Nuclear and coal came on strong again.
 |
For the fifth year in a row, Electric Light & Power has teamed with Energy Ventures Analysis (EVA) to put together one of our most popular industry reports, the Operating Performance Rankings.
 |
Click here to view reamaining tables
Tom Hewson, EVA principal, provided the numbers and analysis for the 2005 Operating Performance Rankings, tracking nuclear, coal and combined cycle natural gas plants by generation, heat rate, capacity factor and emissions. The results for 2005 are important to plant managers all across the country, who can benchmark their operations and track their standings from year to year. (For previous reports, which began in November 2002, go to www.elp.com and select “issue archives.”)
Nuclear Plants: The Big Boys
No new nuclear plants have been built in the United States in a long time, so results for this class of generators don’t change much from one year to the next. Of the 66 reporting units, Palo Verde camps out at No. 1 year after year because it has the highest amount of capacity, but there were some other changes. (See Tables 1 and 2.)
Periodically, nuclear plants must be brought down for maintenance, but on the whole, generation is just down slightly from the year before. They’re still operating at close to a 90 percent capacity factor. “These things are run as hard as they can be and they are doing quite well,” said Hewson. “It’s not unusual for a nuclear plant to run all year.”
Companies like Exelon, Duke and Entergy have taken a position in nuclear, while others, like NRG, are just starting out. Nuclear accounts for 21 percent of our total generation.
Coal, Still Cheap Incremental Power
Among coal generators, the top five plants are still on top. (See Table 3.) These big, big plants are generating more than last year and capacity factors have increased, too. (See Table 4.) Generally speaking, Hewson said there tends to be more of a western slant, due to a number of factors. “Coal is performing as advertised, as a cheap incremental power source, even with a lot of the environmental penalties.”
With California’s global warming legislation, AB32, the state may have found a way to create another crisis, said Hewson. For the first time, California is trying to put environmental standards on imported power, which “pretty much prohibits anything but natural gas,” he said. The state doesn’t want to build nuclear plants, it can’t really expand hydro anymore, so what’s left is wind, renewables and natural gas. “They’ll be replacing large portions of their imports, especially from the coal plants in the Southwest, like Navajo and Four Corners,” said Hewson, plants that are low incremental sources of power. “Whenever you eliminate competition, it suggests only that prices can go higher.”
Will California be a “world leader in the effort to reduce carbon emissions,” as Gov. Schwarzenegger said, or will the state experience another expensive and painful crisis like its meltdown in 2000/2001? Hewson notes that California hasn’t yet completed an economic impact study. A final ruling is expected in December on the plan.
For SO2 emissions rankings, the most important thing to have is post-combustion control, which all these plants do. They’re doing very well, having improved over the year before. (See Table 5) “We have one IGCC plant, Wabash River,” said Hewson. In December 2005, SO2 emission allowance values peaked at $1,600/ton, a pretty good incentive, said Hewson. “We are being pushed to do better. But some of these [states’] limitations are going to be hard to meet.”
The top plants in the coal heat rates rankings are dominated by the supercritical plants. (See Table 6.) “And we’re about to see our first ultra-supercritical coal plant. AEP has proposed one in Arkansas.” The other secret of success is to be operating at a high capacity factor. Most of these plant owners are regulated utilities, and they’re all in the east (except Hawaii, which uses Indonesian coal), burning primarily bituminous coals. “You can be more energy efficient by burning the bituminous coals instead of the sub-bituminous coals. You get more heat intensity.”
Hewson talked about how western and eastern coals differ.
“When the Lord gave out sulfur, he didn’t spend any time in Wyoming. They’re very low sulfur coals, so if you’re trying to reduce sulfur, you want to use western coals. When you want to go to energy efficiency or CO2, you want to go to eastern coals.
“When we get into a CO2 world, this will be very important, because our current controls are very inefficient. It takes about 75 percent of our energy to capture the CO2 we produce using our existing sets of technologies.”
Hewson said he is currently tracking 150 greenfield and four re-powering coal projects, and 100 gigawatts of scrubber projects. But scrubber costs are escalating very quickly, causing some companies, like AEP, to delay some of their scrubbers.
“We’re seeing billions of dollars spent to clean up existing facilities and we’re in the midst of a whole slew of permitting issues, especially with coal, which accounted for 50.4 percent of all our generation last year. With things like CO2 risks coming up, people are worried about whether coal will still be the cheapest alternative.”
Hewson summed up by saying that we’re spending a lot of money to further reduce emissions. “We’re seeing massive construction both in terms of flue gas desulfurization, for sulfur, and selective catalytic reduction, to reduce nitrogen oxides in order to clean up fine particulates, all part of the Clean Air Interstate Rule.
“And then we’ll probably see some more activated carbon injection projects. Mercury control comes into play in 2010.” All of this is requiring a large infusion of capital. “And as we add more onto the back end, we consume more energy and become less efficient.”
Combined Cycle Natural Gas
High natural gas prices, of course, helped re-crown coal as king and ignited more serious discussion about nuclear power, but natural gas combined cycle plants still have their place in the generation mix. In the rankings, many of the plants in the last report’s Top 20 have made the list again. Capacity has been added, although output is slightly down. Co-generation, as always, is a big part of the equation with natural gas. (See Table 8.)
Hewson explained that the heat rate rankings are what most people look at, and that they’re probably the most controversial, too. (See Table 9.) It’s an accounting and reporting issue: Are the plants correctly labeled as cogens? Hewson is diligent about being sure he’s comparing apples to apples.
“What I’ve come to understand now is that there are people who are bonused based on these lists. They’re depending on me. And the heat rate efficiency is one that people don’t spend enough time looking at.”
For more information about Energy Ventures Analysis, visit www.evainc.com or call Tom Hewson at (703) 276-4005.
(Editor’s note: Charts for The Top 20 Coal Generators Ranked by NOx Emissions and The Top 20 Combined Cycle Emissions were omitted because of space limitations and can be viewed online at www.elp.com.)
