Flexibilisation of Power Plants Doug Waters Director Energy Services - PowerPoint PPT Presentation

Flexibilisation of Power Plants Doug Waters – Director Energy Services Uniper Kraftwerke doug.waters@uniper.energy 09 September 2016

Agenda About Uniper EU market requirements for flexibility Our response: Coal Our response: CCGT Wrap up and Q&A 2

Uniper is an international energy company currently having ~42GWs under operations • One of the largest European generators with 31 GW of own, mostly dispatchable generation capacity • Diversified base across technologies and main NWE European Generation markets • Strong capabilities in construction, operations and maintenance • A leading physical energy trader with global footprint • Trading financial and physical gas • Long term contract gas and stakes in pipelines Global • LNG liquefaction and regas, fields and gas storage sites Commodities • Trading financial and physical power • Trading financial and physical coal and freight • Number 3 privately-owned Russian generation company • ~30% capacity increase since 2010 International • 11 GW of generation assets Power • JV in Brazil with assets under operation and strong pipeline Our assets, capabilities enable delivery of bespoke, competitive energy products & services

Uniper’s portfolio and capabilities allows to offer technology services with global footprint Global footprint and broad service offerings Value proposition Leading one-stop-shop energy solutions provider with services across the value chain and life-cycle Optionality to tap into global new-build project opportunities Business at a glance (UEG 1 )  Expertise across multiple technologies  Project management / Services to more than 600 customers 2 Innovation delivery development Engineering services Nuclear services  Active in more than 40 countries 2 Maintenance and asset optimization 1. Uniper Engineering GmbH 4 2. Based on 2015

Uniper & India Power have formed a strategic partnership to service Indian power sector India Uniper Power Services  50:50 joint venture in power plant services +  A value-based service provider  Offering a broad range of flexible and customised services  Headquartered in Kolkata The joint venture will combine strengths of strong partners with complementary scope and portfolio. Key service offerings:  Plant operations and maintenance,  Asset monitoring software and analytical tools,  Flexibilisation of units, Lifecycle extension,  Engineering and integration of pollution control equipment and systems, etc. For further information or queries please contact: Doug Waters Animesh Kumar Doug.Waters@uniper.energy Animesh.Kumar@uniper.energy +44 752 570 3992 +49 173 368 2118

Agenda About Uniper EU market requirements for flexibility Our response: Coal Our response: CCGT Wrap up and Q&A 6

What is happening in Europe today? 1. Reduction in Demand European power generation with decreasing trend  Global recession has destroyed power 3.400 Power Generation [TWh] demand across Europe 2013 vs. 2008 3.300 GER -1% 2. Global Commodity Prices ESP -7% GBR -9%  CO 2 prices have dramatically fallen caused 3.200 ITA -9% by oversupply – attempts to reform have failed to date 3.100  US shale gas has increased US coal exports making coal generation cheaper than gas Strong renewables growth in Europe  Recently this has reversed as global gas 500 prices have fallen putting coal at margin Generation [TWh] Solar 400 300 Wind 3. Renewables Growth turbines 200  Incentive schemes designed to deliver 100 Others (ex. European 2020 targets have caused the Hydro) 0 strong and constant growth of Renewables Source: Eurostat (code: nrg_105a) 4. Political Intervention  Change in operating regime for coal and gas power plants from base load to flexible 7  Sometime gas needs to be flexible and sometime coal

On May 08, renewable electricity “probably” covered ~90% of power demand in Germany Key considerations Significant renewables 1 feed-in with direct impact on electricity production from conventional power plants Very limited production by conventional power plants in times of high renewables feed-in Conventional power plants 2 required to address hours of limited renewables production  It is very difficult to predict the role of fossil generation as it is very dependent upon weather patterns 8

The German energy transition has also implications for other European countries Power generation surplus Electricity-flows via neighbouring countries in addition to inner-German flows Power generation deficit  Power generation surplus in the north; power generation deficit in the south; this discrepancy will even become stronger over time  Grid extension needed to bring the electricity to where it is needed  Lack of transmission routes in Germany leads to electricity-flows via neighbouring countries, causing power system stability issues 9

……and for customers Components of average power-prices for households (ct/kWh) Yearly demand of 3.500 kWh 20 18 15,13 14,92 15,51 16 14,29 14 Total taxes, fees and cost allocation ct/kWh 11,30 11,59 12 9,67 10 8,32 8,53 8,96 6,28 6,81 6,98 7,31 7,61 8 6,24 6,17 6,35 4,80 5,19 5,61 5,28 6 4,07 Thereof EEG-cost allocation* 3,53 3,59 4 2,05 0,08 0,09 0,20 0,25 0,35 0,42 0,51 0,69 0,88 1,02 1,16 1,31 2 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Source: BDEW, Stand: 01/2016 * ab 2010 Anwendung AusgleichMechV 10

Rapidly evolving power market puts pressure on power plants from various dimensions Market, economic Energy policy Regulations situation Fuel price Demand Capital availability Carbon price Alternative energy New technologies Competitors sources 11

Once you understand the market you can focus on a number of key areas to adapt the plant Key areas in power plant  C apacity Power Plant  A vailability  R eliability  F lexibility  E fficiency Health and safety principles O&M strategy  C ost Organisation and processes Performance management Risk management Maintenance strategy Life cycle cost People strategy and execution management Health and safety principles Energy Trading Asset Management  6 basic technical parameters (CARFEC) that can be optimised  All parts of the organisation must work together  Trade offs have to be made while choosing one or more of the CARFEC parameters for optimisation 12

Various potential scenarios for operating fossil plants arise from flexibility requirements in EU Scenario Requirement for fossil plants Adaption response (CARFEC) Availability, Reliability & Cost – High renewables in feed meets Standby mode / preservation demand (e.g. summer / windy) Preservation strategy Reliability, Flexibility & Cost – Intermittent renewables (e.g. Start at short notice for TSO solar in Northern EU) (often within 1 hour), fast reduce start costs and increase ramping performance Availability, Reliability & Cost – High solar (e.g. Southern EU) Night time only operation change operations No wind/sun (anticyclone in Must run Availability, Reliability & Cost - winter) back to old operations regime Grid constraints and poor Offer reliable ancillary service Reliability, Flexibility & Cost renewable reactive power and products frequency response performance 13

Impact on auxiliary systems depends upon flexibility required Preservation equipment  New auxiliary equipment required for preservation strategy (e.g. dehumidifiers, stack balloons)  Needs to be able to be installed and removed as required by the market Variable and low load operation DCS & monitoring  Many motors replaced by variable  DCS control changes may be speed drives required (e.g. drain valves)  Auxiliary boiler integrity  Monitoring may need to be more real time due to risk and  Fuel supply, stocking and feeders commercial need  By-products strategy  A new data strategy is needed  Ammonia and limestone supply and stocking 14

Agenda About Uniper EU market requirements for flexibility Our response: Coal Our response: CCGT Wrap up and Q&A 15

Aim: Provide flexibility without risking integrity or increasing running costs Starts per months (For a 4x500MW coal plant over time) Achievements for this plant:  Efficient start up (reduction in time, variability and costs)  Reduced notice to synchronise and unit synch intervals  Increased ramp rates  Efficient coal stock management and by-products management 16

By-products - 50mill EUR p.a. turnover from 15 flexible coal plants and stable customer demand Products of BauMineral Separate specialist company manages all the storage and handling of by-products Investing in silos, benefication and blending facilities at strategic locations Not just on Uniper sites but in “clusters” Can ensure customer supply and quality 17

Most modifications are not to physical plant but to other areas of O&M strategy O&M strategy Preserv- Integrity ation Mgmt. Plant Process Modifica- Safety tions Flexible operations Operat- Fuel ions Modelling Training O&M strategy …. underpinning it all Is monitoring and data 18

Data - Focus is on being best in class and continuous improvement using benchmarking