Peak-shaving LNG plants

Gas demand in a city with winter heating isn't flat. Melbourne's daily gas use on a cold July morning can be several times its January use. The pipeline into the city is sized for something between the two, because building a pipeline to carry the peak day would leave it mostly empty. Contracting extra pipeline capacity for those few days is expensive — capacity is charged whether you use it or not — and buying gas on the spot market on the peak day is when it costs the most.

A peak-shaving plant solves this by time-shifting. Gas is bought cheap and liquefied slowly in summer when the pipeline has spare capacity, stored as LNG, and vaporised back into the network on the peak days. The "shaved" peak is the part of the demand curve above the pipeline capacity. In the US there are about a hundred of these plants, mostly in the northeast and midwest; the UK, Germany and Australia have a handful.

Unlike every other plant type, a peak-shaver is designed around the tank and the vaporisers. The liquefier is the smallest, least important-looking bit.

1. Liquefier (fill mode, most of the year). Gas is taken off the distribution network, treated (CO₂, water, mercury, heavies) and liquefied at a modest rate — 100 tpd would take about 200 days to fill a 50,000 m³ tank. Nitrogen expander or SMR cycles are standard because they're simple to start and stop.
2. Storage (hold mode). A single-containment or full-containment tank holds the inventory for months. Boil-off from heat leak (typically 0.05–0.1% of contents per day) is compressed and sent back into the gas network, so nothing is lost — the network is a permanent sink for BOG. Managing stratification and rollover over a long hold is the main storage concern.
3. Vaporisation (send-out mode, a few days a year). In-tank pumps lift LNG to network pressure; high-pressure vaporisers heat it back to gas. On a peak day the send-out can be 5,000 tpd or more from a plant whose liquefier makes 100 tpd. The gas is odorised, metered and pushed into the distribution network at the pressure the network needs.

Some plants skip the liquefier entirely. They're just a tank and vaporisers, filled by road tanker from a small-scale or baseload plant elsewhere. This is the cheapest way to add peak capacity to a regional network. In Australia, the same tank that serves a small-scale trucking business can double as a satellite peak-shaver for a regional town's gas supply.

The operating year has a rhythm that no other plant type has:

• Autumn: tank should be full. Vaporisers are tested, burners proven, pumps run up, the send-out header pressure-tested. Readiness is everything — the plant will get one or two calls and must respond within an hour.
• Winter: mostly waiting. On a forecast peak day the network control room calls for send-out at a rate and time. The plant ramps vaporisers, holds the rate for hours or days, and ramps down. Between calls it's back to monitoring boil-off.
• Spring and summer: the liquefier runs to refill what was sent out, plus the boil-off lost over winter. Maintenance is done on the vaporisers while they're idle.

Because the liquefier only needs to refill the tank once a year, it runs for long stretches at a steady rate and then sits idle for months. That start-stop life is why nitrogen cycles and simple SMR loops are preferred — no propane inventory to manage, no refrigerant composition to nurse.

Dandenong LNG in Melbourne's south-east is the main example. It was built in the 1980s to peak-shave Victoria's winter demand and has since grown a road-tanker business supplying LNG to industrial customers and transport. Its role in the Victorian gas system is written into the market rules: the operator can call on it when transmission system pressure is under stress. Other Australian LNG storage tied to peak demand tends to be at import terminal proposals on the east coast, which are a different animal — they import LNG by ship and vaporise it, with no liquefier at all.

A peak-shaver earns its keep by avoiding two costs: firm pipeline capacity reserved for a peak that only shows up a few days a year, and spot gas bought at the top of the market. Against that sits the capital cost of a large cryogenic tank and the fixed cost of keeping a plant on standby that might not run at all in a mild winter. Utilities justify it as reliability — the alternative to a peak-shaver is curtailing industrial customers or, in the worst case, losing pressure in the residential network, which is a multi-week relight nightmare.