Power Generation Application of Unconventional Gas with Jenbacher Gas Engines

Bright YinGeneral Manager, ChinaJenbacher Gas Engines

Austria Connect – 2009ShenzhenSeptember 19, 2009

GE Energy

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About GE• Founded in 1892 by Thomas Edison

• Operations in more than 100 countries

• More than 300,000 employees worldwide 85,000 in Europe

GE Financials 2008Sales $183BNet earnings $18.1BCash flow/Operations $19.1B

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GE Energy Infrastructure

Energy Services

• Power generation• Renewables• Gas Engines• Nuclear• Gasification• Water treatment• Process chemicals

Power & Water

• Contractual agreements• Smart Grid• Field services• Parts & repairs• Optimization

technologies• Plant management

• Drilling & completion• Subsea, offshore &

onshore• LNG & Pipelines• Pipeline integrity • Refining• Processing

• ‘08 revenue: $38.6B• Employees: 65,000 • Operating in 140 countries

Oil & Gas

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Jenbacher gas engines

More than 9,100 delivered engines / 10,800MW Power range from 0.25MW to 4MW

Fuel flexibility Natural gas, biogas, flare gas, landfill gas, steel gas, coal mine gas

Advanced system solutionsGenerator sets, container modulescogeneration, trigeneration, CO2-fertilization

Environmental benefits Low emissionsecomagination solutions

Lifecycle services (parts, repair, CSA, upgrades)1,900 units under CSA

A leading manufacturer of gas fueled reciprocating engines for power generation

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Jenbach, AustriaMain manufacturing site and business HQ

Veresegyház, HungaryContainer manufacturing

Hangzhou, ChinaPackaging for Asian units

1,700 employees worldwide … 1,300 in Jenbach, Austria

Regional assembly facilities

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Jenbacher product range

• Electrical output: from 250 to 330KW

• 8 cylinder

• 1,500 rpm (50Hz) / 1,800 rpm (60Hz)

• Delivered engines: more than 850

• Since 1976 in the product program

• Electrical output: from 800 to 1,500KW

• V12, V16 and V20 cylinder

• 1,500 rpm (50Hz) / 1,800 rpm (60Hz)

• Delivered engines: more than 750

• Since 2002 in the product program

• Electrical output:from 1.5 to 4MW

• V12, V16, V20 and V24 cylinder

• 1,500 rpm (50Hz, 60Hz with gear-box)

• Delivered engines: more than 2,200

• Since 1989 in the product program

Type

• Electrical output: from 500 to 1,100KW

• V12, V16 and V20 cylinder

• 1,500 rpm (50Hz) / 1,800 rpm (60Hz)

• Delivered engines: more than 5,000

• Since 1988 in the product program

2 Type3 Type4 Type6

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Advantages of on-site energy supply

Energy supply directly at the load source allows to reduce or avoid transport and distribution losses.

Key features of Jenbacher plants• High electrical efficiencies of up to 44%• Overall efficiencies (electrical and thermal) of over 90%• Minimum emissions• Specially designed engines for use of alternative, renewable energy

sources and special gases• Maximum operational safety and availability• High power density

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Jenbacher gas engines core applications

Landfill gas

Sewage gas

Flare gas

Special gas

Biogas application Greenhouse

application

Natural gasfor CHP applications

Coal mine gas

Island mode

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Coal Gas … types and - attributes

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Coal gas installations

Sasyadko, Ukraine

12 x JMS 620 GS-S.LCFuel:Coal mine methaneElectrical output: 36,420 kWThermal output: 35,040 kWCommissioning: 2006

In total: 170 engines; 360 MW

Furong CMG, Yibin, China

2x JGS 620Fuel: Coal mine methaneElectrical output: 6,096 kWCommissioning: 2009

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Bio gas and landfill gas installationsDeqingyuan Chicken Waste-to-power projects, Beijing, China

2 x JMS 320Fuel: BiogasElectrical output: 2,126 kWCommissioning: 2009

Xinfeng LFG Project, Guangdong, China

3x JGC320Fuel: Land Fuel GasElectrical output: 3,000 kWCommissioning: 2004

In total: 2950 engines; 2440 MW

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Associated petrol gas ... flaregas/APG

• GGFR estimates that global flaring is around 150 to 200 bcm a year

• Equal to 25% of US gas consumption

• Significant contributions to GHG emissions with negative impacts on the environment

• 200bcm > 400 MTCO2e per year

• Top 20 flared gas countries have 80% of the market share

Source: Global Gas Flaring Reduction (GGFR) World Bank * GGFR partner

In total: 300 engines; 420 MW

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ecomaginationInnovative solutions to environmental challenges

Cost-effective, high output and measurable benefits to the environment … the following Jenbacher applications have already been certified as GE “ecomagination” products by an independent agency:

BiogasLandfill gasCoal mine gasCogeneration

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Service for Jenbacher gas engines

• Commitment to our customers

• Going beyond designing the best available technology

We support your business

We support our customer’s business by providing the right service at the right time throughout the entire operating life of the engine

2050 engines globally are covered by CSA/MSA

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China renewable energy 11th five-year plan• Goals: ↑ RE to 10% of total Installation by 2010; 15% of total by 2020

GW 2005 2010 2020Hydro (Small) 117 (38) 190 (50) 300 (75)Biomass 2 5.5 30Agri-biomass – Straw 4 Biogas 1 Waste – LFG & Incineration 0.5

Wind 1.26 10 50Off Grid Wind 0.05 0.075 Solar 0.07 0.3 1.8

• Renewable Portfolio Stands (RPS) Requirements:− PG firms (>5GW Installation): Non-hydro RE over 3% by 2010; 8+% by 2020− Grid firms: Take over 1% non-hydro RE by 2010; 3+% by 2020

• Renewable Energy Law Implementing Rules:− RE power 100% grid connection guarantee− RE power tariff additional charge/subsidy tradable (Biogas 25 cents more based

on coal fire standard tariff)− RE Special Funding established (Budget planning each year)− 1/2VAT for developers; Other incentive taxation policies under development− Set up State RE R&D Center to promote innovation, tech, & capacity building

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• Increased electricity demand due to economy growth…Distribution and energy security issues

• Environmental regulations reinforcement …CDM

• 2nd W2E pipeline’s accomplishment – gas availability

• Emission Standard of CMG…Government decision to lessen coal mine explosions (6977 died in ‘04)…CMG opportunities.

• China’s long term water conservation plan, 11th 5 year plan, NDRC – 3 lakes (Boyang lake, Dongting Lake, Taihu Lake…), 4 rivers (Changjiang river, Huanghe River, Haihe River,Huaihe River).

• New rural construction project by NDRC …Aims to promote renewable energy utilization such as marsh gas, large-scale poultry farm….

Drivers & barriersDRIVERS

• Lack of financing and missing financial power• Lack of gas distribution system• Low electricity price…Massive coal based power

generation/High gas price• Insufficient NG supply… Cautious development

of NG power plants• Difficulties at long term agreements for

electricity sales…Hard to sale electricity to the grid

• Challenging approval procedures for funds and carbon credits

• Clients lack of knowledge on system integration• Customers expect growing capability to offer

local goods & services at reduced price• Custom duty exemption (10%) for imported

engines is cancelled for 2008

BARRIERS

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’07A ’08A ’09E Strategy(€ in millions)

Orders

’10E ’11E

$3$12

$15

• Enhance the current presence and coverage

• Distributor

• EPC

• Project base

• Develop/penetrate new applications –steel, oil, ethanol, chemical..

• Influence China government policy to put more incentives

• Localization

• Expand the Hangzhou products offer

• More local sourcing

• Improve local services capability

• Provide local trade alternative to customers

300% 152%

Jenbacher China growth strategy

$60

$100

’07-’11CAGR

’07-’08V%

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