how to determine the proper size, and generator type for...

How To Determine The

Proper Size, and Generator Type For

Municipal Size Power Projects

10/4/17

PresenterPresentation NotesKevin O'Connell is the Electric Power Generation Commercial Business Manager for Michigan CAT in Novi MI. His sales and engineering teams cover the Lower Peninsula of Michigan and the state of Indiana. Kevin has been active in the power generation market for over 25 years and has led sales teams offering rental generators & temperature control equipment, generator parts & service contracts, and new & used natural gas, agg/bio-gas, landfill gas, and diesel generators and combustion turbines. Kevin also spent almost 2 years as Managing Director of Oakland Energy & Water Ventures. Oakland Energy & Water Ventures is a $250 million second stage fund which invests in and commercializes innovative products and solutions focused on clean energy & water.Kevin holds an MBA from Walsh College and a BS in Industrial Distribution from Eastern Michigan University.

Agenda • Why Recips & Turbines? • The Case for Recips

– Fuel Considerations – Hours of Operation – Example Projects

• The Case for Turbines – Hours of Operation – Example Projects

• Final Recommendations • Questions & Comments

History of Caterpillar

Founded in 1925 • Product line included 5 tractors • 1st years sales = $13.8 Million Today • Product line now exceeds 300 products • Revenues exceeding $47 Billion • CAT Inc. is a Fortune 50 Company • One of 30 companies on the Dow Jones Industrial Average • Global footprint – with equipment in over 180 countries • CAT has over 24 GW of gas engines in operation globally, and over 28,000 units.

PresenterPresentation NotesSince Y2K my teams in Michigan & Indiana have sold and installed over 1000MW or generators.

Why Recips & Turbines?

25 Michigan coal plants set to retire by 2020 • DTE's Harbor Beach - 121 megawatts - 1 unit retired in 2013 • DTE's Trenton Channel - 240 megawatts - 2 units retired in 2016 • Consumers Energy's BC Cobb plant in Muskegon - 312 megawatts - 2 units retired in 2016 • Consumers Energy's JC Weadock plant in Essexville- 312 megawatts - 2 units retired in 2016 • Consumers Energy's JR Whiting plant in Erie - 345 megawatts - 3 units retired in 2016 • Michigan South Central Power Agency's Endicott plant in Litchfield - 55 megawatts - 1 unit retired in

2016. • Holland Board of Public Works' DeYoung plant - 63 megawatts - 3 units retiring in 2017 • Lansing Board of Water and Light's Eckert plant - 335 megawatts - 6 units retiring in 2018 • Wisconsin Electric's Presque Isle plant - 450 megawatts - 5 units retiring in 2020.

= 2,233 MW of base load power generation

PresenterPresentation NotesDetroit Free Press Published 9:59 p.m. ET Oct. 10, 2015


PresenterPresentation NotesIndustrial: Jan ‘01 = 4.73 – Jan ‘17 = 6.57 = 38.9% increaseCommercial: Jan ‘01 = 7.25 – Jan ‘17 = 10.19 = 40.6% increaseResidential: Jan ‘01 = 7.73 – Jan ‘17 = 12.22 = 58.1% increase


PresenterPresentation NotesWhen you combine increasing electric rates with relatively stable gas prices you get a very favorable spark spread.NYMEX Henry Hub gas options through June 2025 are under $3.5 Mbtu.


Grid Diversification “The electric grid is currently undergoing a significant transformation – changing fuel mixes, advances in energy technologies, and evolving consumer demands. These changes present opportunities for consumers to become active market participants and to have greater control over their energy usage.” Rep. Fred Upton (R-MI), Chairman of House Energy & Commerce Committee

PresenterPresentation NotesBehind the meter resources like combined heat and power (CHP), energy storage, and rooftop solar and demand control resources like demand response and energy efficiency are contributing as well.

Why Recips & Turbines

CONSUMERS BENEFIT FROM RESOURCE DIVERSITY • Grid Operators Are Successfully Managing More Gas and

Renewables • Grid Operators Increasingly Value Flexibility Over “Always On”

Power • Low-cost, flexible resources are the future of the electric grid.

PresenterPresentation NotesBehind the meter resources like combined heat and power (CHP), energy storage, and rooftop solar and demand control resources like demand response and energy efficiency are contributing as well.


Your customers are already thinking about peak shaving, load shifting, CHP, energy storage, etc…projects to help control their cost of energy.

PresenterPresentation NotesThat’s right…your biggest customers are someone else’s biggest target.The good news for everyone here is that most customers don’t want to own & operate these systems, but will if it helps control current and future energy costs.

The Case for Recips

• Attributes of diesel and gas engines • What’s Similar, What’s Different • Application Considerations (Demand Response/Peaking)

• Considerations if applying gas engines • Technology selection for peaking applications • Technology selection for CHP applications

3516C-HD 2/2.25/2.5MW

Similarities between Gas and Diesel

Electrical

Air Intake Systems

4 Stroke Cycle

Exhaust Systems

Cooling Systems

G3516H 2MW, Continuous

PresenterPresentation Notes2nd stage aftercooler more volume of air and fuel

Differences Between Gas and Diesel

Diesel vs Natural Gas Fuel

• Diesel is standardized – #1, #2,ULSD, etc…

• Natural Gas is not – Typical 70-90MN – Variations across country – Variations at a given site – Always request gas analysis – Understand gas fluctuations

PresenterPresentation NotesNatural gas providers historically provide gas to furnaces, boilers, etc. Their goal is often different. They try to meet a wobbe index (which is ok for appliances, boilers, etc.) In doing so, they can spike gas with propane and nitrogen. This can impact the MN

What’s Methane Number (MN)?

• Engine manufacturer calculation of fuel's resistance to uncontrolled combustion

H2 CH4

Detonation Resistance

LOW

Detonation Resistance

HIGH

Hydrogen

MN = 0 Methane

MN = 100

Diesel vs Gas Ratings

• Diesel engine ratings – Rating limits structural – Increased rating, increased engine wear – Standby, Prime, and Continuous ratings

• Ex: 3516C-HD 2500 / 2250 / 2050

• Gas engine ratings – Rating limits are thermal – Same rating for standby, prime , and continuous – No overload capability

PresenterPresentation NotesDieselEngine structure must be robust enough to support high cylinder pressuresFuel injection equipment must:Produce high injection pressureMeter fuel preciselyIntroduce fuel at the correct moment(ignition timing = injection timing)

Spark-Ignited Engine Demands - ThermalInlet charge temperature rise must be regulated to control detonationEngine components must be suited to withstand high exhaust temperaturesSpark ignition equipment must:Produce high ignition voltageCreate spark at the correct moment �(ignition timing = spark timing)

Diesel vs Gas Emissions

Emergency Use Non-Emergency Use

Diesel

Gas

NOx 6.4 g/bhp-hr 0.67 g/bhp-hr

CO 3.5 g/bhp-hr 3.5 g/bhp-hr

NOx 2 g/bhp-hr 1 g/bhp-hr

CO 4 g/bhp-hr 2 g/bhp-hr

NSPS EPA Comparison

>560 bkW example

PresenterPresentation NotesNon-Emergency diesel use requires Tier 4 certification and aftertreatment

Gas engines have lower emissions profile0.5 – 1 g/bhp NOx settings availableMinimal aftertreatment to meet US EPA NSPS

Diesel vs Gas Load Acceptance

• Diesel accepts transient load better than gas • Diesel start faster than gas • Steady state stability is better with diesel • Some gas engines accept load better than others

– Less efficient engines accept load better than high efficiency engines

– Other contributing factors • Gas pressure, temperature, air restrictions

PresenterPresentation NotesNatural gas engines will have less load pickup (transient) capability than a diesel generator set. The steady state (no load change) frequency deviation (stability) will be larger (worse) than with a diesel engine generator set. Start up times will be longer for the natural gas generator set compared to a diesel generator set Exhaust purge cycleAir/fuel mixture to the cylinderAs fuel efficiency increases the gas engine’s capability to accept transients is decreased. For example, a G3516 gen set will have better transient capability than a G3520C unit.

Diesel vs Gas CAPEX

• Gas CAPEX is typically 1.5 – 2X of emergency diesel • Gas CAPEX on par with non-emergency use diesel

Emergency Use Non-Emergency Use

CAP

EX ($

)

CAP

EX ($

)

PresenterPresentation NotesIncreased control loops. More complexity with fuel delivery and air management (high eff turbo chargers). scalability

Chart1

DieselDiesel

GasGas

Series 1

Series 2

1

1.5

0.5

Sheet1

Series 1Series 2

Diesel1

Gas1.50.5

To resize chart data range, drag lower right corner of range.

Chart1

DieselDiesel

GasGas

$

Series 2

2

1.5

0.5

Sheet1

$Series 2

Diesel2

Gas1.50.5

To resize chart data range, drag lower right corner of range.

Applications for Gas and Diesel

• Standby

• Demand Response / Peak Shaving

• Continuous / CHP

DWSD – Y2K

• 55 x 2000kW Generators • + Custom Enclosures • + Ballistic Proof Fuel Tanks • + Automatic Transfer Switches • + Paralleling Switchgear

PresenterPresentation NotesSince Y2K Michigan CAT has sold and installed over 900 MW of power generation.

DC Cook Nuclear

• 2 x 2250 kW • + Custom Enclosure • + Dual Wall Fuel Tanks • + Paralleling Switchgear

Utility Demand Curve

24 Hour Cycle

Load

Peaking with Diesel

Peaking with Diesel Resource

• Asset also used as standby • Required to utilize non emergency diesel • Regional demand response program • Typically low hour 0-150 hours per year

PresenterPresentation NotesCaterpillar has done tens of thousands of projects where diesel generator sets will shave the peak of the electric load world wide.

CMS Energy

PresenterPresentation NotesPeaking with energy storage is a growing option and as CAPEX costs decrease and life cycle increases on energy storage technologies.


24 Hour Cycle

Load

Peaking with Gas

Peaking with Gas Resource


• Natural gas OPEX allows wider range for peaking • Typically up to 3,000 hours per year • Duel purpose gas standby/peaking creates larger

revenue opportunity • Minimal aftertreatment

PresenterPresentation NotesWith the growing demand for quality power, natural gas generator sets are a natural choice to support the electric grid, commonly between 1500 and 3000 hours per year.Big steps are product development are allowing NG generators to perform more like diesel standby units, with less than 10 second start times and better load acceptance.

Peaking with Gas

PresenterPresentation NotesZeeland BPW5 x G3520 NG gensets = 10 MW peaking plant

Peaking with Gas

PresenterPresentation Notes2 x G3520 = 5MW Peaking PlantProject ManagementExperienced Engineer managing the details from start to finishLow Environmental ImpactLow exhaust emissionsSound attenuated 75 dBa @ 10 metersIncreased Flexibility Easy to TransportNo need to Construct a permanent buildingCost Effective Electricity GenerationLow Fuel CostsHigh Electrical Efficiency

Peaking/Solar Firming with Gas • ISO Container Advantages:

– Lower Capital Costs – Smaller Footprint – Greater Mobility

Switchgear

Radiator

PresenterPresentation NotesWe’re currently packaging 2 NG gensets that will provide 1.5 MW of solar firming power for a project in Indiana.

Peaking with Land-Fill Gas

PresenterPresentation NotesThis is at the GM Lake Orion Plant5 x G3520 = 8MW landfill gas to energy project.

Peaking with Land-Fill Gas

PresenterPresentation NotesThis is a project with Wabash Valley Power Association4 x G3520 = 6.4 MW landfill gas to energy project.

Diesel vs Gas Summary

Installation some minor differences Load Acceptance CAPEX (Emergency) CAPEX (Non-Emergency) OPEX

Diesel Gas

PresenterPresentation NotesAdd emissions check

Recips vs. Turbines

• Diesel vs. Gas Engine – What’s Similar, What’s Different – Application Considerations

– Demand Response / Peaking

• Gas Engine vs. Turbine • What’s Similar, What’s Different • Application Considerations

• Peaking • Combined Heat & Power

The Case for Turbines

• Gas Engine vs. Gas Turbine • Advantages of each technology • Application Considerations

• Peaking • Combined Heat & Power

Gas Engine and Turbine Similarities • Low Emissions • High Reliability • High Availability • Suited for High Hours • Low Life Cycle Cost

Gas Engine Advantages

• Higher electrical efficiency • Lower CAPEX • Variable load applications • High altitude/high ambient • Lower fuel pressure • Start and on-line time

Turbine Advantages

• Suited for CHP with large heat to ekW ratio • Higher exhaust temps (900F vs 750F) • 24/7 operations • Footprint • Less maintenance cost • Lower emissions

PresenterPresentation NotesTurbines are well suited for full-load operation for extended annual hours. The favorableeconomics of CHP can make them attractive for continuous, base-load duty. Turbines’ greatestattribute in CHP service is their high heat-to-power ratio. They produce a large volume ofexhaust at temperatures of roughly 900° F (490° C), versus 750° F (400° C) for lean-burnengines. As a result, they produce high-quality, high-pressure steam, well in excess of100 psi (690 kPa), suited for many industrial processes. Combustion turbines also havehigh excess oxygen in the exhaust, enabling significant variations in thermal output.Turbines are also lightweight and have a compact footprint, producing three to four timesthe power in the same space as reciprocating engines of similar capacity. Their design isextremely simple – there is no liquid cooling system to maintain, no lubricating oil tochange, no spark plugs to replace, and no complex overhauls to perform (onlycombustor replacement after about 60,000 hours of duty).Emissions are extremely low, especially with the latest advances, such as lean-premixedcombustion technology. Turbines are ideally suited for loads of 5 MW and considerablylarger. They can operate on low-energy fuels and perform extremely well with high-Btufuels, such as propane.

Gas Engine vs. Turbine Technology Review

Electrical Efficiency 100% 75% Emissions (NOx g/bHP-hr) Heat to Electricity Ratio Type of Heat Available Load Maintenance Cost

Gas Engine 45% 44.2% 0.5 -1 1:1 Hot Water, Some Steam More Variable

$0.01/kW-hr

Turbines 35% 32% 0.075 - 0.125 2:1 Mostly Steam More Constant $0.075/kW-hr

Application Considerations Gas Engine vs. Turbine

• Peaking

• Combined Heat and Power

Peaking

• Gas engines usually best option – Start time – Higher electrical efficiency – Frequent starts and stops


24 Hour Cycle

Load

Peaking with Gas Resource


Combined Heat and Power (CHP)

• Gas engines make sense when… – Electricity generation is driving factor – Applications with hot water and some steam – Increased high altitude and high ambient capability – Better efficiency at part load


• Turbines make sense when… – Heating / cooling driving factor – Applications with large steam demand – Extended run hours with consistent load

Gas Engines vs. Turbine Summary

Heat to Power Need Ratio Type of Heat Needed Load Electricity Cost Driver Heat / Cooling Cost Driver

Gas Engine 1:1 Hot Water, Some Steam More Variable

Turbines 2:1 Mostly Steam More Constant

Oakland University

1 x 4.6 MW Combustion Turbine + Heat Recovery Water Boilers

MSU TB Simon Power Plant

• 15 MW Combustion Turbine • + Heat Recovery Steam Turbine

PresenterPresentation NotesWe also have turbines at U of M and Eastern Michigan University

Ford Motor Company

• 2 x Taurus 60 - Portable combustion

turbines - Each Rated at 5.2MW - Duel Fuel capable - Shipped to Venezuela


Turbine or Gas Engine? • 95% of cases there’s no contest

– If NPV evaluation is made correctly the choice of the proper size and type of generator is easy

• Low temp, low pressure gas, high altitude…go engines • Large heat/ekW ratio, high pressure steam…go turbines

Questions &

Comments

Kevin O’Connell Michigan & MacAllister CAT Power Systems Div. EPG Commercial Business Mgr. Office: (248)349-7050 ext. 1225 Mobile: (517)230-5444 Email: [email protected]

mailto:[email protected]

�How To Determine The Proper Size, and Generator Type For Municipal Size Power Projects ��10/4/17��AgendaHistory of CaterpillarWhy Recips & Turbines?Why Recips & Turbines?Why Recips & Turbines?Why Recips & Turbines?Why Recips & Turbines?Why Recips & Turbines?Why Recips & TurbinesWhy Recips & Turbines?The Case for RecipsSimilarities between Gas and DieselDifferences Between Gas and DieselDiesel vs Natural Gas FuelWhat’s Methane Number (MN)?Diesel vs Gas RatingsDiesel vs Gas EmissionsDiesel vs Gas Load AcceptanceDiesel vs Gas CAPEXApplications for Gas and DieselDWSD – Y2KDC Cook NuclearPeaking with DieselCMS EnergySlide Number 26Peaking with GasPeaking with GasPeaking with GasPeaking/Solar Firming with GasPeaking with Land-Fill GasPeaking with Land-Fill GasDiesel vs Gas SummaryRecips vs. TurbinesThe Case for Turbines Gas Engine and Turbine SimilaritiesGas Engine AdvantagesTurbine AdvantagesGas Engine vs. Turbine Technology ReviewApplication Considerations�Gas Engine vs. TurbinePeakingCombined Heat and Power (CHP)Combined Heat and Power (CHP)Gas Engines vs. Turbine SummaryOakland UniversityMSU TB Simon Power PlantFord Motor CompanyCombined Heat and Power (CHP)Questions �& �CommentsKevin O’Connell�Michigan & MacAllister CAT �Power Systems Div.�EPG Commercial Business Mgr.�Office: (248)349-7050 ext. 1225�Mobile: (517)230-5444�Email: [email protected]�

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