Mariel

Santa Cruz Guiteras

CéspedesNuevitas

Felton

Rente

Dr. Manuel Cereijo, P.E.University of Miami

August, 2009

Republic of CubaPower Sector

Infrastructure Assessment

Content of Presentation Effect of 2008 Hurricanes

Smart grid

Smart Generation

Conclusions

Hurricanes in 2008

Tropical Depression Fay

Hurricane Gustav

Hurricane Ike

Map of Cuba

Hurricane Fay Path

Hurricane Gustav Path

Hurricane Ike Path

ASSESSMENT OF THE IMPACT OF HURRICANES FAY, GUSTAV AND IKE ON THE POWER SECTOR

The impact affected:Power generating unitsTransmission linesTransmission towers and polesTransformersInsulatorsCablesPublic Lighting system

MOST AFFECTED PROVINCES

GuantanamoHolguinLas TunasCamagueyCiego de AvilaMatanzasPinar del RioIsla de la Juventud

SPECIFIC DAMAGES: Isla de la Juventud

•100% of the transmission lines were down

•550 transformers were damaged

•950 tons of electric conductors

•5,120 poles and towers were down

•43,400 electrical insulators

•A wind farm on Playa Bibijagua was completely down

•The gasifier plant, a common project with GEF, UNEP, was 70% damaged.

•Entire system had to be reconstructed

SPECIFIC DAMAGES: Pinar del Rio/Mariel

•150 Transmission towers of 220 Kv were destroyed

•20 transmission towers of 110Kv were destroyed

•4,800 poles were knocked down

•6,100 transformers were damaged

•5,500 public lighting units were damaged

•Entire system had to be reconstructed

DAMAGES IN GENERAL

CHANGE CONNECTING CABLES TO HOMES: 2.9 Million Homes

REPAIRING SUB STATIONS: 965 substations

RE INSTALLATON OF DISTRIBUTION LINES: 120,000 Kms

REPLACEMENT OF TRANSFORMERS: 65,000

DAMAGES IN GENERAL INSTALLATION OF POLES: 235,567 poles

INSTALLATION OF BREAKERS: 4.2 MILLION BREAKERS

INSTALLATION OF METERS: 1.8 MILLION OF METERS

DAMAGES IN GENERAL

REPLACEMENT OF 105,000 PUBLIC LIGHTING UNITS

MAIN PLANTS AFFECTED •Antonio Guiteras, Matanzas. It had been modernized in 2002-2004, at a cost of $65 million dollars. Turbines and output transformer were damaged

•Lidio Ramon Perez, Felton, near Holguin. It had been modernized in 2006-2008 at a cost of $85 million dollars. Output transformer completely destroyed. Turbine damaged

•Maximo Gomez, Mariel. It had been modernized in 2005-2007 at a cost of $100 million dollars. Major damages in the MVLs.

•10 de Octubre, Nuevitas. Modernized between 1998-2006, at a cost of $80 million dollars. Damaged in the air heaters, pumps.

MAIN WIND POWER GENERATING UNITS AFFECTED

Main wind power generating units affected were:

In Gibara, north of Holguin, 5.1 MW, six units, its transmission line and a 33 kV substation

In Isla de la Juventud, 55 meters windmills, in Los Camarreos, 1.54 MW

2009

TRANSMISSION LINES REPLACEMENT COSTS

Voltage Level, kV Pesos/Km

220 105,000

110 85,000

33 63,000

13.8 60,000

4.16 11,000

MAIN TRANSMISSION LINES REPLACEMENT COSTS

Voltage level, kV

Kms neededInvestment, million pesos

220 800 84

110 1000 91

33 10,000 630

13.8 15,000 900

4.16 25,000 225

Total 51,800 1,930

COST OF REPARING SECONDARY DISTRIBUTION LINES

Voltage level, Volts

Pesos/Km, average

Kms needed

Total cost, million pesos

440/240/120 2,500 69,000 172.5

COST OF REPLACING SUBSTATIONS

kV Qty Cost average, dollars

Total, millions, dollars

4.16 500 8,000 4.0

13.8 400 9,000 3.6

Higher kV 65 50,000 3.25

Total 965 10.85

COST OF REPAIRING TRANSFORMERS

kV level Qty Cost, dollars Total, million dollars

220 4 250,000 1.0

110 7 220,000 1.54

33 150 4,000 0.60

13.8 25 3,000 0.075

Distribution Level

44, 800 1,100 4.93

TOTAL 44,986 8.145

COST OF REPAIRING GENERATING PLANTS

PLANT Cost, millions dollarsAntonio Guiteras 5.3

Lidio Ramon Perez 10.5

Maximo Gomez 12.6

10 de Octubre 14.8

TOTAL 43.2

ELECTRIC METER READING REPLACEMENT COST

Qty, millions Cost/unit, dollars Total Cost, million dollars

1.8 50 90

TOTAL 90

COST OF REPLACING BREAKERS

Qty, millions Volt level Cost average, dollars

Total Cost, million dollars

2.5 240/480 100 250

1.7 Higher voltage 400 680

TOTAL 930

COST OF INSTALLING NEW PUBLIC LIGHTS

Qty Cost average, dollars Total Cost, million dollars

105,000 250 26.3

TOTAL 26.3

TOTAL COST OF REPAIRING HURRICANE DAMAGES

ITEMS TOTAL COST, Million dollars

Generating Plants 43.2

Transformers 8.15

Substations 10.85

Main Transmission Lines 78

Public Lights 26.3

Electric Meters 90

Breakers 930

Secondary Transmission Lines 7

Miscellaneous 20

TOTAL 1,213.50

OBJECTIVES FOR FUTURE POWER SECTOR IN CUBA

SMART GRID

SMART GENERATION

MODERNIZING THE GRIDGRID

Modernizing Cuba’s electric system is a substantial undertaking. The nation’s aging electro-mechanical electric grid would not keep pace with innovations in the digital information and telecommunications network.

Power outages and power quality disturbances will cost the economy millions of dollars annually.

MODERNIZING THE GRID

Cuba’s electric system is aging, inefficient, and congested, and incapable of meeting the future energy needs of the Information Economy without operational changes and substantial capital investment over the next decade

SMART GRIDSmart Grid uses “digital technology to improve reliability, security, and efficiency of the electric system: from large generation, through the delivery systems to electricity consumers and a growing number of distributed-generation and storage resources.. Intelligent devices can automatically adjust to changing conditions to prevent blackouts and increase capacity.

Smart Grid refers to an improved electricity supply chain that runs from a major power plant all the way inside your home.

The reliability of electrical power in Cuba will decline even more unless we do something about it as soon as democracy is in place.

The basic concept of Smart Grid is to add monitoring, analysis, control, and communication capabilities to the national electrical delivery system to maximize the throughput of the system while reducing the energy consumption. The Smart Grid will allow generating plants to move electricity around the system as efficient and economically as possible. It will also allow homes and businesses to use electricity as economically as possible.

SMART GRID

It is a colossal task. But it is a taskthat must be done.

While it is running.Full-tilt.

SMART GRID

SMART GENERATION Cuba will have to consider also SMART GENERATION

•Natural gas

•Oil

•Nuclear

•Solar power

•Biomass

•Wind power

Future investment in power generation

New combined cycle unit, G gas turbines and Heat Recovery Steam Generators, in combined cycle configuration. Unit designed to use natural gas as primary fuel, and capable of using distilled (light) oil as back up fuel. On natural gas, the average heat rate is about 6,580 Btu/kwh. Cost estimate: $867/kw (dollars USA)Cost based on 2012 US dollars

They do not include the cost of transmission facilities that are specific to each plant location within the grid in Cuba.

Future investment in power generation

New gas combustion turbine in single cycle configuration. Heat rate at 100% power on natural gas is 10,400 Btu/kwh. Cost estimate: $647/kw.(dollars USA)

Cost based on 2012 US dollars

Future investment in power generation

Under plant conversions, removing existing oil-or gas fueled steam plants, and replacing them with the same design large combined cycle unit describe in slide before. These conversions changes the existing generating capacity to much more efficient, lower emission generation, which reduces fuel use and emissions of SO2, NOx,CO2 and particulates. Cost estimate: $800/kw(dollars USA) Cost based on 2012 US dollars

Decision to make in Cuba: Fuel oil vs. Gas

An important decision for investors in the electrical power sector in Cuba will be if power plants should use fuel oil or gas. The answer depends on the technology.

Let us first analyze the Btu, or million Btu (MMBtu) of fuel per unit of electricity. MMBtu then can be converted to barrels of tons of oil. There are about 6.38 MMBtu per barrel of No. 6 fuel oil. There are about 5.5 MMBtu per barrel of No. 2 fuel oil.

To generate 100,000 MWH of electricity at a steam unit we need about 1,000,000 MMBtu of No. 6 fuel oil, or about 1,090,000 MMBtu of natural gas.

Decision to make in Cuba: Fuel oil vs. Gas

For a new combined cycle unit the heat rate using natural gas will be 6.58 MMBtu per MWH and that with No.2 fuel oil will be about 4% lower, or about 6.32 MMBtu per MWH. Therefore, to generate 100,000 MWH at a combined cycle unit we will need about 632,000 MMBtu of No. fuel oil, or about 658,000 MMBtu of natural gas.

Note that the price of No. 2 fuel oil (in MMBtu) is much higher than that of natural gas, and of No. 6 fuel oil, so that despite this small advantage in heat rate, No. 2 oil is seldom used in combined cycle units.

PROJECTED FUEL COST BASED ON 2009 MARKET CONDITIONS*

Year Natural gas($/MMBtu)

Residual Fuel oil

($/MMBtu)

Distillate Fuel oil

($/MMBtu)

Coal($/MMBtu)

2009 12.66 16.72 27.65 5.51

2010 11.37 16.84 26.71 2.66

2011 10.21 14.87 21.97 2.53

2012 10.02 14.89 22.15 2.48

2013 9.12 13.46 17.65 2.46

2014 9.28 13.69 18.03 2.50

2015 9.43 13.93 18.39 2.54

2016 9.74 14.15 18.74 2.58

*Note that these projections are subject to change at any time, and in fact can change daily.

2017 10.21 14.42 19.12 2.61

2018 10.96 14.68 19.48 2.65

2019 11.95 14.94 19.86 2.69

2020 12.42 15.22 20.23 2.73

2021 12.97 15.94 21.07 2.77

2022 13.55 16.70 21.95 2.81

2023 14.16 17.49 22.87 2.86

*Note that these projections are subject to change at any time, and in fact can change daily.

Year Natural gas($/MMBtu)

Residual Fuel oil

($/MMBtu)

Distillate Fuel oil

($/MMBtu)

Coal($/MMBtu)

PROJECTED FUEL COST BASED ON 2009 MARKET CONDITIONS*

The use of coal

It is not recommended for Cuba because coal is one of the most impure of fuels.

Cuba does not have a significant amount of coal and it would depend on imports for any large use of coal in the generation of power.

The cost of a pulverized coal plant, projected to 2013, is $2,138 per kW of capacity. This cost includes all necessary equipment for the protection of the environment. However, price of coal, in $/MMBtu, is cheaper than all other fuels.

Biomass power generation Biomass is obtained from numerous sources, including by-products from the timber industry, agricultural crops, raw material from the forest, major parts of household waste, and demolition wood

Unlike renewable-based systems that require costly advanced technology, biomass can generate electricity with the same type of equipment and power plants that now burn fossil fuels.

Most biomass power plants operating today are characterized by low boiler and thermal-plant efficiencies; both the fuel's characteristics and the small size of most facilities contribute to these efficiencies. In addition, such plants are costly to build. Today's best biomass-based power plants cost approximately $2,000 per kilowatt of electricity to build, with a thermal efficiency of about 40 percent.

Wind power for generation

Wind power is produced in large scale wind farms connected to electrical grids, as well as in individual turbines for providing electricity to isolated locations.

Since wind speed is not constant, a wind farm’s annual energy production is never as much as the sum of the generator nameplate ratings multiplied by the total hours in a year. The ratio of actual productivity in a year to this theoretical maximum is called the capacity factor. Typical capacity factors are 20-40%, with values at the upper end of the range in particularly favorable sites.

Good selection of a wind turbine site is critical to economic development of wind power. Aside from the availability of wind itself, other significant factors include the availability of transmission lines, value of energy to be produced, cost of land acquisition, land use considerations, and environmental impact of construction and operations. Off-shore locations may offset their higher construction cost with higher annual load factors, thereby reducing cost of energy produced.

SOLAR ENERGY

Solar energy is an alternative with a lot of potential. It's environmentally friendly because it produces no emissions or noise. It's fueled by one of Cuba's most abundant resources -- the sun. But while energy from the sun is virtually limitless, it's expensive to convert to usable electricity .

The technology is improving almost daily.“

It's becoming more cost-effective.

How does solar power work?

Photovoltaic (or PV) systems directly convert sunlight into electricity using solid-state technology. All solar power generated will feed directly into Cuba's grid and then into homes. During operation, PV creates no noise because it has no movable parts, and no pollution or hazardous wastes because no fuel is burned.

What are the benefits of solar power?

• keeps the air clean

• uses a secure and replenishable natural resource and

• reduces dependency on fossil fuels such as oil and gas.

The benefits of solar power are that it:

NUCLEAR POWER Nuclear power is any nuclear technology designed to

extract usable energy from atomic nuclei via controlled nuclear reactions. The only method in use today is through nuclear fission

As of 2008, nuclear power provided 2.5% of the world's energy and 16% of the world's electricity

As of 2008, the IAEA reported there are 440 nuclear power reactors in operation in the world, operating in 31 countries

NUCLEAR POWER

GE Hitachi Nuclear Energy

Westinghouse

AREVA NP

Mitsubishi Heavy Industries (MHI), Ltd.

There are four nuclear power plant manufacturers worldwide:

NUCLEAR POWER

•EPR – European Pressurized Reactor (1,600 MWe)

•ESBWR – Economic Simplified Boiling Water Reactor (1,550 MWe), produced by GE

•ABWR – Advanced Boiling Water Reactor (1,350 MWe), GE Hitachi

•AP1000 – Gen III+ (1,117 MWe), Westinghouse

•US-APBR – Advanced Pressurized Water Reactor (1,538 MWe), Mitsubishi Heavy Industries – U.S. version of Japanese design

There are five basic designs:

NUCLEAR POWER

Waste disposal continues to be the major obstacle to the growth of nuclear power.

However, waste is now being safely kept in rooms no larger than 400 square feet.

Nuclear power plants produce no controlled air pollutants or greenhouse gases. The use of nuclear energy in place of other energy source helps to keep the air clean preserves the earth’s climate, avoid ground-level ozone formation, and prevent acid rain.

GROSS GENERATION FUEL OIL/NATURAL GAS

  YEAR GIGAWATT HOUR

TOTAL 2006 15850  2007 16844  2008 16200     

FUEL OIL 2006 13,750  2007 14353  2008 13800     

ENERGAS 2006 2100  2007 2491  2008 2400

GROSS GENERATION FUEL OIL/NATURAL GAS

15,850 16,200

13,751 14,353 13,800

2100 2491 2400

16,844

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

2006 2007 2008

Year

Gig

aw

att

Hour

TotalFuel oilEnergas

GRUPOS ELECTROGENOS (DISTRIBUED GENERATION)

YEAR Diesel FUEL

2007 934 153

2008 927 262

TOTAL 1087 1189

CONCLUSIONS

The total cost of repairing the damages caused by the 2008 hurricanes is estimated

in: $1,213.5 million dollars

As of August 2009, the damages have been repaired in a 75%

CONCLUSIONS

SMART GRID

SMART GENERATION

THE MAIN OBJECTIVES FOR THE FUTURE OF CUBA’s POWER SECTOR ARE:

CONCLUSIONS

Natural gas/fuel oil as main combustible

Solar power/wind power as auxiliary units, specially for peak demand hours

A careful study should be conducted regarding possible use of nuclear power

FOR SMART GENERATION, CUBA’s POWER GENERATION SHOULD USE:

CONCLUSIONS

Cuba's overall energy infrastructure – from refineries to power-generating plants to electrical grids to local wiring – is in an advanced state of decay, and will require significant investment to upgrade.