Combined Heat and Power Project

1
Combined Heat and Power Project

• 2008-04-29 Final Report Presentation
• Lindsay Booth, Jon Bortles, Ben Horowitz, Brad
  Queen

2
How Much Does Cogeneration Help Reduce Emissions?

• 2004 Stanley Consultants study showed purchase
  electricity as least cost option. Updates at
  higher natural gas prices reinforced finding.
• Reduction in cogeneration of electricity has
  increased emissions
• Campus expansion will increase emissions further

3
Current plan is to build a new heat plant without
Cogen
1.361 cent/kWh difference 110,465,500 kWh
1,503,435 (most of cost difference) However,
carbon cost of 26/Tonne and 2 lbs/kWh generation
is ? 2.449 cents/kWh
Plant Relocation-short version.ppt
4
UCB Goals / Priorities

• Safety
• Reliability (in part via redundancy)
• Minimize cost
• Reduce carbon emissions (per CAP for CU State)
• Electricity
• Heat
• Cooling
• Long term price and supply risk mitigation
• Space and access problems with power house
• Provide for growth in energy usage (incompatible
  with 4)

5
Things That Have Changed Since 2004 Analysis

• CUs adoption of the American College
  University Presidents Climate Commitment (ACUPCC)
• Colorado governors goals
• The probability of carbon cost (due to federal
  cap trade or carbon tax legislation) has
  increased dramatically. Xcel and the Electric
  Power Research Institute are factoring it into
  their planning and so should CU
• Both natural gas and coal costs have become
  volatile
• More efficient replacement cogeneration equipment
  should have been included in the Stanley
  Consultant studies
• Single turbine operation at higher capacity and
  efficiency may lead to lower costs than the low
  capacity factors and poor efficiency of the
  Stanley study. However, there are design
  limitations.
• Xcels recent announcement of a smart grid
  prototype in Boulder will lead to time of use
  electricity rates and may change rules for
  standby tariffs

6
Questions

• Data on current system
• Whats the carbon cost of cogen and non-cogen
  scenarios (taxes and offsets)?
• Are there newer technologies that improve
  efficiency?
• Are there grants, financing, or ESCo options that
  reduce costs of cogen?
• Does carbon cost change the lowest cost result.
• How much of a gap will develop between carbon
  neutrality plan and emissions growth/reductions
  planned?

7
Campus Demand

• Jon Bortles

8
Methodology

• New gross square feet on campus in the next 5
  years 1,247,680.
• This is a 13 increase over the 9,296,759 square
  feet in the 2005 carbon inventory
• Steps
• Multiply GSF by
• a) Campus averages for traditional buildings and
• b) LEED buildings (high/low error bars) averages
• Subtract the above total by of 20 of existing
  buildings with planned retrofits
• Compare to 2005 baseline for kWh, Klbs, and tons
  chilled water
• Convert above values to tons of CO2 (where
  feasible)

9
Assumptions

• Business as usual, purchase electricity from Xcel
  and follow CIP
• Omit Visual Arts
• -20 for LEED when data not available (building
  standards at LEED silver/gold)
• Average Wolf, Atlas, Koelbel kWh/GSF for the
  low electricity factor
• Emission factors provided by EPA, Xcel, Stanley
  report
• Geosciences and biotech high electricity value
  is comparable to Cristol and Porter.
• Used base year of 2005/2006
• All new buildings and retrofits will be additions
  to the chilled water demand.

10
Results Demand
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Results NEW Emissions
15
Keeping our Commitments?

• Not entirely from the demand side.

TonsCO2
16
Planned Capacity Expansion

• Current Peak Demand
• 20 MW
• 160,000 lbs steam / hr
• 7,000 tons of cooling
• Current Peak Capacity
• 32 MW with both turbines
• 370,000 lbs steam / hr
• 3,300 tons of cooling (using steam)
• Planned Peak Capacity
• 400,000 lbs steam / hr
• 15,000 tons of cooling

• Current Power House
• 2 natural gas fired 16 MW turbine generators that
  also produce 60,000 lbs per hour of steam each.
• 2 gas fired boilers that produce 100,000 and
  150,000 lbs per hour of steam
• 3 absorption chillers with a total combined
  capacity of 3,300 tons

17
Cogeneration and Cost Models

• Brad Queen

18
Energy Use and Losses with CHP
http//www.epa.gov/chp/documents/intro.pdf
19
UCBs Cogeneration PlantCombustion Turbine with
Heat Recovery Steam Generator (HRSG)
2
3
3
2
1
1
4
4
4
Combustion Turbine http//www.energysolutionscente
r.org/DistGen/Tutorial/CombTurbine.htm
20
Alt. 1 (Cogen) vs. Alt. 2A (Xcel) Breakeven Gas
Price (from Power Plant Relocation Proposal,
September 2006)
March 6, 2008 The spot price at the Henry Hub
increased 16 cents per million Btu (MMBtu) or 1.7
percent on the week, averaging 9.37 per
MMBtu http//tonto.eia.doe.gov/oog/info/ngw/ngupda
te.asp
Mitsubishi MF-111B Turbine manufacturers
reported heat rate 11024 Btu/kWh ( 2,778
kcal/kWh) for simple cycle only http//www.mhi.co.
jp/en/products/detail/mf-111.html CU
performance with steam augmentation is even
better 10250 Btu/kWh per power plant data sheet
/MMBtu
Reported in September 2006
Net heat rate with recovered heat will be even
further left on this curve
Turbine
(A measure of turbine operating efficiency)
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Turbine Efficiency Is Related to Output
22
Electric Power Research Institute (EPRI) View of
the Future Comparative Costs of Generating
Options
Assuming sufficient RD and the successful
deployment of several low- and non-emitting
technologies, the market choices will among the
new alternatives to coal will depend in large
measure on tow key uncertainties the price of
natural gas and the cost of CO2 emissions
controls and/or market credits.
100
100
IGCC w/o CSS
90
90
80
80
NGCC_at_12/MMBtu
70
70
Wholesale Levelized Cost of Electricity, /MWh
NGCC_at_6/MMBtu
60
60
50
50
26/metric ton CO2
40
40
Coal w/o CSS
30
30
0
10
20
30
40
50
Cost of CO2, /metric ton
Source Original chart prepared by EPRI,
Generation Options in a Carbon Constrained World
2005, NYMEX NG Futures Jan 2006
23
Electricity Rates / New CHP Technologies

• Lindsay Booth

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Electricity Rates
Primary Standby Tariff (PST) Demand
charges Energy charges The Electrical Commodities
Adjustment Standby charges (per kW)
Primary General Tariff (PG) Demand charges (per
kW) Energy charges (per kWh) The Electrical
Commodities Adjustment (per kWh) (fuel
volatility)
25
CHP Technologies that Match UCB Needs
x
x
x
x
x
x
x
x
x
x
http//www.epa.gov/chp/documents/intro.pdf
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New Technologies Gas Turbines

• Type of turbine in the current plant
• Technology has gradually improved since the plant
  was built
• Available in sizes from 500 kW to 250 MW
• Time overhaul ranges from 25,000 to 50,000 hours

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Gas Turbines Efficiency

• Efficiency has been improving with time, so newer
  machines are more efficient than older ones of
  the same size and type
• Can reach overall CHP system efficiencies of 70
  to 80

28
Gas Turbines Emissions

• One of the cleanest means of generating
  electricity from fossil fuel
• Natural Gas is the primary fuel turbines are run
  on
• Emit substantially less carbon dioxide per kWh
  than any other fossil technology in commercial
  use

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Gas Turbines Capital Cost

• Purchasing new efficient technology can be more
  cost effective then refurbishing current turbines

30
Comparable CHP Projects andEnergy Service
Companies

• Ben Horowitz

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Grabbing the Low Hanging Fruit

• UCB capable of internally replicating the
  services of an ESCo?
• ? Energy efficiency overhaul energy cost
  savings via conservation
• 15-40 increased energy efficiency (X
  million/year)
• Savings earmarked and used to fund capital
  improvement projects (co-gen)
• Oberlin report the establishment of an
  internal energy market
• The Deliverables What NORESCO brings to the
  table
• Not your typical ESCo - So much more than
  conservation
• The co-gen masters CEO/President Neil
  Petchers
• ? Advantages of ESCos assumes all upfront
  project costs shifting the financial risk
• ? The guarantee (and the incentive) they wont
  get paid until they walk the talk
• ? Tremendous pressure to succeed to get it
  right and do a good job
• Does this same pressure exist internally at UCB?
  

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Acknowledging Competing Interests

• Reconciling the Aforementioned Pressures
• Internal factions at UCB pressured to deliver
  same results as an ESCo? Not yet.
• First getting our own house in order
  dismantling silos, getting aligned with the big
  picture
• Pressures on facilities/internal personnel
  reliability, cost effectiveness but what about
  the big picture (ACUPCC, Governors goals,
  Capital Improvement Plan/Flagship 2030)?
• Can contracting with NORESCO aid in this
  process?

33
Contracting with NORESCO Controlling the
Outcome A Dynamic Working Relationship

• Recognizing Party Lines Maintaining Ownership
• CNWG facilities internal party, NORESCO
  external
• Recommendation approach NORESCO armed with a
  plan and a vision
• This is what we want, this is how we want to
  do it, this is how you (NORESCO) can help
• A hands-on relationship with NORESCO must be
  driven by involvement working in concert
• Internal forces guiding NORESCOs external
  co-gen expertise the opportunity to bring to
• fruition the implementation of a major piece of
  the carbon neutrality puzzle
• If were serious about carbon neutrality we
  have to get aggressive with this stuff To
  that end, NORESCO can help.

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Results, Conclusions, and Recommendations
35
Conclusions

• Assuming 26/Tonne carbon regulation costs added
  to purchased power price
• Assuming the sale of emission reductions to
  Colorado Carbon Fund at 20/Tonne
• Up to a natural gas commodity price of
  10.08/MMBtu, refurbishment of one existing
  turbine to extend it service life may result in a
  net monetary savings to the university and an
  annual reduction of 36,385 tonnes of CO2
  emissions.
• For natural gas prices between 10.08/MMBtu and
  11.55/MMBtu a reduction of 22,836 tonnes CO2 can
  be achieved via capitalizing a new 5MW turbine.
• Recent spot prices for natural gas have re
  reached 10.50/MMBtu but EIA projections of
  industrial prices point to a return of recent
  averages between 7-8 soon and fluctuations
  within that range until 2022.

36
Lower Heat Rates (Higher Efficiency) Necessary
37
/kWh Comparison Between Generated and Purchase
Power
Capital costs and standby utility charges included
38
Recommendations

• Acceleration in establishing milestones for
  reductions in energy use and emissions as
  necessitated buy ACUPCC obligations and voluntary
  participation in the governors goals.
• Formalize projections of demand growth due to
  Capital Improvement Plan
• Policy formalized regarding fuel price risks
  (with or without cogen this is a significant
  concern).
• Commission of a more detailed professional
  analysis incorporating the latest and most
  efficient cogeneration technologies properly
  configured to UCBs utility demand cycle.
• With the advent of Xcels smart grid in Boulder ,
  UCB should investigate reevaluating how it
  connects to the grid and how the rate structure
  effects generation on campus.

39
Thanks to

• Utility Services for help with CHP and utility
  rate data
• The Office of Campus Resource Conservation for
  help with building performance data
• Environmental Center staff for on one hand
  telling us how complex this issue is and on the
  other hand pushing for results