Blog

The future of gas turbines. Is there one?

Jun 15, 2018

No question, the gas turbine business is on its heels!

The price of oil, combined with the move to renewables has been punishing on the industry and the question rightfully asked is “what’s the gas turbine future look like?”

I have been labeled as unconventional most of my career and do not plan to change anything now.

Here is my take:

1.The gas turbine will see substantial growth in the hybridization of Gas Turbine/Battery technologies to provide Grid-Scale UPS with extended storage.

2.The industry will have to deploy 85-90% post-combustion Carbon Capture & Storage (CCS) to compete with renewables. It will no longer be acceptable to deploy unabated Natural Gas Combined Cycle (NGCC) units. The AEO2018 2050 acknowledges that any marginal improvement from coal-to-gas switching is more than offset by the projected economic growth. It also suggests a trajectory that is 4x what is required to reach 2°C/450ppm.

3.It will not be practical to apply post-combustion CCS to a NGCC unit that is forced into rapid start/stop cycling in order to accommodate the intermittent wind and solar supply variations.

4.The state level Renewable Portfolio Standards (RPS) that require 30-40% renewable generation, also give renewables first dispatch and will have to change. This first dispatch concession/subsidy, intended to encourage renewable, is in direct conflict with CCS deployment and will have to be eliminated. Renewables will have to compete on level playing field without this generous subsidy. Such a change will have a significant and positive impact on the gas turbine future.

5.Post-combustion CCS will have to be deployed on the just completed 10-year gas turbine build-out. You remember, “Capture Ready”?

6.In exchange, the current discussions around NOPR Grid Stabilization and “keeping Nukes and Coal Plants open” will cease. Both of these initiatives, intended to pay utilities to support renewables integration, will be eliminated by the market forces of a level playing. And, the renewables will no longer propagate their variability into the grid by default.

7.You cannot argue that these changes will be too hard to implement. I take the view that we have no choice.

8.In the world of surprises, did you see where China has undertaken a 16 million-acre reforestation plan by 2020? The area is about the size of Rhode Island and is ahead of schedule.

9.This is what leadership looks like.

Grid Scale UPS System

Mar 04, 2018

Most of us are familiar with the “Duck” and the need to manage its impact on the grid. As we make progress toward the Renewable Portfolio Standard (RPS), the duck’s “beer belly” will continue to grow.

The Renewable Portfolio Standard requires the utility in residence to meet an agreed percent of renewables in their electric generation mix, but it also mandates that renewables, if available, dispatch first.

That impact on the “utility in residence” is to reduce its plant load factor, depress the market price for the power the plant produces, and propogate the renewable’s intermittency to the utility downstream assets.

The “utility in residence” must then compensate for that intermittency utilizing conventional generating assets, most of which will be operating off their best efficiency point.

These conventional generating assets are forced to operate at a less efficient “off-design” condition and incur more frequent start/stop cycles that affect equipment repair and life cycle costs.

The DOE proposed, and as of now abandoned, NOPR recognized and attempted to redefine reserve assets as either On-Line and Off-Line. On-Line capacity is clearly more valuable than Off-Line.

This embedded mindset is what has driven conventional utilities and their assets toward a fast start/stop capability.

General Electric now offers a Gas Turbine/Battery Hybrid system, intended to fill the voids left by these new regulatory drivers.

In response, GE has paired their LM6000 Gas Turbine with a 10-MW/4.3-MWh Lithium-Ion Battery, creating a grid-scale UPS system that is now considered Spinning Reserve. LM6000 Hybrid EGT. An Energy Management system optimizes the combined system.

The following graphic has been in the literature since early 2000’s, but still seems relevant. The GE Gas Turbine/Battery Hybrid seems to fit nicely as a UPS system, and it is also now dispatchable in support of renewables integration, as well as a being able to serve a variety of ancillary services.

The LM6000 can include a fast start capability and when coupled with a battery, can serve as a fast response UPS system and/or an extended bulk power asset. The recent emergence of fast start gas turbines is a critical success factor enabling this asset combination.

This effort also has “multiple ways to win’, and important attribute for investors, corporate or otherwise.

It is not clear how such an asset will be deployed or how the concept will be monetized over time, but this looks like a really good idea and a valuable asset toward system-wide renewables integration.

EIA Annual Energy Outlook January 2018

Mar 04, 2018

The EIA released their Annual Energy Outlook for 2018 in January. The forecast includes 10 different cases/scenarios, visible in the table generated using their browser tool.

I have rank-ordered these 10 scenarios from a high to low impact in year 2050, and I have also provided some macroeconomic data for reference. The two Reference Cases, with and without the impact of the Clean Power Plan (CPP), are shown.

Without going into the detail again, this forecast suggests we are on the “red line” trajectory toward 58Gt, worldwide detailed in my September 2017 blog. The U.S. portion of that outcome is 5.4Gt, which we would hit in any of the top five scenarios.

Grid Stabilization or Enabling Renewables?

Feb 15, 2018

The DOE’s recent Notice of Proposed Rulemaking (NOPR), advertised as “Grid Stabilization”, was immediately demonized by the Renewables Community as a subsidy for Coal and Nuclear Power Generation.

The Federal Energy Regulatory Commission (FERC) quickly voted down the initiative.

The DOE really blew the “product positioning” on this, with its “Stabilization” labeling. I see their stabilization effort as the key enabling technology to allow further penetration of wind and solar, but that argument never surfaced.

The NOPR, under whatever name, was a legitimate attempt to create a market and associated compensation for the backup services essential to the continued growth of renewables.

The growth of renewables has been both impressive and important, and we continue to hear that renewables are now competitive with conventional generation. This is only true if the system integration costs for those renewables are not charged to their account. For the most part, these system Integration costs have fallen to the utility in residence, but without identified compensation.

To say that the grid has been taken for granted is an understatement.

It is more like “the tragedy of the commons” where the grid is the proverbial “common” and conventional generation backing it up, is the “depleted resource”, i.e., the decommissioning of conventional generation as uncompetitive.

From Wikipedia:

The tragedy of the commons is an economic theory of a situation within a shared-resource system where individual users acting independently according to their own self-interest behave contrary to the common good of all users by depleting or spoiling that resource through their collective action.

I published a blog in November of 2015 with this graphic:

The original work was authored and presented Ueckerdt, Falko and Hirth, Lion and Luderer, Gunnar and Edenhofer, Ottmar, System LCOE: What are the Costs of Variable Renewables? (January 14, 2013). Available at SSRN: http://ssrn.com/abstract=2200572 or http://dx.doi.org/10.2139/ssrn.2200572

The Clean Power Plan (CPP), or whatever remains of it, includes assumptions of ~30% renewables embedded in the identified state goals. At 30% penetration, the integration cost is equal to the generation costs, but are for the most part, uncompensated.

The DOE NOPR was an attempt to provide that compensation.

With the elimination of the NOPR, it should be no surprise that this issue has surfaced again in the form of “Emergency Aid for Some Coal Plants”, apparently available as an “emergency authorization” from DOE.

For reference, the Lazard “Projected LCOE by 2020”:

Lazard 2017

The EIA Has Resorted to CO2 Intensity in their 2017 WW Forecast

Sep 27, 2017

The EIA just released the International Energy Outlook for 2017 and declared that Carbon Intensity is projected to continue to fall in the Reference Case.

I looked for a definition of and the assumptions contained within the Reference Case, specifically as it relates to the much talked about Clean Power Plan (CPP). There is no mention of, or reference to the CPP in this 2017 International Outlook. Here is what it says.

But, the full implementation of the CPP appears to be built into the forecast and the associated claim of reduced energy intensity.How do I know?

Here is the Reference Case forecast:

The new International Outlook has the U.S. at 5072.6 Mmt in 2050

The EIA 2017 U.S. Energy Outlook for U.S., published in January of this year, shows the Reference Case CO2 emissions in 2050 at 5084.2 Mmt and explicitly included the full implementation of the CPP.

I provided the data for that January Outlook earlier this year on the TMI blog, and on my own website (http://www.base-e.net/blog.php). Here it is, again:

The Reference Case U.S. forecast, for all intents and purposes, is the same level.

Therefore, the new International forecast suggests that the CPP will be fully implemented in the U.S., but our current political rhetoric does not. I guess the EIA has created some of that “plausible deniability” by referring to “current policies” and “existing government regulations”. The rest of their Reference Case narrative is mumbo jumbo.

I keep referring to this MIT technology Review article and graphic by Mike Orcott, originally published in their 2012 Technical Review. It is still the best graphic that I have seen to dimension the problem.

You can see that the U.S.A portion of the 6℃ scenario is 5.4 Gt (5,400 Mmt). The CPP impact in the U.S. forecast is 481.2 Mmt in 2050. If this value is added to the current EIA forecast, the adjusted U.S. value becomes 5,565.4 Mmt.

This Carbon Intensity language tries to put a happy face on our efforts. As I have stated before, this CO2 Intensity is, more or less, the same metric as CO2 per GDP that both China and India advocate. They are still growing their economies.

If you look below at the U.S.A again in the Orcott graphic, the current 2050 Reference Case forecast level is still 4x the 1,300 Mmt level required to reach 2℃

The worldwide totals shown in the EIA 2017 International Outlook are plotted on the Orcott graph and, if met, suggests a 4.5℃ level.

I have no reason to believe that the rest of the world will be any more successful than the U.S., since they too are in a growth mode and that this also suggests that the 4.5℃ is optimistic.