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    Program organization research of

    Low-rank coal fuel waste heat drying

    project in a cement factory

    22nd February, 2013

    Ube Industries

    Ube Machinery Corporation

    Mizuho Information & Research Institute

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    Contents

    1. Project Outline

    2. Low-rank Coal Utilization Expansion

    3. Waste Heat Coal Drying Technology

    4. Reference Scenario setting

    5. Emission Reduction Calculation

    6. Estimated Potential of CO2 Reduction

    7. Conclusions

    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

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    1. Project Outline

    The effect of adoption the low-temperature waste heat recovery system for

    low-rank coal fuel drying into the existing cement plant will be evaluated in

    respect of utilization expansion of low-rank coal and its energy cost saving,

    and estimated the CO2 reduction potential.

    Survey in Summary

    PT Semen Padang Indonesia, West Sumatra

    Advancing on low-rank coal utilization expansion to meet increase of

    domestic coal demand, propagation ofwaste heat recovery system for coal

    drying to the existing cement plant aimed at both low-rank coal utilization

    and CO2 reduction can be achieved large reduction potential.

    Partner / Site

    Objective

    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

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    1. Project Outline

    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

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    Possible Problems by Shifting from High(mid)-rank coal to Low-rank coal:Increase of CO2 emissions

    Decrease in energy utilization efficiency or production efficiency (quantity)

    Low-rankCoal Dryingprocess with employed

    Low-temperature Waste Heat Recovery is

    Effective for Low-carbon Economic Growth.

    Current Circumstances of Indonesian coal

    Indonesian economic growth has been significantly developing and will continue in the

    future:(1) Indonesia will be needed to meet coal demands by foreign countries, while responding to

    sharply increase of domestic coal demands with its economic growth.(2) Indonesian government positions the domestic use of low-rank coal which has large

    reserve, as an economic growth measure.(3) In general, economic growth tends to lead to increase of CO2 emissions. It increases also by

    conversion into low-rank coal as the same.

    (4) However, the Indonesian government is trying as much as possible to suppress an increaseof CO2 emissions with it's economic growth.(5) Low-rank coal utilization technology to realize the Low-Carbon Economic Growth" has

    been expected.

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    Minable years of coal reserves in Indonesia

    Coal RankCV (air dry basis)

    [kcal/kg]Probable Reserve (A) [Mt]

    Actual Production 2011 (B)

    [Mt]Minable years (A/B) [y]

    Low Calorie 7,100 182 - -

    Total 13,448 327 (41)

    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

    0

    20

    40

    60

    80

    100

    120

    2011 2012 2013 2014 2015

    AnnualConsum

    ption

    [Mt/y]

    High

    Medium

    Low

    Coal Consumption for each Coal rank by PLN

    0

    100

    200

    300

    400

    500

    600

    2007 2008 2009 2010 2015 2020 2025 2030 2050

    Coal[Mt]

    Production

    Domestic Sales

    Export

    Coal production and domestic sales and export

    5Source: Ministries of Energy and Mineral Resources

    2. Low-rank coal Utilization ExpansionCurrent Circumstances and Projection of Indonesian coal

    1. Only by medium-high-rank coal used as currently, both coal demand of domestic and export cannot be satisfied.

    2. Especially to correspond to the drastic growth of domestic coal demand, low-rank coal with abundant reserve is required to beutilized.

    3. The superiority oflow-rank coal price merit is invariable. (See next.)

    4. Projection planning of electricity sector which takes 65% of domestic demands also appropriates an increased part by low-rank coal.

    Low-rank coal ratio taken in the amount of the coal used plan to increase from 26% in 2011 to 54% in 2015. Cement sector seems to

    be most similar situation. And ratio of low-rank coal taken in the amount of coal used increases, and the coal rank conversion to

    Low from Medium + High proceeds also in existing plant.

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    0

    20

    40

    60

    80

    100

    120

    140

    Jan

    -09

    Mar

    -09

    May

    -09

    Jul-09

    Sep

    -09

    Nov

    -09

    Jan

    -10

    Mar

    -10

    May

    -10

    Jul-10

    Sep

    -10

    Nov

    -10

    Jan

    -11

    Mar

    -11

    May

    -11

    Jul-11

    Sep

    -11

    Nov

    -11

    Jan

    -12

    Mar

    -12

    May

    -12

    Jul-12

    Sep

    -12

    Nov

    -12

    ICIprice[U$/t]

    Month - Year

    ICI-1 ICI-2 ICI-3 ICI-4 ICI-5

    2. Low-rank coal Utilization Expansion

    Coal Price Index (2009-2012)

    50

    60

    70

    80

    90

    100

    0 10 20 30 40 50I

    ndexofcalorieunitprice

    ratio(ICI-1=100)[-]

    Total Moisture (%)

    ICI2

    ICI3

    ICI5

    ICI4

    ICI1

    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

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    Caloric Unit Price Merit depend on TM (2012)

    Current circumstances ofIndonesian coal market trend

    Waste Heat

    Drying

    2012 average

    EconomicalMerit

    The superiority oflow-rank coal price merit is invariable

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    SP Waste Gas

    Limestone

    Mill

    NSP Tower

    Suspension

    Pre-heater

    Rotary Kiln

    Raw

    Materials Cooler Fan

    Clinker Silo

    EP

    Coal

    Coal Mill

    Stack

    Conditioner

    Air

    (1) Coal Dryer

    (1) Coal dryer" is installed on the coal supply line of the existing cementplant. ( = Paddle type dryer of UMC original development )

    (2) Heat Recovery of unused waste-heat from clinker cooler is connected.

    (2) Heat

    Recovery

    Cement Production Process

    3. Waste Heat Coal Drying TechnologyNEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

    Scope of facilities to be extended

    Fuel Conversion to low rank coal is realized

    7

    Concept of Waste heat coal drying system

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    Concept ofUBE coal dryer

    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

    By drying low-rank coal through recovering unutilized low temperature waste heat (especially 70-200 deg.C)before feeding to the plant, a calorific value of the low-rank coal will be as much as that of high grade coal.

    Promoting low-rank coal utilization necessary to meet increase of domestic coal demand

    Abundant reserves of low-rank coal is advantageous for both stable supply and a price merit

    (1) Concept of proposed technology is:- Use waste heat from Industrial plant and/or own coal fired power plant

    - Reduce moisture content of lignite to as low level as sub-bituminous coal (ex. TM:50% (x1/2) 25%)- Taking advantage of existing plant

    - Without large-scale modification, the cheaper equipment cost is achieved

    (2) Benefit ofUbe's drying process: Suitable drier forlow-temperature waste heat recovery system

    - Recover unused waste heat at low temperature even in atmosphere composition gas

    - Dry coal at high drying efficiency under the considered safety operating condition

    - Ordinary sized coal in bulk fed directly to the coal dryer by existing coal handling systems.

    Low-rank Coal

    Paddle type Dryer

    Dried Coal

    Waste Heat

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    3. Waste Heat Coal Drying Technology

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    (*) Dry coal capacity = 487 k-t/y

    3. Waste Heat Coal Drying TechnologyNEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

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    Concept of waste heat coal drying and energy recovery process

    t/h (3 x 30.8t/h)

    %-TM

    High-moisture Coal(From Existing Coal Conveyer)

    185 260 50

    Clinker Cooler Exshaust Gas

    Waste Heate

    t/h

    %-TM

    Air Dry Coal (To Existing Coal Mill)

    92.345.0

    65.5

    22.5

    (3 x 21.8t/h)

    Coal

    Dryer

    Bag

    Filter

    (1) Coal Dryer(2) Heat Recovery

    Plot Plan

    Area = 1,300m2 (48 x 28m)

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    The essence of proposed methodology is same to CDM methodology ACM0012 but proposed one include coal dryer in the boundary.

    And to evaluate the drying system, the simple and practical indirect monitoring is proposed.

    Reference ScenarioRS Project ScenarioPJ

    Raw coal Coal Dryer Dry coal

    Heat

    Generator

    Fossil Fuel Waste Heat

    Raw coal Coal Dryer Dry coal

    Heat

    Recovery

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    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

    4. Reference Scenario setting

    ReferenceScenario options

    Screeningresults

    Explanation

    1. Without

    Drying

    Coal is directly input to a process.

    Based on the projection of Indonesian coal and its policy, the coal used will become lower rank coal.

    But using lower rank coal directly cause the reduction of production capacity.

    While economic growth will increase demand for cement sector, the choice of production by direct

    supply of low-rank coal is unlikely.

    2. Fossil fuel

    Drying

    Reference

    Scenario

    Coal is input to a process after drying with coal(coal is selected because of economic attractive).

    It is consistent with the Indonesian measure to promote the use of low-rank coal.

    The coal drying technique is mature and feasible. This scenario is most feasible if this project doesnt exist.

    3. Waste heat

    Drying

    Project

    Scenario

    Coal is input to a process after pre-drying with low-temperature waste heat.

    This will become feasible only by using the technique to be installed this time.

    This scenario can realize the Indonesian policy to promote low-rank coal, with less CO2 emissions.

    Based on the sustainable Indonesian economic growth with in a view ofsufficient coal supply-and-demand

    circumstances as a background, the scenario settling with aiming to achieve low-carbon growth was performed

    with considering to the expansion of low-rank coal utilization

    CO2

    Elec.CO2 CO2

    CO2

    Elec.

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    5. Emission Reductions Calculation

    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

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    REy (Reference Emissions) PEy (Project Emissions)

    Fossilfuel-derived

    REfuel,y = HGPJRF EFCO2,fuel PEfuel,y = 0REfuel,y

    The reference CO2 emissions (fromfossil fuel combustion)

    t-CO2/y PEfuel,yProject Emissions(fossil fuel)

    t-CO2/y

    HGPJ

    The amount of heat which is converted

    to product dry coal for the coal dryer

    by the project activity :Using PT

    monitoring value

    Mcal/y

    RF

    The efficiency of heat generator and

    dryer in the reference scenario (1(heatgenerated/fossil fuel used)2(increased heatamount of coal/heat input to dryer))

    :Estimated value

    -

    EFCO2,fuelThe CO2 emission factor of fossil fuel

    which is used for the coal dryer facility

    in the reference scenario :Default value

    t-CO2/Mcal

    Electricity-derived

    REelec,y = PRF,y TPJ,y EFCO2,elec,y 1,000 PE elec,y = ECPJ,y EFCO2,elec,y

    REelec,yThe reference CO2 emissions (from

    electricity consumption)t-CO2/y PEelec,y

    The project CO2 emissions (from

    electricity consumption)t-CO2/y

    PRF,y

    The rated power consumption of the

    coal dryer facility in the reference

    scenario :Estimated value

    kW

    ECPJ,y

    The electricity consumption of the

    coal dryer facilities by the project

    activity :Monitoring value

    MWh/y

    TPJ,yThe operating hours of the facility by

    the project activity :Monitoring valueh/y EFCO2,elec,y

    The CO2 emission factor of

    electricity :Default value

    t-CO2/MWh

    EFCO2,elec,yThe CO2 emission factor of

    electricity :Default value

    t-CO2/MWh

    ERy (Emission Reduction) = REy - PEy = (REfuel,y + REelec,y) - PEelec,y

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    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

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    Process

    Heat

    Recovery

    Coal

    dryerCoal

    Heat receiving stream

    Waste heat stream (air composition)Monitoring parameter (1)Electricity consumption

    measured by power meter

    PEelec,y

    Monitoring parameter (2A. Direct measurement method

    Conceptual diagram of monitoring method

    5. Emission Reductions Calculation

    Air

    ( W1H1 ) ( W2H2 )

    Monitoring parameter (2B. Indirect measurement method

    Measuring feed rate and analysis value

    (property) ofcoal, which were measured both atthe inlet and the outlet of the coal dryer.

    Then calculating the W(Weight of coal) & H(Heat

    value of coal). HGPJ is calculated by HGPJ =

    (W2H2) -( W1H1 )

    Measuring flow rate, temperature and relative humidity of the gasboth at

    the inlet and outlet of the coal dryer, then calculating the difference of water vaporamount contained in the gas by using those measured values. (The calculation result

    is equal to water amount drawn from the input coal.) By using the value of the

    water amount drawn from the input coal, finally calculating the increased heat

    amount from comparing the coal before/after drying.

    Difficult to monitor continuouslyEasy and highly accurate measurement method

    (simple and practical )

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    Symbol Explanation Determination wayPa

    rameterssetbefore

    startofthisproject

    RFThe efficiency of heat generator and dryer

    (=1(RS)2(RS)) in the reference scenario

    Designed value of assumed coal drier facilities that wouldbe used in the reference scenario

    EFCO2,fuelThe CO2 emission factor of fossil fuel which

    is used for the coal dryer facility in the

    reference scenario

    Estimating that the fossil fuel to be input is coal, andanalyzing the input coal on a regular basis

    PRF,yThe rated power consumption of the coal

    dryer facility in the reference scenario

    Designed value of assumed coal drier facilities that would beused in the reference scenario

    EFCO2,elec,y The CO2 emission factor of electricity Using of the emission factor of a grid, or the emission factor

    of a power plant in the case where no grid is used To be upgraded as necessary.

    M

    onitoring

    pa

    rameter

    HGPJThe amount of heat which is converted toproduct dry coal for the coal dryer by the

    project activity during the year

    Continuous and automatic measuring and recording, byusing temperature and flow rate data

    TPJ,y Project operating time Continuous and automatic measuring and recording

    ECPJ,yThe electricity consumption of the coaldryer facility by the project activityduring the year

    Continuous and automatic measuring and recording, byusing electricity meter

    5. Emission Reduction Calculation

    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

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    REy (Reference Emissions) PEy (Project Emissions)

    Fossil fuel-

    derived

    REfuel,y = HGPJRF EFCO2,fuel=119,662[Gcal/y]0.8[-]0.451[t-CO2/Gcal]

    =67,310[t-CO2/y]

    PEfuel,y = 0

    Electricity-

    derived

    REelec,y = PRF,y TPJ,y EFCO2,elec,y 1,000=0 [t-CO2/y]

    PEelec,y = ECPJ,y EFCO2,elec,y=28,270[MWh/y] 0.743[t-CO2/MWh]

    =21,000[t-CO2/y]

    ERy (Emission Reduction) = REy - PEy = (REfuel,y + REelec,y) - PEelec,y= ( 67,310 + 0) - ( 0 + 21,000 ) = 46,310 [tCO2/y]

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    0.77 0.850.94

    1.03 1.14 1.25

    1.381.52

    1.681.85

    2.042.25

    2.47

    2.72

    0.080.17

    0.270.37

    0.490.62

    0.760.91

    1.091.27

    1.48

    1.71

    1.96

    0

    1

    2

    3

    0

    10

    20

    30

    40

    50

    60

    2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

    Estimated

    CO2Reduction

    [Mt]

    AnnualCoalC

    onsumption[Mt]

    Annual Coal Consumption of Indonesian Cement sector

    Possible CO2 Reduction Potential

    Estimated CO2 Reduction Potential based on Increase coal demand from 2012

    6. Estimated Potential of CO2 Reduction

    Coal ConsumptionBefore drying (TM=45%) 92.3 t/h

    After drying (TM=22.5%) 65.5 t/h

    Annual Coal RequirementBefore drying (TM=45%) 0.687 Mt/y Coal Price merit

    = USD11.3M/y(Based on current coal market)After drying (TM=22.5%) 0.487 Mt/y

    CO2 Reduction 46,310 t-CO2/y

    CO2 Reduction Potential Factor on Coal consumption 0.0950 t-CO2/t-coal after drying

    Calculation results of the Indonesian CO2 reduction potential of cement sector

    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

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    Estimated and Possible Potential of CO2 reduction of Indonesian cement sector

    Low-rank coal

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    NEDOs Feasibility Studies with the Aim of Developing a Joint Crediting Mechanism(JCM) SectorCement

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    7. Conclusions

    Simple and Practical MRV for Indonesian Low-Carbon Growth

    In order to effectively address the issue of climate change, eachcountry will be needed to achieve low-carbon growth byutilizing technologies, markets, and finance.

    Based on the circumstances and the future orientations of Indonesia, and by adopting simple and practical MRVmethodology that has been currently considered, the JCM will

    promote transfer of technology from Japan to Indonesia, and willenable to realize a economic growth with less CO2 emissions inIndonesia.

    Estimated and Possible Potential of CO2 reduction of Indonesiancement sector was calculated;

    Estimated CO2 reduction effect using the methodology in the

    project case of coal feed rate of92.3 t-low-rank coal/h is approx.46,310t-CO2/y

    Reduction potential of the CO2 in Indonesian Cement sector is setto 0.77Mt-CO2/y currently in maximum, and 1.96 2.72 Mt-CO2/y around 2025 is expected.

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    Thank you for your attention.

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