Thursday, January 19, 2012

Getting the right mix for stable power supply; EMA looking into future electricity generation fuel mix


SINGAPORE is trying to tweak the mix of different fuels - fuel oil and natural gas currently, and coal, electricity imports and even possibly solar in future - that will be used to generate electricity here.

The aim is to achieve not only competitively-priced electricity for Singapore's industries and households, but also secure stable power supplies.

That is clearly the thrust of a study which the Energy Market Authority is now carrying out. It is currently seeking a consultant, with experience in economics and power engineering, to look into the future electricity generation fuel mix here.

'The consultant will help to propose an appropriate set of assessment criteria to assess Singapore's electricity generation fuel mix and to evaluate options to facilitate the development of the future electricity fuel mix in the medium and long term,' an EMA spokesperson told BT this week.

'A key focus of this study is to examine the role of existing steam plants in the electricity fuel mix,' she added.

When contacted, John Ng, CEO of PowerSeraya, one of Singapore's biggest generating companies, said that the study's focus on existing steam plants is because all the gencos here have moved from using fuel oil-fired steam plants to more efficient combined cycle gas-turbine (CCGT) plants to produce electricity.

'The gas-fired plants are economically superior from a cost-generation perspective,' he said, adding that this 'is why the steam plants have been marginalised'.

Today, over 80 per cent of the electricity produced here by the gencos is by gas-fired plants.

'So the steam plants now serve as extremely good reserve plants,' Mr Ng said. They are deployed for example, when there are gas supply issues, or when the gas-fired plants undergo maintenance.

According to official data, as at September 2011, there was 3,148 megawatts of licensed steam plants here backing up 6,172 MW of CCGT plants and another 285 MW of open cycle gas turbines.

Taking into account other plant types like incineration plants, the total licensed electricity generation capacity here is approximately 9,900 MW.

Because of the gencos' reliance on gas-fired plants, Singapore is currently building a $1.7 billion LNG terminal to bring in liquefied natural gas from mid-2013 to supplement current piped gas supplies from Indonesia and Malaysia.

The EMA in late-2010 also said that it was prepared to look at other options like coal-fired plants and also electricity imports in the medium term.

On the former, Tuas Power is the first genco given the nod by the regulator to import coal for its clean coal/biomass-fired $2 billion Tuas Multi-Utilities Complex on Jurong Island which is starting up this year.

And just last month, the EMA also launched a three-month consultation for potential electricity imports into Singapore starting from 2017-2018.

PowerSeraya's Mr Ng said that 'Singapore is clearly trying to bring in as many economical ways of electricity supplies to try to reduce the price of electricity here. But it has also to balance this, as the higher the reserves margin, the safer power supplies will be'.

EMA's proposal for instance to allow for electricity imports of up to 600 megawatts per source country, which is quite sizeable given peak electricity demand here of 6,000 MW, has alarmed industry officials, who are concerned that this will undermine the big investments they have sunk into new gas-fired capacity here.

On solar use, Singapore is 'actively exploring ways to diversify its energy portfolio to include clean energy sources, such as solar energy', S Iswaran, Minister in the Prime Minister's Office and Second Minister for Home Affairs & Trade and Industry, said this week in the UAE.

The Republic has sought membership to the International Renewable Energy Agency as part of its ongoing efforts to develop renewable energy.