IMPLEMENTATION OF GAS DISTRICT COOLING AND COGENERATION

SYSTEMS IN MALAYSIA

MISE EN OEUVRE DE SYSTMES DE GAS DISTRICT COOLING ET DE
COGNRATION EN MALAISIE

Seth Haron
Gas District Cooling (M) Sdn Bhd, Malaysia

ABSTRACT

With its energy demand in the early 1990s growing at a high rate due to the countrys strong economic growth,
Malaysia studied various options to improve the efficiency of its energy use. Since its natural gas reserves are
almost four times that of its crude oil reserves, efforts were therefore centered on seeking ways to boost the
use of natural gas to mitigate the growing domestic energy need. PETRONAS, the national oil company,
subsequently studied and chose the District Cooling System using natural gas as the primary source of fuel.
The Kuala Lumpur City Center development, which houses the PETRONAS Twin Towers, was subsequently
chosen as the first project to use the Gas District Cooling (GDC) System. To acquire the technology and
implement this project, PETRONAS created a new subsidiary, Gas District Cooling (Malaysia) Sendirian Berhad
(GDC(M)). In the process of improving the plants efficiency, GDC(M) discovered that the GDC systems
efficiency and project economics would be significantly enhanced if its is coupled to a Cogeneration system.
Having proven the success of the GDC/Cogeneration system, GDC(M) embarked on a campaign to
aggressively promote and seek new opportunities to implement the system, both in Malaysia and abroad. Apart
from enhancing efficiency of energy use, and providing better project economics, the GDC/Cogeneration
system also is environment friendly. Today, the GDC/Cogeneration systems is the system of choice for
several important developments in Malaysia, which also includes the countrys prestigious projects such as the
Kuala Lumpur International Airport and the New Federal Government Administrative Center in Putrajaya.


RESUME

Au dbut des annes 90, face laugmentation rapide de la demande nergtique lie la forte croissance du
pays, la Malaisie a d envisager diffrentes options pour amliorer son rendement nergtique. Les rserves
de gaz naturel du pays tant prs de quatre fois suprieures celles de ptrole brut, les efforts se sont
concentrs sur les moyens de stimuler la consommation de gaz naturel afin de rduire la demande nergtique
nationale croissante. PETRONAS, compagnie ptrolire nationale, a opt pour le systme de refroidissement
Gas District Cooling (GDC), qui utilise le gaz naturel comme source primaire de combustible. Lurbanisation du
centre-ville de Kuala Lumpur, qui abrite les tours PETRONAS, a t choisie comme projet initial dutilisation du
systme GDC. Afin dacqurir la technologie et de mettre en oeuvre ce projet, PETRONAS a cr une nouvelle
filiale, la Gas District Cooling (Malaysia) Sendirian Berhad (GDC(M)). En cherchant amliorer le rendement de
lusine, la GDC(M) a constat que lefficacit du systme GDC et la rentabilit du projet seraient amliores de
faon significative par ladjonction dun systme de cognration. Le systme GDC/Cognration ayant prouv
son efficacit, la GDC(M) sest lanc dans une campagne de promotion dynamique et de recherche de
nouvelles possibilits damliorer ce systme, que ce soit en Malaisie ou ltranger. Outre une augmentation
du rendement nergtique et de la rentabilit, le systme GDC/Cognration offre galement une solution non
polluante. Aujourdhui, en Malaisie, le systme GDC/Cognration constitue LA solution des programmes
importants, y compris des projets de grande envergure comme laroport international de Kuala Lumpur ou le
nouveau centre administratif du Gouvernement fdral Putrajaya.

1. INTRODUCTION

Between 1988 and 1997 the Malaysian economy registered a strong rate of growth of over 8 percent
per annum. The robust expansion of the economy resulted in the country's energy demand to increase at a
high rate of almost 10 percent a year during that period. Malaysia however was fortunate because it was
blessed with abundant hydrocarbon reserves, which have enabled her to effectively mitigate the countrys
rapidly growing energy need. As at 1st January 1999, Malaysias natural gas and crude oil reserves stood at
about 86 trillion cubic feet and 4 billion barrels, respectively.

While efforts to increase these hydrocarbon reserves were being intensified, Malaysia also embarked
on programmes to better manage the country's growing appetite for energy. With its natural gas reserves
almost four times as big as its crude oil reserves, initiatives naturally centred on boosting the use of natural gas
to displace oil as the country's main source of energy. This objective was achieved in 1994, owing primarily to
the completion of the trans-peninsula natural gas pipeline grid, popularly known as the Peninsular Gas Utilisation
project, or PGU.

Among the several initiatives considered by PETRONAS, the national oil company which was entrusted
with the responsibility to manage Malaysia's oil and gas reserves, is the District Cooling System using natural
gas as the primary source of energy. Apart from ensuring that the nations natural gas reserves are being used
in the most effective manner, the Gas District Cooling System, coupled with Cogeneration, also presents
Malaysia and PETRONAS with the opportunity to obtain maximum value for the countrys natural gas resources.
The discussions which follow are aimed at sharing the information regarding the Gas District Cooling and
Cogeneration system, its benefits, and the company which is actively promoting and implementing this system.




2. THE DISTRICT COOLING SYSTEM

2.1 A District Cooling System, or DCS, essentially involves the pooling or centralising of the thermal media
(chilled water) required for the air-conditioning of buildings within a specific area or district and producing the
chilled water required from one central plant. The chilled water produced from the plant is then distributed to the
respective buildings via a network of distribution pipeline.
The DCS is actually not a new system in the industrialised countries, having been implemented since
the sixties. However, in Asia, the use of the system has been confined mainly to Japan, with a handful being
implemented in Malaysia, Singapore, Hong Kong, and Taiwan. However, almost all the DCS alr eady in
operation outside Japan are electrically driven. Thus, it is therefore not surprising that till today, the gas based
DCS, or Gas District Cooling (GDC), is still a relatively new system in Asia. Equally important is the lack of
awareness of the system and its benefits within the region.

2.2 The low level of acceptance for the GDC system today in most countries is mainly attributed to the
difficulty in obtaining supply of natural gas in the major cities and commercial centres. In some countries, the
use of this system is seriously hindered by the subsidised electricity tariff and high natural gas price. It is
therefore emphasised that these two factors are critical when determining the viability of the GDC system.
Otherwise, the implementation of such system would not be able to provide the investors with the desired return
on investment for such project.





Figure 1. Typical Layout of a District Cooling Plant
3. DIFFERENCE BETWEEN GDC SYSTEM AND CONVENTIONAL SYSTEM
3.1 The fundamental difference between the GDC system and the conventional district cooling system is in
the way chilled water is being produced. The conventional system uses only electrical driven chillers, namely
electrical centrifugal chillers (ECC), which is powered by electricity obtained from the national grid to drive the
compressors which utilise the refrigerant gas, R134, to cool the water down to the desired temperature, usually
between 4
o
to 6
o
Celsius.
3.2 The GDC system on the other hand provides greater flexibility in the choice of system configuration to
produce the chilled water. To power the chillers, the GDC system provides two options. The first method
involves burning of the gas in the direct fired absorption chiller system to produce chilled water. In the second
mode, natural gas is used to fire the boilers to produce steam which is then used to drive the steam turbine
centrifugal chillers (STC), or steam absorption chillers (SAC). For the STC, the refrigerant R134 is used to
produce the chilled water, whereas in the case of the directly fired absorption chillers and SAC, the chemical
lithium bromide is being used. The choice of chiller to be used depends entirely on the temperature of the
chilled water required by the customers. The STC is able to produce chilled water at a very low temperature of
3.3
o
Celsius, whereas the SAC can only produce chilled water not lower than about 6.0
o
Celsius.


4. GAS DISTRICT COOLING WITH COGENERATION -THE SYSTEM OF THE FUTURE

4.1 When the district cooling system was first implemented at the Kuala Lumpur City Centre Development,
or KLCC, in 1995, the chillers used were all ECCs. The plant was configured as such because at that time,
there was no natural gas supply into the city. However, when natural gas supply was made available in 1997,
STCs were installed in the plant. With the STCs, the plant is able to operate on dual mode, using natural gas
and electricity from the national grid.

4.2 Although the GDC technology is still new in Malaysia, efforts were swiftly carried out to further improve
the efficiency of the system. The need to show profitability of the plant was also an important pressing factor.
Apart from reducing operating cost, ways to generate additional revenues were also explored. Various opt ions
were subsequently studied to optimise the plant's operations, and even the manner the customers operate their
air handling units (AHU) were also examined. At the plant, efforts were focused mainly on how best the steam
required can be generated. Thi s initiative eventually led to the feasibility study to implement cogeneration in the
plant, especially since the electricity generated can also be used to meet the plant's internal needs, with any
excess to be sold to neighbouring buildings.
CHI LLED WATER
SUPPLY PI PE
CHI LLED WATER
RETURN PI PE
GAS DI STRI CT
COOLI NG PLANT
GAS DI STRI CT
COOLI NG PLANT
OFFI CE TOWER
OFFI CE TOWER
EDUCATI ONAL
FACI LI TI ES
EDUCATI ONAL
FACI LI TI ES
ENTERTAI NMENT AND
RETAI L CENTRE
ENTERTAI NMENT AND
RETAI L CENTRE

4.3 Admittedly, cogeneration technology is not a new technology. As most of us are aware, cogeneration
forms the basis for combined cycle technology in power generation, and in district heating systems. However,
until today, cogeneration is still rarely adopted, except in Japan and maybe a few Western countries. The
primary reason as mentioned earlier was the difficulty in obtaining natural gas supply.

4.4 When considering cogeneration as an option to configure a GDC system, three factors are taken into
account, namely: the volume of chilled water required by the customers; the amount of steam needed to drive
the SACs or STCs; and finally the chilled water demand profile.

4.5 The volume of chilled water required is either given by the customers or calculated based on the net
floor area of the buildings within the district which is to be supplied. Based on the volume of chilled water
required, the number and size of SAC/STC needed are then determined. Subsequently, the amount of steam
needed to drive the STCs or SACs are calculated based on the equipment's technical specification provided by
the manufacturer. For example, a 5,000 refrigerant tonne (RT) STC would require some 21 tonnes of steam per
hour. Based on the plant's total steam requirement, the number of gas turbine generators (GTGs) needed to
generate the steam are then determined. This process involves calculating the amount of steam which can be
generated by a particular GTG, as provided by the manufacturer, and dividing this figure with the plant's total
steam requirement. The number of GTGs determined is then finalised by studying the customers' chilled water
demand profile. This study on energy balance is critical in ensuring that the steam from the GTGs matches the
amount required by the chillers (note: the exhaust heat from the GTG is used to fire boilers by the use of a Heat
Recovery Steam Generator). Otherwise, if a mismatch occurs, the GTGs would have to be operated on a part
load or on an open cycle mode during the non-peak hours, when the buildings either require minimum load or
even zero load; thereby resulting in an inefficient operation.

4.6 In cases where the night load is very low and the steam required allows installing the minimum number
of GTGs to meet the plant's internal use only, the balance of the steam required would have to be supplemented
by auxiliary boilers.


Figure 2. Typical System Configuration of a Gas District Cooling and Cogeneration System

STEAM
GAS
G
GAS
GAS
TURBINE
GENERATOR
HEAT
RECOVERY
STEAM
GENERATOR
STEAM
AUXILIARY
GAS
BOILER
STEAM -DRIVEN
CHILLERS
CHILLED
WATER
CUSTOMER
NATIONAL
POWER
GRID
33KV
11KV
33/11KV
CUSTOMER IN PLANT USE

5. BENEFITS OF THE GDC SYSTEM

5.1 The benefits of the GDC cogeneration system are as follows:

5.1.1 Savings in Capital Cost

The most important benefit which the customers would derive from the GDC system is savings in capital
expenditure. By linking the building to the district cooling system, the building owner does not have to invest in
buying the chillers, cooling towers, and all auxiliaries for producing chilled water.

5.1.2 Savings in Operating Cost

Building owners also need not keep a team of personnel to operate and maintain the chillers and cooling
towers. Such reduction in manpower, spares and chemicals costs, which are recurring in nature, also result in
significant savings.

5.1.3 Optimise Building Space

Since the buildings do not need any chillers and cooling towers, significant savings in building design
and reduced build-up can be achieved due to reduced construction cost. The space allocated for the chiller
room can also be converted and thereafter either be leased out or sold, thereby generating additional revenue
to the building owners.

5.1.4 Improve Aesthetic Appearance

With the absence of cooling towers and exhaust stack, the buildings would have a wider and better
range of design. The improved appearance of the buildings would therefore enhance the value of the property
in the development; thereby increasing the asset value to the owners.

5.1.5 Higher Efficiency Factor

With its on-site generation and use of exhaust heat to produce chilled water, the GDC system enables
achieving up to 75% overall systems efficiency compared to about 40% for the conventional electrical driven
system. Moreover, by generating its own power, the GDC/ Cogeneration system reduces stress on the
national power grid.

Figure 3. Comparison between GDC/Cogeneration System and Conventional System

NATURAL GAS CO-GENERATI ON SYSTEM
FUEL ENERGY
I NPUT : 100%
ELECTRI CAL ENERGY : 30 %
USABLE HEAT : 40 %
WASTE HEAT : 30 %
TOTAL USABLE
ENERGY : 70 %
GAS TRANSMI SSI ON
PIPELINE
GAS ENGI NE/
TURBI NE
GENERATOR
ELECTRI CAL ENERGY POWER
THERMAL ENERGY
(CHI LLED WATER)
CONVENTI ONAL GENERATI ON SYSTEM
FUEL ENERGY
I NPUT : 100%
ELECTRI CAL ENERGY TRANSMI TTED : 39%
WASTE HEAT : 61%
TRANSMI SSI ON LOSS : 4%
USABLE
ELECTRI CAL
ENERGY : 35 %
POWER STATI ON
(GENERATI ON EFFI CI ENCY : 39%) POWER LINE
5.1.6 Higher System Reliability

Compared to the conventional system which depends entirely on the power grid for its electricity, the
GDC/Cogeneration system has two sources of power supply, namely electricity generated internally and backup
from the power grid. Customers therefore enjoy a much higher degree of reliable power and chilled water
supply.

5.1.7 Transfer of Technology

For Malaysia, the GDC cogeneration system also provides a valuable opportunity for its people to
acquire new technology. The GDC cogeneration technology is very complex and sophisticated and
encompasses practically all avenues of engineering, such as civil, mechanical, electrical, and instrumentation.

5.1.8 Provide Opportunity to Pipe Gas to the City Centre

The GDC cogeneration plant at Kuala Lumpur City Centre acted as an anchor customer which provided
the much needed load to bring natural gas to the city. The sizeable volume of natural gas required by the plant,
with a projected peak demand of almost 12 mmscfd in year 2000, enhanced the economic viability of investing
in a natural gas distribution network for the city. Today, almost all the hotels neighbouring the KLCC
Development use piped natural gas for cooking and to meet its hot water requirements.

5.1.9 Environment-Friendly System

The use of water as the refrigerant and lithium bromide as the absorber in the SACs makes the GDC
system environment friendly. Furthermore, the absence of chillers, cooling towers and exhaust stacks in the
development and complexes significantly reduce noise and water drift pollution in the area.

6. INTRODUCTION TO GAS DISTRICT COOLING (M) SENDIRIAN BERHAD

Gas District Cooling (Malaysia) Sendirian Berhad (GDC(M)) is a subsidiary of PETRONAS. The
company, which was incorporated in June 1993, started off initially as a joint venture between PETRONAS and
a consortium of established Japanese companies, called TGMM (Malaysia) Sendirian Berhad. The consortium
comprises Mitsubishi Corporation, Mitsui & Co. Ltd., and Tokyo Gas Co. Limited. Although PETRONAS initially
held only 60% equity in GDC(M), it subsequently bought a further 35% equity from the Japanese consortium in
1998, thereby bringing its equity to about 95%. Having gained the technology and skill needed to undertake
new projects and operate existing plants, GDC(M) is being managed and operated totally by Malaysians since
the middle of 1998.

Since completing its first plant at the KLCC in 1996, GDC(M) has since implemented another 2 projects,
one at the Kuala Lumpur International Airport and the other at the New Federal Government Administrative
Centre in Putrajaya, which is about 40 kilometres south-west of Kuala Lumpur. The company's total chilled
water production capacity today is 77,500RT whilst its electricity generating capacity now stands at 68MW.


7. GAS DISTRICT COOLING PROJECTS IMPLEMENTED IN MALAYSIA

7.1 GDC COGENERATION PLANT AT THE KUALA LUMPUR CITY CENTRE (KLCC)

The GDC plant at KLCC was constructed in 1994 and was meant to provide the chilled water needs of
the buildings within the KLCC Development. The plant, which was completed in 1996, now has a total chilled
water production capacity of 30,000RT, comprising 3 chillers each of STC and ECC, each with a production
capacity of 5,000RT. With the sizeable steam required by the chillers, the plant is able to easily accommodate
4 GTGs with a total electricity generating capacity of about 28MW.
To distribute the chilled water within the development, the plant employs a looped chilled water
distribution network with the pipeline size ranging between 48 inches and 36 inches. The temperature of the
chilled water supplied to the buildings within the KLCC is about 4
o
Celsius, whilst the desired return temperature
is about 14
o
Celsius.
In essence, the GDC/Cogeneration plant at KLCC was developed in 3 distinct phases. The first stage
involving primarily ECC chillers with 15,000RT capacity was completed in mid-1996. The second, which
involves the installation of 3 units of 5,000RT STCs and 2 GTGs with capacity of 8MW was completed in mid-
1997. The third stage, which was completed in late 1999, involves the installation of 2 units of 10MW GTGs,
and the related cogeneration equipment.

7.2 GDC/COGENERATION PLANT AT THE KUALA LUMPUR INTERNATIONAL AIRPORT (KLIA)
The GDC/Cogeneration plant at KLIA was secured in 1996 through competitive bidding which involved
several established international companies. Despite being very new to the business, GDC(M) was indeed
honoured when our bid was adjudged the best both technically and commercially.
Completed in early 1998, the GDC/Cogeneration plant has a total chilled water production capacity of
30,000RT, which is needed by the airport to provide the required cooling load for a total passenger traffic of 25
million passengers per annum. To meet the required chilled water supply temperature of 6
o
Celsius, the plant
utilises 12 units of SACs each with a capacity of 2,500RT. For the airport's power requirement, the plant is
equipped with 2 units of 20MW GTGs. To distribute the chilled water to the airport's Main Terminal Building,
which is located 4 km away, and associated Airport Facilities, a total of 16 km of pipes have been laid.
7.3 GDC PLANT AT PUTRAJAYA
Having proven our capability to build, own and operate the GDC/cogeneration plants at KLCC and KLIA,
the Government of Malaysia in 1996 awarded to GDC(M) the exclusive rights to provide chilled water supply to
the whole of the Putrajaya Development. GDC(M) subsequently began construction of its first plant in Putrajaya,
in late 1996 and the plant was completed in late 1998. This plant is located in the Government Precinct or
Precinct One, which only houses buildings occupied by the Federal Government.
Due to the staggered development of the Putrajaya area, the GDC plant was also constructed and
configured to match the phased build-up of the chilled water demand. Initially, the plant was configured with 2
units of 1,250RT electrical chillers and a thermal storage system with maximum capacity of 2,500RT. This is
the first time that the plant is using the thermal storage system, and it is primarily meant to reduce the capital
investment in view of the uncertainty which surrounds the development of Putrajaya due to the economic crisis
which hit Malaysia since mid-1997. Moreover, supply of natural gas was only available in Putrajaya in late
1999.
With natural gas readily available, GDC(M) subsequently installed 5 units of SACs each with a capacity
of 2,500RT. At present, in tandem with the increased chilled water requirement, GDC(M) is installing another 2
units of SACs each with a capacity of 2,500RT. Additionally, to meet the higher power requirement in the plant,
GDC is now installing 2 units of GTGs, each with a capacity of about 4MW.
To distribute the chilled water, GDC(M) has installed a network of distribution pipeline totalling about 4
km, with a diameter of 36 inches. The required supply temperature is about 6
o
Celsius, with the return
temperature set at about 14
o
Celsius.


8. PROJECTS BEING IMPLEMENTED AND FUTURE PROJECTS


8.1 PROJECTS UNDER IMPLEMENTATION

8.1.1 University Technology PETRONAS, Tronoh, Perak

The university, which is wholly-owned by PETRONAS, will have about 6,000 students when it is
completed in late 2001. The GDC/Cogeneration plant, which will meet the chilled water and electricity
requirement for the university, however will need to be completed earlier in mid-2001 to enable the various
utilities to be commissioned.

Initially, the plant would have a chilled water production capacity of about 4,000RT and would be
capable of generating some 7MW of electricity. However, by year 2006, the plants chilled water and electricity
production capacity would be further increased to about 7,000RT and 11MW, respectively, to meet a higher
student population of about 11,000.

8.1.2 Plant No. 2, Putrajaya, Selangor

This plant will serve the chilled water needs of another area to be developed in Putrajaya, called
Precinct Two. This area is located in a man-made island called the Core Island, which is made up of altogether
3 precincts, namely Precincts Two, Three, and Four. The Core Island shall house a mix of Government offices
and commercial complexes. To avoid sporadic digging in the Core Island, all utilities, including GDC(M)s chilled
water distribution pipes, are required to be installed in a Common Utility Trench.

The GDC(M)s plant at Precinct 2 is scheduled to be completed in late 2001, and will have an initial
chilled water production capacity of about 4,000RT. When fully developed in 2007, the plant is expected to
have a total production capacity of about 30,000RT.

8.2 FUTURE PROJECTS

8.2.1 Tanjung Langsat Industrial Complex, Johor Bahru, Johor

The Tanjung Langsat Industrial Park spans over an area of almost 2,000 hectares. The Park is meant
to house petrochemical and other similar medium and heavy industries. Although initial electricity and steam
requirement is fairly small, the quantity is projected to increase to about 120MW of electricity and about 500
tonnes/hour of steam by year 2020.

GDC(M) is building a Cogeneration plant to supply electricity and steam to the Park. The plant, which is
scheduled to be completed by October 2000, would have an initial capacity to produce some 9MW of electricity
and 15 tonne/hour of steam.

Apart from pursuing projects within the country, GDC(M) is also considering proposals to build, own and
operate district cooling and cogeneration plants in other countries, such as Indonesia and the United Arab
Emirates.


9. CONCLUSION

The Gas District Cooling and Cogeneration system enhances the efficiency of the process to produce
chilled water and generate electricity. Adoption and implementation of this system in developing countries with
fast growing economies would enable such countries to reduce their energy consumption, especially oil, and
provides valuable opportunity to develop natural gas distribution network in densely populated and heavily
industrialised areas.

For countries with significant oil and natural gas reserves, the adoption of the GDC/Cogeneration
system in the production of chilled water and generation of electricity helps to add and maximise the value of
their natural gas reserves, whilst allowing for more oil to be exported to generate foreign exchange revenue.

As the leading GDC/Cogeneration company in Malaysia, Gas District Cooling (Malaysia) is seeking
opportunities to further expand its operations, both locally and abroad, and is ready to consider proposals to
undertake projects to supply chilled water, electricity and steam to industrial parks and commercial complexes.