Temporary Power Cost Simulations
Aqualectra is facing increased load growth and has recently retired its gas turbine unit, GT2, making it difficult for Aqualectra to meet peak demand. As a result, Aqualectra is requesting proposals for temporary power solutions to meet the growing demand in 2024 and 2025. The contract for temporary power would last approximately two years, starting around May 2024. Aqualectra requested K&M’s commercial and technical advisory services to determine the least-cost configuration of capacity and electricity from the temporary power units generating assets and the CRU gas turbine.
K&M discussed the scenarios and sensitivities that would be most informative to analyze with Aqualectra. Using the agreed-upon scenarios, K&M adapted its existing generation and cost models for Aqualectra to perform the temporary power analysis. K&M ran and analyzed the models and presented the results, including the levelized cost of electricity (LCOE) of the temporary power scenarios, the recommended configuration of the temporary power, the hourly dispatch of the generation assets, and all assumptions used in the analysis.
The Inter-American Development Bank (IDB) retained K&M Advisors LLC to prepare and lead presentations on the impact of climate change on the water sector in the Caribbean, as well as challenges and ways forward in governance and financing aspects. These presentations set the stage for discussions on how water utilities can act wisely in view of the climate change impact on their business—the CWUIC SP, a first-of-its-kind resilience facility, being one of the notable means available for them to consider, and deal with the sector´s challenges related to governance and financing. These presentations highlighted the state of knowledge regarding climate research as synthesized in the Sixth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC), including projections that the extreme weather events become more frequent and/or intense in all regions. These presentations were made at a session titled “Ministerial Roundtable 1: Water and Climate-Related Disasters” as well as another one titled “Panel Discussion 1: Governance and Innovative Financing” at the 2023 CWWA conference’s High-Level Forum held in October in Guyana.
In this assignment, K&M is responsible for:
- Recommending the approach for IDB presentations at the CWWA 2023 HLF
- Preparing presentation materials
- Lead presentations at HLF
Fogging System Analysis
SEPCO has indicated the power grid in Jordan has had difficulty covering peak loads observed during high-temperature periods. As a result, SEPCO has reviewed potential solutions for its Samra Power Plant to increase power plant generation during these peak periods.
SEPCO intent is to modify all seven gas turbines installed at the Samra Power Plant by installing a fogging system in the gas turbine inlet. This modification aims to increase plant power generation to help the power grid cover the peak loads during high-temperature periods. To evaluate the technical and commercial viability of the fogging system installation, SEPCO engaged K&M Advisors to review the design of generating units’ and auxiliary equipment and systems to evaluate their ability to support the increased power output during fogging system operation.
The purpose of this study is to:
- Verify whether existing auxiliary equipment of each of the phases is capable of supporting facility operation with the fogging systems, and
- Determine the demineralized water demand required for the fogging system.
Fogging System RFP Development
Once the technical viability of implementing the fogging system has been confirmed, SEPCO will need to develop an RFP for suppliers to submit their proposal for design that meets the requirements of applicable standards and good engineering practice. K&M will develop the RFP documentation for suppliers to ensure that the design of the system is adequate and technically sound.
Fogging System Analysis
K&M developed GateCycle models of combined cycle plants to calculate heat and material balances for different ambient temperatures without and with the fogging system. For each combination of the ambient temperature and fogging system status, K&M developed a spreadsheet summarizing the system power output and power output increase, heat rate and heat rate change, fogging system evaporation rate/demineralized water requirements, and other steam and water impacting operation of HRSG, steam turbine, ACC, and other auxiliary equipment that could be impacted by the fogging system. To analyze the demineralized system requirements, K&M calculated the fogging system demineralized water requirements and the total daily demineralized water demand and compared it with the demineralized water system capacity. We evaluated whether there is a deficit of demineralized water with fogging system operation and suggested the required additional demineralized water system capacity.
Fogging System RFP Development
K&M will assist SEPCO in developing the fogging system RFP. The RFP document prepared by K&M will include instructions to bidders, functional technical specification including the scope of supply and services and general technical requirements, and forms to be submitted by bidders. It is expected that the draft supply contract will be prepared to be included in the RFP will be based on the standard SEPCO’s supply contract, so no draft contract preparation is included in K&M’s scope. SEPCO will provide K&M with any available technical and commercial information received to date from the prospective fogging system suppliers.
Caribbean Utilities Company (CUC) plans to renew the contracts for purchasing ULSD from Sol and Rubis. As part of this renewal, CUC wants to refine the fuel supply contracts used in the past and revisit if PLATTS is still the optimal fuel price index for CUC.
K&M will improve and refine the fuel supply agreements that CUC used in previous fuel supply tenders. K&M will also analyze if PLATTS is CUC’s optimal fuel price index. This analysis will include investigating which fuel price indices CUC’s fuel suppliers are likely to use to buy the fuel they supply to CUC and whether CUC would be better off using those indices rather than PLATTS. Based on this analysis, K&M will make specific recommendations on an appropriate fuel price adjustment formula.
K&M will assist CUC in developing new drafts of the primary and secondary fuel supply contracts that reflect the above improvements and refinements.
K&M will then assist CUC in preparing an RFP and reviewing and evaluating the proposals submitted by Sol and Rubis.
A private company had been considering the conversion and/or replacement of some of its existing diesel or coal-fired generation units, exploring the option of switching to Heavy Fuel Oil (HFO). To assist with this evaluation, the company engaged K&M to develop a proposal for conducting a return-on-investment analysis for different scenarios related to HFO conversion or replacement.
The proposal encompassed the following components:
- Conversion and newbuild technical analysis: This involved assessing the viability of converting existing units to HFO, considering factors such as technical feasibility, equipment compatibility, and potential modifications. Additionally, K&M conducted an analysis of newbuild HFO technology options, including the associated balance of plant (BoP) requirements and cost analysis.
- Scenario analysis: K&M performed a comprehensive scenario analysis, examining various conversion and replacement options to determine their economic viability. This analysis considered factors such as capital costs, operational efficiency, fuel availability, and environmental impacts.
- Implementation roadmap: K&M developed an implementation roadmap outlining the steps and timeline required for the execution of the selected HFO conversion or replacement strategy. This roadmap provided a structured approach to guide HSA in the successful implementation of the chosen scenario.
By conducting the return-on-investment analysis and providing a comprehensive proposal, K&M supported the private company in making informed decisions regarding the conversion or replacement of their existing diesel or coal-fired generation units with HFO. The analysis considered technical aspects and scenario evaluation and provided a roadmap for the implementation of the chosen strategy.
U.S. Trade and Development Agency (USTDA) is working to implement the Global Procurement Initiative: Understanding Best Value (GPI) Regional Energy Procurement Program for South Asia (REPPSA) Virtual Training Series. The purpose of the REPPSA Virtual Training Series is to learn about innovative best-value procurement practices to support the development of high-quality energy infrastructure. The REPPSA Virtual Training Series is broken into a two-part training series focused on best practices in the procurement of energy infrastructure.
K&M was engaged by Green Powered Technology to develop and deliver USTDA-funded training sessions on Public Private Partnerships for Energy and Power Purchase Agreements. The workshops were designed to learn about innovative best-value procurement practices to support the development of high-quality energy infrastructure.
The K&M team developed training presentations and content and delivered virtual training sessions to public sector energy sector representatives from Maldives, Sri Lanka, Nepal and Bangladesh.
K&M delivered virtual training sessions on use of PPPs for energy sectors, PPP planning, PPP procurement preparation and design including non-price evaluation factors, PPP implementation, role and development of PPA, development of bankable PPA, roles and best practices of key PPA provisions, and incorporation of non-price evaluation factors in PPA.
Saint Lucia had been experiencing increasingly severe weather systems, largely due to global climate change. These extreme weather events posed a threat to LUCELEC’s critical infrastructure. Recognizing that the current grid in St. Lucia was not built to withstand the strongest storms, particularly Category 5 and above, LUCELEC aimed to update its grid construction standards and implement measures to enhance system resilience. This was in response to the anticipated increase in severity and frequency of Atlantic storms resulting from climate change.
To prepare for these actions, LUCELEC enlisted the services of the K&M Team to conduct a comprehensive study addressing two key areas:
- Establishing a method to measure the existing grid resilience and setting annual resilience targets.
- Analyzing the electrical network infrastructure in St. Lucia through inspections, models, and other tools to identify a series of projects that would enhance the resilience of the transmission and distribution networks, generation assets, and LUCELEC’s solar farm.
Throughout the study, K&M developed a reliability metric to track LUCELEC’s progress in improving system resilience. This involved reviewing and analyzing system data, conducting interviews with LUCELEC’s senior staff, performing on-site visits, and identifying a prioritized pipeline of climate resilience projects. The ultimate objective was to enable LUCELEC to formulate a specific grid resilience improvement plan.
During the course of the study, K&M successfully developed a reliability metric that would allow LUCELEC to measure their progress in enhancing system resilience. They conducted a comprehensive review and analysis of system data, engaged in interviews with LUCELEC’s senior staff, conducted on-site visits, identified a pipeline of climate resilience projects, and prioritized them accordingly. The outcome of the study empowered LUCELEC to develop a targeted grid resilience improvement plan.
Sixth Street engaged K&M for a technical due diligence review of a new 940 MW natural gas-fired combined cycle electric generating facility in the Village of Lordstown, Trumbull County, OH. The project will feature a 2×1 configuration, employing two Siemens Energy SGT6-8000H 1.6 combustion turbine-generator units (CTGs), two Nooter/Eriksen heat recovery steam generators (HRSGs), and one Siemens steam turbine generator (STG). The facility, collectively known as the Power Island Equipment (PIE), may utilize Vogt or Siemens HTT HRSGs. Additionally, the project will incorporate supplemental firing and evaporative cooling for enhanced power output in specific conditions.
K&M conducted a technical due diligence review, focusing on the Independent Engineer’s report, EPC and O&M contracts, and financial model assumptions. Following the review, K&M prepared a memo identifying project risks and recommending adjustments to the financial model assumptions.
K&M was contracted by Guinéenne d’Energie (GDE) to perform a pre-feasibility study for a new gas-fired power plant project in Conakry. The objective of this assignment is to identify the size and timing of gas-fired capacity additions that are economically justified in the Guinean grid, estimate the economically justified electricity generation using natural gas and resulting gas demand, assess the viable generation options for a new gas-fired power plant in Conakry, and develop an implementation plan for progressing the project from its current conceptual stage to a commissioning stage.
K&M’s scope of work included:
K&M has commenced this pre-feasibility study by collecting data on the current state of the power system in Guinea and developing a simplified model to estimate thermal capacity requirements to meet annual peak and reserve requirements. From this work, K&M has identified the size and timing of gas-fired capacity additions that are economically justified in the Guinean grid. K&M also developed a simplified merit-order dispatch model to estimate the dispatch of a new gas-fired power plant and calculate the resulting gas demand. Later, the team assessed viable interconnection arrangements between the power plant and transmission system substation, evaluated site conditions, and identified viable technologies and configurations. K&M also calculated and compared the marginal costs and the Levelized cost of electricity for each generation technology option. Lastly, the team assisted the project by developing an implementation plan to help progress the project from the current conceptual stage to the commissioning stage.
FortisTCI was negotiating its regulatory framework with the Turks and Caicos Islands Government (TCIG) while the Government was also considering developing a multisector regulatory agency. FortisTCI hired K&M to assist them in writing a response to Kairi Consultants, a consulting firm hired by TCIG to assess the existing regulatory frameworks for public utilities. K&M prepared a Report on Reform of the Regulatory Framework Applicable to FortisTCI. This report described FortisTCI and its applicable regulatory framework, benchmarked regulatory frameworks in other Caribbean jurisdictions, and provided recommendations for the relevant framework for regulating FortisTCI.