Independent Power Producers
Independent Power Producers (IPPs) are non-utility generators (NUG) that are typically not owned by the national electricity company or public utility. IPPs generate electricity and sometimes heat (via cogeneration) for sale to a third party. This third party could be the national electricity company, or may be via private wires to a specified company and is typically in grid parallel mode.
Investors in IPPs need to ensure security of revenues and fuel supplies. This may be achieved through a number of mechanisms including power purchase agreements (PPA), sovereign guarantees or feed in tariffs.
Independent Power Producers Benefits
Using gas engines for IPPs has a number of benefits including:
- Facilities can be built as modular solutions consisting of individual engines
- Significant flexibility in ramping up and down power production. An individual engine can operate down to 50% of the full fuel gas input.
- Facilities can be deployed rapidly compared to other major centralised power plants
- Gas engines have high electrical efficiency. Total fuel efficiency can exceed 90% if the unit is established for cogeneration, either linked to a local heat user or district heating network.
- Supporting local electricity grid through distributed generation