Gas

Need reliable power? Consider dual-fuel capability

Need reliable power? Consider dual-fuel capability
(Michael Bergstadt, managing director utility consulting, 1898 Co. )

In a world with increasingly frequent severe weather events that may disrupt power supplies, a move to dual-fuel capabilities at power plants may make economic sense.

That was the conclusion of Michael Borgstadt, managing director of utilities consulting for 1898 Co., is a business unit of Burns & McDonnell. He was speaking as part of The New Energy Mix Knowledge Hub, sponsored by American Fire Technologies during POWERGEN International in Dallas.

Borgstadt based his argument on lessons drawn from Winter Storm Uri, which hit Texas and the ERCOT grid in February 2021.

Without assigning blame for the outages which lasted for days and affected thousands of people across the state, Bortgstadt said that market dynamics surround natural gas played at least a role in the crisis. He said that natural gas supply and demand dynamics were out of balance and that gas-fired power plants effectively were curtailed because they could not get fuel. When they were able to secure supplies, they often had to pay extraordinarily high prices.

Those vulnerabilities led Borgstadt and his team to consider options related to firm fuel supplies. Traditional coal-fired power plants once offered some level of security in being able to generate through a prolonged winter storm like Uri. But projections show that coal–and their 30-60-90-day stockpile of fuel–will make up a diminishing portion of the U.S. generation mix within a few years; perhaps 25% of the total.

And while battery energy storage is garnering headlines, Borgstadt said that most applications offer at most four hours of energy supply, far short of meeting a multi-day power crisis event.

Other options that offer firm fuel capability include fuel oil, liquefied natural gas (LNG) and propane. Borgstadt said that each offers pros and cons for power generators. For example, fuel oil is a proven fuel for generation but retrofitting existing technologies can be tough. LNG could be promising, but may come with a big investment on processing equipment and transportation, in addition to boil-off issues. And propane is not always compatible in some gas turbine applications and may lead to as much as a 25% derate in reciprocating engines.

But after considering capital costs, fuel prices and potential market compensation for providing firm power, Borgstadt’s team found that an investment in firm fuel could pay for itself over the course of a single long-duration weather event.

“A dual-fuel option provides both reliability and a rewarding financial opportunity,” Borgstadt said.

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