EFFECT OF FUEL AND HOT DAY POWER CONTRACT PROVISIONS ON NATURAL GAS FUELED GAS TURBINE POWERED PLANT OPERATING ECONOMICS WHILE UTILIZING INLET CHILLERS, EXHAUST HEATED FUEL AND BACK UP FUEL SUPPLY SYSTEMS

摘要

Pricing volatility for both power and natural gas fuel has increased in recent years. This, along with increasing interruptions of fuel supplies, is providing an opportunity to increase profit margins. Growth of the spot market for both fuel and excess power and the gradual reduction in excess generating capacity is leading to significant changes in fuel procurement and power sales strategies. After several years of relatively low delivered natural gas prices with summer and shoulder season surplus conditions, upward gas pricing pressure and summer power demand has resulted in delivered gas prices that have not been seen in a decade. This, along with increasing duration and frequency of gas supply interruption for non-firm transportation customers has spawned widening price differentials between firm and non-firm gas delivery pricing. Power plant operators have applied various techniques to mitigate the effect of these changes in fuel availability and power sales pricing. Two areas have been investigated in this study that could help. First, several systems have been evaluated that could reduce the total amount of fuel burned at the typical plant by making plant changes. In addition, the application of plant equipment that would increase hot day electrical production to allow increased sales of premium spot market electricity was studied. Second, two back-up fuel storage systems that would allow the use of less expensive non-firm fuel contract gas transportation rather than primary firm transportation are explored to determine when such systems would make economic sense. One of the systems employed traditional fuel oil storage, while the other looked at operating concepts with Liquefied Natural Gas (LNG) as the stored fuel. Although gas pricing and power market metrics have been changing rapidly over the past few years, the authors believe that the upward pressure on fuel supply prices will persist as long as power demand continues to increase and fuel supplies remain relatively constant. Even if new gas supplies are brought to market the building of new gas pipelines to increase our nation's firm transport capacity will be a long and expensive process that will increasingly be hindered by environmental and other land use concerns. This paper addresses concepts and strategies to alleviate some of these problems and to help power producers respond in a profitable manner to changing industry conditions.