Bechtel: A Partner in Taiwan’s Energy Transition

As Taiwan pursues its ambitious plan to realign the energy mix of power generation to reduce carbon emissions, the need for organizations capable of delivering complex energy projects has never been more urgent. The government has adopted an ambitious “50/30/20 plan” to increase the use of natural gas in electricity generation to 50% of the total and the use of renewable energy to 20% in the next few years, while Reduce reliance on coal to 30%.

Bechtel – a global leader in energy infrastructure – has invested decisively in expanding its established capabilities in Taiwan to support the country’s energy transition goals. The successful execution of these projects remains a serious challenge, given Taiwan’s continued growth in energy demand amidst global economic uncertainty. Bechtel is drawing on its extensive experience – over the past 15 years it has built more than 44,000 megawatts (MW) of combined cycle power plants (CCPP) and 15 LNG storage tanks in 13 countries, including Taiwan – — to help meet gas-to-power goals. “Bechtel’s integrated engineering, procurement and construction (EPC) execution model has a proven track record of improving project performance and efficiency, and delivering on time and within budget,” said Lee Broadhurst, Asia Operations Manager. “We want to use our proven methodology to deliver EPC projects in support of Taiwan’s ambitious energy plans,” said Broadhurst, who manages Bechtel’s thermal power project interests in Taiwan in Taiwan.

Two government-owned companies, Taiwan Power Corporation (TPC) and China National Petroleum Corporation (CPC), are leading the charge in building the country’s infrastructure, while independent power producers are also key to the transition. Given its extensive expertise and experience in the design and construction of natural gas power generation projects, Bechtel is in a prime position to help.

Bechtel recently completed a CCGT project in 2021. The 1,182 MW CCGT was completed in 37 months, although much of the project took place during the Covid-19 pandemic.

Turbocharging for Large LNG Projects

In July 2022, Bechtel Energy broke ground on the Taichung Port Zhongyou Taichung Phase III LNG Import Receiving Station – two fully enclosed LNG storage tanks of 180,000 cubic meters. Scheduled for completion in 2026, they will be the largest LNG storage tanks ever built in Taiwan. The project is a key step in realizing the country’s clean energy aspirations, buffering against potential supply disruptions by rapidly expanding the LNG import terminal.

The expanded LNG storage capacity will support TPC’s ongoing construction of additional CCPPs – installations using gas and steam turbines. TPC currently has approximately 8.7 gigawatts (GW) of new CCPP projects under construction, with further purchases estimated at 8 to 10 GW expected by the end of the decade, providing Bechtel with a value-added platform.

Another key advantage for Bechtel is its ability to leverage the collective and individual expertise of the local team at Pacific Engineers & Constructors Ltd. (PECL), Bechtel’s wholly owned subsidiary in Taiwan. During its 44-year history in Taiwan, PECL has become intimately familiar with the details of Taiwan’s engineering regulatory compliance regime and the needs of its clients.

An existing 2,000MW heavy oil fired power plant is currently planned to be converted to a 1,300MW combined cycle gas turbine. PECL acted as TPC’s owner’s engineer in this project, providing the environmental impact assessment and preliminary design of the power plant, LNG receiving terminal and LNG storage tanks.

Bechtel’s Integrated Delivery Model

Navigating complex energy transition programs requires accurate forecasting of the availability of new generation capacity, which in turn relies on the timely procurement and execution of the major infrastructure projects involved. Laying the groundwork for the success of such projects has long been one of the priorities of the AmCham Taiwan Infrastructure Committee. The Committee recommends that the government rely on merit-based bidding rather than the lowest price in the procurement process for strategic national projects, and always apply contract terms and conditions consistent with contemporary market practice. These changes will encourage increased market activity by international players, helping to raise standards for critical projects in safety, scheduling, supply chain management, and workforce and execution planning.

Some progress is being made in addressing these issues, and there are indications that they may be addressed in the next TPC purchase. “Bechtel welcomes this development, seeing it as an opportunity to demonstrate the applicability of the company’s integrated approach to EPC management,” said Chris Hearn, Asia Business Development Manager, Energy Business Unit, Bechtel.

Bechtel’s integrated delivery model ensures connectivity for each scope of work, up to the operation of the entire plant. It considers all pathways and how they interact and predicts influences from external sources. The recently completed 1,200 MW US Southfield Energy CCPP project successfully navigated the impact of Covid-19 as the project entered critical construction and commissioning phases as the project team and client took immediate steps to protect project objectives.

The greater the alignment and understanding of shared goals within the team, the greater the ability to positively impact outcomes. In the Taichung Phase III LNG storage tank project, Bechtel is working with the target Taiwanese contractor to study specific construction methods to improve technology to meet the requirements of the LNG and cryogenic markets. Collaboration and early engagement with local contractors is a critical part of setting up for success.

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