GE Turbines Flying Like Hotcakes
GE Power Systems has not been able to keep its gas and steam
turbines on the shelves, as Reliant Energy, Duke Energy North
America and NRG Energy all recently signed long-term multi-turbine
GE billed the Duke purchase, worth $4 billion in generation
equipment and services, as one of the largest commitments of its
type in U.S. history.
The Duke agreements cover the purchase of 84 gas turbines, 17
steam turbines and long-term service agreements for up to 23
merchant power plants across the country. When completed, the power
plants will produce more than 13 GW of power for the wholesale U.S.
market. The units ordered represent enough electricity to power up
to six million homes.
GE gas and steam turbines, with their associated auxiliary
equipment, have been shipped to four Duke projects currently under
construction. In addition, construction activities will begin on
six more projects during the first half of 2000 with subsequent
turbine and auxiliary equipment shipments to support summer peaking
requirements in 2001 and 2002, respectively. The remaining
equipment will be shipped from 2000 through 2002 with the intent of
supporting the regional summer load growth in several U.S. markets.
The service agreements will provide major maintenance and spare
parts over a 12-year period from the date of installation on the
Duke Energy North America projects.
But why sign such a large deal? "With the GE partnership we have
again capitalized upon market timing. It is the same market
philosophy that we bring to managing our generation portfolio,"
said James M. Donnell, president and CEO of Duke Energy North
In another deal, NRG Energy Inc., a wholly-owned subsidiary of
Northern States Power Co. executed a memorandum of understanding
with GE Power Systems to purchase 11 gas turbine generators and
five steam turbine generators. The purchases will take place over
the next five years and are valued at $500 million with an option
to purchase additional units.
The 16 turbines have an equivalent generation output of 3,000
MW, which represents enough electricity to supply approximately 1.5
million homes. NRG Energy intends to install the turbines at its
existing North American plant sites.
S&S Energy Products, a GE Power Systems business, was
awarded a $280 million contract from Reliant Energy of Houston to
provide 19 GE LM6000 gas turbine-generator sets, auxiliary and
"The acquisition of GE's state-of-the-art aeroderivative gas
turbines from S&S Energy Products provides us with unique
capabilities to complete our power projects in the Midwest and
offer our customers an in-service date as early as the summer of
2000," said Carolyn Marsh, vice president, Reliant Energy Power
Reliant Energy will operate the gas turbines in simple- cycle
mode for peaking power. Some units will begin service this summer,
with the remaining slated for operation next summer. Reliant plans
to use eight of the units at a site in Shelby County, IL.
S&S Energy Products will fabricate and assemble the LM6000
gas turbine-generator packages in Houston. "To meet the tremendous
increase in power needs throughout the United States, S&S
Energy Products has experienced a significant rise in gas turbine
demand," said Mark Axford, vice president of North American Sales
for S&S Energy Products. "This is evidenced by the sale of 88
GE LM gas turbine- generator sets, including the 19 Reliant Energy
units, in 1999." S&S Energy Products is headquartered in
GE is no stranger to mega-power generation supplies
transactions. Last year, the company inked Entergy into a $1.9
billion, 24 turbine deal, and also forged an arrangement with
Dominion Resources for a 10 turbine deal. Yet this effort is much
larger than either of those previous endeavors. The commitments
from Duke include 36 7FA advanced technology gas turbine-generators
and up to 48 7EA gas turbine-generators, plus 17 steam turbines.