Published September 26, 2008

TP bets on coal power

Genco opts for clean coal plant and biomass cogen on Jurong Island

By RONNIE LIM
Email this article
Print article
Feedback

(SINGAPORE) Competition among the newly-divested generation companies (gencos) here is hotting up. China Huaneng-owned Tuas Power (TP) said yesterday it will build a $2 billion clean coal/biomass cogeneration plant on Jurong Island - the first here to use such fuels - to supply steam and electricity to petrochemical customers.

And next week, Japanese/French-owned Lion Power, which acquired Senoko Power this month, is scheduled to announce expansion plans.

TP president and CEO Lim Kong Puay told BT the plan to go into coal-firing was conceived around 2006 - long before TP's sale in March this year to China's largest coal-fuelled power producer.

'They are of course very supportive,' he said of the plan, which will give TP a feedstock alternative to natural gas and oil, prices of which have soared.

Construction of the stand-alone clean coal (80 per cent)/biomass (20 per cent) project, in the Tembusu sector of Jurong Island, will start next year.

When operational in 2011, the project, which will include a 20 million gallons per day desalination plant and waste-water treatment facility - will produce mainly steam, at about 900 tonnes per hour.

It will also produce 180 megawatts of electricity, half of which will be for its own consumption and the rest to be sold through the islandwide electricity grid. This will add marginally to TP's current 2,670 MW electricity capacity.



Regulator the Energy Market Authority (EMA) said yesterday it is allowing TP to import a small quantity of coal for the cogen project because gas that TP needs may not be available in 2011 when chemical plants it will supply utilities to start up.

'We will not allow any entry of coal to adversely affect and jeopardise the viability of the LNG project,' EMA said, adding that it is banning the use of coal solely for power generation or on a large scale, to avoid this affecting Singapore's planned imports of liquefied natural gas, starting in 2012.

TP said it will transport the coal in covered barges to the Tembusu cogen plant, where it will be unloaded through fully-enclosed conveyors and stored in covered silos. The 'top' ash generated will be reused, while 'bottom' ash will be recycled into value-added products such as construction materials.

The carbon-neutral biomass will reduce the plant's CO2 emissions to a level comparable with those of oil-fired plants.

The plant will enjoy 70 per cent operational efficiency versus the 50 per cent efficiency level of today's combined-cycle gas turbine plants, TP's Mr Lim said.

'This means the plant will use less resources to produce the same unit of electricity, and therefore there will be less carbon emission.'

While the plant will cost roughly 20 per cent more to build than a conventional plant, it will result in 10 per cent cheaper products, so customers can expect more competitively-priced utilities, Mr Lim said.

TP's cogen investment follows a recently announced $1 billion-plus contract to supply utilities to bio-diesel maker Neste Oil, although this will come from TP's existing Tuas plant, which it will boost with $100 million of modifications. Mr Lim said TP is negotiating more utilities deals with other investors on the island.