Generation & Markets

U.S. power-plant construction tends to follow fads. Identifying these trends is easier than determining the primary drivers and issues that contributed to them. Understanding how these drivers affect power-planning decisions can help utilities predict generation-construction trends in the future and avoid getting caught in a group-think trap.

One sure sign of recovery in boom-and-bust power-generation markets is the renewed growth in the planning and construction of power plants. Active efforts are underway in generation development in the Southeast markets in spite of the high levels of generating reserve margins. With its traditional utility-dominated market structure and a preference for baseload generation, the Southeast is the battleground for the next round of power-generation development.

It is time to adapt to new rules of the game, and change procurement tactics. Read these five effective strategies for managing escalating input costs.

The heavy investment required for new generation technologies clearly is a global phenomenon, but global-resource competition to build power plants is making power-plant development more expensive—and may even limit the number that any one utility in any one country can develop.

After years of feasibility studies, lack of development funds, and escalating fuel costs across the energy spectrum, ocean energy is suddenly a very hot topic.

Ethanol plants either are operating, under construction, or planned for several areas in the Midwest. These same areas also have municipal solid waste (MSW) produced daily in an existing landfill. In addition, these areas have a need for establishing or extending a landfill.

As an alternative to the existing concept of a landfill, plasma-arc technology has been applied to the treatment of MSW. Known as plasma-arc gasification for the treatment of MSW, this recent development would eliminate or minimize the need for a landfill.

The ERCOT region remains a living example of how to make a successful transition to restructured wholesale and retail markets for electricity. At the same time, the market continues to witness some significant developments. Sights are turning from recovery to the next stage of the power business cycle: The Buildup.

Some power markets may be seeing possible signs of recovery. Spark spreads appear to have bottomed out, and reserve margins have begun to fall in some markets. As Figure 1 shows, recovery is uneven, with many regions still experiencing excess supply and a few regions with peak reserves under 10 percent.

Reactive power is becoming a hot issue in many regions of the country. Regulators and grid operators are grappling with ways to account fairly for reactive power supplies, and to encourage such resources to come online where they are needed. These analyses, however, are largely ignoring a vast fleet of infrastructure already installed on the network. West Point military academy, for example, has four small synchronous generators that are used for combined heat and power or emergency power applications. If these generators also were used as synchronous condensers, they might supply additional revenue to pay for the distributed energy investment.