The Colorado Bend saga – latest from GE

16 October 2018

Since GE’s Power business publicly disclosed information about an oxidation issue on a blade that has affected its 9FB and HA gas turbine fleets, Chuck Nugent, CEO of Gas Power Systems, GE Power, and Scott Strazik, CEO of Power Services, GE Power, have gone on to LinkedIn to  explain the issue in some detail.

They start with ‘5 simple facts’:

"1. The issue involved oxidation that could cause distress on 9FB and HA gas turbine Stage 1 Blades (S1B). 

2. It is limited to the HA and the 9FB, one of the HA’s predecessors and a legacy fleet. The issue does not impact any other GE fleet upgrades like the AGP solution for the B/E/F-fleets, new HA or 9F.05 order.

3. We identified the solution and have a plan in place to implement it. We have a joint team across Gas Power Systems and Power Services leading the effort in partnership with our regional commercial and service teams. They have been proactively working with our customers on a case by case basis to schedule planned replacement outages and solve any technical issues. 

4. The FieldCore and APM teams are ready to execute the planned replacement outages at customer sites. You can expect to hear more about these planned replacement outages as we work through our timeline with our customers. For example, we began the replacement process with EDF last weekend, and we expect the unit to return to service before the end of October.

5. We were already working with Exelon when the event occurred at Colorado Bend in early September. As a precaution, Exelon chose to proactively shut down their additional HAs."


Return to service

Over the last few weeks GE has worked with Exelon  to return all four of their HA units back to service, and by end-September two of them were already back online with new blades 'ahead of schedule'.

• GE announced on 1 October that H. Lawrence Culp Jr has been named chairman and CEO of the company by a unanimous vote of the GE board, effective from that date.  The board also appointed Thomas W. Horton as lead director.  Mr. Culp and Mr. Horton have been members of the board since April 2018. Mr. Culp will succeed John Flannery as Chairman and CEO. 

Regarding general performance and a goodwill impairment charge, presumed (but not certain) at this stage to be related to its takeover of Alstom, GE had this to say. “While GE’s businesses other than Power are generally performing consistently with previous guidance, due to weaker performance in the GE Power business, the company will fall short of previously indicated guidance for free cash flow and EPS for 2018.  In addition, GE expects to take a non-cash goodwill impairment charge related to the GE Power business. GE Power’s current goodwill balance is approximately $23 billion and the goodwill impairment charge is likely to constitute substantially all of this balance. The impairment charge is not yet finalised and remains subject to review. The company will provide additional commentary when it reports third quarter results”. 

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