Opportunity Fuels for CHP

1
Opportunity Fuels for CHP

• Northeast Combined Heat and Power Initiative
• Annual Spring Meeting
• April 6, 2005
• Paul Lemar Jr., President
• pll_at_rdcnet.com

www.rdcnet.com www.distributed-generation.com
2
The Opportunity for Alternative CHP Fuels

• High natural gas prices have decreased spark
  spreads and reduced CHP market potential
• Proposed solutions focus on increasing natural
  gas supply or reducing demand, neither will
  likely help much in the short run
• Renewable portfolio standards, public benefit
  funding, and other renewable incentives are
  spurring investment in biomass fueled projects

3
Natural Gas Prices Have Risen and Are Expected to
Stay High
Source EIA and NYMEX
4
Alternative Solution Develop Other,
Cost-Effective Fuels

• Opportunity Fuel any fuel that has the potential
  to be used for economically-viable power
  generation, but is not traditionally used for
  this purpose
• Opportunity fuels include

• Anaerobic Digester Gas
• Biomass (General)
• Biomass Gas
• Black Liquor
• Blast Furnace Gas
• Coalbed Methane
• Coke Oven Gas
• Crop Residues
• Food Processing Waste
• Industrial VOC's

• Landfill Gas
• Municipal Solid Waste
• Orimulsion
• Petroleum Coke
• Sludge Waste
• Textile Waste
• Tire-Derived Fuel
• Wellhead Gas
• Wood
• Wood Waste

5
Processing Technology Key to Use of Opportunity
Fuels
6
Why are Opportunity Fuels Not Used More Often?

• Availability of fuel source often inconsistent in
  volume and in quality, resulting in variations in
  fuel volume, BTU content, and contaminants
• Often requires changes (adding ) to generating
  equipment or purchasing processing equipment
  (digester, filtration, gasifier)
• Site where fuel is located has little thermal
  and/or electric demand
• Costs to transport fuel to ideal site can kill
  projects
• Producing/processing fuel can be labor intensive
• Technology not yet commercialized for small-scale
  use in U.S.

7
Currently, Opportunity Fuels Contribute Little to
U.S. Generating Capacity
2003 Nameplate Capacity (1024 GW)
8 GW
Source EIA 860, 2003
8
Opportunity Fuel Performance Chart Selecting the
Top Candidates
9
Led By Biomass Gas, Opportunity Fuels Have
Significant Potential
Fuel energy content based on available resources
that could be used as fuel. Biomass gas
conversion efficiency assumed at 80 percent.

• Biomass gas offers most potential but requires
  most RD to achieve
• Total fuel energy content without biomass gas is
  2,200 Trillion BTU
• Total natural gas use for power generation (2002)
  
• Non CHP consumed 4,200 Trillion BTU
• CHP used 2,800 Trillion BTU

10
Evaluating CHP Technology Options

• CHP Technology price, performance, and emissions
  parameters have been evaluated (new and retrofit
  technologies that can use the opportunity fuels)
• Microturbines - Steam turbine systems
• Reciprocating engines - Fuel cells
• Combustion turbines
• In some cases (such as coalbed methane and
  processed TDF), existing technology can be used
  with very little modifications or additional
  maintenance
• In other cases (such as ADG or LFG combustion
  turbines), equipment and maintenance costs can
  cost 150-200 of the off-the-shelf price (with
  natural gas)
• Auxiliary equipment (gasifiers for biomass gas,
  digesters for ADG, filtration equipment for
  low-Btu gases, etc.) will also add capital cost

11
Most States in Northeast Have Renewable Emphasis
on Opportunity Fuels
12
Massachusetts RPS-Qualified, New Renewable
Generation Units
Source Massachusetts DOER, January 2005 Note
Approximately 500 MW of additional capacity has
completed Advisory Rulings for preliminary
qualification under the RPS. Most are 20-50 MW
units burning wood.
13
Preliminary Market Potential Favors Biomass and
Wood Waste
(Preliminary)
Note Based on economic potential for on-site
use by host facility. Does not assume net
metering nor renewable energy credits.
14
Northeast Region Offers Significant Potential
15
And the Top Opportunity Fuels Appear to Be ..

• The opportunity fuels that currently have the
  most potential for US DER/CHP projects are
• Anaerobic Digester Gas - over 6,800
  municipal/industrial WWTPs could potentially
  benefit, as well as over 7,000 dairy farms and
  11,000 hog farms - over 3 GW of electric capacity
  could be achieved.
• Biomass Gas -any type of solid biomass fuel can
  be gasified - over 500 million tons (7,500
  Trillion Btu) is available each year, potentially
  producing 21 GW.
• Landfill Gas - currently about 380 landfills
  participate in LFG-to-energy projects, of which
  about 280 produce electricity (2.3 GW) - over
  1,000 more landfills could have project
  potential, which could add 1.7 GW.
• Wood Waste - can usually be obtained
  inexpensively, if not for free, and can be used
  easily in boiler-steam turbine systems - wood
  waste offers potential for 7 GW.
• Together, these fuels offer 32 GW in economic
  potential
• Near term, landfill gas, anaerobic digester gas,
  and wood waste will lead the way