September 2016 - Water Market Insights 204

The future power plant water market will be larger and more profitable but will require a major reorientation for the supplier industry. The factors shaping this change are

It is likely that much of the electricity, heat and power in the future will be generated locally and not transmitted long distances. In effect, the world is going to look more the way it did in the 1920s when most power was generated by units smaller than 100 MW. A significant portion of this energy will be generated by combined heat and power facilities.

The power plant additions in 2020 will total 305,000 MW. However, this number is quite misleading unless one realizes that the solar capacity is used only a fraction of the day and that the capture of waste heat can double the equivalent power output for fossil sources.

2020 Power Additions by Source in Equivalent Megawatts
Generator Type	2020 Electricity Additions	Energy Input Equivalent	Extractable Base Load Potential %	Potential Equivalent Heat and Power	Likely Combined Heat and Power
Gas Turbines	73,000	144,000	70	100,800	10,000
Gas Engines	7,000	17,000	70	11,900	10,000
Nuclear	15,000	30,000	70	21,000	0
Coal Utility	75,000	187,000	70	130,900	5,000
Coal Industrial	4,000	9,000	70	6,300	3,000
Biomass	5,000	11,000	70	7,700	3,000
Solar	30,000	30,000	20	6,000	0
Wind	80,000	80,000	40	32,000	0
Diesel	10,000	25,000	70	17,500	1,000
Total	305,000	533,000		334,100	32,000

The first column provides the capacity for each generation source based on continuous operation. The second column adds in the additional capacity if the available waste heat is converted to useful purposes. The third column indicates the percent of this energy which could be captured. The fourth column provides the potential equivalent heat and power if it were most efficiently utilized. The fifth column provides the likely combined heat and power. The large central station coal and gas turbine plants have very large amounts of waste heat. There is no good use for this heat in the surrounding community. Attracting new industries to these locations with the promise of low cost energy is a challenge and will not be realistic for units started up in 2020. Solar and wind segments generate electricity but not heat. So they are not included. Most diesel generators are used for standby or emergency purposes and are not utilizing waste heat.

So potential combined heat and power will be 32,000 MW and represent an investment of $640 million.

Heat recovery is the key to an efficient CHP system. This creates a good potential market for water treatment. An integrated waste management and energy company in Malmö, Sweden, is using Tranter Plate Heat Exchangers to capture waste heat from boiler flue gas condensate and cool this stream prior to purification and discharge. Gas cleaning from the waste-to-energy boiler takes place in a four-stage scrubber. Heat in the condensate from the top stage of the scrubber is transferred to the district heating loop through a Tranter Model GXD-205 exchanger. During the exchange, the scrubber condensate is cooled to a temperature 1–2 °C (1.8–3.6°F) above the incoming district heating water.

Two other heat exchangers complete the condensate heat recovery and cooling process. Plates for all three units were manufactured in 254 SMOTM stainless steel (1.4547) to withstand chlorides and fluorides in the flue gas condensate.

Approximately 40 percent of the valves, pumps, sensors and materials used in the power industry are classified as “high performance” by McIlvaine. This includes both severe and critical service applications. The information generated by high performance products will be worth more than the products themselves. This is the derivation of a broader conclusion reached by Jeffrey Immelt of GE who predicts that potential for machine to machine communications will be worth more than the machines themselves.

The availability of information on product performance promises to reduce operating cost for component owners. This provides the potential for component companies to make better components and to sell them at higher profit margins.

Jeffrey Immelt also believes that industry needs to develop the “hurry up” pace endemic to Silicon Valley. McIlvaine has demonstrated this accelerated pace with a series of recent webinars for a large U.S. utility. The utility is facing an investment of $700 million due to a sudden regulatory reversal. Rather than make one large technology investment, the utility can combine a number of small investments and save hundreds of millions of dollars. The decision-making process has utilized the input from the “wise crowd” in a manner which is semi-structured.

Some of the most valuable input has come from individuals with very narrow but comprehensive expertise. The key to the “hurry up” pace will be to beneficially extract the niche knowledge on processes, products, industries and geographies. This expertise must be better exploited if the power industry is going to change at anywhere near the rate of the semiconductor industry. Individuals instead of retiring can focus on providing their niche expertise to the world. Product suppliers are going to have to develop the process and application expertise through a combination of internal or external resources. In the era of smart products process knowledge will be increasingly important.

Consulting and service companies have very big challenges and opportunities. The financial rewards for providing a new and better solution are substantial. The owner will increasingly rely on outside assistance as new technology is being rapidly deployed. On the other hand, the consulting or service company who does not have the “hurry up” frame of mind will be in jeopardy. Consulting companies will have to develop the niche expertise and cannot rely on the specifications compiled for a similar project two years earlier.

The value of the wise crowd can be tapped only if there is a structure in place to take advantage of it. McIlvaine has created Decision Guides for technology selection for each type of power generation. These Decision Guides are available to any power plant owner. The organized utilization of case histories, white papers and webinars combined with the ongoing wise crowd input from webinars and emails is proving a unique new way of making power plant product decisions.

The wise crowd concept includes better collaboration among various groups within supplier companies. GE, for example, is a major valve supplier but also provides the coal-fired generators, gas turbines, gas and diesel engines and other power generation technologies. Reduction of the $700 million U.S. utility project investment will take place only with integration of the digital optimization system, combustion modifications and new air pollution technologies employing unique combinations of chemicals. More than a dozen of GE groups in Europe and various locations in the U.S. need to collaborate to provide the best combination of products for this project. Since a number of chemicals as well as other liquids and gases are involved, the smart valves will play a critical role.

Other suppliers are divisions of companies which are operators of power plants. Collaboration among these divisions is also highly desirable. NSSL Limited is a major valve manufacturer. It is part of NECO Industries which owns manufacturing plants and is constructing new coal-fired power plants. These power plants will be subject to new environmental regulations limiting SO₂, particulate, and NO_x to low levels. The valve requirements will be different than for existing power plants which have not had to meet tough standards. Collaboration between divisions will ensure that the best valves be chosen for the new requirements.

Changes in the mix among fuel sources and the rapid deployment of new technology will change the supplier industry. A new digital age decision process for product selection will provide a vehicle for change. The end result will be a higher premium for high performance smart products.

The Asian market for coal-fired power plant equipment is going to be very large. The new regulations on environmental control in India will create a large market in the next few years. Indonesia and Vietnam are planning over 100,000 MW of coal-fired power plants. China, Japan, Europe and the U.S. are upgrading existing coal-fired power plants McIlvaine has a complete program to help m suppliers succeed in this market:

44I Power Plant Air Quality Decisions (Power Plant Flow Control and Treatment) This service has a free child web for power plants with a decision guide for each product and interface with power plants around the world

Utility E-Alert Tracks Billions of Dollars of New Coal-fired Power Plants on a Weekly Basis

• Energy Secretary Moniz states Administration working to keep Coal a part of Low Carbon Energy

• Saurashtra Power Plant (India) must revise Design to meet Air Pollution Regulations

• NEPRA grants license to China Power for 1,320 MW Coal-fired Power Plant at Hub Balochistan, Pakistan

The 41F Utility E-Alert is issued weekly and covers the coal-fired projects, regulations and other information important to the suppliers. It is $950/yr. but is included in the $3020 42EI Utility Tracking System which has data on every plant and project plus networking directories and many other features.

DATE	HOT TOPIC HOUR AND DECISION GUIDE SCHEDULE *The opportunity to interact on important issues*
TBA *Markets*	Food - Analysis of 12 separate applications within food and beverage with analysis of valve, pump, compressor, filter, analyzer and chemical options; impact of new technologies such as forward osmosis.
TBA *Markets*	Municipal Wastewater - Quality of pumps, valves, filters, and analyzers in Chinese and Asian plants; new pollutant challenges; water purification for reuse.
TBA *Markets*	Mobile Emissions -Reduction in CO, VOCs, and particulate in fuels, oils, and air used in on and off road vehicles; impact of RDE and failure of NO_x traps and the crisis in Europe created by the focus on clean diesel.