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Fast track Bangladesh barges

Fast track Bangladesh barges

In 1996, a severe supply-demand imbalance led the Bangladesh government to implement a private sector power programme. Two projects have already met with success under this initiative - Khulna, Bangladesh`s first IPP project, and Haripur.

Siân Green

In October 1997, the Bangladesh Power Development Board signed a power purchase agreement (PPA) with the Khulna Power Company for a 110 MW barge-mounted power plant at Khulna. Just one year later, in October 1998, the plant entered commercial operation, bringing much-needed power to Bangladesh`s western region.

At just 96 kWh, Bangladesh has one of the lowest per capita electricity consumption rates in the world, and its distribution networks serve only 15 per cent of the population. Generation capacity in the country is inadequate, with peak demand reaching 2700 MW compared with capacity of 2000 MW.

In addition to this demand-supply imbalance, Bangladesh is also hampered by a regional imbalance in the power sector. Around 85 per cent of the country`s generating capacity is located in the east where natural gas is available, while the western side of the country has suffered from acute power shortages.

By 1996, the reliability of the electric power supply system in Bangladesh had reached crisis proportions, and like many developing countries, the Bangladesh government recognised the need for private sector involvement. In 1996, the government implemented the Private Sector Power Generation Policy, and in November of the same year the Bangladesh Power Development Board (BPDB) requested bids for the supply, installation and operation of three generating facilities for a period of 15 years. One of these plants was Khulna, which when commissioned in 1998, became Bangladesh`s first independent power project.

The city of Khulna had suffered daily blackouts due to demand outstripping supply. Generating costs were also high in the area due to the low efficiency of equipment and the use of expensive fuel. Consisting of two Wärtsilä Power Commodores, the Khulna power plant operates as a baseload plant in parallel with the public electricity supply system. It has brought 110 MW of much-needed capacity to the region.

The Khulna deal

Following the bidding process in 1996, Wärtsilä NSD Power Development was awarded the contract by the BPDB to develop the 110 MW barge-mounted plant on a build-own-operate basis.

Wärtsilä Power Development is a subsidiary of Finland`s Wärtsilä NSD, and was formed in 1992 to help Wärtsilä compete in the growing IPP market. The company sought financing and sponsors for the project, forming the Khulna Power Company Ltd. to develop the project on a fast-track basis. Khulna Power`s principal sponsors are Wärtsilä Power Development and Coastal Power Khulna Ltd., a wholly-owned subsidiary of the Coastal Corporation of Houston, USA. Coastal purchased its stake in Khulna Power in August 1998.

The total cost of the project amounted to just over $104 million which was met with 42 per cent equity, 50 per cent senior debt and 7.6 per cent subordinated working capital.

Under the terms of the PPA, which was signed on October 16, 1997, the BPDB will purchase the entire output of the Khulna power plant for a term of 15 years. BPDB`s obligations under the PPA are guaranteed by the government of Bangladesh under an implementation agreement also signed in October 1997. The PPA tariff is comprised of fees covering debt servicing, operations and maintenance (O&M), fuel costs and return to investors.

The O&M of the Khulna project has been undertaken by Wärtsilä NSD Operations, a wholly-owned subsidiary of Wärtsilä NSD. The agreement is a fixed-fee contract covering all aspects of O&M mobilization and on-going operation of the plant throughout the 15-year period of the PPA. The pricing structure consists of a mobilization fee, a fixed monthly fee for manpower and a variable cost per MWh covering variable costs, spare parts and maintenance.

The Khulna facility is located near an existing power station on the banks of the Bhairab river near Khulna, Bangladesh`s third largest city. The two barge-mounted Power Commodores, known as Tiger I and Tiger III, are equipped with 19 Wärtsilä 32 generating sets, nine for Tiger I and ten for Tiger III. The units currently operate on heavy fuel oil, but can be converted to run on natural gas when that becomes available on the site.

The two Power Commodores have a prefabricated modular design which helps reduce their installation time and cost. Each weighs around 4000 t. Noise levels are reduced by the flexible mounting of the gensets, and torsional vibration in the engine-generator shaft system is also minimized by means of a flexible coupling between the engine and the generator. Fuel supply is taken from on-shore storage tanks, and the barges themselves have the capacity to store fuel in on-board tanks in the hull.

The equipment installed on the barges is designed to operate at full load at a maximum ambient temperature of 35 degrees C and a maximum engine room temperature of 43 degrees C.

The units installed at Khulna are Wärtsilä 18V32 low-NOx gensets. The engines are four-stroke and direct injected, with a turbocharged and intercooled design. Each engine is Vee configurated with 18 cylinders operating at a speed of 750 r/min, and with a total shaft output of 6750 kW. Cylinder bore and stroke are 320 mm and 350 mm respectively. Each cylinder has two inlet and two outlet valves.

The gensets produce power at 15 kV and 50 Hz. Waste heat from the prime movers is recovered and used to produce thermal energy in the form of steam for auxiliary equipment. Steam flows from exhaust gas boilers to the oil-fired auxiliary boiler which acts as a steam drum for the whole system. The auxiliary boiler also provides steam for heating when the engines are not operating. The boiler produces 1500 kg/h of steam at 8 bar and 90 degrees C.

The power plant is designed to burn heavy fuel oil as the main fuel with light fuel oil as a standby fuel. The fuel currently used has a sulphur content of close to three per cent. Once natural gas becomes available at the site, the plant can be modified to operate on gas with a liquid pilot fuel. The engines can be started and stopped on heavy fuel, providing that the operating temperature is maintained. The system is designed for a fuel viscosity of 380 cSt/50 degrees C.

The lubricating oil system provides the necessary lubrication for all moving parts of the engines. It consists of an engine-related lubrication system and a plant system that serves the whole power plant. Installation time for the lubricating system was reduced through the development of a prefabricated piping module installed into the free end of the engine. All pipes are flushed and thus only a final flushing was needed when the plants were assembled.

The cooling system consists of two circuits. The primary circuit is an engine cooling system with water flowing through the engine; in the secondary circuit, water is not in direct contact with the engine, but with heat exchangers.

The engine itself is cooled by two separate water circuits. The high temperature circuit cools the cylinder heads and cylinder liners, while the low temperature circuit cools the charge air and lubricating oil. The two circuits are connected to a seawater-cooled heat exchanger.

The automation system is designed for safe and reliable operation of the engines. Plant operation is centralised in the control room, except for functions such as separators and auxiliary units which are equipped with local control panels for independent automatic operation. For safety, the start, stop and operation mode selection of such units is only performed using the local control panels.

Operation, control and monitoring of the power plant are carried out by means of a central control panel and the Wärtsilä Operators Interface System (WOIS). The main control functions are performed from the central control panel, including engine start, stop, synchronization and loading. The central control panel also contains conventional, panel-mounted meters for the generator output, power factor, current and voltage. A WOIS workstation provides plant monitoring and includes schematic process displays, alarm and event lists, trend displays and reports of process data.

Reducing risk

Under its O&M agreement, Wärtsilä NSD Operations was able to give extensive performance guarantees for the full term of the contract, enabling Khulna Power Company to reduce its risks associated with the project. The operator has given guarantees for the annual capacity factor, minimum produced energy and minimum output of the plant at any time. All related environmental guarantees are also in force for the duration of the contract.

The mobilization period for Khulna lasted eight months, during which the local operating company for the project, Khulna Power Operators Ltd., was established. Mobilization included the hiring of the plant`s top management, middle management and base manpower, totalling around 115 people.

Khulna is equipped with operation software such as Eldoc (electronic engine manuals), MAMA Pro (preventive maintenance), inventory control, accounting and reporting programmes. It has a multimedia telecommunication system for trouble- shooting and communication worldwide. The site`s spare parts stock comprises a complete set of engine exchange parts in order to uphold the availability guarantees. It also includes one set of station emergency parts and facility wear parts for two years of operation.

If in the future the plant is converted to natural gas operation, Wärtsilä NSD Operation will carry out the conversion, and will be responsible for keeping all performance values the same both during and after conversion.

Haripur

In the autumn of 1998, while Khulna was being commissioned, Wärtsilä was also in negotiations for another barge-mounted independent power plant in Bangladesh. The Haripur project, near Dhaka, was due to be handed over to the customer in June 1999.

In addition to the Khulna project, Wärtsilä had also made a bid in 1996 to be the main equipment contractor for the Haripur project. Although initially the company did not want to take an ownership position in Haripur, slow and problematic negotiations in mid-1997 caused it to reassess its position.

Influenced by its success with Khulna and the fact that it would be able to place the debt and equity for the Haripur project, Wärtsilä decided to take an ownership position in the project company and drive forward the selection of other equity investors. It thus signed a PPA with BPDB in March 1998 and quickly sought two partners: Ogden Energy Group and El Paso Energy International.

Ogden, Wärtsilä and El Paso all hold equity stakes in Haripur, with El Paso holding the largest share. Wärtsilä was responsible for delivering the project as the equipment contractor while El Paso carried out administrative services. Ogden is the plant operator.

On August 10, 1998, Wärtsilä and the project company signed an equipment contract and in September 1998 the project secured the commitment of the Overseas Private Investment Corporation to provide limited-recourse long term debt for 70 per cent of the project cost.

At Haripur, the barge configuration and engine type chosen are different to those at Khulna. Haripur features eight Wärtsilä 46 engines on one barge. The gas diesel version of the engine is installed as natural gas and is already available at the site. Minimal site work was also necessary at Haripur because no on-shore fuel tanks are required and the silting characteristics of the Sitalakhya river are such that the barge can be moored in the river. In addition, on-board radiators, as opposed to river water cooling, is used at Haripur.

The Haripur barge was assembled with the gensets in Singapore and was completed by the end of March 1999. It was then towed to Haripur and arrived on site on 21 April 1999. Commissioning then began and the plant was handed over to the customer at the end of June 1999. It ran initially on heavy fuel oil as this allows for a faster start up.

Challenging times

The Khulna power plant was inaugurated on September 12, 1998 and in its first months of operation its power dispatch was slightly higher than budgeted. An 84 per cent capacity factor has been achieved, translating into the production of 333 017 MWh for the first five months. The average availability was 97 per cent and reliability was 98 per cent. The plant heat rate and lube oil consumption were also below budgeted values for the same period. However, the unstable nature of the local grid has caused the plant to trip several times due to grid failure.

The engines` 4000 h overhaul has already been completed and Wärtsilä is currently scheduling the more extensive 8000 h overhaul. Total station manpower is now 140 people; 90 working with operations and administration and 50 working on maintenance related duties. The plant is operated continuously with three shifts.

Wärtsilä has encountered some challenges in the first few months of operation, mainly relating to the intake of cooling water from the river. Fine sand, which is difficult to filter out, has worn the pump bearings and caused problems with the filters. Wärtsilä is currently working to improve this system.

In addition, some local circumstances have created difficult operating conditions for the plant operator and its staff. Wärtsilä says that it has had pirates boarding the barges on occasions, and also frequent strikes and rioting in the region has made it difficult for crews to reach the barge site.

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Figure 1. A barge-mounted diesel power plant is towed to Bangladesh

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Figure 2. The engine room of the Haripur power barge

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Figure 3. Khulna is located in western Bangladesh which suffers from regular power shortages

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