- In Customer Stories
- Posted 15/04/2016
Ambitious Project to Create Single Coal Fuel Hub
Through working with Studio Zeta and WITNESS, ENEL were able to test and validate the Porto Torres project, creating a single coal fuel hub, increasing profit and capacity.
Lanner is extremely proud that energy company ENEL chose WITNESS and our long standing Italian partner Studio Zeta to test and validate a proposed project to create a single Coal Fuel hub at Porto Torres, Sardinia. WITNESS is well proven in this field having been selected for many shipping studies around the globe and the work conducted by Studio Zeta enabled ENEL to confidently move forward with implementing their ambitious project.
ENEL is a multinational group with Headquarters in Italy,
and is one of the most important players in the supply of
electricity and gas to Europe and Latin America.
The Group is present in 40 countries on 4 continents,
working in the field of generation with a net installed
capacity of 98 GW, distributing electricity and gas to 61
million customers through a network of approximately 1.9
ENEL is the largest Italian energy company, focusing
on power generation from thermal power plants and
renewable sources, with about 40 GW of installed capacity.
Of these, about 3 GW of products are from renewable
plants operated by EGP.
In addition, ENEL manages much of the electricity
distribution network in the country and offers integrated
products and services for electricity and gas to 33 million
In order to streamline the purchasing and transportation
of coal from mines to power plants in the Mediterranean,
ENEL decided to evaluate the possibility of having its own
fleet and managing the logistics network around a hub at
Porto Torres, Sardinia.
In an interview with Gilberto D’Ignazi, Head of Logistics
Thermal Plant Development and Energy Management
Division at ENEL, he discusses the requirements of the
Porto Torres project.
“This is a project born from the need to reduce the cost of
supplying fuel to our power plants in the Mediterranean.
Today, each jetty handles the arrival of the coal from
various ports of origin, according to the limits allowed by
the draft of the ship and the water in the harbour. Often
we have to use ocean liners of high tonnage at partial
Each control unit also has a specific mixture of
fuel, however we can only order the quantities
needed for each port, when they are actually
Our idea is to build a single hub in Porto Torres,
which in addition to meeting the requirement of
specific water depths, will make it possible to
reach all of our points of delivery within 24 hours
To support this project, we also want to create
a specialist team, capable of modelling the
individual power needed to develop a flexible
system for mixing fuel.
This would concentrate the supply of coal to
a single port, enabling the coal to be blended
to suit the specific requirements of the power
plant it is to be delivered to, with the size of the
vessel compatible with the channel depth of the
Imagine the savings and the reduced
environmental impact created by this project?
Not only that, it would also enable us to be
completely flexible: for example, after the
maintenance of a boiler, a different mixture
of fuel may be needed, this could be made on
demand from the hub centre.
In addition, greater purchasing power would
result in better bargaining power with suppliers.
We would, in fact, have ability to store 1.5
million tons of raw material at Porto Torres.
It would mean we can perform at our very best,
whilst reducing our impact on the environment
and minimize our fuel costs. Establishing
self-unloading vessels within our fleet could
also bring significant benefits, saving both in
investment and operating costs in the future.
The project is an ambitious and far-reaching
strategy, and we therefore must anticipate and
quantify project risks and optimize technical
We understand that to do this it is essential
to thoroughly test our plans using simulation,
enabling us to gain a holistic view of the
dynamic behaviour of the entire supply chain.
Only then can we assess more alternative
scenarios to make decisions with confidence and
effectively communicate solutions to investors.”
Worldwide, 39% of electricity is produced from
coal, and in the 27 EU countries, 33%.
In the future there will be a strong growth in
electricity generated from coal, driven primarily
by China and India, two countries with large
populations, almost 2.5 billion people, where
energy demand is growing at a remarkable pace.
Equally remarkable, however, is the
technological innovation taking place at ENEL,
which has allowed the energy provider to
become 10% more energy efficient compared to
a few years ago.
In particular, investments in the technology of
“clean coal”, which is made in Italy, now allows
ENEL to propose new generation power plants
which meet the high standards of environmental
For example, the Torrevaldaliga Nord
power plant, which opened in July 2008 at
Civitavecchia, is one of the most advanced in
the world. The systems in place to transport
and handle the coal are completely sealed,
meaning the fuel never comes into contact with
air, and emissions have been reduced by up to
88% compared to the previous oil system it was
Background of the Project
ENEL believed that the logistics of supplying
fuel to its coal-fired power plants in the
Mediterranean did not have the qualifications to
support the competitive challenges of the coming
The most obvious constraint of the logistics
model was the inability of current ports with
shallow waters to accommodate vessels with
Due to each power plant reaching its maximum
thermal efficiency when fuelled by a specific
grade of fuel, each plant is only able to use a
limited number of suppliers.
All of this creates many economic inefficiencies
arising from both the cost of purchasing the fuel
and the transportation logistics.
ENEL therefore decided to evaluate the
possibility of completely redesigning the
supply chain model, creating a large hub in
Porto Torres, a port with deep water suitable
to operate high-tonnage ships, and make its
own fleet, optimizing the sale, transport and
shipment to ports across the Mediterranean.
The site of Porto Torres was the first of its size
in Sardinia. During the past decade the port has
seen a huge development in terms of industrial,
commercial and passenger trade. Today there
are programs for the renovation and expansion
of the port.
Elements of the Supply Chain
A variety of vessels and ships are part of ENEL’s
supply chain. Each one has a different set of
requirements and needs which has to be taken
- Capesize vessels with a dead weight tonnage
- Panamax type ships with a dead weight
tonnage of 72.000
- Panamax type ships with a dead weight
tonnage of 65.000 which are also
- Handymax type vessels with a dead weight
tonnage from 12,000
- Tugs for entry and exit from the port
- Loading docks which include cranes, hoppers
The Complexity of System Logistics
Within a supply chain such as this one, there are
multiple levels of demand, as well as variations
in the type of fleet needed when delivering the
fuel from the ports in Indonesia, South Africa,
Colombia, United States and Russia.
Each fuel supplier has its own set of rules
regarding the arrival of ships to its ports,
therefore the random variations in arrival times
needs to be included in the plan.
The type of fleet needed for the loading of coal,
bound for the various power stations is another
factor which needs to be considered, as well as
the viscosity of the coal, which when incorrect
can result in failures or jams to unload berths.
The frequency of failures (MTTF) also needs to
be modelled, as does the time it takes to conduct
any repairs (MTTR). The shift patterns of the
ground operators is also another consideration,
as are the rules and regulations set out by each
Objective of the Project
Since the realisation that a single hub is a
“single-point-of-failure” that could endanger the supply of fuel to the entire production system
of ENEL in the Mediterranean, Studio Zeta
was selected to fully analyse the system being
Studio Zeta’s task included the need to validate
the capacity of the new port when loading and
unloading the ship’s cargo. The model also
needed to verify staff requirements and the cost
of resources on-shore, which included quay and
Other tasks included quantifying potential
demurrage charges, evaluating the performance
of the logistics system and the “fleet mix”, which
includes the incoming (Panamax, Capesize) and
outgoing ships (Panamax, Handymax and the
Stress tests were also to be conducted to
quantify the sensitivity to variations in weather
conditions and the duration and frequency of
mechanical failures. The model was also used to
quantify Disaster Recovery planning.
Following the objective for the project being
set out, Studio Zeta used Lanner’s Simulation
Platform WITNESS to conduct various
experiments, which included the following
- A fault-free environment with no influences
from the weather
- The introduction of variability and failures
within the supply chain and various weather
conditions to test the robustness of the plans
- Shift patterns of ground operators
- Varying the arrival of ships to the ports
- Varying the frequency of failures within the
Stress tests were also used to discover how the
increase of volumes and the increase of faults
would affect the supply chain, as well as the
time it would take to return to normal operations
after a disaster took place.
In all of these cases the logistic system studied
by ENEL has proved to be robust, capable of
handling the amount of projected capacity and
be able to withstand unexpected events, even
when they are severe.
By using WITNESS Simulation, Studio Zeta was
also able to identify organisational solutions
regarding the resourcing of the ground
operators, significantly improving the working
capacity of the port.
The study has also enabled ENEL to reconsider
the requirements of minimum safety stock,
thereby reducing the cost of working capital.
“The project is an ambitious and
far-reaching strategy, and we
therefore must anticipate and
quantify project risks and optimise
technical solutions. “It is essential to thoroughly test our plans using simulation, enabling us to gain a holistic view of the dynamic behaviour of the
entire supply chain.”
Gilberto D’Ignazi, Head of Logistics, ENEL