Northern Ireland's electricity is provided by four power stations. The large Ballylumford plant, owned by British Gas subsidiary Premier Power, has recently been converted from oil to natural gas. Baseload power is supplied by Nigen's coal-fired Kilroot and West Belfast stations, while the oil-fired Coolkeeragh plant helps meet peak demand.
The Province's generating market is set for a major shake-up over the next few years. Firstly, electricity regulator Ofreg expects the aged West Belfast and Coolkeeragh plants to close in 3-5 years. The resulting shortfall in capacity will be met either by a proposed interconnector with Scotland or by new generating plant - probably gas-fired. An assessment of the cost of power delivered by the interconnector, due to be released by Ofreg in June, will determine which course is taken.
Secondly, Ofreg's two-year battle to push down generating costs is expected to come to a conclusion later this year. Unlike the rest of the UK, where generating costs are determined by bidding into the electricity Pool, Northern Ireland's generators are paid for availability under fixed-term contracts. Ofreg wants costs cut from the current level of 4.2p/kWh towards the 2.9p/kWh typical of Pool prices.
Nigen is considering a range of options to bring down costs, and has submitted confidential initial proposals to the regulator. ENDS understands that one option is to convert Kilroot to burn Orimulsion, the cheap bitumen-based fuel imported from Venezuela. Use of gas is also being considered, but may raise concerns that the Province could become over-dependent on a single fuel source.
Previous efforts to introduce Orimulsion in the UK have been dogged by controversy. Last year, PowerGen paid £3.5 million to a Kent farmer who alleged that use of the high-sulphur fuel in Richborough power station had harmed his crops (ENDS Report 272, pp 3-4 ). At the same time, National Power dropped long-running plans to convert its Pembroke plant to run on Orimulsion.
Ian Cross, Kilroot's Safety and Environment Co-ordinator, says that Nigen "would not consider Orimulsion without full abatement." Indeed, the Department of the Environment's pollution inspectorate would almost certainly insist on an FGD retrofit before the fuel could be used. Earlier this year, the inspectorate received new powers under a version of integrated pollution control (IPC) (ENDS Report 277, p 40 ). Nigen is due to apply for authorisation by the end of the year.
Even without conversion to Orimulsion, FGD at Kilroot is a likely prospect. The 600MW station was commissioned in 1981 to run on heavy fuel oil, but in 1989 was converted to run on either coal or oil. Since then it has run on imported coal, typically with a relatively low sulphur content of about 0.8%.
Nigen's contract to generate power from Kilroot runs until 2024, though there is a cancellation option in 2010. Because of this long remaining operating life, says Mr Cross, "whatever option we take up will have to meet new plant standards. Clearly on the existing fuel mix FGD is going to be required." Kilroot is located on the north shore of Belfast Lough - making it a possible candidate for the relatively cheap seawater scrubbing option.
However, the high capital and operating costs of FGD could conflict with Ofreg's drive to cut generation costs. The existing contracts allow the Province's generators to pass on costs arising from a change in the law - but it remains unclear whether this clause applies to environmental costs arising from the application of the "best available techniques not entailing excessive cost".