Polymer Processing Cost Saving Workshop - 07 Deriving revenue from energy

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  • SEM is administered by the Single Electricity Market Operator (SEMO)Is jointly run by the Transmission System Operators (TSOs) ,SONI (NI) & Eirgrid (RoI)TSOs are responsible for controlling and operating both the engineering and commercial aspects of running the Electricity GridTSOs are accountable to the Electricity Regulators NIAUR (NI) and CER (RoI)SEM is a gross mandatory pool, into which all ‘generators’ >10MWs must bid their electricity prices All ‘suppliers’ must purchase energy from SEM before selling on to domestic and commercial customersSEM is an ‘all island’ market for North and South of IrelandOn average €7.1M/day, flows through the SEM, equivalent to €2.6B/yrRevenue Breakdown = Approx. 30% for Capacity Payments and 70% for ‘Energy’
  • As per the slide
  • TSOs are responsible for producing the Capacity Statement , which projects the maximum demand and generation levels over the next 10 yrs, ensuring enough generation capacity and reserve margins to meet demand
  • The dotted line is where the demand would have been had it not been for demand suppression using diesels How many clients were using diesels for tariff avoidance?In RoI many clients were providing demand reduction in the WPDRS – Winter Peak Demand Reduction SchemeThe Electricity Regulators and System Operators would like to see increased participation from demand reduction
  • AGU The demand is not taken into account. Operates as a standalone generator.Very costly and now not financially viable due to NIE network restrictions and recent technical restrictions imposed by NIEDSUMuch more flexibleMuch less costlyMany clients are familiar with operating this scheme and are less nervousDemand suppression on the commercial meter by:- ‘switching off’ - direct demand reduction suppression of demand by using the generator, combination of both

Transcript

  • 1. DERIVING REVENUE FROM ENERGY; DEMAND SIDE REDUCTION & POWER GENERATION PRESENTED BY: MICHAEL JACKSON MSc CEng FEI Chartered Energy Engineer MANAGING DIRECTOR, ETI 21st March 2014
  • 2. SINGLE ELECTRICITY MARKET - OPERATION
  • 3. WHAT SERVICE DOES ENERGY TRADING IRELAND (ETI) PROVIDE ? 1. ETI contracts with each site owner/client and bids the capacity into the Single Electricity Market (SEM) 2. SEM pays ETI Capacity Payments – ETI pay each client as per the ETI/Client contract 3. ETI pays capacity annually - DSUs energy is recompensed by avoided demand, DUOS and TUOS during the time of dispatch. 4. There are three ways to reduce demand: - Direct demand reduction – pumps, fans, compressors, air conditioning etc. - Suppress demand using a stand-by diesel (or other generator) - A combination of 1 & 2.
  • 4. WHY ARE CAPACITY PAYMENTS MADE? 1. Capacity payments are made to incentivise generators to provide capacity. 2. Capacity payments are made whether or not the generators are scheduled to run. 3. In UK and Ireland our maximum demand is in November – February but capacity payments still must be paid to ensure these power stations remain available and commercially viable. 4. Outside of the winter peak many of the expensive peak generators will not be required to generate as the demand will have reduced. 5. Generation and electrical demand must always be in balance every second. Failure to balance = blackouts.
  • 5. NIE LOADCURVE
  • 6. ETI Services Aggregated Generating Unit Aggregated Demand Side Unit M NIE Network G Load M MEC M NIE Network G Load
  • 7. WHAT IS REQUIRED FOR INCLUSION IN THE AGU? System Requirements:- No longer financially viable for most sites!! 1. An MEC (maximum export capacity) – depends on the local NIE/ESB network £1200 2. A separate electricity meter required on generator tails - £600 3. Synchronizing panel - £10K 4. G59/G10, NVD, under/over frequency protection (costly!) NVD - £40K 5. NIE SCADA - £10K 6. Set up local RTU (remote terminal unit) to communicate with ETI’s SCADA system for monitoring and control of the generator controller and plant 7. Contract with Energy Trading Ireland (ETI)
  • 8. DSU - WHAT IS REQUIRED? System Requirements:- Recommendation for most clients!! 1. An MEC (maximum export capacity) – NOT REQUIRED but will increase income potential. (Depends on the local NIE/ESB network) 2. A separate electricity meter required on generator tails – NOT REQUIRED 3. Contactors on switched circuits/loads – YES (if offering direct demand reduction) 4. Synchronizing panel - if you don’t want to ‘island’ the site. 5. G59 protection to Generator 6. Set up local RTU (remote terminal unit) to communicate with ETI’s SCADA system for monitoring and control of the generator controller and plant 7. Contract with Energy Trading Ireland (ETI)
  • 9. WHY USE ETI SERVICE IN YOUR BUSINESS ? • Your business has existing infrastructure which could be earning significant revenue - large standby diesel generators /large demand which can be reduced. • Presently it is costing your business to maintain diesels. • ETI provide a personalised service to maximise income. We discuss with the client the income from capacity payments versus their operational requirements. The client decides what they want ETI to trade!!
  • 10. HOW MUCH COULD YOUR COMPANY EARN? • Anticipated £15k - £20k/MW/yr (subject to technical feasibility). • If using DSU the capacity payment will be based on your demand curve and the load which we can reduced by ‘switching off’ and/or using diesels for load suppression.
  • 11. WHAT ARE THE RISKS? – FEW!! • If the company previously carried out demand reduction they will understand what is involved • The diesels are paid for sharing their capacity with the SEM, irrespective of whether, or not, they are called to run • They are the most expensive generation available to the TSOs, therefore will be the last to be ‘called’. • In 2011-12 they were ‘called’ for 1hr in the whole year • In 2012-13 they have not been called • Capacity is increasing so the likelihood is diminishing • Additional benefits: 24/7 monitoring of diesels and fuel stock levels