Converteam presentation

SECURING ENERGY RESOURCE
…and ‘Plan B’

John F Hill, 22nd June 2011

This document contains confidential and proprietary information of Converteam and must not be used for any
purpose other than that for which it is supplied by Converteam. Its contents must not be disclosed to any other
person nor copied in whole or in part without the prior written consent of Converteam

Securing Energy Resource

The Opportunity
Power generation – an immediate need

The Machines
The materials to make the solution

Reducing the Risk
Long term plans, local suppliers

Investing in ‘Plan B’
The cost and value of a reserve option

© 2011 Converteam UK Ltd. All rights reserved
COMMERCIAL IN CONFIDENCE CUSTOMISED TECHNOLOGY FOR CUSTOMER SUCCESS 22Jun11 2

The opportunity - replacement

NEW GENERATION CAPACITY

The size of the market:
First underlying fact: conventional generating plant retirements
– Throughout the EU, 365GW+ (over 50%) of plant replaced between 2000 and 2030
Source: European Commission
– Example UK: Over 40GW of generating plant retire between now and 2030

PLUS GROWTH
DECC Electricity Market Reform Analysis, courtesy: Redpoint Energy Ltd

The opportunity – size

NEW GENERATION CAPACITY

The size of the market: EU national energy targets (%demand)
Second underlying fact
– Europe: targets 20% of energy from
renewable sources by 2020
Legally binding
Some EU nations to do more
Example UK - ~30% of electricity,
normalised score end 2010; 7.2%!
Source: DECC Energy Trends Mar11

– Options (similar throughout Europe)
First new nuclear; 2027?
CCS operational stage; 2025?
Large scale solar PV; cost 2020?
South of 50º N
CCGT with area heat; 2018?
Large scale wind; 2014
Energy efficiency; NOW
Source: Redpoint Energy Ltd, Electricity Market Reform Analysis

Other underlying facts
– China: massive commitment
– India: most acute energy shortage
– Brazil: best onshore wind
– USA: Obama’s second term?
courtesy: Eurostat, EC


The Opportunity

The Machines
The materials to solve the problem

Reducing the Risk



The Wind turbine power train

Pioneering – utility scale, variable speed wind turbines

The Megawatt class (1995)
Typical rated powers: 500kW - 2MW
Start-up wind speed: 4m/s
Rated power from: 13m/s
Rated speed: 20m/s
Cut out speed: 25m/s
Rotor diameter: ~70m
Asynchronous doubly-fed generator
Converteam ProWind DF converter
With patented power control

Power train costs kept lowest by converter
feed to the rotor of the generator only, and
availability of ‘catalogue’ generators
Tacke 1.5s, courtesy Tacke Wind 1995


The Wind turbine power train

Pioneering – utility scale, variable speed wind turbines

The Multi - Megawatt class (2002)
Typical rated powers: 2.0 - 5MW
Start-up wind speed: 3m/s
Rated power from: 13m/s, to
Cut out speed: 25m/s
Rotor diameter: 80 - 100m
Asynchronous squirrel cage generator
Converteam ProWind FF converter
4 quadrant Active Energy Management
EU / USA Grid Code compliance
Grid Fault Ride Through
With patented power control SWT 2.3 series, courtesy Siemens Wind Power 2004

No increase to overall power train costs as
power electronic costs reduce, and converter
fully feeds the ‘catalogue’ generator, with no
slip rings.

The machines – mainstream rating

Matching the wind farm developer CFO

Larger, utility scale wind turbines, with higher ratings
(onshore <3MW, offshore <6MW) are now mainstream:
Because infrastructure costs do not grow in proportion to
rating
– Small projects require big development (consenting, access, connection)
– Small turbines require similar footfall
– Sites have specific access tolerance
– Wind is turbulent near ground level (tall towers, large rotors)
– Therefore best kWh/capital is at higher power

Higher turbine ratings require a lower speed turbine rotor
– High power rating and low speed, mean high torque generator
– (or high ratio gearbox)
DD115, courtesy XEMC Darwind
Minimising turbine structural cost requires a low mass nacelle
– Low mass nacelle requires a low mass generator
Highest torque / lowest mass = highest torque density
– Therefore the lightest generator, with:
The lowest serial production cost
The least supporting structural cost


Emerging magnet dependence – Standard Speed

Utility scale, variable speed wind turbines

The Standard Speed PMG, onshore or offshore (2009)
Large scale serial production planned
Globally marketed
Giant, multi-national turbine makers
‘Building Block’ assembly
(say) 250kg of magnets

V112 3MW, courtesy Vestas 2.5xl, courtesy GE Wind


Emerging magnet dependence – Hybrid

Power ratings for offshore
Fully integrated, geared, Permanent
Magnet Generator
Rated Powers: 2 - 5MW
Rated Speeds: 100 – 400rpm
Intermediate Speed Permanent
Magnet Generator
Magnets: 500kg to 1 tonne

Multibrid M5000 Courtesy: Prokon Nord Hybrid PMG –Converteam Nancy


Emerging magnet dependence – Direct Drives


The Direct Drive PMG for a giant Wind Turbine (2010)
Large scale serial production planned
Globally marketed
Giant, multi-national turbine maker
‘Building Block’ assembly
Very high reliability
Low maintenance
High efficiency
Converteam ProWind FF converter
4 quadrant Active Energy Management
EU / USA Grid Code compliance
Grid Fault Ride Through
SWT 3.0-101 (courtesy Siemens Wind Power)
With patented power control
Magnets: around 2 tonne
Price competitive with conventional topology


Infrastructure – power balance

The 20 year challenge

Horses for courses
Tidal Power
Tidal energy has one great advantage – predictability
Exploiting this source is challenged by its cyclic power
output
…and tidal zones give us priceless natural features
– Tidal turbines La Rance, courtesy EdF
Used in a modular way can avoid impacts to the
ecology of a tidal zone, but will produce power to a profile
which matches the ebb and flow rates
Local Flywheels or batteries can compensate
efficiently for the cyclic nature of the power available, with
high storage density
– Small Hydro Power Fleming Lagoon, courtesy DECC
Lagoon walls can provide Hydro storage, and contain
turbines which generate electricity as the tide rises /
lagoon fills, then generate and regulate energy when the
tide turns / lagoon empties.
– Batch processes
Many energy intensive industrial processes are
operated in cycles, which can be designed to
chronologically match tidal power availability Deltastream, courtesy Tidal Energy Limited


Infrastructure – power balance

The 20 year challenge

Horses for courses
Wave Power
180
INPUT POWER IN KWATTS Some wave technology uses hydraulic accumulators
160
140
120
as stores – but these produce difficult maintenance
100
80
60
40
issues
20 Powerbuoy, courtesy OPT
0
− 20 Careful modelling of very large wave farm layout can
30
OUTPUT POWER IN KWATTS
provide virtually constant power rating with no additional
25
20 storage
15
10
5
…but very large wave farms are many years away.
0
For the next ten years…
Supercapacitors on the DC link, Converteam ATG

– Supercapacitors
Actual constant power is possible for every wave
device by fitting supercapacitors to the existing power
electronic converter – crucial for direct generation

– HydroAir
‘Rotating Inertia’ of air turbines on oscillating water
columns can provide sufficient power output smoothing.
This is the same resistance to slowing, as described to
ride through grid events, but in response to the peak and HydroAir, courtesy Dresser Rand
trough of the wave energy source.



The Opportunity

The Machines

Defining the Risk and Reducing it



The Risk – political backdrop

WIND TURBINES

The attractiveness of our accessible market:
UTILITY SCALE
– Breathtaking chance of modern, sustainable business
– Massive capital investment in all tiers of the industry

BARRIERS - UK, Germany, France
– Industries need…
Political and regulatory stability
– Consenting and regulatory authorities need…
A clearer brief, and genuine understanding of the service
they provide, to our wider society
Time to assist, to guide, to improve, brave initiatives or
honest objections of residents, farmers and industry
Resources to take responsibility for the co-ordination of
their data needs; one standard, one checklist (perhaps not Whitelee, courtesy ScottishPower Renewables
one hurdle, but one racecourse)
Source: BIS Penfold Review Jul10

CLEARLY – the wind industry was formed by
environmentalists. We have…
– A desire to maintain a natural, scenic setting for life
– A recognition of the corrosive impact of short term
opportunism

THE UNFATHOMABLE BUSINESS CHALLENGE - POLITICS

The Risk – competitiveness

WIND TURBINES
There’s no UK, utility scale turbine maker. For an original equipment supplier:

100% export
– First stops Europe and Asia
Tier Three
Specification risk and cost
– Example: Chinese standards / regulations / COP
Tier Two
Contractual risk and cost
– Example: German warranty law

Transportation risk and cost Tier One
– Example: weather delay and damage
– Result: delivery (and inward) stock holding

Tariff and duty cost Turbine Maker
– Example: Indian import classifications

Exchange rate risk and cost
– Risk both ways; sales and foreign purchases

UK BOM costs / landed prices
– Euro overvalued, Sterling undervalued; imports expensive, exports competitive
Source: Economist Big Mac Index

Despite all this WE REMAIN HIGHLY COMPETITIVE. If only UK content were higher…

The Risk – commodities

WIND TURBINES
The UK has little indigenous ‘rare earth’ material:

China produces 90% of world supplies; exports cut by 40% in
2010
– Currently stockpiling; “environmental concerns”

Prices doubled in the last three weeks
– Neodymium oxide for permanent magnets up by 78%

Deliveries extended to 30 weeks
– Typical state-owned supplier, less than 2% of to date 2011

Low UK share of hi-tech material manufacture:
Hywind tow out, courtesy Statoil
Carbon fibre prices have risen 80 – 100% in the last ten years
– While volumes continue to rise

Power semiconductor volumes for wind CAGR >25%
– Industry book-to-bill regularly 1.1
– UK manufacturer Dynex, Chinese owned, expanding, Q1/11 book-to-
bill 1.4



The Opportunity

The Machines

Defining the Risk and Reducing it



Alternative Strategies

Compact Induction generators

Why for wind?

Under control at high overspeeds

No magnets
– No demagnetisation risk
– Lower propensity to shock damage
– No eddy current heating

Simpler production

Lower cost in higher volumes

Variant on current production
CIG, Converteam Rugby

Massive service experience



Bigger still - superconducting generators

Why for wind?
High Temperature Superconducting wire only
now starting production, but…
– Could be cheaper than copper to carry the
same current the same distance in just a few
years; trend…
1998 $1000 / kAm
2002 $200 / kAm
2005 $100-$150 /kAm
2009 < $100 /kAm
– In five years, it could be more readily available
than permanent magnets, as rare earth
availability declines
– HTS Machines can be 50% of the size of
conventional machines
– Ideal for the naturally high torque of wind
turbines
– Value of very high power density is amplified by
nacelle mounting costs
1.7MW Hydrogenie rotor, Converteam Rugby
Patents, Converteam Technology Ltd


Superconducting generators

Why for wind?
Higher efficiency
– HTS rotor has almost zero losses – power
consumed by the cryogenics is a small
fraction of the normal losses in a
conventional rotor
– For a superconducting generator, efficiency
improvements of several % are possible
leading to significant savings over the lifetime
of the machine
High system stability by using novel machine
design (e.g. air gap winding)
Low synchronous reactance (typically 0.3 to
0.4 per unit)
Low load angle (typically <20 deg at full
load)
High pull out torque
1.7MW Hydrogenie rotor, Converteam Rugby
Patents, Converteam Technology Ltd

Thank you for your attention

This document contains confidential and proprietary information of Converteam and must not be used for any
purpose other than that for which it is supplied by Converteam. Its contents must not be disclosed to any other
person nor copied in whole or in part without the prior written consent of Converteam

www.converteam.com

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