Scottish energy giant SSE yesterday sounded a “vote of confidence” for Peterhead Power Station, giving the go-ahead to £15million upgrade works.
SSE says the investment work, which will take place over the next two years, will extend the life of the plant and allow it to operate more flexibly and efficiently.
It also safeguards around 100 jobs at the gas-fired power station, which is one of the largest power plants in Scotland.
As part of the upgrade, modifications will be made to high pressure and intermediate steam turbines, control systems and the ancillary plant connected to the main unit at the station.
SSE says the majority of work will be carried out by the plant’s existing staff, with specialist contractors brought in as required.
The plant has the potential to produce 1,180MW – enough electricity to power 1million homes – but has on average been running at “well below 50% capacity” for the past year, an SSE spokesman told the Press & Journal.
It is hoped the upgrade work will enable the plant to work at an output as low as 200MW – currently the lowest it can operate is around 480MW – so it can better meet the energy needs of the grid network.
“Clearly the gas market at the moment is quite challenging, and that raises questions about the future of gas plants in the UK,” said the spokesman.
“But we can see there is a role for Peterhead in our generation mix of the future.”
He said the investment signalled a strong vote of confidence in the plant.
The Peterhead plant is in the running for tens of millions of pounds of UK Government funding – a decision is due in early 2014 – to design a carbon capture and storage (CCS) plant on-site.
The Shell-led project could create up to 1,000 jobs during its construction phase.
SSE yesterday also announced plans which could see two coal-fired power stations – Ferrybridge in North Yorkshire and Uskmouth in South Wales – close in the next ten years.
An EU directive to limit emissions of sulfur dioxide and nitrogen oxides would have required SSE to make the plants more environmentally friendly by fitting abatement technology.
SSE has instead chosen to “opt-out” and run the plants as normal, closing them after 17,500 operating hours from 1 January 2016 or by the end of 2023 – whichever is earlier.
The energy giant said there was still the option to make changes to the plants in the next two years to make them comply with the directive.
Peterhead South councillor and chairman of the Buchan area committee Stuart Pratt said last night: “This is excellent news for Peterhead and further underlines the area’s position as a key player in terms of the country’s energy industry.
“This is a significant investment by SSE and makes it clear that the company is here for the long term.”