There is really no increase in installed capacity coming from the 330 MW of generation announced by ESET.

I listened to Dr Vin Lawrence who happens to be the chairman of ESET at a press conference making a grand announcement that cabinet has given approval for 330 MW of new generating capacity to be added to the grid, but this statement is not entirely true, as while power generation  maybe new it’s not an increase in our installed capacity.

Recall folks, that JPS plans to retire 292 MW of HFO and diesel fired plants with a 190 MW plant, so the net effect of this is really a reduction of nearly 100 MW being on the grid.

The 140 MW Co generation plant  being proposed by the Alpart will not add 140 MW of power to the grid, so don’t be fooled by these numbers. I will take a minute to explain what Co-Generation means so you get a better idea of what was not said by Dr Vin Lawrence and his team.

Alpart requires a lot of steam for its operations and steam is considered to be a secondary energy source, which means it must have a primary energy source to produce the steam it needs for refinery process.

Instead of producing the steam it needs from burning bunker C in a boiler and the power from a generating plant, the company has decided to go the more efficient route of building a Co-Generation plant  which will use LNG.

The plant will most likely  burn LNG in a turbine to generate electricity.  It will also use the waste energy in the form of heat produced from the burning of the LNG in what is called a Heat Recovery Steam Generator( HRSG) to produce the steam it requires for its processes plus generation of additional electricity . This is what is called Co generation and in the case its a combined Cycle Gas Turbine ( CCGT)

Alpart is also a large electricity user, which means part of the 140 MW that would be produced, will be utilized by the plant itself, thus reducing the amount of energy from the announced 140 MW to probably around 100 MW.

It therefore means that the net increase in actually generating capacity by ESET is really Zero and not 330 MW being banded about. Recall the following

1. JPS to retire 292 MW HFO fired plants
2. JPS to build new a 190 MW plant ( LNG fired)
3. Net change in actual generating capacity = -102 Mw
4. Alpart to build 140 Mw Co Gen plant
5. Alpart will utilized approx 40 MW
6. Power to grid from Alpart = 100 MW
7. Overall net change in generating capacity = – 2MW

So like I said there is really no net increase in generation capacity, what the country is likely to benefit from is improved “efficiencies” coming from these more modern generation facilities.

A increase in efficiency will lead to a overall increase in overall power available from the same installed capacity and ultimately lower energy prices. Let me explain this so as not to confuse readers.

1. A  100 MW HFO fired Single Cycle  generating plant (installed capacity) with a efficiency of 30% will only  produced 30MW of usable power.
2. A 100 MW LNG fired CCGT (Installed capacity) with an efficiency of  ~50%, will however produce about 50 MW of usable electricity or  66% more power.

So while the installed capacity has been reduced in real terms, we are should see an increase in available power and its this efficiency increase that should lead to lower energy prices.

I will attempt to use the figures about to determine an reasonable estimate of what electricity prices could be if these plants are actually built in operation by 2018.

Bless.