Phishing For Phools -- December 8, 2015

Updates

December 20, 2016: the Freeport terminal is on-line; first shipment sailed December 16, 2016.

Later, 12:21 p.m. CT: see first comment. Just after receiving that comment, I saw this story. Phillips 66 commissions a 100,000 b/d NGL factionator in Texas -- 

Phillips 66 Co. has commissioned a 100,000-b/d NGL fractionator near its 247,000-b/d Sweeny refinery in Old Ocean, TX.

Supported by 250 miles of pipelines and a multimillion-barrel storage cavern complex, Sweeny Fractionator One is now producing purity ethane and LPGs that deliver via pipeline to local petrochemical customers as well as to the market hub at Mont Belvieu, TX.

The company said it expects to begin LPG deliveries to international markets once it completes the 150,000-b/d LPG export terminal at Phillips 66’s existing marine terminal in Freeport, TX.

The Freeport LPG export terminal, which will have an initial export capacity of 4.4 million bbl/month, remains on schedule for startup during second-half 2016.

At a combined capital investment of more than $3 billion, Sweeny Fractionator One and the Freeport LPG export terminal will connect to a 100,000-b/d de-ethanizer unit to be installed at the Old Ocean site that will upgrade US propane for export  

December 8, 2015: here's another example of the cost of new natural gas projects. Seeking Alpha is reporting on the Caithness Moxie Freedom power plant in Luzerne County, PA, the first plant using GEs high efficiency 7HA.02 gas turbines to be project financed.

The 1,029 megawatt (MW) plant will be able to generate the equivalent power needed to supply approximately one million US homes.  

GE Energy Financial Services and its co-leads arranged $592 million senior secured credit facilities to support the Caithness Moxie Freedom Projects construction and operation, with eight other banks in the syndicate. 

I don't know if this is the total cost of the project, but if so, $592 million / 1,029 MW = $575,315 / MW.

Compare that with $6 million / MW that the Minneapolis folks paid for a few MW of solar energy at their airport.

Also note the efficiency of these turbines:

GEs HA gas turbines are the worlds largest and most efficient at more than 61% combined cycle efficiency, and lead the industry in total life-cycle value. HA technology provides cleaner, reliable and cost-effective conversion of fuel to electricity.

Compare that to the load factor of solar energy: 9%.

Original Post

 

Finally some good news coming out of Minnesota. This is a nice story coming out of Minnesota because it gives us current cost estimates for a new natural gas plant vs solar/wind.

PrairieBizMagazine is reporting:

Minnesota Power is moving forward with plans to build a major natural gas-fired power plant, accepting bids through January from multiple companies in an ongoing push to move away from coal.

The utility is expected to negotiate with multiple bidders in 2016 for the plant which could be built anywhere in the Upper Midwest -- not necessarily in northern Minnesota, but within the Midwest electric grid system, company officials said.

Specifications require the proposals to be between 200 and 400 megawatts, and the facility -- essentially a large gas turbine that would fire to create electricity when demand requires -- will cost from $300 million to $400 million to build, said Al Rudeck, Minnesota Power's vice president of strategy and planning.

$400 million / 400 WM = $1 million / MW. At $300 million / 400 MW = $750,000 / MW.

Compare that to the $7 million / MW that airports in Minnesota and Wisconsin are spending for solar and then then this:

From an August 25, 2014, post, this is 30-second sound bite for "cost of renewable megawatt":

• Solar: $3 million / MW
• Wind: $2.5 million / MW
• Natural gas: $865,000 / MW

It looks like the numbers haven't changed much, except for the hobby projects at Minnesota and Wisconsin airports. Note the data about solar load factor at this post. 

Phishing for Phools.

*******************************

Phishing For Ohio Phools

When I read this article sent to me by Don, I had to laugh.

My comments back to Don:

I had to laugh -- as soon as I saw the size of the project: 20 MW.

• 20 MW with local utility committed to buy 5 MW
• $120 million
• $6 million / MW
• Phishing for Phools

The good news: the fish will have no shortage of dead-bird parts to feast upon.