On January 31, 2013, Wärtsilä received an order from Portland General Electric Company (PGE) to supply a 220 MW power plant being built near Clatskanie in the state of Oregon, USA with 12 Wärtsilä 50SG natural-gas-fuelled engines and related auxiliary equipment. We asked Rick Tetzloff, Senior Project Manager at PGE, to share the business logic behind their selection of Wärtsilä technology.
Introducing flexibilityRick Tetzloff
Senior Project Manager
Portland General Electric Company
Just to set the scene, PGE could be described as a fairly typical investor-owned utility in the Pacific Northwest. We have residential, commercial and industrial customer segments, and our main priority is to achieve the best combination of cost and risk for these customers.
In 2009, we submitted an Integrated Resource Plan to the Oregon Public Utility Commission (OPUC) which established the need to seek approximately 200 megawatts of flexible peaking capacity. We then initiated an RFP process in 2011, into which we ourselves made two entries, one of which employed Wärtsilä technology.
Managed by a separate, impartial team at PGE, the RFP and bidding process was overseen by an independent evaluator reporting to OPUC. Port Westward Unit 2 in its current form, using Wärtsilä 50SG engines, was the successful proposal. That’s the long, complex process that gave rise to this selection of technology and supplier.
In terms of our annual energy needs in the Portland area, we are becoming a dual-peaking utility, with nearly equal summer and winter peaking loads. On a daily basis, we also have a fairly standard loading profile, with morning and afternoon peaks.
Traditionally we’ve relied on hydro resources to provide flexibility, but the share of our generation provided by hydro is declining over time. Where before we depended on mid-Columbia hydro contracts for load-following functions in our generation system, more and more of those resources are now switching to a short-term market basis or serving their native loads.
Our Integrated Resource Plan showed that we needed products that would provide ancillary services, including load following, regulating margin, spinning reserve and non-spinning reserve.
Wärtsilä’s engines cover all of these needs. The plan they proposed for the Port Westward Unit 2 plant complements our portfolio very well. The power generation we have currently is more traditional, and wasn’t designed to be ramped up and down throughout its load range at a fast rate. This capability was something we needed to add to our system to maintain flexibility as more wind energy is integrated into our system.
Gas on hand
Fuel storage was critical to the success of this project because traditional pipelines need to have the gas scheduled a day in advance. You need to predict how much gas you are going to use the next day and be responsible for balancing it if you deviate from that.
Having access to an underground reservoir close to our facility was a key driver for this location and for this kind of technology to be added to our system. There is very limited available capacity in the existing pipelines so we will need to use what capacity we have to inject gas into the storage reservoir during off-peak periods in order to have it available when needed for this plant. When fully constructed, we’ll end up with an underground natural gas storage reservoir and pipeline that we can draw from at any time of day, at any load, to match our needs on the generation side.
So, with natural gas the fuel of choice, it became about selecting a technology. The Wärtsilä system we decided on provides three critical services that we were looking for to develop our portfolio:
• Peaking service during the winter and summer periods
• Load following throughout the year
• Wind integration service throughout the year
The biggest benefit the Wärtsilä 50SG engines provide for our system is in helping us to maintain compliance with our commitments to renewable energy, and as those commitments increase over time, they also allow our customers to benefit from a more renewable-focused electricity portfolio.
The modelling we’ve done to date, looking at our entire portfolio, shows that these engines will be operated throughout the year when integrating wind.
Though it's diffucult to predict the capacity factor for the plant, we expect that some portion of the plant will be used every month if not every week, when integrating wind. There may be days when only two or three units are run, and others when all units will be operated at minimum load and have that spinning reserve available as the day progresses.
As the wind energy penetration in the Northwest increases to meet state renewable portfolio standard requirements, we expect this plant to be used on a more regular basis.
One area we needed to work on was the education about this new technology, as the use of reciprocating engines as a prime mover for generation is a new development within PGE. There was a bit of a learning curve internally and with our stakeholders, which necessitated informing people and getting them more familiar with using this technology in a major power plant.
During the decision-making process we also developed an internal model that simulates overall system costs to show the savings to our customers that are realised by having flexible capacity. We can plug different resources into this simulation and model the constraints and the flexibility of those resources, and then see how these results are reflected as lower overall OPEX in the system.
This included some modelling of things like pumped-storage hydroelectricity and compressed air energy storage. In the context of our integrated resource plan, we look at all the options, but those technologies are very risky right now. They take a long time to develop, and there are also a lot of permitting risks.
With the future addition of more wind energy to our system to meet our renewable portfolio standard requirements, the need for flexibility is only going to increase. This was one of the driving reasons why the flexibility of Wärtsilä's technology made them a good fit for this project.
Wärtsilä has a long history. We see them as a company that tries to work fairly and reasonably with their partners, and we’re happy to pass on the benefits of this relationship to our own customers and stakeholders.
*The text has been edited upon customer request