Questions Raised Over General Electric’s Flagship Power Turbines in Pakistan
|ISLAMABAD: General Electric’s flagship gas turbines ran into problems in Pakistan earlier this year, leading to delays and lengthy outages at three newly built power stations, according to several senior Pakistani officials and power executives.
GE has said there were teething problems. But the questions over one of its most important products suggest another setback for the company in a year in which its shares have plunged and third-quarter results were called “horrible” by new Chief Executive John Flannery.
There is no evidence that GE’s 9HA-Class turbines have fundamental design flaws. But so far the Pakistani plants, which began running this year, are producing power at levels well below their capacity and the problem was acute in the crucial summer months, when temperatures in the country frequently exceed 40 degrees Celsius.
Data from the Central Power Purchasing Agency showed the Bhikki, Haveli and Balloki plants jointly generated only a half of their current maximum capacity in August. A month later all three plants showed improved output but remained well below capacity. Reuters was unable to review more recent data.
“It had terrible consequences because we lost a lot of power which would have come to the grid during the peak summer,” said Yousaf Naseem Khokhar, the top civil servant in the Energy Ministry’s power division.
In a statement sent to Reuters, GE said “every commercial HA site today is demonstrating exceptional performance levels for both output and efficiency”.
On the issues in Pakistan, GE said: “We’ve encountered and communicated openly about launch challenges and readily resolved issues during this time.”
The 9HA-class gas turbines, the GE power division’s newest and most prestigious product, entered the Guinness World Records last year for efficiency, based on the amount of electricity generated from natural gas at the power plant in Bouchain, France, where it was first put into commercial operation in June last year.
Pakistan, desperate for additional electricity to avoid crippling blackouts, teamed up with GE to build the power stations at Bhikki, Haveli and Balloki at breakneck speed.
GE won the contracts to supply Pakistan with six turbines for the three power plants in 2015, based on the lowest priced deal per megawatt of capacity.
The first problem was the deliveries were delayed by up to three months and missed some of the summer months this year, several Pakistani officials said. They said they were told the delays happened because a part of the turbine needed further testing.
The plan was to fire up the turbines in simple cycle mode - delivering around 800 MW per power plant - in the spring of 2017 and then to upgrade to 1,200 MW combined cycle output after the summer.
The delays infuriated Islamabad, because getting additional power during the summer was a crucial factor ahead of 2018 parliamentary elections.
One of the two turbines at the Bhikki power plant was delayed by about a month. At the Balloki and Haveli plants, the turbines were delayed by about three months, two senior Pakistani officials aware of the situation said.
Then, in early May, a combustion seal leak was detected at one of the turbines at the Bhikki plant. To fix this, and to apply the same remedy to the five other turbines, GE airlifted all the units to France for repairs.
In July, Prime Minister Shahid Khaqan Abbasi, who was then the petroleum minister said that GE spared no expense to fix the problems.
But that meant one Bhikki turbine was offline for about 40 days and the other for about 50 days. The other two plants had not begun operations at the time, but came online in July and August.
In a third setback, one of the turbines at the Haveli plant was badly damaged during a power outage three weeks after it was inaugurated in July, the Pakistani officials said.
At such times, batteries and a generator act as back-ups to ensure a pump continues to push lube oil into the turbine.
“Both didn’t work,” said one of the officials, adding the diesel generator had no fuel. The turbine crashed, with damage estimated at $33 million, and although it was refitted with a new rotor by GE, it is still to resume operations.
The power station is being built by China’s SEPCOIII Electric Power Construction Corporation. SEPCOIII did not return queries for comment.
In September, Pakistan awarded its most recent power contract to Siemens, after bidding by several companies, including GE.
Stephen Tusa, an analyst at JP Morgan in New York, wrote in a recent note that although GE has assured investors that the Pakistan problems have been resolved, they could re-emerge in other plants around the world.
“The risk is that if these issues are not remedied, GE has already ‘sold’ another 30 units, some of which are at higher output ratings,” he wrote.
“Remedies would have to be applied up the curve, something we view as a challenge, especially as senior management tries to cut costs aggressively. Stay tuned.”