Fast-track power: A bridge to economic development

Fast-track, turnkey power can provide developing nations with rapid access to reliable generating capacity and a better quality of life, argues Laurence Anderson

According to the International Energy Agency, 1.3 billion people – 18% of the world’s population – are currently without access to electricity, and that number is expected to grow by 2.1% per year through 2040.

Approximately 80% of that growth is forecast to occur in non-OECD countries throughout Africa, Latin America and Asia, largely due to rapid global population growth that is spurring industrialisation, demand for a better quality of life and a significant rise in the use of electronic devices and power-intensive appliances such as refrigerators.

The need for additional generating capacity has only grown more crucial, and a number of countries and governments have voiced commitments to bridging the growing gap between supply and demand.

Laurence Anderson

In Southeast Asia, for instance, Indonesia’s government has pledged that the nation would be 99% electrified by 2020 – no small order considering that the current electrification rate is approximately 74% and some 60 million people lack power.

In the Philippines, the challenge to meet that country’s pledge to attain 99% electrification by 2017 seems even more daunting, with approximately 29 million people – roughly 30% of its population – currently without access.

Similarly, in the US, the Obama administration issued a much-publicised pledge last year to bring 30,000 MW of new generating capacity to Africa. To date, according to a recent administration estimate, the Power Africa initiative has resulted in approximately 2500 MW of new capacity. That’s enough to power about 3.5 million homes on a continent where the Africa Progress Panel estimates 621 million lack electricity and the population is forecast to double by 2040.

While the panel suggests that solar power is the key to Africa’s future, the fact remains that a diverse portfolio of generating technology is needed to offset and compensate for the disadvantages inherent in any power technology.

In the case of solar, beyond the limitation of intermittent sunshine, there’s also the issue of high initial cost. Therefore, with or without the financial assistance and incentives that would be needed for a massive solar build-out in Africa and other developing regions, conventional fossil-powered generation is likely to remain part of the mix for the foreseeable future.

The same need for diverse sources of power generation can be found in those parts of the world that are heavily reliant on other renewables, such as hydropower. Whether it is due to the annual dry season or unexpected droughts, a number of developing nations in Africa, Asia and South America would benefit from the availability of supplemental or backup generation.

Perhaps the greatest challenge to closing the power gap facing developing nations is that bringing permanent electric generation online – from planning and financing to construction and eventual commissioning – can take years. Throw in the lack of available financing, political instability, permitting hurdles and socio-political events, and the timeline can become insurmountable for many developing nations.

But that doesn’t mean that the 1.3 billion people lacking electricity should have to go years – even decades – waiting for this essential ingredient for economic development and a better quality of life.

Reliable power generation – fast

Fast-track, turnkey power, available using state-of-the-art gas turbine technology and diesel- and gas-powered reciprocating generators, offers myriad benefits as a bridge to a better quality of life and economic growth while permanent power stations are progressing along the long path to reality. Among the benefits of interim fast-track power are:

ࢀ¢ Mobile power modules and gas turbines are easily transportable by land, sea and air;

ࢀ¢ Power modules and gas turbines can be bundled, providing scalable generating capacity from approximately 10 MW to 500 MW or more;

ࢀ¢ Installation and commissioning are rapid due to minimal construction and setup required for this modular solution;

ࢀ¢ Rapid installation means reliable power in weeks not years – for as long as the need exists;

ࢀ¢ Distributed power means the capacity can be located near demand, reducing the need for transmission and distribution infrastructure, while also cutting the power loss that occurs as electricity travels long distances across the grid;

ࢀ¢ Up-front customer investment is minimal, avoiding long-term financing and credit issues;

ࢀ¢ Mobile, modular design allows the plants to be rapidly demobilised and removed from the site when a permanent solution becomes available.

A promising future

Beyond the pent-up demand for power and the long timeline to bring permanent generation online, I am seeing three other factors that should drive increased adoption of interim fast-track power.

The first is that on-site power solutions can be tailored to the unique requirements of each country and customer. Developing nations increasingly need a range of technologies and types of fuels and voltages, as well as scalability in project size and duration. In addition, services that encompass engineering and design, project planning, installation, construction, commissioning, operation and maintenance, balance of plant and decommissioning are especially attractive in remote areas of the developing world looking to industrialise and grow their local economies.

Case in point is our recent project in Myanmar, where 70% of the population lives in rural locations and approximately three quarters of the people are without electricity. In 2014, APR Energy signed the first agreement between a US-based power generation company and the government of Myanmar since the lifting of sanctions by Western nations. Within 90 days, the company had installed and commissioned 82 MW of gas-fired power and later added another 20 MW of capacity.

While this fast-track solution provides the power equivalent needed to electrify six million homes in central Myanmar, this generation predominantly is being used to grow the country’s manufacturing base south of Mandalay. As Myanmar manufacturing expands, jobs are created, household income and purchasing power rises, and the production of revenue-generating export products grows.

The suitability of mobile, modular generating equipment also makes this an ideal solution for energy-intensive industries such as mining, where operations typically are in remote locations, far removed from the power grid. Remote mining projects in places like Botswana and Mozambique required round-the-clock power and the ability to meet variable load requirements until the power was no longer needed.

The second factor that I see driving growth for interim, fast-track power is an increased demand for mobile gas turbines, which offer a higher power density, resulting in a reduced footprint, and lower emissions and quieter operation than reciprocating generators. They also provide significantly greater grid stability, as well as ancillary services such as spinning reserves, positive frequency control and power system stabilisation.

The growing interest in gas turbines brings me to the third factor I see driving growth in interim fast-track power: the shale gas explosion and a shift to abundant, low-cost natural gas as a fuel of choice for electric generation.

In developing nations rich in these natural resources, declining worldwide hydrocarbon pricing and reduced export revenues have become a disincentive for exploration-and-production companies to tap into vast reserves off the coast of West Africa, parts of Southeast Asia and elsewhere.

Mobile gas turbines are an ideal way for these nations to monetise the economic value of their idle gas resources, and to transform this energy into electric power that will support industrialisation and manufacturing of products that might generate higher export revenues. Then, as the economic wealth of these developing countries grows – thanks to this gas turbine-powered bridge – they will begin to amass the financial resources to invest in permanent generation.

A meeting at the Center for Strategic and International Studies, held this past May, provided an early glimpse into what future demand might look like for LNG. An executive from the Panama Canal Authority explained that when the expansion of the locks was being designed, LNG shipments were not a consideration. When the expansion is completed in the next year, two LNG shipments per week from the US are expected to pass through the canal, en route to Asia – quickly ramping up to three shipments per day.

The executive noted that, one day, some of the LNG passing through the canal could be off-loaded in Panama – opening the door to the possible creation of a regional electricity hub, fueling 300 MW-400 MW of combined-cycle generation to serve Panama and its Colombian neighbors to the south, and Costa Rica and Nicaragua to the north.

The interim power industry is ideally positioned to provide a bridging solution that utilises mobile gas turbines while permanent LNG-powered generating capacity is developed – in Central America and across the globe.

Bridge to a better life

While the challenge of providing reliable electric power to the billions of people living in developing and remote parts of the world is massive and growing, it is one that can – and will – be overcome. My optimism is fueled by a simple truth: the benefits of providing this essential ingredient far outweigh the cost of these commitments.

That said, permanent power generation – much like Rome – can’t be built in a day.

Fortunately, with interim fast-track power, we have a readily available bridge that can facilitate near-term industrial growth and help developing nations and billions of people around the world to attain the improved quality of life they desire.

Laurence Anderson is CEO of APR Energy

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