Energy management solutions can guarantee more economic CHP plant operation and allow plants to participate in the smarter business of balancing the grid, writes Juha-Pekka Jalkanen

Finland’s Fortum Suomenoja combined heat and power plant

Credit: Valmet

Today’s energy systems have become increasingly complex because of two major challenges. Wind and solar, along with energy storage, pose the first challenge to the balance management of any energy-producing system. The second challenge is the continuous turbulence in electricity pricing. When wind is abundant, electricity prices drop radically to a very low level. The price changes also need to be considered at the plants as quickly as possible.

Although district heat needs to be produced, a plant must assess how profitable electricity production is when selecting production units for district heat. Reaching optimal production is more demanding than ever, so plants need to plan better and forecast the future. They also must react more quickly to changes in the market, and produce more electricity at times when it is most profitable to do so. How can they know what the electricity price will be today? How much heat is needed? Additionally, how can they take care of process disturbances and be ready to participate in the intraday or reserve power market?

Synchronising networks

Combined heat and power (CHP) is used to produce electricity along with heat for industrial processes or heating. The main difference between the networks lies in the fact that the heat network operates locally with the CHP plant having active control over it, whereas the balance in the electricity network is controlled by the transmission system operator.

Because day-ahead electricity prices are at the level of a low-cost commodity, there may be more business motivation for participating in the regulating power market. The key is to find the right combination of controlling the heating network and participating in balancing the electricity network. This puts the CHP plant in a key role as a bridge to enable a smooth synchronisation of resources.

In the end, the two networks should not only be sustainable, they must also be affordable and reliable. These goals can be achieved by a clever co-ordination of various players in the energy markets and a smart mix of energy sources – and the right tools to control the results.

Novel concepts for sustainability

FLEXe stands for building flexibility into energy systems. The FLEXe consortium aims to achieve a better energy system for the future. TEKES, the Finnish Funding Agency for Innovation, is funding the project. The goal is to enable companies to create novel technological and business concepts to ease the disruptive transition from the current energy system towards one that combines smartness, flexibility, environmental performance and economic success.

The consortium consists of 17 companies and 10 research institutes or universities in Finland. Thanks to a broad spectrum of competencies, FLEXe covers the whole energy system value chain.

As the only company in the programme that concentrates on advanced plant-level and district heating network controls, Valmet’s role is to study how to support system-level flexibility by means of advanced controls. The target is to get information from different business models to understand future developing needs. This will enable Valmet to create a path for companies to migrate to new systems. Valmet will specifically study the optimal operation and control strategies of power plants and heat networks in this new and flexible operational environment.

Plan, optimise, control

To enable CHP plants to plan and forecast more effectively as well as become more proactive, the Valmet DNA Energy Management platform allows plants to plan their energy production in the most optimal way. In addition, energy management controls, information sharing and updated production plans give plants the quick reaction ability they need.

Valmet DNA Energy Management is a modular energy management system, delivered in collaboration with partner Energy Opticon Ab in Sweden. The system forecasts district heat demand and optimises production, allowing units to achieve the best total economic costs and to determine the optimal times for unit startups and shutdowns. A common user interface for all personnel improves communication. Thanks to a uniform way of planning, fewer human errors occur.

Valmet DNA Steam Network Manager and Valmet DNA District Heating Manager are part of the energy management controls. Costs are minimised because disturbances can be corrected quickly, and power generation can be maximised by keeping plant availability as high as possible.

A holistic approach for district heating

Fortum’s Suomenoja CHP plant in Finland produces heat for households in the greater Espoo region, and electricity for the national grid. Its large and complex network consists of multiple units. The power plant produces about 1800 GWh of electricity and 2200 GWh of district heat per year.

Intraday production planning at Tampereen Sähkölaitos in Finland. Optimisation enables calculating the weekly production forecast and the day-ahead production plan.

Source: Valmet

Suomenoja is the first power plant in Finland to optimise its district heating network using the DNA District Heating Manager solution, which is based on multivariable model predictive control. Until the optimisation, operating conditions in the plant’s district heating network were maintained manually, and operators had to run the network with more heat than necessary. At the same time, constant temperature and pressure fluctuations at the plant posed risks for severe disturbances. The goal was to provide Suomenoja with both economic and environmental benefits through better control of its network.

Better control of temperature and pressure fluctuations in the heat plant minimises heat stress to the district heat piping, and is thus one tool to avoid severe disturbances. Better control of the pressure difference throughout the network also eliminates the need to produce any additional heat, resulting in higher energy efficiency.

The DNA District Heating Manager keeps heat production and consumption accurately balanced throughout the whole network. The CHP, heat-only units and pumping stations are all controlled by a single controller, which takes into account the dynamic interconnections of all controlled units.

The co-ordinated control of all production units and pumping stations allows heat loads to be transferred from one area to another with flexible allocation of heat loads between production units. Accurate control improves heat delivery efficiency by decreasing the heat losses in the network.

While the heat production of the CHP units varies according to electricity prices, or they participate in the balance control of the electricity grid frequency, the heat-only stations keep the entire district heating network stabilised. This allows all units to be run at economically optimised loads and enables a fast response to unexpected disturbances, heat demand changes, electricity prices and grid balance actions.

Ultimately, all improvements contribute to the reduction of fuel consumption and CO2 emissions, making CHP production an even more environmentally friendly and economical form of heating.

The key is to find the right combination of controlling the heating network and participating in balancing the electricity network. This puts the CHP plant in a key role.

Source: Valmet

Optimisation and forecasting

Tampereen Sähkölaitos Group, based in Tampere, Finland, is a regional operator in energy with approximately 130,000 customers. The 120-year-old group provides electricity, district heating, district cooling and natural gas.

In 2014, Tampereen Sähkölaitos Group chose Valmet as a supplier for the production optimisation system for the entire Tampereen Sähkölaitos. The system features district heat demand forecasting and production optimisation of all five power plants and peak heat centres.

‘Our three main reasons for implementing the production optimisation system at Tampereen Sähkölaitos were to help the electricity traders plan the production, to improve communication between the traders and the control room, and to allow the use of the same optimisation model for long-term production optimisation – and even for budgeting,’ says Marko Ketola, Senior Specialist at Tampereen Sähkölaitos.

An accurate forecast of the district heat demand forms the basis for decisions. Optimisation enables calculating the weekly production forecast and the day-ahead production plan to support electricity trading and the intraday production plan. The traders who work 24/7 make the plan for production.

Due to the lower electricity prices, the production environment has become more complex. For instance, bypassing the turbine is used more often. Therefore, it is more difficult to manually optimise and plan production.

‘In addition to their expertise, traders now have the tools for making the production plan. This reduces errors and improves the planning accuracy,’ Ketola says.

The production optimisation system is integrated within the automation and information systems of the company and individual plants, and is connected to Tampereen Sähkölaitos’s financial system. Therefore the current production and consumption rates, availability of the production units, electricity purchase data and fuel prices can be used to quickly update the production plan, whenever there are changes in the market and process environment. Thus, even electricity market changes are reflected in the latest optimal production plan.

Tight integration also ensures that the communication between control rooms and traders is improved. The current plan, and any deviation from it, are shown in the operator’s interface in the control system.

Communication is also important, according to Marko Ketola. ‘Earlier, this was mainly based on phone calls. Now, there is a common user interface that displays the plan and the reasons behind the plan. There’s a common basis to discuss and from which to make production decisions,’ he says.

The system does not remove the need to talk, but it enhances transparency and thereby production efficiency. Integration with the control system makes it possible to use the district heat demand forecast and the optimal production plan to control production.

Over the long term, systematically collecting history and monitoring information on forecasts, plans, actual production and deviations from the plan enable Tampereen Sähkölaitos to economically follow up its energy production. This means that it is possible to decrease production costs for district heat and increase profits from electricity production.

The upside of being in balance

With the use of energy management and controls for district heating networks, it is possible for a plant to play an active role in improving the overall production economy and ultimately balancing the grid.

Short-term benefits include using the same planning principles for each shift, minimising the chance for human error and eliminating differences in running the plant. Also, when the day-ahead electricity is planned and communicated to everyone, the controls can support the plant in keeping the target.

Additionally, a CHP plant can capitalise on the potential offered through electricity trading. With changes in the market, weather or process, it is possible to quickly calculate and utilise a new production plan for the current day or the following hours. This allows plants to participate in the short-term market.

In all, it makes sound business sense for a CHP plant to proactively participate in balancing the electricity grid, not only on the day-ahead and intraday markets, but also as a frequency-controlled power reserve.

CHP plants that take advantage of advanced energy management solutions and district heating controls can decrease the production costs of heat and maximise profits from electricity sales. This makes production within complex networks easier to plan, optimise and control. In turn, CHP plants can take a more profitable role in the future’s sustainable, reliable, flexible and affordable energy system.


Juha-Pekka Jalkanen is Director, Power Automation Solutions at Valmet. www.valmet.com

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