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Released January 18, 2018 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Duke Energy Corporation (NYSE:DUK) (Charlotte, North Carolina) plans to spend about $200 million to convert four coal-fired units at two stations in the Tar Heel State to burn partly or entirely natural gas.
Three of the affected units--the James E. Rogers Energy Complex Unit 5 and Belews Creek units 1 and 2--began commercial operations in the 1970s and still have economic value, which is why the utility is converting them to burn gas instead of demolishing them, Duke spokesperson Kim Crawford said in an interview. Rogers Unit 6 began operating in 2012. The Rogers plant, formerly known as the Cliffside Steam Station, also was home to four smaller units (1-4) that were retired in 2011.
Crawford said the plan is to modify the Belews Creek units to burn up to about 50% natural gas. Rogers Unit 5 will be modified to burn up to about 40% gas. That plant's Unit 6 will be converted to burn 100% gas. "As part of our long-term planning, we are implementing dual-fuel optionality across our coal fleet, where it is in the best interest for our customers," she said.
"The benefits of these modifications include reducing carbon dioxide emissions, which aligns with our long-term strategy to continue reducing our environmental footprint; fuel savings to our customers by using the lowest-cost fuel on a daily basis; increased flexibility to manage future coal and gas cost uncertainties; and more flexibility to adapt to growth in renewable generation," Crawford added.
Belews Creek is a two-unit, 2,240-megawatt (MW) station in north-central North Carolina. Rogers Unit 5 is rated at 544 MW of generation capacity, while Unit 6 can generate up to 825 MW of electricity, the company said. The Rogers station is located in western North Carolina.
The utility's leadership decided to convert the Rogers units in October 2016, and an air permit was received in September 2017, Crawford said. Duke decided to convert Belews Creek this past August and expects to receive the required air permit in early 2018.
According to Industrial Info's Global Market Intelligence (GMI) Integrated Platform, the construction project at the Belews Creek station has total investment value of about $150 million. No estimate of the cost of the Rogers station project was available, though news reports have placed a combined $200 million value on converting the four units, making construction work at that plant worth about $50 million. For more information, see Industrial Info's report on Rogers project.
Construction at the Belews Creek unit 1 is scheduled to begin in May 2019 and end that fall, while work at Unit 2 is expected to start in mid-2020 and be complete by late-2020. Work at the Rogers complex is slated to begin in March or April of 2018, and finish in September or October of this year.
Duke will not be bidding the engineering, procurement and construction (EPC) work, Crawford said. The utility has awarded contracts for engineering and the firing system supply for both sites, and the construction services will be competitively bid. Bids for construction at the Rogers plant were being prepared in late 2017. Bids for construction at Belews are expected to be released in early 2019, she said in an interview.
Like many electric utilities, Duke has been investing heavily to either install pollution-control equipment at some coal-fired units, or close existing coal-fired units and replacing the lost generation with gas-fired generation, renewables and energy efficiency.
The utility's 2017 sustainability report, released before the Belews Creek and Rogers fuel conversions were decided, said Duke has retired 46 coal-fired units at 18 power plants since 2011, while converting one unit to burn natural gas. The retired units have total generating capacity of 5,254 MW. Looking forward, Duke plans to retire an additional 2,006 MW of coal-fired generation at four stations between 2018 and 2024.
In 2005, Duke's fuel mix was 61% coal and oil, 32% nuclear, 5% gas and 2% renewables. At year-end 2016, Duke's fuel mix has shifted to 34% coal/oil, 34% nuclear, 28% gas and 4% renewables. Looking forward to 2030, the sustainability report said, 36% of Duke's electricity would come from natural gas, nuclear would account for 28% of electricity, 27% would come from coal or oil, and 9% would come from renewables. For more on this, see May 31, 2017, article - Duke Plans $36 Billion in Capital Outlays Over Next Decade.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
Three of the affected units--the James E. Rogers Energy Complex Unit 5 and Belews Creek units 1 and 2--began commercial operations in the 1970s and still have economic value, which is why the utility is converting them to burn gas instead of demolishing them, Duke spokesperson Kim Crawford said in an interview. Rogers Unit 6 began operating in 2012. The Rogers plant, formerly known as the Cliffside Steam Station, also was home to four smaller units (1-4) that were retired in 2011.
Crawford said the plan is to modify the Belews Creek units to burn up to about 50% natural gas. Rogers Unit 5 will be modified to burn up to about 40% gas. That plant's Unit 6 will be converted to burn 100% gas. "As part of our long-term planning, we are implementing dual-fuel optionality across our coal fleet, where it is in the best interest for our customers," she said.
"The benefits of these modifications include reducing carbon dioxide emissions, which aligns with our long-term strategy to continue reducing our environmental footprint; fuel savings to our customers by using the lowest-cost fuel on a daily basis; increased flexibility to manage future coal and gas cost uncertainties; and more flexibility to adapt to growth in renewable generation," Crawford added.
Belews Creek is a two-unit, 2,240-megawatt (MW) station in north-central North Carolina. Rogers Unit 5 is rated at 544 MW of generation capacity, while Unit 6 can generate up to 825 MW of electricity, the company said. The Rogers station is located in western North Carolina.
The utility's leadership decided to convert the Rogers units in October 2016, and an air permit was received in September 2017, Crawford said. Duke decided to convert Belews Creek this past August and expects to receive the required air permit in early 2018.
According to Industrial Info's Global Market Intelligence (GMI) Integrated Platform, the construction project at the Belews Creek station has total investment value of about $150 million. No estimate of the cost of the Rogers station project was available, though news reports have placed a combined $200 million value on converting the four units, making construction work at that plant worth about $50 million. For more information, see Industrial Info's report on Rogers project.
Construction at the Belews Creek unit 1 is scheduled to begin in May 2019 and end that fall, while work at Unit 2 is expected to start in mid-2020 and be complete by late-2020. Work at the Rogers complex is slated to begin in March or April of 2018, and finish in September or October of this year.
Duke will not be bidding the engineering, procurement and construction (EPC) work, Crawford said. The utility has awarded contracts for engineering and the firing system supply for both sites, and the construction services will be competitively bid. Bids for construction at the Rogers plant were being prepared in late 2017. Bids for construction at Belews are expected to be released in early 2019, she said in an interview.
Like many electric utilities, Duke has been investing heavily to either install pollution-control equipment at some coal-fired units, or close existing coal-fired units and replacing the lost generation with gas-fired generation, renewables and energy efficiency.
The utility's 2017 sustainability report, released before the Belews Creek and Rogers fuel conversions were decided, said Duke has retired 46 coal-fired units at 18 power plants since 2011, while converting one unit to burn natural gas. The retired units have total generating capacity of 5,254 MW. Looking forward, Duke plans to retire an additional 2,006 MW of coal-fired generation at four stations between 2018 and 2024.
In 2005, Duke's fuel mix was 61% coal and oil, 32% nuclear, 5% gas and 2% renewables. At year-end 2016, Duke's fuel mix has shifted to 34% coal/oil, 34% nuclear, 28% gas and 4% renewables. Looking forward to 2030, the sustainability report said, 36% of Duke's electricity would come from natural gas, nuclear would account for 28% of electricity, 27% would come from coal or oil, and 9% would come from renewables. For more on this, see May 31, 2017, article - Duke Plans $36 Billion in Capital Outlays Over Next Decade.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
