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Pre-Feasibility Study of a 1000 MW Pumped Storage Plant in Saudi Arabia

Willy Kotiuga, Souren Hadjian, Michael King SNC-Lavalin Inc., Hydro Division, Canada

Luai Al-Hadhrami, Mohamed Arif, Khaled Yousef Al-Soufi King Fahd University of Petroleum and Minerals, Saudi Arabia

Abstract Electricity demand has grown in the Kingdom of Saudi Arabia at a very fast pace and there are large differences between the summer and winter peak loads as well as between morning and evening peak loads. Thus, the predicament facing the Saudi Arabia power sector is how to reduce the requirement and investment for new thermal peak plants in order to meet the rapidly increasing short-term peak demands. To ensure a reliable power supply, the system needs expensive peaking units to operate just for a few hours during the whole year. To reduce the peak thermal generation, the possibility of building pumped storage hydroelectric power plants is being considered. During the off peak generating hours, when surplus generation is available, the pumped storage plant will pump water to an upper reservoir, and then use this stored water for hydro generation during peak load hours. The scoping study started in April 2012 showed that a 1,000 MW pumped storage plant, that could generate power for eight hours, would eliminate the need for 1,000 MW thermal plant burning heavy fuel oil. It also identified a number of potential sites that will be ranked using Multi-Criteria Analysis (MCA) to combine criteria such as: geological conditions; environmental and social impacts, capital cost and economic viability; as well as access to the transmission grid. The major challenge is the limited experience in using seawater for pumped storage. Mitigation of corrosion effects from seawater is a major issue and may become a significant cost factor. Saudi Arabia’s extensive sea-water corrosion mitigation experience and world-wide experience from tidal water power projects will be integrated in the solutions proposed for the first large scale sea-water pumped storage plant. This paper presents the results of the prefeasibility study which includes: impact on meeting the peak demand, site selection criteria, integration to the existing network and pumped storage plant configuration.

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STUDY OBJECTIVES AND APPROACH

Objectives The study’s purpose was to address the developing problem in Saudi Arabia of the varying demand load shape, on both hourly and seasonal basis, which is compounded by the rapidly increasing electricity demand in the Kingdom’s power system. Since the power supply is entirely thermal, the economics of generation can be significantly improved if there is a mechanism for levelizing the demand being met by the thermal plant generation. The study examined possibilities for pumped storage hydroelectric generation to at least partially levelize the demand on the thermal system, whereby water is stored at an upper reservoir during off peak hours, and then used for generation during peak load hours. This reduces the demand on the thermal system during peak hours and utilizes relatively low cost thermal plant during the off peak pumping hours. The cost of this off peak pumping to storage is primarily the fuel cost for thermal plants operation during off peak hours. The three main objectives of the study included:

• Analysis of the load curve characteristics to develop a relationship between load factor modification and installed capacity and storage from pumped storage to determine ‘optimal’ sizing

• Identification and evaluation of potential sites, including the redevelopment of existing water storage projects

• Provide an preliminary environmental and economic assessment of these potential sites

The study evaluated both new sites, originally expected to be using seawater, pumped to adjacent high ground as well as the possible redevelopment of existing freshwater storage dams with the addition of upper reservoirs and pumping/generation facilities.

Overall Study Components The three main components of this project were: (i) a scoping study, (ii) project identification, and (iii) environmental and economic assessment. The Scoping study included:

• Review of international practices as part of the process to develop project criteria, especially as related to seawater use.

• Analysis of load characteristics, hourly and seasonal, as well as future projections

• Study of installed capacity ranges, in order to relate project size to thermal demand modification

• Development of siting criteria to provide the basis for project site identification

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Project identification is closely related to the scoping study, it included: • New site investigations to identify sites meet the siting criteria (physical

parameters, related to storage and cost efficiency) • Assessment of pumped storage options for existing storage dams • Ranking and selection of candidate sites for environmental and economic

assessment The environmental and economic assessment followed the project identification phase and was applied to only the selected possible sites, including:

• Preliminary environmental and social impact assessment to determine if there are any major risks associated with the selected sites

• Economic evaluation to determine the costs and benefits associated with each of the selected candidate sites

• Development of overall implementation schedules for the selected projects The conclusions developed in the study are presented in the following subsections.

RESULTS

International Practice The purpose of this review was to define current maximum size applications, which provide a sound indication of economic and design limits, and to investigate experience in saltwater applications.

Conventional (Freshwater) Plants A review of conventional international pumped storage development showed that most experience has been developed by USA, Japan, Ukraine, Germany and France, with USA and Japan providing about 40% of the total pumped storage installed capacity. Project data shows that single stage reversible pumped storage units are now being designed for up to about 800 m head, and in the next decade this limit may increase to about 900 m. Higher heads may be developed using multiple stage arrangements, however for the purpose of this study a practical limit of about 800 m head and single stage units were assumed. The largest power stations in the world are in the 2000 to 3000 MW range. However plants sizes in the 1000 MW to 1500 MW range are more common and, typically in these larger stations, the units sizes are in the 300 to 400 MW range. The analysis of the load shape for the system and sizing of existing thermal united showed that an installed capacity of 1000 MW with ability to supply full capacity for eight hours would be required. Thus, for the purpose of evaluating alternative sizes a typical station configuration, such as 4 x 250 MW units with a maximum head of 800 meters was taken into account.

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The other parameter of interest was the relation between head (elevation difference between upper and lower reservoirs), and the distance between reservoirs (approximately the overall water conduit or tunnel distance). Clearly, the shorter the distance in relation to the head the more cost effective the layout is. Comparison of this parameter (L/H) showed that plants being developed were almost always with a ratio of less than 10. Thus, for a maximum head of 800 m, the maximum distance between the upper and lower reservoirs should be less than 8 km.

Seawater Plants Experience of pumped storage using seawater is limited to a single project in Japan, the 30 MW Okinawa project with a head of 136 m, operating since 1999. Its small size allowed very expensive corrosion protection to be applied, and plant performance has been successful. A much larger plant, with about the same head, is at the conceptual study stage in Ireland. No direct information was found on the cost of erosion protection needed for a seawater plant, or the overall reliability and life of such protection. However, this protection would have to include extensive epoxy painting, cathodic protection and prevention of saltwater leakage from the system.

Load Shape Modification The analyses considered the growth in the demand for the central, eastern, western and southern operating systems separately for the period up to 2028 and then, based on planned internal interconnections, analyzed the effect on construction of a 1,000 MW pumped storage on the system thermal requirements. The analyses used hourly load patterns for 2011. The analyses showed that the plant would operate between May and October, with a typical operating pattern of 8 hours during the peak period and 12 hours of pumping during the off-peak period. The major deciding factor for the pumping/generation rate is the Load Marginal Cost (LMC) in each of the four operating areas. The pumping would be done in off-peak hours and powered by the marginal thermal unit in the system where the LMC at off-peak is the lowest – interconnection capacity allowing. Then the pumped storage plant (PSP) would generate power to replace thermal power during peak hours in the areas where the LMC during peak hours is the highest – interconnection capacity allowing. Analyses showed that the LMC in off peak hours was lowest in the western operating area providing the pumping energy. The maximum benefit would result from supplying peak generation to the southern area. However interconnection capacity could limit this, so the analysis of benefits assumed peak supply to the western, central and eastern areas. An analysis was done to evaluate the relation between net benefits and plant sizes, and it demonstrated that benefits increased with plant size. However, if expressed as a

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function of plant size (and thus investments), benefits decrease rapidly for plant sizes above 1,000 MW. This provided the basis for selecting 1,000 MW as a nominal maximum plant size for this study.

Search for Saltwater Sites along the Western Coastline To identify candidate saltwater sites, topographic studies were made of the whole coastline from Aqaba to the Yemen border, approximately 1800 km. The screening of potential sites was made using the head limit of 800 m, and L/H of less than 20. The figure to the right represents the plan view and profile 20 km parallel to the coast line. A total of 27 specific cross sections, or profiles from the sea, were identified, and compared for maximum heads of 500 and 800 m. Three alignments in the Gulf of Aqaba were identified that met the basic criteria. This provided the initial conclusion that the Gulf of Aqaba offered the most potential for economic pumped storage development. The next phase was the identification and comparison of ten potential sites along the Gulf of Aqaba. The procedure was to identify suitable upper reservoir locations and then, by inspection, a tunnel alignment linking each of them to the sea. Three sites, approximately 90 kms south of Aqaba, provided significantly better cost indicators. In terms of construction access, the preferred site of these three, referred to as the Magna site (XS-1), was selected on the basis of better topography in the powerhouse / tailrace areas. The Magna site would provide the following project parameters:

Installed capacity 1000 MW Units 4 x 250 MW Head 755 m L/H 4.64 Turbine discharge 165 m3/s Upper reservoir storage 5 h2m (total) Reservoir dam 80 m high x 350 m crest length

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Existing Dams The evaluation of existing water storage dams included seven projects: Rabigh, Murwani, Therad, King Fahd, Hali and Baysh. Review of adjacent topography at each site confirmed that in all cases, the existing reservoirs would have to be the lower reservoir. Thus, the study sought to locate upper reservoir options for each, whereby between 300 and 800 m of head could be developed with a L/H ratio of less than 10-12, and where the upper reservoir topography was adequate for the required reservoir size. Three possible sites were identified for each existing dam. These upper reservoir sites were ranked for each project and only Baysh could offer qualifying upper reservoir site locations. Thus, this option was retained for more detailed study, because Baysh would meet the reservoir size requirement to provide 360 m of head, with a cost indicator L/H of 11. The existing reservoir and the proposed new upper reservoir are shown in the figure to the right.

Selected Sites and Capital Costs The more detailed studies consisted preparing of preliminary layouts and cost estimates. The economic assessment concentrated on the best of the coastal saltwater sites, Magna, and the redevelopment of the existing Baysh dam. The Magna site was evaluated with two options:

• Use of saltwater taken directly from the sea, with the addition of corrosion protection, and associated increased capital and maintenance costs (Magna A)

• Use of freshwater from a desalination plant at the tailwater discharge, requiring the desalination plant and a lower reservoir at sea level, however without additional costs for corrosion protection (Magna B).

The rational for the desalination option at Magna was twofold:

• The uncertainly in predicting increased costs for erosion protection and the effectiveness of these measures

• The probability that cost of a desalination plant would be significantly lower than the cost for erosion protection.

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Table 1 Summary of Project Options

Item Magna A Magna B Baysh Installed capacity MW 1000 1000 1000 No units 4 4 4 Head m 755 755 330 Upper reservoir dam height m 80 80 112 Upper reservoir dam crest length m 350 350 400 Plant max discharge m3/s 165 165 375 Headrace tunnel length m 786 786 832 Headrace tunnel diameter m 5 5 7.8 Powerhouse dimensions m 72Lx21x20H 72Lx21x20H 87Lx5Wx59H Tailrace tunnel length m 3200 3200 2536 Tailrace tunnel H x W m 6.8x5.6 6.8x5.6 14x14 Desalination plant No Yes No Transmission interconnection Tabuk Tabuk Jizam Transmission distance kms 205 205 70 Voltage kV 330 DC 330 DC 330 DC Project preparation time (years) 7.5 7.5 7.5 Construction time (years) 5 5 5 Capital cost $US (million) Civil works - direct 279 366 426 Electro-mechanical - direct 485 485 523 Camps/construction power 28 37 43 Transmission 104 104 42 Total direct cost 897 992 1,034 Indirect costs 301 327 353 Total project cost 1,198 1,319 1,387 Environment / social mitigation 14 18 21 Desalination plant (5000m3/d) 0 15 0 Corrosion protection 239 0 0 Total budget ($US million) 1,451 1,352 1,408 Cost/kW ($/kW) 1,451 1,352 1,408 These costs are essentially the same at the accuracy level of this study. However it should be noted that the operation and maintenance (O&M) costs for both Magna alternatives will be higher that for Baysh. Magna A will have higher maintenance and equipment replacement costs due to corrosion effects. Whereas, Magna B will include higher operation costs associated with the desalination plant, primarily for power supply and O&M for the desalination plant itself.

Social / Environmental Impacts A preliminary social and environmental impact study was included in this study. Essentially, due to the remote or low population environments for each site, social and environmental impacts are expected to be minimal.

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Given that both projects are essentially underground, primary biological environment impacts will be associated with the reservoirs, and with the construction process. Mitigation actions will mainly consist of strictly observing the Wildlife Regulations of Saudi Arabia and ensuring an adequate clean up and restoration of the work sites after project completion. However, there will be significant social impacts during construction due to the influx of construction workers, although these will primarily be housed in camps. Impacts will essentially occur in the towns of Magna and Baysh, and transport infrastructure will also be affected There will be social and environmental benefits that will accrue from the construction and long-term operation of either project. These are outlined below.

Socioeconomic Advantages: • Direct or induced generation of local employment. • Increased economic well-being and spill-over effects in the area • Availability of back up renewable power generation to the community with an

emission-free source. • Improved social values due to cross-cultural exchange of communities • Increased overall social welfare of the energy market, both on the supply and

demand sides.

Environmental Advantages: • The project will produce electricity without burning fossil fuel. Hence it will

ultimately help in reducing the carbon emission by Saudi Arabia • The freshwater dam will help increase the groundwater table within the project

area which will benefit the terrestrial environment. • Preliminary study of terrestrial biological environment indicates that there is no

protected area in or to immediate vicinity of either site.

Economic Assessment The economic assessment compares and evaluates two options for the seawater Magna site and one for the redevelopment of the Baysh dam.

• Magna A - Use of saltwater taken directly from the sea, with the addition of corrosion protection, and associated increased capital and maintenance costs

• Magna B - Use of freshwater from a desalination plant at the tailwater discharge, requiring the desalination plant and a lower reservoir at sea level, however without additional costs for corrosion protection.

• Baysh - Addition of a pumped storage plant to the Baysh water storage dam, using the existing Baysh reservoir as the lower reservoir

Each alternative would provide 1000 MW of peak generation

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For Magna A, the lower reservoir is not required, hence its capital cost is reduced by the cost of lower reservoir (M$86 USD). However, an allowance of a 20% increase in costs was used to take into account the measures required to mitigate the corrosion affects on the plant, in terms of erosion protection and waterproofing to prevent salt water leakage. For Magna B, the capital and O&M costs of the desalination plant have been included in the economic analysis. Based on the data obtained from various sources on desalination plant costs, the desalination plant capital and O&M costs were assumed to be USD 2,900/m3/day and USD 0.50/m3 respectively. The desalination plant capacity is assumed to be equivalent to the make-up water requirements, meaning 5,000 m3/day. For both alternatives, Magna (Gulf of Aqaba) and Baysh, an allowance for environmental mitigation costs of 5% of the civil work costs was assumed for the economic analysis. The basic comparative parameter used was the benefit cost ratio (B/C). The results for each of the selected options are provided below:

Magna A – Pumped storage plant with seawater: B/C = 1.31 Magna B – Pumped storage using desalinated water: B/C = 1.49 Baysh pumped storage: B/C = 1.43

A sensitivity analysis was carried out for each alternative, and the B/C ratios were determined for the following: range of capital cost (+/- 20%), range of purchase price of electricity for pumping (+/- 20%), range of electricity selling price (+/- 20%), as well as alternative discount rates of 3% and 7% versus the base case of 5% discount rate. Payback periods were also determined for each case. Essentially, positive B/C ratios were obtained for each case, confirming that the results are robust and not sensitive to assumptions regarding costs and electricity prices. Also, the ranking between alternatives remained unchanged for each sensitivity case.

CONCLUSIONS The study’s objective was to provide a high level assessment of whether, and to what extent, pumped storage could be used as a cost effective and technically viable approach to reduce future thermal generation costs, and thus overall costs for meeting the electricity demand in Saudi Arabia. Based on the study results, which are summarized in the previous subsections, the following conclusions may be drawn.

Technical Feasibility Conventional pumped storage using freshwater is in widespread use worldwide. Recent experience seems to favor plants in the 1,000 to 1,500 MW range. At an initial stage of

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assessment, the most probable economic plant configuration would be about 1,000 MW for a head under 800 m. There is no technical impediment for a conventional pumped storage development, and there is widespread experience in design, construction and equipment manufacture in this field. Experience on pumped storage plants using saltwater is limited to a small research plant in Japan. Thus, there is no direct experience on which to base technical feasibility or additional costs for corrosion protection for plants in the 1,000 MW with 800 m head range. However, there is significant experience on low head saltwater hydroelectric plants for tidal power, as well as for corrosion protection in maritime seawater environments. In conclusion, if a pumped storage plant using with sea water is to be promoted, the next step would be a mid-size project in the 250 MW with 300 m head range, in order to allow further development of designs for corrosion protection. This study considered the option of providing desalinated makeup water for coastal plants, which would be technically and economically a viable option for the development of coastal pumped storage.

Load Shape Modification System simulations showed that the addition of peak hourly capacity from pumped storage with an associated energy loss for pumping would have a significant effect on reducing thermal generation requirements and would be economic. It was also determined that an optimum addition would be of about 1,000 MW, as benefits as related to plant size and cost would proportionally decrease for higher installations. Thus further, investigations should target this size range.

Coastal Pumped Storage Sites Based on topographic studies of the complete Saudi Arabia western coastline, that is from Aqaba to the Yemen border, it was determined that the most favorable topography for a cost effective pumped storage development would be in the Gulf of Aqaba. Based on the screening of ten sites in the Gulf, the most potentially cost effective site would be near Magna, allowing the construction of a plant of 1,000 MW under a head of 755 m. The alternatives for the Magna site would be seawater use with corrosion protection (feasibility not confirmed at this stage) or desalinated water use.

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Redevelopment of Existing Storage Dams A study of seven existing water storage dams concluded that the most promising site for adding pumped storage generation would be the Baysh dam, where the existing reservoir would serve as the lower reservoir. Topography would limit the plant to 330 m, however it could be developed with a 1,000 MW installed capacity.

Environment No social or environmental issues would severely mitigate against pumped storage at either of the two sites, Magna and Baysh, were identified.

Economics Based on the three selected alternatives of 1,000 MW, that is Magna with and without desalination as well as Baysh, costs were similar at $1,350/kW to $1,450/kW, with the differences being well within the margin of accuracy at this preliminary stage. Estimated costs included all indirect costs, but without interest during construction and they are consistent with those from other similar planning studies. The economic studies showed attractive results for all three options, with the Magna alternative with desalination being the preferred alternative. Base case B/C ratios were in the order of 1.3 to 1.5, with payback periods of 11 to 12 years.

Way Forward In order to reduce future thermal requirements, the study has shown that either coastal development (with desalination) or redevelopment of Baysh would be viable solutions. Any decision to undertake further studies should include a non-cost evaluation of the coastal versus redevelopment concept for the selection of the next project. The conventional project implementation process could involve at least 5 years for project preparation, including studies, design and contracting, followed by about 5 years of construction. The next step would be a detailed pre-feasibility study, involving some field investigations at the selected site which would take at least one year, followed by a final feasibility study and environmental assessment.

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Author Biographies Dr. Willy Kotiuga is Senior Director, Strategic Studies with SNC-Lavalin Global Power with over 30 years of experience advising utilities, governments and funding institutions as well as the private sector on power sector issues. He has been the principal investigator in the preparation of regional and national power sector plans where he played a key role in the development of methodologies for forecasting load demand, assessment of power market opportunities, optimization of generation resources and economic evaluation of options. He obtained his PhD from the University of Walterloo in Canada Dr. Luai Al-Hadhrami is Director of the Center for Engineering Research and Associate Professor of Mechanical Engineering with the, King Fahd University of Petroleum and Minerals (KFUPM), Saudi Arabia. He has over 10 years experience in teaching and applied research in energy conservation and thermo fluids. He has published several technical papers in refereed technical journals and conference proceedings. Dr. Al-Hadhrami obtained his PhD from Texas A&M University and MS and BS degree from KFUPM, Saudi Arabia. Mr. Mohammed Arif is a Research Engineer with the Research Institute, King Fahd University of Petroleum and Minerals (KFUPM), Saudi Arabia. He has 30 years of experience in field of power system planning and power quality studies. He has published several technical papers in refereed technical journals and conference proceedings. Mr. Arif obtained his MS in Electrical Engineering from KFUPM in 1985 and BS from Nagpur University, India, in 1980. Mr. Khaled Al-Soufi is a Research Engineer with the Center for Engineering Research, KFUPM, Saudi Arabia with over 25 years of experience in applied research in the areas of high voltage and power systems. He supervises the High Voltage Laboratory and has managed many research projects including: establishing an electrical equipment testing laboratory, determining environmental effects on polymer insulators properties, performance of high voltage insulators, captive power generation policy, and effects of underground high voltage cables on water trees. Mr. Michael King graduated from McGill University, Canada, in civil engineering in 1961. He worked for Shawinigan Engineering up to its take-over in 1982 by Lavalin, and its subsequent fusion with SNC to form SNC-Lavalin in 1991. He has extensive experience in generation planning and in the planning and design of hydroelectric projects in Canada, Pakistan, Malaysia, East Africa, Southern Africa, Nigeria, Honduras, Panama, Bolivia, Argentina and Guyana. He has been involved in the Saudi Arabia pumped storage study throughout its execution. Mr. Souren Hadjian is a Senior Engineer with SNC-Lavalin with over 30 years of experience in the design of the civil works of power plants around the world. He graduated from Concordia University in Montreal Canada in civil engineering and is a registered professional Engineer.