Indian Heat Rate Alliance (IHRA)
Working Groups Meeting
August 12, 2014
Background
Heat Rate Business Case
Savings
• Annual coal costs: Rs. 5
bn
• Annual GHG emission
reduction: 3 mmt+ CO2e
•
•
Sustained heat rate
improvement
• 10 kcal/kWh at 145 GW
coal generation capacity
at a PLF of 70%
In 2011-12, CEA found an average 11.49% deviation between operating heat
rate with designed heat rate (ranging largely from 2-20%).
PAT regulations under NMEEE expects144 thermal power plants (97 are coalfired) designated consumers to save 3.1 mtoe (2.9 mtoe from coal-fired
plants) during 2012-15
3
Barriers to Heat Rate Improvement
Ecosystem Barriers
• No long term plan and absence
of technology road-map
• Lack of financial incentives
through policies and
regulations to reduce fuel costs
and CO2 emissions
• Lack of awareness about offthe-shelf services & solutions
• Absence of competitively
priced solutions adapted to
Indian context and skilled
service providers
• Lack of financing mechanisms
for capital investments to
improve plant efficiency
• Insignificant research, training
and knowledge sharing
framework
Corporate Level Barriers
• Need for board level
commitment for efficiency
improvements
• Lack of dedicated outlays for
efficiency improvements in
annual O&M budgets
Plant Level Barriers
• Absence of knowledge, skillsets and dedicated teams to
analyze and interpret the
performance gaps
• Need for guidelines and tools
to address performance gaps
• Utilities irrespective of their
size are not willing to afford
costs and risks associated with
solution development
Indian utilities are aware of heat rate opportunities and are now
beginning to appreciate the role of solution developers, service
providers and skill/knowledge building
4
Approaches to Address Barriers
• Pursue policy prescriptions and regulatory directives to
incentivize efficiency improvements
• Facilitate market driven collaborative R&D to adapt &
develop cost effective Heat Rate solutions
• Foster partnerships and establish an operative network
between stakeholders
• Enlarge the support services market to meet the demand
of an expanding sector through non-OEMs
By establishing an industry organization to address the
above barriers on an exclusive basis, a platform can be
provided for a collective voice to all stakeholders
5
Indian Heat Rate Alliance
Proposed Aims/Objectives of IHRA
•
•
•
•
•
•
Encourage the idea and cause of improved heat rate of thermal power plants
on a continual basis & help in achieving heat rate at par with global standards
Offer an autonomous, independent platform for reflecting on policies,
regulations and salient topics concerning heat rate improvement in utilities
Provide technical assistance to utilities for acquiring appropriate technologies
and solutions for their problems through collaborative research & development
Act as a clearing-house of information and data bank
Facilitate technical and business partnerships between stakeholders
Engender a services sector to support the utilities and encourage tie-ups
between international companies and Indian entrepreneurs
7
Stakeholder/Members
Utilities
Central utilities like NTPC,
Damodar Valley
Corporation (DVC), Neyveli
Lignite Corporation and
new entrants like National
Hydro Power Corporation
(NHPC)
State utilities/ generation
companies
Original
Equipment
Manufacturers
Service
Providers
Research &
Educational
Institutions
Asset management service
providers like SKF, Bentley,
Emerson, Alstom, Black &
Veatch, Lloyd Register
Boiler-Turbine-Generator
(BTG) manufacturers like
BHEL, L&T Power,
Toshiba-JSW Turbine &
Generators, BGR Energy
Systems, Thermax
Babcock & Wilcox Energy
Solutions, Ansaldo Caldaie
Boilers India, Bharat
Forge, Alstom, GE Power,
Power Machines, China
Power & Lighting and
Doosan Power Systems
India. , Siemens
Process monitoring,
analytics & optimization
providers like BHEL,
Honeywell, Steag,
Emerson, General Physics,
Smart Signal, Kalki Tech
(PRISM), ABB, Siemens
Financial
Institutions
Banks as State Bank of
India, ICICI Bank
Specialized institutions like
Central Power Research
Institute
NBFCs like Tata Capital
CleanTech
Technology Innovators
Independent Power
Producers like Tata Power,
Reliance Energy, Adani
Power, Jindal Power,
CESC
Educational institutions like
IITs, NITs, Indian Institute
of Science, National Power
Training Institute (NPTI)
Specialist Service Providers
Plant Auxiliaries (Balance
of Plant)
Public financial institutions
like Power Finance
Corporation, India
Infrastructure Finance
Corporation Limited, IFCI
8
Value Proposition for Members
Utilties
OEMs & Service Providers
• Knowledge on advanced
technologies and
management practices to
improve heat rate to meet
PAT targets through issues
of guidelines &
newsletters and
organization of workshops
& seminars
• High returns despite low
investment through
collaborative R&D
• Access to state-of-the-art
research & training
• Access to competitively
priced state-of-the-art
services from the local
market
• Improved organizational
expertise and capabilities
• Expand business
opportunities to benefit
from growing heat rate
improvement market;
demonstrate, test and
adapt new technologies &
practices
• Ability to offer knowledge
and technology driven
cost competitive quality
services
• Participate in institutional
alliances with utilities,
OEMs, academia and
research to deliver cost
effective solutions
• Opportunities for
international service
providers to forge
alliances with domestic
entrepreneurs
Research & Education
Institutions
• Expanded and real-life
R&D platform
• Larger portfolio of
technical training courses
• Improved organizational
expertise and capabilities
Financial Institutions
• Opportunities to design &
test new financing
mechanisms
• Larger business
development
opportunities in the Indian
market
• Improved organizational
expertise and capabilities
9
Organization Structure
Governing Board
Mentor
Executive Director
Applied Research
& Technology
Council
Business
Development
Council
Learning by
Sharing Council
Program Manager
Program Manager
Program Manager
Assistant Program
Manager(s)
Assistant Program
Manager(s)
Assistant Program
Manager(s)
Administration &
Accounts
Manager
Accountant
10
Activities of Councils
Applied Research &
Technology Council
Business Development
Council
• Launch & manage Solution
Development Program and
Model Power Plant Program
to facilitate applied research
& demonstration
• Collaborative research to
develop/adapt solutions
• Promote interactions with
international research
institutes
• Demonstrate services &
solutions in Model Power
Plant(s)
• Launch & manage Service
Provider Development
Program to expand Indian
network
• Facilitate joint ventures
between international
service/ solution providers
and Indian entrepreneurs
• Promote Indian
service/solution start-ups
• Organize service/solution
providers workshop &
showcase events
• Provide technical
consulting & representative
services
Learning by Sharing Council
• Launch manage a Learning
by Sharing Program to
create a common platform to
facilitate sharing of best
practices
• Conduct missions to best
performing thermal power
plants globally
• Organize training
programs, focused
workshops & webinars
• Develop online information
bank
• Develop/update best
practices manuals
• Publish quarterly news
letter
• Organize annual Power
Plant Conference
1 or 2 Working Groups under each Council will provide policy guidance and
technical leadership to the IHRA and its members in the selection, design and
conduct of heat rate improvement strategies and solutions
11
Targetted IHRA Deliverables as on Dec 31,
2016
Applied Research &
Technology Council
• Facilitate collaborative
research on 2-3 priority
solutions
• Showcase solutions &
services in at least 1
Model Power Plant
Business Development
Council
Learning by Sharing
Council
• Facilitate at least 3
partnerships between
international service/
solution providers and
Indian entrepreneurs
• Showcase at least 2
Indian technology startups
• Organize 4 regional
technology/ service
providers showcase
events
• Provide consulting
services valuing at least
Rs 50 lacs
• Conduct 4 visits to Best
Operating Power Plants
• Organize 7 training
programs, focussed
workshops & webinars
• Updating at least 1 best
practices manual and
technical manual
• Conduct 2 Annual
Power Plant
Conferences
• Publish 8 quarterly
newsletters
12
Solution Development Program
A Unique Revenue Stream for IHRA
• IHRA’s flagship program
• Implementation through collaborative R&D
• Focus on creation of IPR for wide-scale deployment &
commercialization generating revenues for IHRA in the
long term
14
National coal savings and CO2
mitigation potential Showcase
National Cost
Potential Quantum
National Coal
National CO2
S.No Key Potential Areas kCals/KWh at each Savings ( in million Savings ( in million Savings (in Rs)
(assuming Coal costs
plant
tonnes)
metric tonnes)
Rs 2000/Tonne)
1
Dry Flue Gas
40
10
12.5
Rs. 2000
2
Condenser & Cooling
Tower
20
5
6.25
Rs. 1000
3
Combustion
10
2.5
3.17
Rs. 500
 The CO2 mitigation can also be achieved by introduction of advanced technologies like
 IGCC
 Oxy fuel combustion
 Carbon Sequestration
15
Key areas of efficiency improvement and
cost saving potential at power utilities
Major Heat Rate Loss Areas
1.
High Loss category (40-80 kcal/kWh)



7%
7%
2.
35%
10%
Medium
Loss
kcal/kWh)



22%
19%
3.
Turbine (HP/IP)
Dry Flue Gas Loss
Unaccountables
RH Spray
Unburnt Carbon
category
(20-40
RH Spray
Unburnt Carbon Loss
Unaccountable (LPT Efficiency, Hi Energy
drain passing, Insulation loss, etc)
Low Loss category (<20 kcal/kWh)


Condenser & CTs
Condenser and Cooling Tower
Dry Flue Gas Loss
HP / IP Turbine
MS & HRH Temperature deviations
Feed water Temperature deviations
Source: Efficiency Improvement at State Utilities – Challenges and Opportunities, CII Power Plant Summit, 2013
16
Potential Priority Areas
Technology Transfer, Adaption
and Indigenization
• Identification and implementation of best practices.
• Reduction of air, steam and flue gas leakage.
• Optimization of combustion through understanding of
coal quality and how it burns in the boiler, fine tuning
operational parameters (air-to-fuel ratios), coal
fineness, furnace cleanliness, etc.
• Use of low grade heat for coal drying.
• Co-firing of boilers with multiple fuels.
• Lowering of stack temperature.
• Enhancing fuel flexibility in Indian Boilers.
• New technology adaption in efficiency and
performance improvements including carbon capture &
sequestration
O&M Practices & Technologies
• Optimization of processes using advanced
computational tools.
• Conduct on-line, real time monitoring of performance.
• Standardization of performance metrics.
• Development of solutions for issues on seals on air
heaters, condensers, boilers, tube components, etc.
• Use of variable speed motors,
• Use of flue gas conditioning heat exchangers.
• Implementation of intelligent soot blowing system.
• Upgrading turbines.
• Routine performance testing of critical equipment.
• Improved performance of condenser, cooling tower,
boiler feed and CE pumps, FD&ID fans, ESP, etc.
• Proactive maintenance.
• Loading profile and impact on plant efficiency
First solution with IHRA IPR to be developed by end 2016
and commercialized by 2020
17
Aims of Working Groups
•
•
•
•
•
•
Identify, prioritize and select operational and technological/ engineering
solutions for development and implementation in select Indian utilities.
Foster partnerships between utilities, service providers, OEMs and other
stakeholders in the planning and implementation of utility solutions.
Guide the design, development and pilot testing of the utility heat rate
improvement measures, practices and technological solutions.
Monitor and evaluate the impact of the pilot projects on the utility’s technical
and financial performance.
Authorize and certify the progress report on the impact of the operational and
design solutions on the utility’s performance; disseminate widely the findings
of the pilot projects, and
Provide strategic guidance and direction to the IHRA and members of the
utility solution project consortium (eg. Service providers, OEMs, Utilities, R&D
labs, etc.) on issues related to licensing and ownership of the Intellectual
Property Rights (IPR)
18
Model Power Plant Program
Demonstrations and Skills
Why Model Power Plants
• Efficiency interventions follow an one-off, unit by unit
approach.
– Lessons take time to disseminate across the sector and,
– Inaccessible to plant and personnel due to diversity among utilities
and the geographical expanse
There is thus, a need for a common model demonstration unit located at a
relatively easily accessible thermal power station with in-plant facilities for training,
laboratory, communication and data-links as well as “on-line” demonstration of
technologies.
20
EPRI Model
• Model Power Plants
(MPP)
– Monitoring & Diagnostic
(M&D) Center at
Philadelphia Electric Power
Company (PEPCO)
– Instrumentation and
Controls (I&C) Center at
TVA’s Kingston Plant,
– Heat Rate Improvement
Center at Potomac Electric
Power Company
• Functions of MPP
– Venue for training and
workshops
– Showcase of innovative
technologies and
operational solutions;
– Testing, standardization and
certification of processes
and products;
– Site for market driven,
collaborative R&D projects
– Hardware/tool lending
facilities
21
Profile of Power Plants in India
• CEA estimated 490 thermal power plant units (as on Mar 31, 2012)
– 25 to 800 MW of capacity and have varied problems and solutions
• 46% of units producing 46% of national generation have 195-250 MW capacity
• 37% units producing only 15% of national generation have 25-150 MW capacity
• 17% of units producing 39% of national generation have a capacity of 500 MW
or more
• 67.7% of the total operating coal based thermal units have exceeded their midlife (> 15 years) while 46.2% have exceeded their operational life (> 25 years)
• 52.4% of the total capacity (MW) of coal based power has exceeded their midlife (> 15 years) while 28.6% has exceeded the operational life (> 25 years)
Utility members will be requested to offer and earmark representative
units with capacities of 210 MW, 250 MW, 500 MW and 660 MW to serve
as model power units
22
Aims of Working Groups
•
•
Identify, prioritize and select model power plants for heat rate technology and operational solutions
demonstration.
To assist in the program design and costing of the model power plant demonstration projects.
Specifically, the WG will consult and deliberate on the following:
–
–
•
•
•
•
•
•
•
expectations from the proposed MPP unit as a site for pilots and for training & knowledge sharing
accrual of monetary benefits and resolution of IPR issues to the utility and its partners hosting the MPP.
To advise on the methodology, criteria & number of selected stations and units. The Working Group
will need to explore establishing multiple model units on the basis of capacity or choice of model units
that have a functional focus similar to the approach followed in the US by EPRI.
Discussions with utilities to secure buy-in for designating the identified units as MPPs; Selection of 36 units based upon the agreed criteria
Determination of broad budgetary requirements for designated MPPs and funding mechanisms
Foster partnerships between utilities, service providers, OEMs, National Labs and other stakeholders
in the design and conduct of market driven consortia R&D projects. .
Guide the design, development and pilot testing of the utility heat rate improvement measures,
practices and technological solutions.
Monitor and evaluate the impact of the model power projects on the spread and dissemination of best
practices in the country
Provide strategic guidance and direction to the IHRA and members of the utility solution project
consortium (eg. Service providers, OEMs, Utilities, R&D labs, etc.) on issues related to licensing and
ownership of the Intellectual Property Rights (IPR)
23
Service Provider
Development Program
Wide-scaling Run & Repair Services
Potential & Challenges
• Potential
– CEA estimates that “run-repair-replace’ for R&M/LE during 2012-22
will require investments of Rs. 555-855 bn
– Compliance of Perform Achieve Trade Scheme
• Significant challenges
– Non availability of competitively priced, modern, state of the art
services and products
• services are available internationally usually through small and medium scale
service providers at prices that are competitive in developed countries
• such service providers do not typically exist in India
• international service providers can be contracted by Indian utilities, the costs
are exhorbitant and therefore not financially viable in the Indian context
– BTG manufacturers/OEMs focus on on green-field capacity
addition or replacements
“Run and repair” market remains small with a huge un-estimated
potential
25
Conclusions from Round-table for Service
Providers and Original Equipment
Manufacturers
• MSMEs provide a range of thermal efficiency related services in the
developed markets.
– Many MSMEs established by former employees. India has very few such
service providers. They face significant barriers:
• Lack of recognition by utilities and misconstrued competition by OEMs
• Utility procurement practices that does not recognize start-ups/new enterprises
or have entry barriers like financial creditworthiness and/or proven institutional
track record
• Lack of dedicated budget lines in utilities for promotion of efficiency
• Expanding the pool of heat-rate service providers needs a nurturing
eco-system
– Encouraging former employees to turn entrepreneurs and establish
enterprises
– Facilitating partnerships or franchisee agreements between international
service providers and Indian entrepreneurs
– Creation of a platform that can assist service providers to network and
market their skills and products
26
Aims of Working Groups
• In discussion with utilities, identify and prioritize solution areas for
which service providers are immediately required
• Identify priority solutions areas for which service providers are not
available in India but are available abroad
• Initiate discussions with 3-5 international service providers on their
plans to establish a base in India.
• Foster partnerships between these international service providers and
Indian entrepreneurs for establishing indigenous
enterprises/franchisees
• Create awareness amongst utilities on availability of indigenous
service providers and the need to develop procurement frameworks to
contract them
• Guide IHRA to develop model/standard documents for procurement
and contracting of various services
27
Finance & Sustainability
Potential sources of revenue






Membership fee
Seed money
Participation fees for training programs
Sponsorships for events
Management fee for collaborative/ consortia research,
Fees from consulting services, IPR and/or technology
commercialization
29
Challenges & Support required for IHRA
 IHRA expected to break even in year 6
 Activities of Learning by Sharing & Business Development Councils will start generating a
surplus from year 1 itself
 Risks: Low
 Solutions developed by Applied Research & Technology Council expected to be commercialized
with IHRA revenues from year 5
 Risks: High
 IHRA’s sustainability
 Need for international collaboration and partnership for technology transfer
 Capacity building for the IHRA team both in terms of technical and managerial capability through
 Understanding the functioning & focus areas of EPRI, VGB, Jcoal & similar organizations
internationally
Needs gap funding of nearly Rs. 3 Crores in the first 5 years
Will generate surplus of around Rs. 1 Crores in years 6-8
30
Thank You