New power station announced

A string of power cuts earlier this year laid bare the strain that Gibraltar’s outdated power generation network is under, focusing attention on the need for a long-term solution to the crucial issue of electricity supply.

The cuts drew accusations of bad planning, although the Gibraltar Electrical Authority argued they were down to unforeseeable circumstances. Temporary generators were brought in to cover demand in the short term and avoid a similar situation, but the question of long term supply remained. That long-term solution, in the form of a new power station, is finally becoming reality after two years of delay arising from technical and legal issues.

In March, the Gibraltar Government announced that it had awarded a £122.8m contract for the construction of a diesel power station and related distribution infrastructure. It is the largest single contract ever awarded by the Gibraltar Government. Once complete, the new power station will replace Gibraltar’s three existing facilities and ensure sustainable power supply for decades to come. Getting here has been a tortuous process that started in 2007 and involved major technical work to assess the site and properly evaluate the scheme’s environmental impact.

It was further complicated by a legal challenge by nearby residents concerned about noise, a case that was settled out of court and resulted in further design tweaks. Chief Minister Peter Caruana, in announcing the contract, made no bones about the difficulties encountered.

“It has been a hugely complex process to get to this stage, but the new power station will ensure a modern and resilient electricity supply to Gibraltar well into the future in the most environmental friendly way that is practical and realistic,” he told B2B.

“It represents a very large investment for our future prosperity as a community both in social and economic terms.”

The contract was awarded to a joint venture between ETDE SA – major power station contractor company subsidiary of French multi- national company Bouygues – and Dutch Civil Engineering Company Volker Stevin Construction Europe B.V.

The new Power Station will initially contain eight Caterpillar Diesel Generating sets each of approximately 7.8 Mega Watts, providing a total installed capacity in 2013 of 62.4 Mega Watts. The scheme will provide room to add further engines in the future should Gibraltar’s power needs expand further.

Central to the project are environmental considerations. The new power station will comply with EU regulations and use best available technology to minimise emissions and pollution.

This includes selection of engines with high efficiency and thus minimised consumption of fossil fuel and thus production of carbon dioxide, use of low sulphur and low ash fuel to minimise levels of particulate emissions and Sulphur Dioxide, use of selective catalytic reduction equipment and engines with fuel injection and valve timing optimised to minimise Nitrogen dioxide emissions.

“The use of leading equipment and best available technology makes an important statement about our commitment as a community to the environment,” Mr Caruana said.

“The closure of Gibraltar’s three existing and ageing power stations will, by itself represent a major environmental gain.”

The Environmental Safety Group, which has long campaigned for cleaner air in Gibraltar and has been highly critical of emissions from existing plants, welcomed the announcement, if with some reservations.

Replacing Gibraltar’s three “ageing and heavily polluting” power stations – Waterport, OESCO and the Ministry of Defence facility – is, for the group, a positive step.

But the fact that the new plant will rely on diesel engines is a source of concern for the ESG.

“The new power station is a critical and important step for immediate environmental and health benefits for the community,” the group said following announcement of the contract.

“Clearly fossil fuel reliance for Gibraltar’s’ energy needs on a long-term basis is not a position supported by the ESG.”

“Once in place, the focus should move towards the sourcing of biofuel such as biodiesel – waste vegetable oil, or natural gas from anaerobic breakdown of sewage and domestic waste – as fuel for the new power station, with which it could operate with little or no changes to its engines depending on the biofuel used.” Other environmental campaigners were less accommodating.

The Gibraltar Ornithological and Natural History Society was among those who objected to the project on a number of fronts. It was concerned, for example, that construction of the plant would have a huge adverse impact on wildlife and ecology in the south of Gibraltar, one of the last relatively-untouched areas on the Rock. According to GONHS, the Gibraltar Government’s energy strategy “requires more vision” and focus on renewable sources of power.

Construction of a new fossil fuel power station will leave a damning future legacy for Gibraltar, the group said.

“It has to be assumed that once the power station is built it will be here for decades, with the environmental deterioration of the South District continuing for generations,” GONHS said in a statement last year.

“And generations will regret the decision.”

“Gibraltar is sealing its options and will be anchored firmly in the past at a time when fuel costs will spiral and stocks run out.”

But was there really an alternative?

At a symposium late last year organized by the Gibraltar Group of Professional Engineers, international energy experts suggested that renewable sources of energy were not adequate for Gibraltar’s needs, at least at this stage.

The Rock’s size meant there was insufficient space to use established sources such as wind and solar energy, while others including tidal energy were still in the early stages of development and could not be relied on to meet local demand.

Dr Nigel Burton, president of the Institution of Engineering and Technology in the UK and a veteran of the energy sector, offered a sobering assessment on the scope for green energy in Gibraltar.

For Dr Burton, the future lay in diesel generators powered by renewable sources of bio-diesel, a view in line with that offered by the ESG.

“To my mind, you already have the way forward,” he said.

“If some of the other renewable things help you around the edges, then so much the better.”

“If the target is to introduce renewables in Gibraltar, then it’s going to be a little bit of this, a little bit of that and a little bit of the other,” Dr Burton added.

“It’s not going to be a big bang solution, with the sole exception of perhaps bio fuels.”

There is, of course, another option, but one that few dare mutter openly, let alone support as a viable alternative: buying electricity from Spain.

When the Chamber of Commerce explored this idea in an editorial in this magazine last year, the reaction from many sectors of Gibraltar was sharp.

The widespread view was that, against the background of decades of hostility by Spain, Gibraltar needed to remain energy independent.

But the high cost of the new power station, coupled to concerns about environmental sustainability, prompted the Chamber to ask the difficult question.

“In these days of pan European markets in energy supplies, could we not plug in to the European ‘grid’ and contract with some European Electricity Authority or Energy Company for the supply of power?” the Chamber asked in the editorial.

“Is the price of ‘independence’ on energy terms worth paying, now and for many years to come, particularly in an era when cross border energy supply is a common occurrence?”

As for reducing demand, there is little realistic prospect of progress here either, particularly given Gibraltar’s sustained economic growth. New business, property and infrastructure developments will translate into increased appetite for electricity.

While energy efficiency measures – low consumption light bulbs and the like – will help, Dr Burton made clear at the energy symposium that genuine gains would be hard-earned in this context.

Ultimately, it was down to price.

“It’s only when people have to pay for things that they change their behaviour.” he told B2B.