Engineers Forum

Texas, United States Demand for wind energy is down. Valuations of wind farms are decreasing. And competition is getting more fierce. It’s a tough market out there – so what is a wind company to do? Innovate.
Innovation isn’t always the easiest thing to pursue in a bad economy. It can be next to impossible to bring new technologies to market when investors are skittish about financing even the most well-established ones. But many of the major wind players agree that now is the best time to focus on improving technologies and differentiating products.

The companies that choose to innovate will come out of the economic malaise in a strong position. Those that don’t will likely fall behind in the race to compete with fossil energies.

“We’ve been working on a lot of things. We’re taking a multi-pronged approach,” says Wally Lafferty, head of the Vestas Americas R&D program. “We’re expanding operations and hiring all kinds of people.”

Two years ago, Vestas opened an R&D facility in Houston, a city rich with aeronautical engineers. The facility is focused on aerodynamics, electro-magnetic machines, new blade designs and grid integration issues. Lafferty says that all the R&D efforts at Vestas revolve around one thing: Bankability.

“Ultimately, we need to drive down the cost of wind electricity so that it’s competitive,” he says.

Other companies like Siemens, GE and Statoil are undertaking similar internal pushes to expand R&D and push the limits of wind turbine size, location, weight and portability. This spring, Siemens released its new 3-MW direct-drive turbine. Vestas is also coming out with a new V112 3-MW machine and a 6-MW offshore machine. And the Norwegian oil and gas giant Statoil is continuing its $65 million program to develop a floating offshore unit for deep waters.

Developing new technologies in-house is one thing, but actually deploying them in the field is another. Some companies with new technologies ready for market are finding it difficult to move on projects.

“It doesn’t matter how good your innovation is, no one will put any money in a wind plant that uses new technology because of the perception that it increases financial risk,” says Fort Felker, director of the National Wind Technology Center at the National Renewable Energy Laboratory.

Take American Superconductor (AMSC). The company has been working on high-temperature superconductors (HTS) — wires that can carry 150 times more electricity than copper — since the late 80′s. The superconductor power cables constructed with AMSC’s HTS wire can be deployed underground at roughly the same cost as conventional above-ground lines. The cables include distribution and transmission voltages and can be either AC and DC systems.

In the last 12 months, a couple of utilities in the U.S. pulled back on projects to develop cables with these wires.

“If it weren’t for the economic downturn, I’m pretty sure we would have had by now our first commercial contract for superconductor cables for urban applications here in the United States,” says Greg Yurek, Founder and CEO of AMSC.

AMSC recently signed a deal with LS Cable in Korea to deploy 30 miles of superconductors in the country. A number of Chinese companies have also expressed interest in the cables, says Yurek. But business in the U.S. has come to a halt.

AMSC continues to sell mechanical and electronic equipment for wind turbines, waiting for the U.S. market for superconductors to open back up. When it does, Yurek believes that his company will do a lot of business. AMSC was already picked by Tres Amigas LLC to provide $1 billion worth of the company’s DC voltage Superconductor Electricity Pipelines for a project that will unite America’s three power grids. (AMSC has a minority stake in the company). And when utilities start building out new transmission to accommodate wind farms, he says that business will increase further.

“We are confident that this will take off in the U.S.,” says Yurek. “It might happen in other countries first, but the U.S. will be an important market.”

AMSC is also working on a 10-MW direct-drive offshore wind turbine that features a generator with superconductor rotors, potentially making the machine lighter and more efficient. That turbine is still in the early R&D phase, however.

Despite the slowdown in business, AMSC — like most of the other leading wind companies — is trying to stay on top by thinking about innovation. It might be difficult to get projects in the ground today, but it will inevitably get easier as the economy improves. Companies must be prepared to deploy their technologies when the time is right.

For more on wind technology innovation from AMSC, NREL, Statoil and Vestas, listen to this week’s podcast linked above.

Source: http://www.renewableenergyworld.com/rea/news/podcast/2010/06/wind-r-d-why-its-more-important-than-ever
Written by Stephen Lacey, Podcast Producer
Published: 18 June 2010

California, United States — Carbon dioxide seems to be the evil nemesis in a world preoccupied with its contributions to climate change. The less CO2 you emit, it seems, the better citizen you are, and with good reason. But at algae-to-biofuel facilities across the nation, carbon dioxide is not only not the enemy, it’s an essential partner to helping achieve a low-carbon future.

CO2 — along with sunlight and water — is needed to grow algae, which can in turn produce oil, otherwise known as “oilgae” or “green crude.” While in its nascent stages, the “oilgae” industry is making strides toward commercial production, all while putting CO2 – designated a pollutant by the Environmental Protection Agency last year – to work as a needed, and yes, valuable, feedstock.

Using CO2 as a catalyst to grow algae is a more viable solution for what to do with the plentiful gas than, for example, sequestering and burying it underground, according to those in the industry. “Putting it underground will not create a market. Finding a way of turning [CO2] into something that can provide value will,” Tim Zenk, vice president of corporate affairs at Sapphire Energy, said.

“The potential is huge because at least in theory, it’s such a win-win. You’re using carbon that would otherwise be put into the atmosphere, and creating products,” Clint Wilder, senior editor with CleanEdge, said. CleanEdge recently issued a report highlighting as a “trend to watch” the role CO2 can play as a feedstock for various industries, including algal biofuels and cement production.

Green crude producer Sapphire, backed by Bill Gates’ Cascade Investment and Venrock, a venture capital firm of the Rockefeller family, successfully produced 91-octane gasoline from algae that fully conforms to ASTM certification standards in 2008, and last year participated in a test flight using algae-based jet fuel in a Boeing 737-800 twin-engine aircraft, according to its website. Sapphire’s algae production occurs in an open-pond system vs. a closed bioreactor. “We went with the open-pond approach because we didn’t see much advantage of closed, which can be very expensive. We needed to be competitive with fossil sources of oil … which is around $75-80 a barrel,” Zenk said.

After the algae is grown, the oil is extracted and refined in a typical refinery set-up. Even though burning the oilgae releases CO2 back into the atmosphere, “on a lifecycle basis, if CO2 is consumed during the algae process, our fuels are extremely low-carbon,” Zenk said. Compared to diesel, the amount of carbon is reduced by 68 percent over the lifecycle. He estimates that between 12 and 15 kilograms of CO2 are consumed per gallon of oil produced.

“A great rule of thumb is 1 kilogram of algae requires 2 kilograms of CO2,” Joanna Money, vice president of business development at Solix Biofuels, said. Solix has two facilities that produce algae, a research and development facility at Fort Collins, CO (which uses CO2 from nearby New Belgium Brewery), and a demonstration plant in southern Colorado. Solix’s closed bioreactor system provides five times the surface level exposure to sunlight compared with open-pond systems and seven times the biomass productivity, according to the company’s website.

Solix’s test environments currently yield peak rates in excess of 2,000 gallons per acre, per year, according to its website. In five years, “we will be working with partners to deploy commercial production modules to grow, harvest and extract algae,” Money said.

According to experts, microalgae can produce between 5,000 and 15,000 gallons of oil per acre per year. That hasn’t yet been done on a large scale. Sapphire recently received a $104-million grant from the Department of Energy to build a $135-million commercial demonstration facility in Columbus, NM. Construction on the Integrated Algal Bio-Refinery will begin this year. The 300-acre fully integrated cultivation-harvest-extraction facility will produce at least 1 million gallons per year of finished fuel when completed sometime in 2012, Zenk said. The company is committed to using anthropogenic sources of CO2.

“We need to take that technology to the next step after the commercial demonstration. If all goes well and the capital is available, we’re hoping to be in commercial production by 2018,” Zenk said. A commercial production facility would be able to produce between 5,000 and 10,000 barrels of finished fuel a day, he said. To put that in perspective, according to 2008 data from the Energy Information Administration, U.S. total crude oil production is 4,950,000 barrels per day, and U.S. petroleum consumption is 19,498,000 barrels per day.

Carbon Pricing Needed
While algal biofuels may not replace petroleum anytime soon, their production certainly represents a creative and viable solution for using up unwanted CO2, even to the point of creating a new commodity market for it. “The key is to actually have a price on CO2 emissions. Once carbon is actually priced, in terms of having to pay for emissions, you will see a market emerging,” Wilder said.

The Chicago Climate Exchange offers voluntary-but-binding contracts for trading carbon dioxide via a cap and trade system. CCX President Richard Sandor has publicly stated that carbon can become the largest commodity in the world.

But whether or not CO2 becomes a real commodity depends on legislation, Solix’s Money said. “Absent a price or market for carbon, or at least a carbon regime,” CO2 will not become a commodity, agreed Zenk. “There has to be a business out of the collection, distribution, and adding value to the carbon molecule.”

Algal biofuels isn’t the only industry finding ways to add value to the carbon molecule. Another industry with vast potential for using CO2 is cement production. One example is Los Gatos, CA-based Calera, backed by funding from Khosla Ventures. Calera’s Mineralization via Aqueous Precipitation process consumes CO2 from a nearby Dynegy-owned natural gas powerplant to produce calcium and magnesium carbonate and bicarbonate, the basic building blocks for cement. The process converts 1 ton of CO2 into 2 tons of building material. The result, according to Calera, is that it not only consumes CO2, but also avoids the release of carbon from traditional cement production.

The prospect of using CO2 to manufacture cement “is very exciting,” Wilder said. “It’s one of the most carbon-intensive products to make. The sheer volume of cement used around the world is mind-boggling.”

With carbon-capture industries like these gaining ground, it’s not hard to envision a future where CO2 is treated less as the enemy and more as an integral ingredient in the global economy. While a zero-carbon future is “hard to imagine,” Zenk said, “I think you’ll find [a] low-carbon [future.] We can win the war on climate if we think about it in those terms, at least in my lifetime.”

Janneke Pieters is a freelance writer on energy, electricity and other issues. She is the former associate editor of Electric Perspectives magazine, published by Edison Electric Institute.
Published: 22 June 2010
Source: http://www.renewableenergyworld.com/rea/news/article/2010/06/using-carbon-to-fight-carbon?cmpid=WNL-Wednesday-June23-2010

Indonesia, which to a certain extent is still a centrally planned economy, is actively implementing regulatory reforms. The current national planning process is based on the 2004 National Development Planning System Law. According to the law, a comprehensive Long-Term Development Plan, spanning 2005 through to 2025 was established first, then – combined with vision and mission of the elected president – a national Medium-Term Development Plan (RPJM) is derived.
The RPJM serves as reference for sectors and regional strategic planning developed by ministries and regional governments. From this mid-term development plan, a “government work plan” (RKP) is determined annually within each ministry. The mechanics for developing the current RPJM is similar to that of the six “five year development plans” implemented during the Soeharto era. Under the system, goals are targeted, supporting policies are developed and government funds are allocated. The government is assumed to have a significant role in guiding development and in providing funding.
Central planning, however, is effective in environments where all factors are under the direct control of government institutions and where those institutions obey instructions. This is no longer the case for energy planning and policy coordination in Indonesia. Following the fall of President Soeharto in 1998, Indonesia’s political landscape and legislations have undergone major reforms, started by the introduction of a regional autonomy law in 1999 that gave authority to provincial governments to regulate and manage many affairs in their regions, including the energy sector.
The autonomy law was followed by a 1999 law balancing the fiscal relationship between the central and regional governments, realigning revenue sharing from energy and mineral resources sectors in favour of the provincial administrations. Since then, we have moved with more decentralisation and privatisation agendas in energy sector in line with the reforms of other sectors. Those are changing Indonesia toward a more democratic society with greater reliance on liberalised market.
State-owned oil and gas company Pertamina, according to the 2001 Oil & Gas Law, no longer has the responsibility to serve as the government representative to fulfil our demand for oil fuels. Likewise, the 2009 Electricity Law has reduced state-owned electricity company PT PLN to a mere player in the country’s electricity industry and asked the regional governments to prepare their plan for development in the sector.

Source: http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/Opinions/Columns/15-Jun-2010/Energy-planning-in-Indonesia

Recently I had an opportunity to visit Saudi Arabia where most of construction has been done by British base construction companies or it is in progress. The planning of road infrastructure is super one but the users of these roads are not aware of traffic sense. I traveled in Taxis and buses and observed that:

1. Roads are wide enough and able to carry on heavy traffic.
2. Most of the road users have no traffic sense.
3. Most of the road users do not care pedestrians who want to cross the roads on ZEBRA crossing, especially near the Haram
in Makah and Madina.
4. To monitor the traffic flow and violations by the drivers, role of cameras is very limited.
5. Taxi drivers especially and general public do not bother to give indicators while changing the lanes
on highways especially and on turns also.
6. Road users do not bother to cross other vehicles using hard shoulders of motor ways.
7. Drivers do not bother to take safety precautions e.g. to fasten the seat ballots while on highways, especially taxi drivers.
8. During the monitoring process, Saudi drivers are neglected while foreigners are fined heavily.
9. Taxi drivers have some special technique in their taxis where they suspend the speedometer so passengers cannot watch
the speed and ask to drive slow.
10. The standard of learning drivers looks very poor while passing the driving test looks very very poor.
11. Driving in congested areas is just similar to India, Pakistan and Bangladesh where whistling horns and to “go first” without
knowing the right is preferred.

Do you have some experience in driving a car in Saudi Arabia and what you learnt….?

What is the new Construction Act? When does it take effect? How will it impact our commercial contracts? What is all the fuss about a new Scheme? These are some of the questions raised by our clients – and with good reason. No one working for a client, main contractor or subcontractor can ignore the new Act or indeed the new Scheme. From 2011, their effects will ripple through standard form contracts, payment notices and procedures, and adjucation – so now is the time to ask questions.

The new Construction Act, which replaces the construction aspects of the Housing Grants, Construction and Regeneration Act 1996, is being delivered via the Local Democracy, Economic Development and Construction Act 2009. While the Bill received Royal Assent on 12 November 2009, it is important to note that the essential commencement order, required to bring into force part 8 of the new Act, which amends Part II of the 1996 Act, is still awaited.

So the new Construction Act will come into force when the government issues the commencement order – but before that can happen a new Scheme is needed. This in turn means that the government will be consulting the industry on its proposed new Scheme. The consultation is an opportunity to both be informed of the issues and to push for changes.

It is expected that the consultation will start this month. The latest expectation is that the government will consult on a specific form of the new Scheme rather than embark on a wide-ranging consultation on what the different parts of industry would like to see.

So what will change? Briefly, the amendments fall into two areas: adjudication and payment. On the adjudication side the amendments will:

• remove the requirement for a construction contract to be “in writing”, except the adjudication provisions of a contract, which must still be “in writing”.

• introduce a statutory slip rule for adjudicators’ decisions which would give adjudicators latitude in correcting minor errors in their decisions.

• restrict the parties’ right to agree who pays the costs of the adjudication until after the notice of intention to refer the dispute to adjudication has been issued.

On payment, the amendments will:

• prohibit “pay-when-certified” clauses. In other words a main contractor cannot make payment to a subcontractor dependent upon their own payment being certified by the employer.

• introduce new rules on payment and withholding notices.

• include a requirement for the paying party to pay the notified sum.

• include new rights for contractors that suspend, in part or whole, performance for non-payment. This may or may not now require the contractor to walk-off site.

It is clear that any standard form agreements and any bespoke subcontracts will need to be amended to reflect the changes in the payment provisions. Of particular concern to main contractors – especially those working in the PFI sector – will be the requirement to exclude any payment clauses that make payment downstream contingent upon payment upstream or from a third party. Pay when paid and pay when certified arrangements will no longer work.

Simple things such as terminology and the names of the various payment notices will need to change. The definition of “due date” and “withholding notice”, for example, will need to be amended. Contracts will need to expressly state who is to issue the initial payment notice. Standard form notices and letters will also need to be amended and further details or allocation of sums being withheld will be needed. It is likely that this will be done after publication of the new Scheme.

If there is an adjudication, any agreement on who pays for the parties’ costs can only be made after a notice of adjudication has been issued. This means that any existing forms of contract will also need to be amended to take this change into account.

Despite all the changes, the Local Democracy, Economic Development and Construction Act 2009 leaves much unchanged. The following issues have not been addressed, for example:

• whether the timescales in the adjudication process are mandatory and absolutely fixed.

• whether a decision has to be handed over to the parties before expiry of the 28/42 day time period.

• whether several disputes can be referred to one adjudicator in one adjudication.

• whether there should be only one mandatory adjudication procedure.

• whether there should be different methods to enforce decisions.

It is unlikely that the new Scheme will address all these points. The Scheme is essentially there to regulate payments and the adjudication process where the parties’ contracts are found to be at odds with the terms of the Construction Act. It is therefore likely that the government’s drafting team will include clauses that bring colour and clarity to the new payment provisions while doing little to the adjudication procedure.

Once the Act comes into force – likely to be in 2011 – any gaps or cracks will, of course, be filled in by the courts. To that end, the new Act will inevitably be followed by a wave of legal arguments seeking to interpret exactly what the government meant to say when it drew up the new Act and the new Scheme.

The impetus behind the Act was to settle the problem areas with less recourse to the courts. But their role in construction will be far from over.

Hamish Lal is head of construction at solicitor Jones Day, London