Special Report Contents

• Comment: Drive towards efficiency

• New direction for Saudi power sector

• Morocco keeps solar target in sight

• Tehran’s dwindling water supplies

Siemens’ recent signing of a $9bn contract with President Abdul Fattah al-Sisi to provide 14.4GW of additional generation capacity is the latest sign of confidence in the ability of the German firm to assist in solving Egypt’s electricity crisis.

Having just completed the expansion of the Attaka power plant near Suez City, one of Egypt’s numerous fast-track generation projects, Siemens inked its biggest ever single deal with the president in Berlin on 3 June. The multibillion-dollar signing was built on agreements made at the Egypt Economic Development Conference in March, where the electricity ministry unveiled plans to develop an extra 54GW of power capacity by 2022.

On track

While there is still much work to be done to agree on the financing for such a large contract, Siemens CEO Joe Kaeser told MEED following the signing that his firm was ready for the challenge. “We have the financial system lined up with our partners – and we have reliable partners,” he said. “It needs to be documented well and it’s important we deliver on time… but this is pretty much the simpler part of it.”

New turbine technology in a combined-cycle plant can almost double the power generated from the same fuel used

Inviting MEED on a tour of the Siemens turbine manufacturing facility in Berlin and nearby testing facilities, the German firm was keen to showcase the latest technologies that will be used in its Egypt projects and elsewhere in the Middle East and North Africa (Mena) region, where clients are increasingly investing in the most efficient generation technology to meet rapidly growing demand for power.

This interest in more efficient power infrastructure is being driven by a combination of rising demand for electricity and concern over access to gas resources. With the exception of Qatar, most of the countries in the GCC are now importing gas, and Egypt has recently become a net importer of the fossil fuel.

While diversifying energy resources used for power generation by moving to alternatives such as renewables and nuclear power is set to become increasingly common in the Middle East in the coming years, gas currently remains the cheapest and most efficient resource for electricity production. Boosting the efficiency of gas power plants and the equipment they contain leads to less fuel being consumed, and this is becoming crucial for governments as they seek to contend with limited gas availability. In addition to the fuel security issue, using more efficient technology decreases the environmental impact of power plants, while reducing operating costs.

Utilities across the region are therefore
turning towards new combined-cycle power plants, and are converting existing simple-cycle facilities to combined-cycle formations.

Unsurprisingly, gas turbines remain the core product at Siemens’ Berlin facility, which has been manufacturing turbines for more than 100 years and has 3,700 staff. But the firm is also aware of the need to keep developing new technology and innovative products.

Evolving technology

“Gas turbines remain central to Siemens’ power business,” Olaf Konig, the firm’s strategic projects gas turbine manufacturing manager, told MEED. “We have been developing turbines in Berlin for a long time, but it is important we keep improving and evolving the technology to improve products and develop new ones.”

Siemens’ newest and biggest utility-scale turbine is the H-Class turbine, which can produce up to 400MW, enough to provide electricity for a city of up to 1.3 million people. The turbine on its own has a 40 per cent efficiency rate and, when installed, can provide a power plant efficiency rate of more than 60 per cent. The first facility to install the H-class turbine, the Irsching power station in southern Germany, achieved a world record energy efficiency rate of 60.75 per cent in 2011.

More efficient turbines result in significant savings, both in terms of economics and damage to the environment

Olaf Konig, Siemens

Compared with the estimated average gas burning efficiency rate of 32-34 per cent for an open-cycle turbine in Saudi Arabia, new turbine technology in a combined-cycle plant can almost double the power generated from the same fuel used. To put this into perspective, a 1.5 percentage point efficiency improvement can reduce gas consumption of a plant by 14,700 tonnes a year (t/y) and reduce carbon emissions by 41,000 t/y.

“More efficient turbines result in significant savings, both in terms of economics and damage to the environment,” says Konig. “That is why even in areas with lots of natural resources, [utilities] are looking at the latest technology.”

As part of its 14.4GW order from Egypt, Siemens will supply 24 H-Class turbines, with each of the three planned power plants – Beni Suef, Burullus and New Capital – set to be powered by eight of these turbines.

Egypt is not alone in investing heavily in the most efficient gas turbine technology. The programme for additional generation capacity up to 2024 that was recently launched by Saudi Electricity Company (SEC) is indicative of the shift in the region towards more efficient combined-cycle technology.

Investment drive

Out of the 47,711MW of additional capacity that SEC plans to develop over the next decade, 36,832MW, or 77 per cent, will be combined-cycle power plants. About 5 per cent will come from converting existing simple-cycle power plants to combined-cycle facilities, and just 1 per cent of the new schemes planned in this period will utilise simple-cycle technology.

Kuwait is also moving ahead with an ambitious capacity-building programme. The vast majority of the 10,500MW planned to come online by 2022 will involve major new combined-cycle gas-fired plants. The Ministry of Electricity & Water is also undertaking a programme to convert simple-cycle plants to combined-cycle.

While Siemens has established itself as one of the world’s largest turbine manufacturers over more than a century, it is constantly looking for ways to improve products and procedures, and research and development forms a key part of this.

“R&D and improving processes is central to what we do,” said Markus Seibold, head of enabling technologies, gas turbine at Siemens. “We can save time and costs, and also improve our products.”

One of the most important developments in Siemens’ manufacturing process in recent years has been the introduction of selective laser melting (SLM), which uses 3D printing technology and high-powered lasers to produce parts for turbines.

Examples of parts currently being produced by SLM in Siemens’ turbine plant in Berlin include combustor nozzles and burner tip for repairs. The use of SLM results in significant cost and time savings, with the time to manufacture combustor nozzles being reduced by up to six months. The use of computer design and laser melting has also had a major impact on the overall production of certain components of the turbine manufacturing process.

“The use of 3D design and SLM processing has reduced the cycle [from design to testing phase] from 18 months to two or three months,” said Seibold. “This allows us to make savings, but also be more flexible to meet the needs of the customer in a shorter time.”

While the $9bn order from Egypt has increased Siemens’ presence in the Mena region, the German firm is keen to further enhance its projects pipeline.

Plenty of opportunity

With MEED estimating that installed generating capacity in the region will need to increase by more than 144GW by 2020 to meet demand and maintain reserve margins, there will certainly be plenty of opportunity to do so.

In addition to providing and installing power plants and networks, Siemens is developing regional manufacturing facilities. As part of its deal with Egypt, the group will build a manufacturing facility for rotor blades for wind farms in the Ain Sokhna area. This follows the construction of a turbine manufacturing facility in the Eastern Province of Saudi Arabia.

Whether products are manufactured in Germany or abroad, it is clear that improving efficiency will remain a key target for Siemens and its competitors looking to compete in the Middle East’s evolving power market.