NIS republics eye international sources for massive retrofit and greenfield needs
Electrical energy demand has reached crisis levels in many states as industry battles bankruptcy, aged facilities, emissions excesses
By Ann Chambers, Assistant Editor
The New Independent States (NIS) and the countries of Central and Eastern Europe are making ambitious plans to expand their electric power infrastructure, with an estimated 136 GW of installed capacity to be in place by 2010, according to US Trade and Development Agency statistics.
“More than 50 projects in these nations … are already in the pipeline with financing from the World Bank and the European Bank for Reconstruction and Development,” said J. Joseph Grandmaison, US Trade and Development Agency director.
Aging fossil-fueled plants and low-quality coal are widespread problems, causing high generation costs, high carbon-content emissions and, in some cases, bankruptcy. Industry leaders in the NIS republics are looking to the international power community for assistance in upgrading everything from basic plant equipment, to coal availability, to emissions, to controls and safety equipment, to rate schedules. A number of the local utilities have drawn up plans detailing their current and future needs; but without outside help, the massive resources needed to improve electricity generation are nonexistent.
The Far East region of Russia is approximately 6.2 million square kilometers (Figure 1), with a population of nearly 8 million people. It has a large supply of natural energy resources, with more than 34 percent of the estimated coal reserves of the Russian Federation and 30 percent of the hydroelectric potential.1 There are also gas and oil fields, geothermal springs, wind and ocean resources. The largest fuel and energy sources are not distributed evenly, however, and are located mainly in uninhabited areas
Power-generating plants and electricity consumers are separated by large distances, so there is an extensive 220-kV transmission network. However, construction of a 500-kV network is now under way in the south. Coal constitutes 69 percent of the fuel used in fossil power plants; fuel oil accounts for 22 percent; diesel oil accounts for 1.5 percent; and gas accounts for 7.5 percent. About 80 percent of the coal comes from local mines.
The Eastern Power Grid (EPG) covers a majority of the territory, serving 5 million people, including most of the industrially developed parts of the Far East. EPG has 70 percent of the installed capacity in the region with 16 plants, with a total capacity of 7,048 MW. EPG is planning to expand after merging with Nikolaevsk and Central power systems.
The economy in the Far East is expected to stabilize soon, leading to an increase in electricity demand. Expansions are planned at Bureyskaya Hydroelectric Power Plant, plus a variety of upgrades and modifications to existing power plants. Major demand increases are expected in the south of the region with up to 3 million MWh of electricity imports.
Major projects scheduled by the turn of the century include:
– complete construction of 2,000-MW Burey Hydroelectric Power Plant,
– start construction of Urgal 1 Hydroelectric Power Plant in Khabarovsk Territory,
– start construction of Nishne-Burey Hydroelectric Power Plant in Amursk Territory and
– complete construction of Vilyuy Hydroelectric Power Plant Unit 3, Yakut Central Fossil Power Plant, Magadan Heat and Power Plant and Ust-Srednekan Hydroelectric Power Plant.
The decade 2000 to 2010 is expected to be a turning point in the national economy, with positive growth in the industrial and economic markets. New hydroelectric facilities are being contemplated in Khabarovsk and Amursk territories in this era, along with one or two nuclear power plants in Khabarovsk and Primorsk territories.
One of the biggest projects under way is the Urgal Fuel and Energy Complex in Khabarovsk Territory. When completed, it will include:
– Urgal Hydroelectric Power Plant 1, on the Neman River, 600 MW;
– Urgal Hydroelectric Power Plant 2, in the Bureya River, 290 MW;
– Urgal State Regional Power Plant, first phase 645 MW, full capacity 2,200 MW;
– Urgal Gas Turbine Power Plant, sited on a natural gas field near the Elga railway station; and
– Urgal 1 Coal Mine, output expected to reach about 6 million tons.
Russia`s first independent power producer will soon be a reality, as Magnitogorsk Integrated Iron and Steel Works (MMK) plans to enter the cogeneration business. Magnitogorsk awarded KMR Power Corp. a mandate to develop, construct, own and operate a 150-MW natural gas-fired, combined-cycle plant at its facility to help meet the firm`s increasing demands for electric power and steam.
Term of the agreement is 20 years, after which the facility will be transferred to MMK. A joint venture has been arranged between Stone & Webster and Westinghouse to act as the equipment contractor and to provide turnkey supply.
Foster Wheeler International Corp. has also entered the Russian market, with a recent announcement of a contract for Tonar Corp., a Moscow-based state and joint-stock corporation. Foster Wheeler is performing a feasibility study and design for a 480,000-metric-ton-per-year municipal solid waste (MSW) processing complex.
The Timokhovo Ecocomplex will include recycling and waste-to-energy sections. The waste-to-energy section will be based on Foster Wheeler`s advanced circulating, fluidized-bed boiler technology to cleanly convert waste into electricity.
Ukraine`s total installed capacity is 54,200 MW, with fossil-fueled plants providing 67.6 percent and nuclear plants providing 25 percent of that total.2 There are 104 fossil-fueled plants, ranging from 150 MW to 800 MW. However, 82 percent of all operating units have already reached their designed service life limit of 100,000 hours, and 48 percent have already exceeded maximum allowed service life limits of 170,000 hours. Twenty units have been in operation for 200,000 hours. Constant daily cycling with units going out of service for the night and consequent start-ups for morning load has caused deterioration and maintenance problems. The nuclear plants are base-load stations and are not used for controlling the network`s frequency.
None of the fossil-fueled plants are equipped with NOx or SO2 emission-control systems. Hydroelectric plants play an important role in maintaining peaking function. Ukraine has 4,700 MW of hydroelectric capacity, 8.8 percent of the national capacity. Most of the hydroelectric plants have been in service for 20 to 40 years, so they also have severe maintenance problems.
Fuel consumption increases as equipment deteriorates, and emission problems worsen. Oil and natural gas are being used at the coal-burning plants to improve combustion problems, to increase cycle efficiency and to reduce pollution. However, nonpayment by consumers, combined with an outdated and unstable tariff rate system, are restricting the resources of the Ministry of Energy in importing oil and natural gas. All this has resulted in reserve shut-down and long-term lay-up of the most efficient and reliable gas and oil-fired units, which have a combined capacity exceeding 6,000 MW. Reforms are called for, and the Ukrainian power industry is attempting to provide a foundation for the financial investments needed, with initial restructuring recently completed.
The National Energy Control Center has been working to create an electricity market. Ukraine is working toward a competitive market where all major electricity generators would function as one generating system, regardless of the form of ownership. Local governments will have control of local electric tariff rates and work to stimulate power industry development. Local and foreign investments are invited.
– The National Electric Co. has been organized to handle transmission lines of 220 kV and higher.
– Twenty-seven regional, state-controlled corporate electric utilities have been established.
– Six state-controlled power-generating corporations have been established.
Former construction divisions of the Ministry of Energy, manufacturing and fabricating plants, design institutions and other branches of the ministry have become public corporations in the past two years.
Free-market conditions have been established, but the functioning has been hampered by the unstable financial and credit conditions.
The National Energy Program through 2010 calls for widespread reconstruction and major technical upgrading of existing power plants that will utilize the latest domestic and foreign technologies. Projects are to be financed by the utilities, using funds from increased electricity and heat tariff rates. Some programs are to be funded by the government and foreign investors. It is estimated that the improvements to fossil power plants, electric distribution and heating networks will require (US)$9 billion.
Armenia is a small, landlocked country with a land area of 29,800 square kilometers and a population of approximately 3.5 million.3 The country depends heavily on the national network of power and gas distribution for residential, commercial and industrial purposes. The electric network is one of the most developed branches of industry and is spread throughout the country.
Before 1988, the installed capacity of power plants in Armenia was about 3,500 MW, with 1,750 MW from fossil-fueled power plants, 800 MW from one nuclear plant and 950 MW from hydroelectric power plants. The Armenian distribution network is a well-developed network of electric transmission and distribution. The extension networks are 35 kV and higher; and there are 35 200-kV substations, giving a total capacity of 13,772 MA.
However, Armenia is experiencing a power crisis due to shortages from Azerbaijan and Turkey, lack of rail transport to the European part of the former Soviet Union, frequent disturbances of rail and gas pipelines through Georgia and shutdown of the one nuclear plant following a 1988 earthquake. As a result of these factors, current generating capacity is only one-quarter of the 1988 total. The government is scrambling to shore up the electric industry, including:
– equalizing tariff rates to all consumers,
– normalizing and centralizing collections of tariffs for hydroelectric and fossil energy,
– technically upgrading via World Bank financing and US Agency for International Development,
– reorganizing the energy sector with a goal of making the electrical network and all thermal power stations self-supporting and self-financing, and
– repairing the nuclear plant.
The government of Armenia expects the energy sector to build its own finances for development but, in the meantime, is looking to foreign credits and investments.
The power-generation system of Kazakhstan is comprised of fossil fuel and hydroelectric power plants, with combined power output of 16,000 MW interconnected with the transmission lines from 110 kV to 1,150 kV.4 To achieve independence in its power supply and create conditions for national economic stabilization and future growth, the government realizes the need to build up its power-generation industry.
Production and consumption of electricity in the country decreased 24 percent from 1990 to 1994–from production of 104.7 million MWh to 79.5 million MWh–and was projected to fall to 75.2 MWh for 1995. The generation drop is caused by the physical and technological deterioration of the power plants combined with economic difficulties.
The main power-generating units are at, on average, 45 percent of their life level; but each year, 500 MW of capacity reaches its designed maximum service life limit; and by 2000, 800 MW of capacity will reach retirement age each year.
By 2010 electricity consumption could increase to 115 million to 125 million MWh. There is an existing deficit of approximately 12 million MWh, so the country needs to add 38 million to 48 million MWh of additional capacity. This will require new generating units with total capacity of 4,400 to 5,300 MW by 2010 (Table 1).
The most complex problem exists in West Kazakhstan, which is not connected to Kazakhstan Common Power Grid. The Russian Federation supplies 4 million to 5 million MWh per year to this region; but in 1994 alone, due to the price difference between locally produced and imported electricity, the state lost more than (US)$50 million.
This region`s economy has a strong influence on national currency stabilization, so a priority has been placed on stabilizing the power supply in the region, primarily through construction of Aktubinsk and Uralsk power plants, plus an additional unit at Atyrausk.
Kazakhstan is working to attract foreign capital to assist in the operation of existing plants and construction of new ones. In June 1995, Kazakhstanenergo and a consortium of Siemens, Babcock and BMB Group signed a turnkey contract for a combined-cycle 954-MW power plant in Aktubinsk. Construction will be financed with the help of foreign credits, guaranteed with sales of crude oil.
Other projects include Akturbo Corp. and ABB Craftwerke, Germany, installing a 100-MW gas-turbine generator at Aktubinsk and Traktebel of Belgium developing plants for combined-cycle units at Ural Power Plant No. 1. Traktebel will finance 100 percent in a build-own-transfer arrangement.
This republic is rich in hydroelectric resources and coal. It also has oil and gas reserves. Coal deposits are reported to include 620 million tons of industrially explored coals and an estimate of 1,360 million tons as the total resource.5 The deposits appear to comprise 64.5-percent brown or lignite coal and 21.5-percent high-volatile coal and are distributed throughout the country. Coal-mining production has fallen from almost 4 million tons in 1990 to about 1.7 million tons in 1993 and less than 1 million tons in 1994.
Energy production is increasingly shifting from coal to hydroelectric, and the demand for residential heating is declining because electricity is more convenient and can be purchased on credit. Heating plant consumption is declining because the plants are not generating enough revenue to pay their fuel expenses. As a consequence, they are being taken out of service when steam production is not essential.
There are no funds to support pilot or demonstration facilities in the republic, although there are some test facilities set up near Osh. Since all energy sources–coal, gas, oil, electricity, hot water and steam–are subsidized in different ways, the task of evaluating the economics of an energy form is formidable. The price of heat, hot water or electricity delivered to the consumer is set by a government agency on the basis of the amount the consumer can afford to pay in the local economy. If the consumer cannot afford to pay for the energy received, the energy provider receives no revenue, but still must provide the energy.
The republic plans to gradually replace its coal-generation facilities with new hydroelectric plants, but the financing has not been secured for major construction efforts on these projects. To meet demands, construction of the hydroelectric facilities and associated transmission and distribution lines needs to be dramatically accelerated.
Low efficiency of the power plants is evidenced by high particulate emissions and high levels of unburned carbon in the fly ash. In some instances, carbon content in the ash is near 40 percent. Power generated is bartered for coal and oil with Kazakhstan. Because of the low plant efficiency, an unnecessarily high amount of fuel is used for producing electricity, rather than for heating and transportation. Inefficient combustion also drives up the costs of hot water and steam for district heating.
High carbon in the coal ash limits the ability of pollution-control equipment to collect the ash. The high carbon content also makes the ash unsuitable for paving material or other uses. It must be disposed of in landfills.
Kyrgyzstan is seen as a strong candidate for clean-coal technologies. As the economy strengthens, post-combustion-control systems will be needed. Utilities are considering pulse-jet baghouses for particulate controls and coal-cleaning technologies to reduce the sulfur content of local coals, although some local coals are naturally low in sulfur. Integrated gasification combined-cycle (IGCC) technologies are seen as a promising element in Kyrgyzstan`s future. IGCC could provide a source of energy and raw materials to support other industrial development within the country without substantial deterioration of the environment. Electricity, hot water, steam, gas, chemical feedstocks and other materials could be derived from coal in a single integrated facility and distributed to existing industrial complexes, new greenfield sites and to the population to replace use of coal and high-priced electricity.
1 “Russian Far East–An Overview of the Power Generation Industry,” Alexander Ognev, Vostokenergo, Power Engineering International NIS Forum, Anaheim, Calif., USA, Dec. 3-4, 1995.
2 “Ukraine–Electric Power Sector Current Trends and Future Prospects,” Alexander Simonenko, Ukraine Ministry of Energy, Power Engineering International NIS Forum, Anaheim, Calif., USA, Dec. 3-4, 1995.
3 “Armenia–An Overview of the National Energy Plan and Prospective Projects for International Investors,” Mels Hakobian, Armenergo, Power Engineering International NIS Forum, Anaheim, Calif., USA, Dec. 3-4, 1995.
4 “Kazakhstan–Opportunities in Central Asia`s Largest Republic,” Nurmagambet Sujunov, Kazakhstanenergo, Power Engineering International NIS Forum, Anaheim, Calif., USA, Dec. 3-4, 1995.
5 “Coal Utilization in the Republic of Kyrgyzstan,” Clark D. Harrison, CQ Inc., Power Engineering International NIS Forum, Anaheim, Calif., USA, Dec. 3-4, 1995.