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Climate Change Blog

  • 02
  • October
  • 2015

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The Clean Power Plan’s Building Block 1: Efficiency Improvements at Affected Coal-Fired Steam EGUs

This is the second in a series of posts explaining the “building blocks” that EPA used to determine emission goals for existing power plants in the Clean Power Plan. This post focuses on what EPA calls building block 1. Building block 1 consists of measures that improve heat rate at coal-fired steam electric generating units (“EGUs”). In the final rule, EPA concluded that “a well-supported and conservative estimate of the potential heat rate improvements” achievable through best practices and equipment upgrades is a 4.3% improvement in the Eastern Interconnection, a 2.1% improvement in the Western Interconnection and a 2.3% improvement in the Texas Interconnection.

An EGU’s heat rate refers to the amount of fuel energy input required (Btu) to produce 1 kWh of electrical output, and EPA described heat rate improvements as “changes that increase the efficiency with which an EGU converts fuel energy to electric energy, thereby reducing the amount of fuel needed to produce the same amount of electricity.” Because fuel combustion is the primary source of GHG emissions from EGUs, decreasing the amount of fuel required to produce a particular amount of electricity through heat rate improvements would also reduce the carbon intensity of a source’s generation.  

To calculate heat rate improvement potential for coal-fired EGUs, EPA employed three different analytical approaches to determine the degree of heat rate improvements reasonably achievable by each interconnection through the application of best practices and equipment upgrades.  EPA described the three analytical approaches as follows:  

  1. The “efficiency and consistency improvements under similar conditions” approach;
  2. The “best historical performance” approach; and
  3. The “best historical performance under similar conditions” approach.

For all three approaches, EPA used a dataset comprised of 11 years’ worth (from 2002 – 2012) of hourly gross heat rate for 884 coal-fired EGUs, and EPA reportedly employed a unit-specific approach, comparing each EGU’s performance against its own historical performance, rather than comparing an EGU’s performance against other EGU’s with similar characteristics.

Additionally, in each of the three approaches, EPA assessed potential heat rate improvements regionally, within the Eastern, Western, and Texas Interconnections. The Texas Interconnection generally corresponds to the portion of the state of Texas covered by the Electric Reliability Council of Texas.  

Each of the approaches resulted in heat rate improvement values that differed by several percent. According to EPA, the different values all represented reasonable estimates of the potential for heat rate improvements by EGU’s in the three interconnections, but EPA ultimately selected the most conservative value (meaning the smallest heat rate improvement) for each region. In all three regions, the most conservative values were generated using the “efficiency and consistency improvements under similar conditions” approach. As such, this approach is described detail below.

The “efficiency and consistency improvements under similar conditions” approach:

EPA determined that there are three sets of factors that influence an EGU’s heat rate (1) ambient temperature, (2) hourly capacity factor at the unit in question, and (3) unit-specific factors that are within the control of the operator. To control for the factors that are outside of the operator’s control, EPA structured its analysis of heat rate improvements under the “similar conditions” approach by segmenting each unit’s performance based on historical emissions in a series of capacity factor and ambient temperature combinations. To do so, EPA created a matrix comprised of 168 “bins,” each of which represented a 10-degree Fahrenheit range in ambient temperature, and a 10-percent range in capacity factor. EPA then distributed each hour of gross heat rate data for each EGU into the matrix. For example, one bin would contain all of an EGU’s hourly gross heat rate data generated from 2002 through 2012 while that EGU was operating at an 80- to 89-percent capacity while the ambient temperatures were between 70oF and 79oF.

EPA determined that its matrix appropriately controls for variations in temperature and capacity factor and that any remaining variation in each bin’s data would be primarily driven by factors within the EGU operator’s control, representing the possible range of heat rate improvements. EPA then established a benchmark for each bin based on each EGU’s 10th percentile hourly gross heat rate for each capacity-temperature bin. In other words, the benchmark was demonstrated by 10 percent of all measurements in each capacity-temperature bin. The Agency reportedly “chose the 10th percentile because it represents a demonstrably achievable gross heat rate indicating efficient operation of the EGU, but ignores unusually low outlier values.” EPA excluded outlier values that were greater than ±2.6 standard deviations from the EGU’s mean gross heat rate.

EPA then assessed the effect on overall heat rate that would occur if EGUs achieved more consistently efficient operation. To do so, EPA compared the data in each bin to the bin’s benchmark value and identified all hourly gross heat rate values that were greater than the benchmark. EPA then adjusted each hourly gross heat rate that was greater than the benchmark downward by a specific percentage, which EPA referred to as a “consistency factor.” EPA reportedly employed a statistical assessment of the overall variability of heat rate in each region to come up with the following consistency factors: 38.1% for Eastern Interconnection; 38.4% for the Western Interconnection; and 37.1% for the Texas Interconnection. For greater detail on the Agency’s procedure for calculating the applicable consistency factor, refer to page 2-48 of EPA’s Greenhouse Gas Mitigation Measures Technical Support Document (“GHG Mitigation Measures TSD”).

The Agency’s general approach is “based on the principle that a coal-fired EGU following best practices should be able to consistently operate closer to the demonstrated and achievable benchmark heat rate.” GHG Mitigation Measures TSD, pg. 2-46.

Applying this process to all 884 coal-fired EGUs in the dataset, EPA determined that it would be reasonable to conclude that, on average, EGUs are capable of improving heat rate by:

  • 4.3 percent in the Eastern Interconnection;
  • 2.1 percent in the Western Interconnection; and
  • 2.3 percent in the Texas Interconnection.

Example Equipment Upgrades and Best Practices for Heat Rate Improvements

EPA’s GHG Mitigation Measures TSD provides the following non-exhaustive lists of equipment upgrades and best practices that could be used to improve heat rates:

Equipment upgrades:

  • Install intelligent sootblowing system
  • Replace feed water pump steam turbine seals
  • Overhaul high pressure feed water pumps
  • Upgrade main steam turbine seals
  • Upgrade steam turbine internals
  • Install variable frequency drives for motors
  • Retube or expand the condenser
  • Install sorbent injection system to reduce flue gas sulfuric acid to allow lower temperature exhaust gas
  • Upgrade air heater baskets for lower temperature operation
  • Upgrade and repair flue gas desulfurization systems
  • Refurbish the economizer
  • Upgrade ESP components to lower auxiliary power consumption
  • Improve SCR and FGD system components to lower draft loss

Best practices 

  • Adopt training for O&M staff on heat rate improvements
  • Perform on-site appraisals to identify areas for improved heat rate performance
  • Install neural network software for combustion/optimization with monitoring system for heat rate optimization
  • Repair steam and water leaks – replace leaking valves and steam traps
  • Replace / repair worn air heater seals
  • Manage feed water quality
  • Chemical clean boiler to remove scale build-up from water side
  • Install and operate condenser tube cleaning system
  • Repair boiler furnace and ductwork cracks to prevent boiler air in-leakage
  • Clean air preheater coils to restore performance
  • Adopt sliding pressure operation to reduce turbine throttling losses
  • Reduce activation of attemperator which compensates for over-firing the unit
  • Remove deposits on turbine blades
Cost of Building Block 1

According to EPA, the cost attributable to emissions reductions under Building Block 1 is equal to the cost of achieving heat rate improvements less any savings from reduced fuel expenses. EPA expects that the savings in fuel cost associated with the percentage heat rate improvements identified for each region will cover much of the associated costs and predicts that even if EGUs were to rely primarily on equipment upgrades (rather than cheaper-to-implement best practices) to reduce heat rate, reductions could generally be achieved at $100 or less per kW, or approximately $23 per ton of  CO2 removed.

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Author

Margaret E. Peloso

Margaret E. Peloso Partner