Station A

State-of-the-Art Sustainable Power

In February 2019, Bahamas Power and Light Company Ltd. (BPL) announced the signing of a contract with Finnish technology group Wärtsilä to build a new 130-megawatt (MW) $95M power plant in the existing Station A building at the Clifton Pier Power Station. The new plant will be capable of burning Heavy Fuel Oil (HFO), Diesel Oil (DO), or liquefied natural gas (LNG) when it becomes locally available. This operational flexibility is an important step to ensuring energy security and cost stability for The Bahamas.

Station A is Now Online

Prime Minister Dr. Hubert Minnis, together with Cabinet ministers, Members of Parliament and other Government representatives, joined the Board of Directors of Bahamas Power and Light Company Ltd. (BPL) along with BPL executives and some of our larger customers on Friday, 20th December 2019 to celebrate Station A putting 132 megawatts of new, high-efficiency, lower-cost power to the New Providence grid. The plant came online Sunday, 15th December 2019 meeting the deadline set by BPL and Wӓrtsilӓ.

“These engines are state-of-the-art,” said BPL CEO Whitney Heastie. “These engines dramatically increase our generation capacity and will allow us to take other engines off the grid for critical maintenance without impacting our energy supply. Importantly, we will now have excess capacity in our system so, come summer, when peak demand is around 260 megawatts, we will have over 300 megawatts of available power.”

Our Chairman, Dr. Donovan Moxey, said, “The new power plant is a reality and is providing power to the Bahamian people. The launch of Station A is a critical component of our turnaround strategy – provide cleaner, more reliable power to help put an end to summers of load shedding and grow our economy.”

“Everything we are doing at BPL is about righting the ship and fixing the historical problems that have plagued this utility,” Moxey continued. “The problems can’t be solved overnight but today is a clear indicator that we are making very real progress that is going to positively impact the lives of our customers. I’m very proud of the team here at BPL for their hard work and I’m honored to have the Prime Minister and members of the Government joining us today.”

At the completion of the project – scheduled for December 2019 – BPL customers will see a substantial improvement in the power generation reliability in New Providence, and equally welcome, lower fuel costs on their monthly billing. Two factors will influence the lower fuel charges: the use of more efficient generation and the ability to burn lower price fuel. Additionally, BPL will then own sufficient generating assets to finally begin to close the chapter on rental generation in New Providence which began in 2011.

The Engines

The Wӓrtsilӓ 50DF engine is designed to give high output with fuel flexibility, low emissions, efficiency and reliability, and can burn natural gas, light fuel oil (LFO), or heavy fuel oil (HFO). The engines can smoothly switch between fuels whilst operating, and are designed to provide the same output regardless of the fuel. The new plant at Station A will be anchored by seven of these engines.

A major feature of the new engines is the heavy reliance on electronic control. The engine functions are controlled by an advanced automation system that allows optimal running conditions to be set, independent of the ambient conditions or fuel type.

Goals

Station A was decommissioned in 2016. In order to prepare the engine hall for its new life, BPL had to dismantle and remove the four decommissioned two-stroke diesel engines that had been in place since they were commissioned in the 1980s, along with the auxiliary works that supported them. This was completed in February 2019. The civil engineering works required to prepare the site for the new plant were completed in May 2019.

The Big Picture

Ultimately, the new plant is expected to form part of the 220MW power station to be built by Shell NA envisaged in the Memorandum of Understanding between BPL and Shell. Indeed, Shell was instrumental in BPL’s selection of Wӓrtsilӓ to build the power plant. Wӓrtsilӓ was hired on an engineering, procurement and construction (EPC) basis. In this form of contracting arrangement, the contractor – in this case, Wӓrtsilӓ – is responsible for all the activities from design, procurement, construction, to commissioning and handover of the project to the end-user, in this instance BPL, and in due course, Shell NA.

Benefits

The new plant is expected to begin pushing power to the grid by the end of 2019.

The new plant will eliminate BPL’s dependence on generation rentals, which cost the government and people of The Bahamas millions per year. The new plant adds 130 MW of new, highly efficient, tri-fuel generation and maximizes the use of Station A. With the completion of Station A, Clifton Pier Power Station will be returned to the status of baseload station, which will ensure the newest, most efficient engines are first use, increasing the use of HFO and leading directly to a lower fuel charge to the customer.

The new plant will also greatly improve generation stability, moving BPL further along the path to complete energy reliability.

Engines – Logistics

The engines arrived in Nassau on May 6, 2019.

The refit of Station A was a logistical tour de force. As the ship carrying the seven Wärtsilä 50DF multi-fuel engines crossed the Atlantic from Finland, crews were hard at work prepping the hall at Station A.

Over the next six months, BPL and Wärtsilä were engaged in a complex, delicate dance which required near absolute perfection to pull off. In broad strokes, the dance started with getting Station A ready, which included pouring new foundations for the new engines. This required more than 2,000 cubic yards of concrete – that’s 200 trucks of concrete! – and was the main feature of the preparation of the engine hall. Next came delivery of the engines, followed by placement – a production in itself – and then delivery and set up of the auxiliary equipment.

The placement of the engines began with getting them off the ship at the port. Special equipment was used to effect the transfer. This task required such precision that the engines were transported at walking pace – two miles per hour! – from the port to the hall through the night along a pre-mapped route. The engines were transported aboard a special vehicle – itself a technical marvel – driven by remote from behind. The transfer from the port to the hall, at that pace, took about nine hours, with the team walking the engines the entire route. To place all seven engines took 23 days.

The engines are scheduled to be tested and commissioned in December 2019.

How soon can consumers see a reduction in the cost of electricity in their bill?

The fact is that the engines are going to be powered by heavy fuel oil initially, until LNG becomes available. The price of heavy fuel oil is significantly lower than the price of diesel. Once the engines come online, residents of The Bahamas can expect to see prices go down in the fuel charge.

By what percentage will consumers see their fuel charge go down?

The fuel consumption today is about 80% diesel and 20% heavy fuel oil. We’re going to shift from being a more diesel-burning entity to being a heavy fuel oil-burning entity. We anticipate that the fuel charge will drop significantly, especially since the new plant will be base loaded. It will be first dispatched before other units are dispatched.

Where is BPL getting the $95M?

When the fire happened in 2018, we were newly into the fiscal year, and we were able to push aside a lot of the capital projects that we were planning on doing to make the new generation possible, knowing that we would have to put in generation to supplement the loss of the 63 MW at Station C. So the great percentage of the money is coming from capital works that were deferred in favour of this new generation.

We had to reprioritize.

Clearly, when you’re financially constrained, you have to make decisions that are not always the easiest decisions to make. You have to look at an order of priority, so works that mitigate things that are going to negatively impact our customers, we simply say, “We’ve got to get those done.”

How much did BPL pay for rental units last year?

We pay significant costs for rental units. It’s a little less than $2M a month, so you can see the Bahamian people are paying a significant amount of money for rental units. The important thing for us is that when Station A is up and running, we really can close the chapter on rental units. That’s what we focus on more than anything else, because it’s a cost to the Bahamian people that really, they should not be bearing.

Does this plant mean we see the light at the end of the tunnel regarding blackouts?

The plant will experience upwards of 99.9% reliability because of the way it is constructed. Customers will see a dramatic reduction in generation-related outages.

How will we maintain the reliability of this new equipment?

There are four really critical things on these assets.

  1. We’re dealing with a high-efficiency engine, higher than anything we have in the fleet today.
  2. The assets burn the cheapest of oils that is available on the market today, even cheaper than gas.
  3. We can get more power out of one barrel of that oil than we can get out of a barrel of diesel or gas, so it’s even that much more efficient from that perspective.
  4. Lower maintenance costs. These engines are known to not cost as much when you provide the maintenance.

So when you combine all those together, your operating costs goes down.

Also, we are not going to be operating these assets. BPL is moving away from owning and operating generating facilities. So there will be Key Performance Indicators (KPIs) that a service provider is going to be mandated to provide to us so that we know such things as maintenance, reliability and efficiency are being adhered to on these assets. So it’s not just a matter of turning the assets over to anybody, but it’s also making sure that KPIs are met.