T&TEC

T&TEC AND GE

SMART POWER FOR TOBAGONIANS

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INTERVIEW: T&TEC AND GE

SMART POWER FOR TOBAGONIANS Sustainable Business Magazine speaks to Courtenay Mark, Chief Technical Officer at the Trinidad and Tobago Electricity Commission (T&TEC), Carlos Mousadi, Regional Managing Director for Central America and the Caribbean at General Electric (GE), and Ramon Ortiz, Regional Sales Manager for the Caribbean at GE, about a major generation project in Tobago, and how natural gas-based generation is making the Caribbean energy landscape better-suited for renewables.

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If you were on the Caribbean island of Tobago in November 2018 and you watched television, or used a microwave, or switched on an electric light, you probably wouldn’t have noticed anything had changed. That’s the nature of our relationship with electricity in the 21st century: it is a constant, invisible partner, only noteworthy in it in its absence.

But something had changed. Over the course of the month, a new GE LM2500 aeroderivative gas turbine – the first gas turbine in Tobago’s history – had been installed at the Trinidad and Tobago Electricity Commission’s (T&TEC’s) Cove Power Station, near the south-western tip of the island, and was quietly supplying 20MW of

electricity to Tobago’s grid. Unnoticed by the ordinary consumer at home or work, almost overnight, Tobago’s electricity supply had become more reliable, more flexible, and more sustainable ANTICIPATING DEMAND For the last few years, Trinidad’s demand for electricity has remained fairly constant, with a system peak fluctuating between 1350 and 1400MW, and a well-equipped, resilient grid able to comfortably meet demand. Trinidad’s twin island of Tobago, however, is another story. Though only around 60,000 people live on the island, in recent years, international investors have shown interest in some significant new developments in Tobago, from new

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INTERVIEW: T&TEC AND GE that cable were to fail, the island needs to be sufficiently self-reliant to keep itself going.”

To prepare for these eventualities, T&TEC issued a tender for an additional generator at the island’s Cove Power Station. Ultimately, T&TEC selected General Electric’s LM2500 aeroderivative gas turbine. “We have been in Trinidad and Tobago since the 1950s,” explains Ramon Ortiz, Regional Sales Manager for the Caribbean at General Electric (GE). “Our technology provides 79% of the installed generation at present, most if not all of which is gas turbines. So we have a longstanding and strong relationship with T&TEC.” hotels to a major airport expansion. “We at T&TEC recognized these trends towards greater interest in Tobago,” says Courtenay Mark, Chief Technical Officer at T&TEC. “We currently have adequate installed capacity to meet Tobago’s needs, but if additional loads come onto the system, we want to be prepared. Tobago is also connected to Trinidad by a submarine cable, which is over thirty years old and is approaching end-of-life. If

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RELIABLE TECHNOLOGY The LM2500 is derived from aviation turbines, which are required to be extremely reliable – a necessity for a power plant in the Caribbean, where extreme weather is a regular hazard. The LM2500 turbine is capable of being safely stopped and started several times without failing. It also has low water consumption, and, by using

natural gas and a Dry Low Emissions (DLE) upgrade, is much lower-emitting than other fossil fuel-based alternatives.

“We went for the LM2500 because it’s a well-proven workhorse in the industry,” says Mr. Mark. “GE has other turbines on the system in Trinidad. There’s also a large liquefied natural gas facility on the island, which is self-powered using GE turbines. So GE has a very good reputation here, and we went for tried, tested, and proven technology. We now have a combination of reciprocating engines and this gas turbine running side by side.”

“They need that reliability on a small island,” explains Carlos Mousadi, Regional Managing Director for Central America and the Caribbean at GE. “When it’s needed, it must operate as expected. Then there’s the power density, the emissions, and the low lifecycle costs. It’s also highly scalable.

While at the moment they have 20MW, they can bring it up to 40MW if they need to in the future just by changing the core engine, which gives them greater flexibility. The oth-

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er important thing is that you can just start it, and you don’t have a time penalty. With an industrial gas turbine, when you start it, it takes hours. With an aeroderivative, you can start it as many times as you want it.”

NEW OPPORTUNITIES In the year since the LM2500 was installed at the Cove Power Station, Tobago is already seeing an increase in demand for electricity.

“There is a local quarry operation with crushing plant operations which is ramping up production now,” says Mr. Mark. “Because of the new turbine, the electricity is available for

that. The infrastructure is in place to ensure there will be no shortages on the island.

Now, even if the undersea cable were to go down, the island can be electrically independent. With the availability of natural gas, it also makes it efficient to generate electricity in an environmentally-friendly way.”

Another impact of the new turbine is improvements to the skillsets of T&TEC’s Tobagonian employees. “Our local technical people on-island are learning very quickly, both in terms of the mechanics of the infrastructure as well as the electrical and control system,” says Mr. Mark. “It’s making Tobago

a bit more self-sufficient. Whereas before, there were certain overhauls where we depended on external providers, now our local guys are getting tooled up, getting training, improving their knowledge, and we’re able to support them with our team in Trinidad.”

Advances in IT have allowed Tobagonian operations to be monitored from Trinidad, and knowledge can now be shared more effectively throughout the organization.

“Because of our internal telemetry, we can remotely see what’s happening over there, and the communication and fibreoptic networks mean T&TEC can be self-reliant in our comURECON / LOGSTOR

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INTERVIEW: T&TEC AND GE

“WE AT T&TEC HAVE BEEN FOCUSING ON STRENGTHENING OUR INFRASTRUCTURE TO BE RESILIENT AGAINST DISASTERS”

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SDV Energy and Infrastructure, S.L.

is an international group, born in Latin America and administrative head office in Madrid, Spain, and operational offices Brazil, Venezuela, Colombia, Trinidad & Tobago, Peru, Chile, Honduras and Mexico dedicated to the engineering, procurement, construction and maintenance of projects in sectors related to energy and infrastructure in Latin American countries in operations since 1989. Through its subsidiaries, or by itself, SDV energy and infrastructure, S.L. has executed construction work in countries such as Brazil, Chile, Colombia, El Salvador, Guatemala, Honduras, US Virgin Islands, Mexico, Nicaragua, Peru, Dominican Republic, Trinidad & Tobago and Venezuela, with over 30 years of experience serving our customers.

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munications between islands,” says Mr. Mark.

“But now, we’re seeing Tobago become sufficiently resourced to do their own planning, troubleshooting, operations, maintenance, and backing up their maintenance scheduling.

It is a real success story. One of the services provided by GE under our agreement is also external monitoring, so their equipment is monitored 24/7, and we receive reports if any limits are exceeded. They also provide online support, parts servicing, and routine inspections and maintenance.”

SUPPORTING GREEN Another advantage of aeroderivative turbines like the LM2500, because of their ability to be quickly stopped and started, is that they can provide base load power in an energy environment which uses intermittent sources like solar or wind, making the LM2500 an effective support for renewables. T&TEC currently has a tender out for 130MW of grid-connected solar power – power which will be supported by pre-existing GE turbines. “This solar capacity will interconnect to our existing system in Trinidad, and will obviously save on fuel as well as emissions associated with hydrocarbon fuel,” says Mr.

Mark. “Because of our low electricity rates, it isn’t very attractive for domestic customers to invest in rooftop solar panels, so we’re investing at the grid level.”

“As the Caribbean invests more in renewables like solar and so on, we’re deploying more equipment capable of stabilizing the grid, like the LM2500” says Mr. Mousadi.

“We’re also offering an integrated package with energy storage as well, the LM6000, which we have already deployed in California. In combination, the gas turbines and the energy storage will help grids to increase renewable penetration.”

PROMOTING GROWTH “What these Caribbean markets have in common is they’re converting the fuel matrix from heavy fuel oil to natural gas,” says Mr. Mousadi. “First for environmental reasons, because there’s lower emissions, but also right now natural gas is competitively priced. There’s a lot more competition now in natural gas, which used to be difficult to deploy. Also, the fuel suppliers are going much more downstream. They want to own their own power plants. When you travel in the Caribbean today, you see a big change

in the market. At the conferences, there are now many natural gas fuel suppliers, which is great for everyone.”

“I don’t see in the immediate future any great need for generation expansion,” says Mr. Mark. “We at T&TEC have been focusing on strengthening our infrastructure to be resilient against disasters. This means we’ve been improving our grid and our relationships with external suppliers for various services in case of a disaster. The Cove Power project is just one part of this. Today, the reliability on Tobago has increased as a result of the LM2500, and should additional loads come on the system, we are well-prepared to deal with that in the future.” c

COURTENAY MARK, CHIEF TECHNICAL OFFICER, T&TEC

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THE CARIBBEAN BECOMES A HOT SPOT FOR RENEWABLE INFRASTRUCTURE INVESTMENTS According to Bloomberg’s New Energy Outlook 2019 report, wind and solar power plants now generate the cheapest energy across more than two thirds of the world.

What’s more, conventionally produced electricity from coal and gas plants is expected to be more expensive than that of its renewable counterparts, especially wind and solar, almost everywhere by 2030. One of the regions that will be particularly affected by the energy transition is the Caribbean.

Energy supply on the Caribbean islands is heavily dependent on fossil fuels. The Council on Hemispheric Affairs points out that 87 percent of energy production in the region is based on the use of imported diesel or oil. In spite of the heavy dependency on energy that is produced by fossil fuels, the Caribbean, home to ample natural renewable energy resources, provides the perfect conditions for generating clean energy. There are more than enough solar, wind, geothermal, and hydropower resources that could make the islands largely independent of fossil fuels. The Caribbean nations are signaling that they are ready for a radical change in energy policies that is bound to catapult them to the forefront of a renewable energy revolution.

A REGION OF CLEAN ENERGY PIONEERS The Caribbean has set itself ambitious goals to reduce the need for CO2-emitting fossil fuels and improve its energy independence.

Concretely, governments are planning to diversify their power mix and steadily increase the renewables share of electricity generation. The forerunners when it comes to implementation include Jamaica, the Dominican Republic, Saint Kitts and Nevis, and, to a lesser extent, Antigua and Barbuda.

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Several countries in the Caribbean already announced stronger renewable energy policies last year. Barbados, for example, aims to be 100 percent reliant on renewables by 2030, while Jamaica has pledged to reach 50 percent renewable energy generation by 2030. Jamaica is also expected to complete its Integrated Resource Plan (IRP) by the end of this year. The IRP aims at creating planning certainty by assessing the needs of the electricity sector. It’s the governments’ willingness to drive renewables forward that makes clean energy generation a viable alternative in the region.

Collaborations between governments and the private sector are essential in that regard. They not only enable the countries to meet their objectives within the set timeframe but also allow them to implement the necessary changes smoothly. By means of public-private partnerships (PPPs), renewable energy projects can reach completion much sooner and within budget – thus preventing nasty surprises along the way. The private partner’s vast experience in managing renewable energy assets represents another major advantage. It’s fair to say that some projects wouldn’t even be possible in the first place if it wasn’t for PPPs. Jamaica’s Paradise Park, commissioned in June 2019 and with 51 MW the largest solar PV park in the English-speaking Caribbean, can serve as a prime example of the benefits that can be achieved with renewable energy investments in the region. The facility has a 20-year agreement with the Jamaica Public Service Company (JPS), where JPS will purchase all electricity generated by the facility at 0.085 USD/kWh. Considering the usual costs for conventionally produced energy, which typically range between 0.15 and 0.44 USD/kWh, Paradise Park represents the

cheapest energy provider in the country. In fact, the solar PV project demonstrates that renewables can compete with conventional electricity sources.

Paradise Park was the seed asset for the MPC Caribbean Clean Energy Fund LLC (“the Fund”), in which the regional investment vehicle MPC Caribbean Clean Energy Ltd. participated. The former provides clean energy investment opportunities in Jamaica, Barbados and the wider Caribbean region.

Both the Fund and MPC Caribbean Clean Energy Ltd. were initiated by MPC Renewable Energies GmbH, a wholly owned subsidiary of MPC Capital AG. BRIGHT FUTURE FOR INVESTMENTS IN RENEWABLE INFRASTRUCTURE It’s companies like MPC Caribbean Clean Energy Ltd. that foster the transition towards renewable energy generation in the Caribbean.

MPC Caribbean Clean Energy Ltd. also makes a case for the enormous potential of clean energy assets in the region as it has recently distributed its first dividend, only nine months after the IPO in December last year. With USD 0.089 per share, MPC Caribbean Clean Energy Ltd. is one of the top dividend-paying stocks on both the Jamaica and the Trinidad and Tobago stock exchange. The total distribution amounted to USD 1,014,877.4 and exceeded initial predictions by 4.1%.

Such developments don’t go unnoticed.

As Caribbean islands are increasingly turning to renewables, a rising number of investors are directing their attention to lucrative clean energy projects in the region – the need for funding to build and operate solar PV parks and wind farms has clearly boosted investor interest. Buckle up as renewable infrastructure investments in the Caribbean are about to take off. c

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