. All rights reserved. Evaluating natural gas variation … supply and economics MENA natural gas production will exclusively serve domestic needs (except for LT contracts) …. Is it enough? What is the subsidy level? Will MENA turn to US shale? 2 Source and availability? 3 Economics … what is variable composition worth? LNG capacity additions Example: 2x7F.03 gas turbines in CC (ISO day operation) comparing LNG to LNG/shale mix 1. 2. 3. 4. 30% lower “delivered’ shale gas price Shale supplements 25% of current consumption LNG price at $15/MMBTU (contract price) Plant performance (GTCC) remains equal # of trains Annual savings at baseload operation: $29MM 12 © 2014, General Electric Company. Proprietary information. All rights reserved. What’s next ? 100% ethane, propane and more Ethane example: what’s changed ? • Ethane price collapsed to methane price • Improved GE ethane combustion capability up to 100% ethane in F-class GTs What’s the value? Blended fuel savings $MM • Run profile • NG Fuel • Peak Power Pricing Ethane potential Ethane blend recast • 25% blend • Ethane 40% less expensive than NG • Move to first dispatched • Net profit based on incremental power + lower fuel price $9MM/year avg. customer value potential © 2014, General Electric Company. Proprietary information. All rights reserved. • Based on gas turbine simple cycle ISO output and heat rate • 8000 hrs/yr all ISO’s except MISO • 7000 hrs/yr MISO 13 Summary • Regional trends, configuration/operational constraints and fuel availability will continue to drive the power generation industry towards non-traditional fuels • Gas turbines have demonstrated flexibility and economics to operate on a wide variety gaseous and liquid fuels • GE has successfully tested/operated many of these fuels and decreased operational and capital expense impacts to the heavy duty gas turbine … goal is for performance like it is operating on natural gas 14 © 2014, General Electric Company. Proprietary information. All rights reserved.