CHP/District Heating Conference & Networking
Event, 22nd May 2014 – Prince Philip House,
London.
Delivering the Future
Caterpillar
Established 1925 by Benjamin Holt and Daniel
Best
 Worlds leading manufacturer of Construction
and Mining equipment, Diesel and natural Gas
engines and industrial Gas turbines.
 Turnover: 60 Billion US Dollars (2011) – GBP
37.8 Billion
 Profit: 4.9 Billion US Dollars (2011) – GBP 3.1
Billion (8.2%)
 Employees: 125,099
 Route to Market: Independent Worldwide
Dealer Network
 Dealer Employees: 127,000
 Caterpillar Dealers Worldwide: 188
Finning and Caterpillar
 Established 1933 By Earl B Finning
 Exclusive Dealer For Caterpillar
 Western Canada (Alberta, BC, NW Territories & Yukon),
UK & Ireland, Argentina, Chile, Bolivia, Uruguay
 Turnover: 5.9 Billion CAN $ (£3.8 Billion Pounds) in 2011
 Canada 50%, South America 36%, UK 14%
 EBIT: 380 Million CAN $ (244 Million Pounds) in 2011 (6.4%)
 Employees: 11,900 of which 5,300 are skilled technicians
 World HQ in Vancouver, Canada.
 Toronto Stock Exchange FTT.TO
 World’s Largest Caterpillar Dealer
 If its CAT we sell it and maintain it
Global Locations
Who Are Finning ?
Finning
South America
Finning
Canada
Finning UK
and Ireland
Antofagasta
Cannock
Fort McMurray
Santiago
Edmonton
Vancouver
Revenue
£2.4bn
£1.3bn
£0.5bn
Finning in the UK and Ireland
Finning (UK) Ltd
Headquarters in Cannock
23 Branches
About 1600 people
Major business units:
Equipment Solutions
Power Systems
Product Support
Turnover about £525m in 2011
Businesses: Cat, Diperk, Rollo,
Damar Group , Murray Controls
Power Systems
Equipment and Installation Business
700 Employees
 Power & Energy, CPCT
 Commercial Marine & Offshore
Petroleum
 Pleasure Craft
 Industrial & EP Retail
 Diperk, Rollo (Damar, MCS)
 Turnover GBP 220 Million
£180 Million – New & Used Equipment
£40 Million – Parts & Service
 International experience – 43 countries
 Lifecycle support
 24/7 operation
 Manned telemetry
 Parts logistics
Specialist EPC Contractor
Global Turnkey EPC Solution provider
Infrastructure, Power Generation, Mission Critical, Renewables, Utilities
Green Park Energy Mines Gas – Fully Risk Transferred
Landscape, building, fencing, engines
generators, power, connection CAT finance
£20m – 12 x 3520, 24 MWe, over 6 sites
Canary Wharf
4 x 3516, 1.8 MWe at
11kV, on acoustics floor
cast in place, above
directors offices,
standby
Thames Water – 1. Biogas CHP 6 MWe 2. Biodiesel
Biogas plant currently being fitted
with steam boiler for Cambi plant
designed and installed by Finning
Finning sponsored research student at
Brunel into biodiesel. Not as simple as it
sounds. 5 x 3516, 8 MWe
Silent Valley Landfill
and Biogas
Prototype 3520 joint development CAT and
Finning
BNHJV Mission Critical
BNHJV Energy Centre
Complete turnkey energy centre 6 x gas
engine chps 3516 1.2 MWe
Green Energy and CHP
Southern Water Biogas to power
Process CHP
Natural gas chp for process heat and
power – pharmaceuticals – 3516 1.2 MWe
Digester Technology
New food waste digester for Wessex
Water, including waste reception,
maceration, hammer milling etc
Caterpillar 3408 turbocharged 255 kWe gas engine
gasifier for wood chip
Obtained 220 kWe
from natural gas
engine – 1990
Waste cooking oil derived fuel to power 10 x 1820kWe
diesel engines
• CAT 3516BHD diesel sets developed and optimised by Finning for
the purpose of running on the bespoke fuel
• EPC by Finning, Gensets by CAT, all works inc civils and M&E by
Finning or Finning owned companies, risk transfer for availability
and output
• Funded by CAT finance and 7 year O&M BY Finning
Other engine based projects Finning are pursuing with clients
Some of the planed projects in which Finning CPCT is taking full EPC
responsibility:
• wood to gas engine power via gasifier
• Waste incl. RDF to gas engine power via pyrolysis
• tallow to power via diesel engine
How To Procure CHP that works (1)
1. Initially use a third party consultant to monitor in detail your plant
and to scope out likely size of power plant , fuel, vendor options etc
based on detailed monitoring and modelling, a not insignificant task
2. Its then essential to then let each engine or chp supplier to design,
spec and quote for the total design – buildings, pipes, civils, electric
and the power plant including say any gasifier etc and provide overall
wrap
3. Do not involve third parties between you the client and the vendor as
this will add unnecessary cost, and provide wriggle room in any
subsequent dispute – you want responsibility to rest solely with the
vendor – if a third party produces a spec to quote against the
vendor may always revert to “ …well your design was wrong….” (and
third party designs are often wrong)
How To Procure CHP that works (2)
4. Instead force vendor to accept all liabilities for his design,
installation and any subsequent non performance ( loss of output,
non-availability, maintenance costs, efficiencies etc)
5. Ask him to provide both a purchase offer and a full EPC funding
option ( ie some kind of p/kWh offer) with the possibility of
outright purchase at a later date
6. The choice of supplier shuld then be made solely on the fully
funded cost of providing heat and power ( ie the p/kWh offer) and
therefore in large part on the cost of having the funded offer –
NOT merely the cheapest offer.
7. Further the Bank or funder, will perform diligence on the vendor,
and secure vendors with a good track record will get low cost of
funds and the bank’s own technical experts will also ensure the bid
is of the correct standard. This is all revealed by the p/kWh cost.
How to Procure CHP that works (3)
7. You want vendors who are financially secure and who can be held
to account for non performance – only these will be able to get
funds at reasonable costs and this is inevitably reflected in the
p/kWh cost.
8. The above points will ensure that vendors do not cut corners on
installation to offer an initially cheaper price (inevitably resulting in
a higher lifecycle cost) - vendors know better than any third party
advisors what is necessary, and by offering a 10 year guarantee on
performance will be forced to design to a correct standard
9. When you have picked the cheapest funded offer, (p/kWh) you may
take the buy out if ultimately you prefer to fund it yourself and if
necessary after an initial proving run
B