Global energy conglomerate GE Power says it is keen to offer its market-leading Ultra Super-Critical clean coal technology to help the Sultanate take its maiden plunge into coal-based power generation as part of its diversification away from predominantly gas-based generation.
Leading international developers and technology providers are in contention for a contract award to build Oman’s first coal-based Independent Power Project (IPP) — a 1,300 MW scheme planned at the Special Economic Zone (SEZ) in Duqm on the Sultanate’s southeast coast.
The Oman Power and Water Procurement Company (OPWP), the sole procurer of new capacity under the Sector Law, is currently evaluating prequalification documents submitted by interested firms vying for a licence to build the ambitious development. The Duqm Clean Coal IPP is expected to provide 600 MW by 2024 and 1,200 MW at full power in 2025, assuming timely approvals. The plant will provide essential power supply to the developing Duqm industrial hub, and export surplus capacity to the country’s main grid.
OPWP has stressed that the Duqm Clean Coal IPP “will meet the most current international standards for environmental quality and emissions control”. Final regulatory approval is anticipated in the coming weeks, paving the way for a Request for Proposals (RfP) to be issued before the end of this year.
GE Power, which is the technology provider for the Gulf region’s first coal power project — the 2,400 MW Hassyan plant currently under execution at Saih Shuaib in Dubai — says it is eager to support Oman’s power generation goals based on clean coal as a fuel resource.
The Sultanate, says a key GE Power executive, is expected to opt for coal power technologies that offer exceptional efficiency while also limiting harmful emissions. “We haven’t seen the specs yet, but from the standpoint of the project’s requirements and environmental footprint, OPWP will play an important role in the choice of technology because it’s a balance that bidders have to find to optimise the tariff as much as possible, while at the same time, comply with the specs,” according to Dr Sacha Parneix, Commercial General Manager for GE Steam Power Systems covering the Middle East, North Africa & Turkey (MENAT) region.
Dr Parneix believes that Oman is expected to apply very stringent emissions requirements as a key project prerequisite. “Let’s see how stringent they are and the technology will automatically adapt. But looking at the competition that was active on the Hassyan Clean Coal Project in Dubai, it’s very likely that efficiency and low emission tech will be applied in Oman as well,” he stated.
Speaking to the Observer, Dr Parneix said GE Power’s Ultra-Supercritical (USC) technology enables the power plant to run at a higher steam temperature and pressure than traditional coal-fired plants, thereby improving the plant efficiency and decreasing stack-emissions.
“From an environmental point of view, we are making power generation based on coal cleaner to a point where it is equivalent to gas-based power generation. And from a global point of view, we are looking to make it much more efficient with a lower carbon footprint that the average coal fleet installed around the world, mainly in North America, Europe and China.”
GE Power sees emissions standards being set by the new Hassyan Clean Coal Project in Dubai — the first phase of which will commence operations in 2020 — as surpassing guidelines already set by the Organisation for Economic Cooperation and Development (OECD), European Union (EU) and the World Bank. “Right now, the Dubai project is setting new standards, which are much lower — they may be called Dubai Standards perhaps,” he remarked.
Dr Parneix also sees countries like Oman — among others in the wider region — making a long-term commitment to coal-based power generation as part of their efforts to achieve a diverse energy mix.
“It’s the scheme of things in countries in the Gulf; When you get into a power project regardless of the fuel, it’s always a long-term commitment from the country. This is ruled into a Power Purchase Agreement (PPA) that the private investor will sign together with the government to have some guarantee that the power output will be purchased by the government. That’s valid for all technologies — gas, wind, coal, and so on — at least that’s how the grid system works in the GCC.”
Asked if countries embracing coal would have to necessarily make a larger commitment to coal power generation to benefit from, say, economies of scale, Dr Parneix stated: “Not necessarily! This is a project specific commitment — it doesn’t have to be an enormous commitment beyond (what is planned). As a fuel resource, coal is available in all continents with an abundance of supply. You don’t have to link your project with one specific source market and thereby risk constraints in terms of long-term commitments. That’s not needed at all. There is enough competition today to make sure you have enough access to coal affordably and reliably.”
Oman’s fuel diversification policy envisions up to 3,000 MW coal based capacity to be developed by 2030.
[Next: Why coal power generation makes sense for relatively gas-rich countries like Oman: Part 2]