Comment

December 2009

Global perspectives: Energy activity

By Cris Whetton

Wärtsilä O&M agreement

In conventional power generation, Finland’s Wärtsilä now has 1.0 GW of electrical output under operations and maintenance agreements in Brazil. The agreements cover 12 power plants in different locations. Wärtsilä has been contracted to operate and maintain the Geramar I and Geramar II power plants in Miranda do Norte, Brazil. Both plants are located on the same site and are each supplied with 19 Wärtsilä 20V32 engines. The plants will generate a total of 320 MW of electrical output to the national grid. This five-year operations and maintenance (O&M) agreement means Wärtsilä will take full responsibility for the efficient operation of the plant and for all service and maintenance functions. It is estimated the contract will result in the creation of approximately 60 new jobs for local applicants. The two Geramar plants are scheduled to be fully operational in January 2010. The contractor for the two plants, Geranorte, is a Brazilian consortium made up of Equatorial Energia, the Brasil Energia Investment Fund and GNP.

Wärtsilä has also been contracted to supply a barge-mounted power plant to serve a mining operation in Papua New Guinea. The contract, signed in August, is valued at approximately €57 million. The customer is Lihir Gold Limited, and the power plant will provide electricity to its Lihir Island gold mine. The power plant is scheduled to be fully operational by April 2011. The barge-mounted plant will be based on Wärtsilä 20V32 engines operating on heavy fuel oil. Since the plant is planned as being an interim solution to the company’s power needs for the site, it was decided to mount the power plant on a barge so it could later be moved to another location when no longer needed at Lihir Island. Extra electrical power was needed at the mine since Lihir Gold Limited is extending the facilities. The company required a flexible power solution for interim use, and emphasized the importance of having a firm delivery date. Wärtsilä has earlier supplied some 20 power barges to the Philippines, Jamaica, the Dominican Republic, and Bangladesh.

Biodiesel in Bulgaria

Bulgaria is boosting its biofuels position: from 1 March 2010, all Bulgarian fuel stations will be obliged to add at least 2% biodiesel to ordinary diesel fuel. This measure has been included in the amendments of the Law on Renewable and Alternative Energy Sources and Biofuels, which the Council of Ministers passed on 14 October. The next step is to be passed in the National Assembly. After September 2010, the amount of biodiesel in the regular diesel must be at least 3%, and after 1 March 2011 at least 4%. However, the state will not oblige retailers to add bioethanol to regular gasoline.

Finland’s energy collaboration

AW-Energy, an Espoo-based company developing wave energy technology in Finland, has signed a $4.4 million (€3.0 million) contract with the European Union (EU) to demonstrate its technology. The contract between AW-Energy and the EU is the first one under the CALL Framework Programme – Demonstration of the innovative full-size systems. The goal of the project is to manufacture and deploy the first full-size Finnish wave energy unit in Portuguese waters. The nominal capacity of AW-Energy’s WaveRoller unit is 300 kW, and the project includes a one-year testing period, starting from the summer of 2011.

Finland intends to join the Implementing Agreement on Ocean Energy Systems (OES) of the International Energy Agency (IEA), established to provide a framework for international collaboration in energy technology R&D, demonstration, and information exchange. Denmark joined the IEA-OES back in 2001, Norway in 2007, and Sweden in 2008. If the testing period indicates AW-Energy’s WaveRoller unit is really able to supply enough electricity on the bottom of the Portuguese waters, the next step would be the commercialization of the project.

Wood-fired power station in Britain

In Britain, the Environment Agency has approved plans for the country’s largest wood-fired power station. The 350MW Prenergy plant in Port Talbot, South Wales, is expected to generate power for up to 500,000 homes while cutting emissions by between 50 and 80% compared to gas or coal fired power stations. The Environment Agency said the permit would be dependent on Prenergy ensuring the new facility has no measurable impact on local air quality and the wider environment. It also requires Prenergy to deliver quantifiable carbon emission reductions by using only wood chips sourced from certified sustainable sources, the first time such a clause has been included for a biomass plant.

Solar power grows in Spain

The largest solar power plant in Europe, the PS20, has been recently inaugurated near Seville, Spain. It should produce sufficient power to supply 10,000 homes and to avoid the release of 12,000 tonnes of carbon dioxide per year. The PS20 is the result of research made by the EU using the neighboring plant, the PS10. The PS20 has been constructed and will be run by Abengoa Solar. It uses an array of 1,255 heliostats to concentrate sunlight onto a receiver, mounted on a central tower, where water is flashed into steam and sent to a turbine to produce electricity.

Britain building biofuels industry with wheat

Finally, the growth of the biofuels industry in Britain may have the potential to turn the country into a net importer of wheat for the first time in its history, according to the National Farmers’ Union. The farm lobby estimates 13.9 million tonnes of wheat will be produced in 2009, 3.4 million tonnes less than 2008, because of decreased yields and lower plantings. Meanwhile, two new biofuel projects are set to consume 2.3 million tonnes of British wheat next year. If these trends continue, it could bring to an end to Britain’s self sufficiency in wheat. One $400 million dollar biofuel plant, owned by Ensus, a bioethanol company backed by American private equity companies Carlyle Group and Riverstone Holdings, will consume 1.2 million tonnes of feed wheat to produce over 400 million litres of bioethanol a year. All the biofuel will be purchased by Shell.

A second $400 million refinery constructed by BP, the international food and retail group Associated British Foods, and U.S.-based DuPont will require 1.1 million tonnes of wheat to produce about 400 million litres of bioethanol a year. It is scheduled for completion in 2010. Both refineries are angling to capitalize on British and European Union targets to reduce carbon emissions from road transport though biofuels, and both refineries said they plan to use low-quality wheat sources, which are normally used for animal feed, rather than using the high-grade wheat that normally goes toward making bread.

Cris Whetton is InTech’s European correspondent.