Smart Power Generation: Flexible Capability for System Optimization

© Wärtsilä October 17, 2012 Joe Ferrari

Flexible Capability for

System Optimization

Wärtsilä Corporation


Established 1834, based in Finland

Publicly traded $6 Billion company

18,000+ employees

World leader in

Decentralized power plants 1-500 MW

Marine Propulsion

O&M services for power plants and ships

Wärtsilä Power Plants Installed Base

Oil & gas

Flexible baseload

Industrial self-generation

Grid stability & peaking

Total: 48,8 GW Plants: 4599

Engines: 10159

Countries: 169

Europe:

Output: 11,8 GW

Plants: 1783

Engines: 3336

Asia:

Output: 17,2 GW

Plants: 1619

Engines: 3487

Africa & Middle East:

Output: 10,4 GW

Plants: 830

Engines: 2116

Americas:

Output: 9,5 GW

Plants: 367

Engines: 1220

* December 2011


Smart Power Generation

• Fast, Dynamic and Efficient Generation

• Improves system efficiency, enables renewables, lowers cost.

Reliable Sustainable

Affordable

Smart

Power

System

Enables!

Fast Clean

Efficient

Smart

Power

Generation

Smart Power Generation Desired future!


Balancing Challenge

Influx of Renewables and the “balancing challenge”

Variability increases: System responds to “Net Load”, not Load

Uncertainty increases: uncertainty in forecasts


Net Load as a Driver

- More cycling of thermal plants

- Lower capacity factors for thermal plants

Net

Load

Load

Renewable

Generation

NREL, Lew et al., 2011

- Baseload?

- Greater reliance on sub-hourly schedule/dispatch


Impact on Thermal Dispatch

Most volatile (Low load) 20% Wind

Coal cycling GTCC deep turndown, cycling

1 week

Wind

New England Wind Integration Study

http://www.iso-ne.com/committees/comm_wkgrps/prtcpnts_comm/pac/reports/2010/newis_report.pdf

GTCC




Uncertainty, Day Ahead vs. Real Time

Source: IMM Quarterly Report Summer 2011:

https://www.midwestiso.org/Library/Repository/Report/IMM/2011%20IMM%20Quarterly%20Report%20Summer%20Final

.pdf

Day Ahead Wind

Difference

Real Time Wind

https://www.midwestiso.org/Library/Repository/Report/IMM/2011 IMM Quarterly Report Summer Final.pdf

https://www.midwestiso.org/Library/Repository/Report/IMM/2011 IMM Quarterly Report Summer Final.pdf

What do Grid Operators Say they Need?

Survey of 33 grid operators, 72% of global wind capacity

From Figure 38, Jones, LE (2012)

http://www1.eere.energy.gov/wind/pdfs/do

e_wind_integration_report.pdf

0% 20% 40% 60% 80% 100%

Smart Power

Generation


http://www1.eere.energy.gov/wind/pdfs/doe_wind_integration_report.pdf

http://www1.eere.energy.gov/wind/pdfs/doe_wind_integration_report.pdf

Smart Power Generation, features

Fast Clean

Efficient

Smart

Power

Generation


Low Generation Costs

– High Efficiency (across whole load spectrum)

– Low CO2

– Low Maintenance Costs (VOM)

– No penalties for starts/stops/cycling

– Minimal derating due to temperature or altitude

– Low gas pressure requirements

Cost Effective, Optimal Plant Sizing

– Technology should be scalable, competitive

– Match generation with load

– Ability to expand

Agility of dispatch Fast Start (minutes, not hours)

Fast ramp rates up & down

Unrestricted up/down times

Low minimum loads (wide range of capacity

available)

High starting reliability and availability

CLEAN: Low environmental impact Low CO2 and local emissions even when ramping

and on part load

Minimize water consumption

Engines for Power

PLANT SIZE

20V34SG

(9.34 MW* / unit)

10 to 200+ MW

18V50SG

(18.76 MW* / unit) 50 to 400+ MW

18V50SG

(Flexicycle™)

20.32 MW*/unit

50 to 500+ MW


* Generator Terminals, sea level, radiator cooled, 25C(77F) ** Generator Terminals, 5% tolerance, LHV , sea level, radiator cooled, 25C(77F)

Efficiency 47%**, 5 min start

Efficiency 48.6%**,

10 min start

Efficiency

52.6%**,

10/45 min

start

Wärtsilä Flexicycle(TM)

12

~90% of MW

~10% of MW

Wärtsilä Modular Solution

- scale plant size to match need

- Allows for future expansion

113 MW

Simple

Cycle

6 x 18V50SG 10 x 18V50SG 188 MW

Simple

Cycle


16 x 18V50SG 300 MW

Simple

Cycle

16 x 18V50SG 325 MW

Flexicycle™

16 x 18V50SG Flexicycle™

Plant Efficiency (Example, 10 x 18V50SG)

5 units 10 units 6 units 7 units 8 units 9 units

Performance Basis: 25C (77F), sea level, radiator cooling, generator terminals (Lower Heating Value),

Methane Number > 80, 5% Tolerance

10 x 18V50SG, Plant Output = 188 MW

Min stable plant load = 5.6 MW


50%

Start / Stop Profile (20V34SG)

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Load

1 2 3 4 5 6 7

5 min

Gas Purge Cycle

Run time

Stop 1min

Prelubrication & Synchronization

min 12 13 14 15 16 17

5 min from start to full load

min

Gas purge cycle

Full load again in 5 min

40% Load in 2 min


WHAT DOES ALL THIS MEAN (BIG PICTURE)?

Power Systems Need Flexible

thermal assets.

Wärtsilä Smart Power Generation: Fast,

Efficient, Clean

How to Quantify the Value of Smart Power

Generation?


Quantifying the Value of SPG (system level)

Spanish 2020 renewable target = 42%


Simulation year 2020

Over 120 power plants simulated (plus additional renewables)

Base Case: The envisioned capacity mix

Alternative: Same as above but add 9 GW of Wärtsilä Flexicycle™

Time scale/Platform: 10 minute time scale, PLEXOS™

Smart Power Generation Delivers Savings

9 GW OF FLEXICYCLE™ ADDED BASE CASE (2020)

SMART POWER GENERATION: 422 GWh/week,

633 MUSD/year in savings.

4.3% reduction in production cost for the system!


Adding intermittent generation (wind, solar) should not push

assets into regimes of operation they are not optimized for

Summary

Wärtsilä SPG is the most appropriate technology for efficient

energy production, load following, cycling, daily starts/stops.

• Highest simple cycle efficiency commercially available (47-48+%)

• Combined Cycle (Flexicycle™) efficiency 53%

• When included in a diverse portfolio, reduces costly cycling of

other technologies (optimizes dispatch of other assets)

• Plant sizes from 10 to 500+ MW

• Enables integration of renewable energy while minimizing cost


Thank You!


www.smartpowergeneration.com

Joseph Ferrari

Market Development Analyst

Wärtsilä North America, Inc.

900 Bestgate Road, Suite 400

Annapolis MD 21401

410-573-2100

[email protected]

Q & A

Quantifying Smart Power Generation Benefits DNV KEMA Energy & Sustainability

October 17, 2012

Enabling the energy transition

Our Global Experience of Professionals in Energy and Sustainability

provide Insight across the Energy Value Chain

Our passionate professionals work in multidisciplinary teams to enable our

customers in finding the optimal solutions.

Their impartiality, high-level expertise, and experience are widely recognized.

They understand the business consequences of a technical decision and the

technical consequences of a business decision.

They are present at major conferences and seminars and participate in

international advisory boards, associations, and standardization bodies to share

knowledge and stimulate innovative thinking.

22

Policy & Strategy

Production TradingTransport & Distribution

Use


SPG Study Focus

As the amount of renewable generation increases, the need for

Ancillary Services will increase:

- We focus on both generation cost and ancillary services

We decided to use CAISO as a study system

- well-developed market that shares many features with other ISOs/RTOs-

increased renewable penetration, retirements of GW of capacity

- In CAISO Ancillary Services includes load following (up and down),

regulation (up and down) spinning and non-spinning

23


SPG Study Scenarios: CAISO 2020

To analyze CAISO we used the WECC model (and isolated the impacts on

CAISO).

- We used CPUC and CAISO LTPP projections for the Base Case (Environmentally

constrained case + High Load scenario)

- We focus on comparing 5.5 GW of new and Once Through Cooling (OTC)

repowered with 5.5 GW of gas turbines in simple and combined cycle (scenario 1,

the “base case”). These are the “OTC replacement” units.

We then explored several scenarios of changing out or adding to the new or

OTC replacement units with Wärtsilä SPG.

Today we’ll focus on one of the scenarios (Scenario 4).

- In this scenario we added 3.2 GW of Flexicycle and 2.3 GW of Wärtsilä 34SGs in

addition to the already included 3.2 GW of GTCCs and 2.3 GW of simple cycle

GTs.

- We allowed the dispatch software to pick/choose the most appropriate dispatch

sequence to meet the load projections for CAISO 2020 with 33% renewable

penetration.

24


Scenarios to Highlight SPG Benefits in 2020

Scenario 1: Base Case

- Environmentally constrained generation asset assumptions

- Includes 5,517 MW of new and Once Through Cooling (OTC) re-powered assets

- High Load sensitivity case

Scenario 2: SPG in Simple Cycle instead of new and OTC

- Base Case assumptions, except

- Instead of 5,517 MW of new and OTC re-powered assets use 5,500 MW of simple cycle SPG

Scenario 3: SPG mix instead of new and OTC

- Base Case assumptions, except

- Instead of 5,517 MW of new and OTC re-powered assets use 3,300 MW of combined cycle SPG and

2,200 MW of simple cycle SPG

Scenario 4: Optimal Mix of new and OTC with SPG

- Base Case assumptions, and

- Add 3,300 MW of combined cycle SPG and 2,200 MW of simple cycle SPG

25


Smart Power Generation – Deployed in concert with other energy

resources, enhances the grid and provides other benefits….

Measuring benefits of Flexible Capacity in

North American RTO (CAISO) - Net savings in generation costs are about 5%

- Reserve margins can be managed at lower costs

Minimizing cost of providing Ancillary Services

in an RTO (CAISO) - Regulation (Up and Down)

- Load Following (Up and Down)

- Spinning

- Non-Spinning

Determining how Smart Power Generation

plays in concert in a Resource Portfolio - SPG competes in different markets against

different resources

- Resource adequacy improves

26

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

MW

Hour

Import(+)/Export(-)

New OTC Gens

Gas

Hydro

Wind

Solar

Other

Nuclear

Load + Flexibility

Peak Hour Supply

Load + Flexibility = 64,254 MW

Load = 56,018 MW

Imports = 10,474 MW

New OTC = 4,157 MW

Nat Gas = 14,764 MW

Hydro = 7,523 MW

Wind = 1,147 MW

Solar = 8,776 MW

Other = 4,575 MW

Nuclear = 4,486New OTC = re-powered Once-Through-Cooling capacity which is gas fired.


Trends faced by North American RTOs

Renewable Portfolio Standards

Thermal plant retirements and additions

Environmental restrictions on siting new plants and operations of existing

plants

Increased demand response and distributed resources

Changing Power Flows and High levels of import/export activity

27


Primary Control

Secondary Control

Tertiary Control

Time Control

Spinning Reserve

Non-Spinning Reserve

Load Following

InertiaGovernor Response

Regulation

Economic Dispatch

Supply Stack

Seconds

Minutes

Minutes

Hours

ContingencyReserve

Forecast ErrorMinutes

10 minutes

30 minutes

SPG strengths

Time Domains for SPG Benefits in Frequency Control/Ancillary

Services in an Uncertain Portfolio

28

Flex Ramp


Scenario 1: Base Case Capacity Mix to Meet Peak Load and

Flexibility in 2020

29

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

MW

Hour

Import(+)/Export(-)

New OTC Gens

Gas

Hydro

Wind

Solar

Other

Nuclear

Load + Flexibility

Peak Hour Supply

Load + Flexibility = 64,254 MW

Load = 56,018 MW

Imports = 10,474 MW

New OTC = 4,157 MW

Nat Gas = 14,764 MW

Hydro = 7,523 MW

Wind = 1,147 MW

Solar = 8,776 MW

Other = 4,575 MW

Nuclear = 4,486New OTC = re-powered Once-Through-Cooling capacity which is gas fired.

Flexibility:

Spinning & Load

Following Up:

49% supplied

by existing CCGT

Regulation UP:

38% supplied by

hydro; 38% supplied

by OTC CT

During peak hour,

Demand Response

Provided portions.


Scenario 1: Base Case Has Substantial Increase in Energy and

Ancillary Services in 2020; SPG reduces Costs

30

Ancillary

Services

= $139

Generation

Cost =

$8,061

Ancillary

Services =

met by CT

backstop* =

$381

Generation

Cost =

$6,702

Ancillary

Services

= $348

Generation

Cost =

$6,351

A/S = 45,687 GWh

*Sources: 2011 State of Market Report, LTPP assumptions, simulation results. Using the Demand Response

backstop costing on average $17,500/MWh and with shortfall penalties the cost is $1,2 billion for the base case.

A/S 72,662 GWh A/S 72,662 GWh

+ $158

- $1,359

- $33

- $349

Hydro

OTC

CT Backstop

Gas

Hydro

OTC

Gas

SPG

Hydro

Gas

60%

Costs

in M

illio

ns $

A

ncill

ary

Se

rvic

es

targ

et G

Wh a

nd

su

pp

liers

2011 2020 Base Case

2020 Base

Case + SPG

0%

5%


Scenario 1: Base Case with Demand Response supplying Ancillary

Service Shortfall at $17,500/MWh

31

Ancillary

Services

= $139

Generation

Cost =

$8,061

Ancillary

Services

= $1,201

Generation

Cost =

$6,702

Ancillary

Services

= $348

Generation

Cost =

$6,351

A/S = 45,687 GWh

*Sources: 2011 State of Market Report, LTPP assumptions, simulation results

A/S 72,662 GWh A/S 72,662 GWh

+ $1,062

- $1,359

- $777

- $349

Hydro

OTC

Demand Response

Gas

Hydro

OTC

Gas

SPG

Hydro

Gas

60%

Costs

in M

illio

ns $

A

ncill

ary

Se

rvic

es

targ

et G

Wh a

nd

su

pp

liers

2011 2020 Base Case

2020 Base

Case + SPG

0%

15%


SPG Cost Savings in RTD: Peak Hour Day

32

0

1

2

3

4

5

6

7

8

1

10

19

28

37

46

55

64

73

82

91

10

0

10

9

11

8

12

7

13

6

14

5

15

4

16

3

17

2

18

1

19

0

19

9

20

8

21

7

22

6

23

5

24

4

25

3

26

2

27

1

28

0

28

9

$/M

W f

or

5 m

inu

te in

terv

al

5 minute dispatch interval

Scenario 1 RTD: Base Case Scenario 2 RTD: All Generators

41% savings

by:

• Reducing

high cost

Demand

Response

• Cheaper

start/stop and

ramping


Resource Adequacy = Deliverability @ Risk

33

Delivery risk with:

1) Forced Outage

2) Start up Failure

3) Ramping

4) Miss-forecast

Resource Mix

1) Thermal units (35%)

2) Demand Response (15%)

3) Renewables – 33%

4) Imports – 20%

Pro

babili

ty

Capacity

1 day in 10 Years Event

Base Case

Base Case + SPG

364 MW

Doc.ID: Revision: Status: 15 / © Wärtsilä

For more information

34

Mikael Backman Market Development Director, Americas

Wartsila Power Plants

+1-410-573-2100, tel

[email protected]

Joseph Ferrari Market Development Analyst, Americas

Wartsila Power Plants

+1-410-573-2100, tel

[email protected]

Alan Roark Principal Consultant

Manager, Risk Assessments

+1-215-997-4500, tel

[email protected]

www.smartpowergeneration.com

mailto:[email protected]

