Cogeneration September October 2013

WORLD ALLIANCE FOR DECENTRALIZED ENERGY

In Association With

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DENMARKS CLEVER USE OF COGEN IN EUROPES CONTINUALLY EVOLVING ENERGY MARKET n ITS BOOM TIME FOR THE SERVICING AND MAINTENANCE

OF INDUSTRIAL GAS TURBINES n SOUTH KOREAN PETROCHEMCIAL FACILITY BENEFITS BY FIRING ITS COGENERATION PLANT WITH A WASTE BY-PRODUCT

n ONE COMPANY HAS TAKEN A REVOLUTIONARY APPROACH TO HYDROGEN FUEL CELLS

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W.C

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P.CO

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ASEAN looks to decentralized energy

to meet demand

1309cospp_C1 1 9/9/13 11:25 AM

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Cogeneration & OnSite Power Production | September-October 2013 www.cospp.com2

Contents Volume 14 Number 5September-October 2013

16

16 Launch then learn: On-site power development in ASEAN The impetus behind decentralized energy development in the ASEAN region is gathering pace. We look at the many opportunities that exist in helping to secure supply,

counterbalanced by the challenges that remain.

By Elisa Wood

22 Denmarks smart use of cogeneration Denmark is acknowledged as a frontrunner in forming adopting liberalized rules and regulations in its energy sector. It also ranks high in its innovative use of its large CHP feet.

This is perfectly by Skagen Varmevrk, a district heating company.

By Anders Ahnger, Bent Iversen and Mikael Frejman

28 Futures bright for IGT service & maintenance sector Stable growth is predicted for the global power plant services and maintenance market over the next fve years. We fnd out if this is refected in the services and maintenance

market serving the decentralized energy market, in particular the industrial gas

turbines (IGT).

By Dr. Heather Johnstone

34 CHP at petrochemical site: Fuel fexibility makes sense Heavy-duty gas turbines can enable CHP plants to burn process by-products that might otherwise be a liability. We present the design and operational experience of one such

CHP facility at a petrochemical complex, located in South Korea.

By Yoon-Ho Lee, Michel Moliere and Heung-Yub Ahn

38 A revolutionary approach to hydrogen fuel cell technology A UK-based clean energy frms revolutionary approach to hydrogen fuel cell technology, translates into cheaper, smaller and more durable fuel cells We explore the science behind

the technology.

By Dr. Andrew Creeth

Features

WORLD ALLIANCE FOR DECENTRALIZED ENERGY

In Association With

September-October 2013

DENMARKS CLEVER USE OF COGEN IN EUROPES CONTINUALLY EVOLVING ENERGY MARKET n ITS BOOM TIME FOR THE SERVICING AND MAINTENANCE

OF INDUSTRIAL GAS TURBINES n SOUTH KOREAN PETROCHEMCIAL FACILITY BENEFITS BY FIRING ITS COGENERATION PLANT WITH A WASTE BY-PRODUCT

n ONE COMPANY HAS TAKEN A REVOLUTIONARY APPROACH TO HYDROGEN FUEL CELLS

ASEAN looks to decentralized energy

to meet demand

Cover photograph: A bustling street at night in Bangkok. In the ASEAN region, Thailand is

seen as leading the charge in decentralized energy development

to secure supply and meet power demand. See the feature article

staring on p.16. PHOTO: SUPERSTOCK

1309cospp_2 2 9/9/13 11:26 AM

www.cospp.com

ISSN 14690349

Chairman: Frank T. Lauinger

President/CEO: Robert F. Biolchini

Chief Financial Offcer: Mark C. Wilmoth

Group Publisher: Glenn Ensor

Associate Publisher: Dr. Heather Johnstone

Managing Editor: Dr. Jacob Klimstra

Production Editor: Mukund Pandit

Consulting Editor: David Sweet

Contributing Editor Steve Hodgson

Design: Kajal Patel

Production Coordinator: Kimberlee Smith

Sales Manager: Natasha Cole

Advertising:

Natasha Cole on +1 713 621 9720

or [email protected]

Editorial/News:

e-mail: [email protected]

Published by PennWell International Ltd,

The Water Tower,

Gunpowder Mill, Powdermill Lane,

Waltham Abbey, Essex EN9 1BN, UK

Tel: +44 1992 656 600

Fax: +44 1992 656 700

e-mail: [email protected]

Web: www.cospp.com

Published in association with the World Alliance for Decentralized Energy (WADE)

2013 PennWell International Publications Ltd. All rights reserved. No part of this publication may be reproduced in any form or by any means, whether electronic, mechanical or otherwise including photocopying, recording or any information storage or retrieval system without the prior written consent of the Publishers. While every attempt is made to ensure the accuracy of the information contained in this magazine, neither the Publishers, Editors nor the authors accept any liability for errors or omissions. Opinions expressed in this publication are not necessarily those of the Publishers or Editor.

Subscriptions: Copies of the magazine are circulated free to qualifed professionals who complete one of the printed circulation forms included in the magazine. Extra copies of these forms may be obtained from the publishers. The magazine may also be obtained on subscription; the price for one year (six issues) is US$133 in Europe, US$153 elsewhere, including air mail postage. Digital copies are available at US$60. To start a subscription call Omeda Communications at +1 847 559 7330. Cogeneration and On-Site Power Production is published six times a year by Pennwell Corp., The Water Tower, Gunpowder Mill, Powdermill Lane, Waltham Abbey, Essex EN9 1BN, UK, and distributed in the USA by SPP at 75 Aberdeen Road, Emigsville, PA 17318-0437. Periodicals postage paid at Emigsville, PA. POSTMASTER: send address changes to Cogeneration and On-Site Power Production, c/o P.O. Box 437, Emigsville, PA 17318.

Reprints: If you would like to have a recent article reprinted for a conference or for use as marketing tool, please contact Rhonda Brown. Email: [email protected]. Tel +1 866 879 9144, extn 194 or direct line +1 219-878-6094.

Printed in the UK by Williams Press Ltd on elemental chlorine-free paper from sustainable forests.

Member, BPA Worldwide

www.cospp.com

22 28

38

4 Editors Letter

6 Insight

8 WADE Comment

10 News update

42 WADE pages

47 Diary

Regulars

1309cospp_3 3 9/9/13 11:26 AM

Editors Letter


Equations and opinions

A magazine such as Cogeneration

& On-Site Power Production

(COSPP) is supposed to have

value. That means it should

serve you, its readers, with useful content.

Value can originate from the pleasure of

reading interesting stories, from information

on products and suppliers, and from useful

knowledge about local power generators.

However, business life is so hectic these days

and so much information is offered constantly,

that a tendency exists to skip all nice to know

information and to concentrate only on need

to know information. The big question always

is, what is nice and what is needed?

I remember the time as a young engineer, I

tried to read almost any magazine and book

on engineering that I could get my hands on. I

hoped all that information would help me fnd

the right answers, and even the right questions.

I had and still have a very high esteem for

people who have the skill to write an article.

But it often took a lot of effort to understand

the content and the associated value of the

articles.

Only when I started to carry out my own

technical research did the situation change.

It is very peculiar, but when you are urgently

looking for an answer, digesting literature can

happen quickly. It appears that the brain can

automatically select what is needed and

ignore what can be skipped. Nevertheless, the

right literature has to exist, and COSPP has and

will play an important role in this.

The big question now is, what should a

good article for COSPP look like. Recently, a

friendly and helpful experienced engineer

told me that using formulas in an article

would immediately turn off the bulk of modern

readers. Many people are apparently allergic

to mathematics.

And yes, I agree with him: a formula by itself

is like a magic sentence, a charm, but can

lead to irritations. A good article is therefore not

based on formulas. However, good articles

can feature technical equations that illustrate

relationships between quantities. If the author

has explained what the background of the

equation is and how it can be used, preferably

with a diagram illustrating the relationship,

it can be an eye opener. Equations can, for

example, help you to calculate the fnancial

benefts of on-site power generation. Physical

relationships can also tell you why electricity

supply systems beneft from local generation.

Therefore, dear prospective authors, please

do not hesitate to insert helpful equations in

your articles. Good articles are more than an

opinion: good articles explain and teach.

Why am I writing this? It is partly a result of

being happy with a magazine dedicated to

distributed generation-related subjects, but

also partly due to some irritation. During recent

discussions with policy makers in Brussels on

the benefts of local generation, they told me

that what I said was nothing more than an

opinion. In order to get support for my opinion,

I had to show them that a large proportion of

the population supported me. When I tried

to explain that my reasoning was based on

scientifcally-proven facts, they still answered:

That is only your opinion.

One sees the same thing happening in

discussion groups on Linked-In and other

social media. Solid knowledge is replaced by

feelings and opinions. Fortunately, we have

this magazine, in which we can exchange

valuable information and help to provide

useful knowledge for further expansion and

optimization of cogeneration and on-site

power production.

Jacob Klimstra

Managing Editor

P.S. Dont forget to visit www.cospp.com to

see regular news updates, the current issue

of the magazine in full, and an archive of

articles from previous issues. Its the same

website address to sign-up for our fortnightly

e-newsletter too.

Dr. Jacob Klimstra

1309cospp_4 4 9/9/13 11:26 AM

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Insight

Building cathedrals gives way to mass- produced power sources

Among three themes

recently asserted by

energy guru Amory Lovins

as affecting the US energy

scene is that momentum is shifting,

not just from fossil-fuelled power plants

to renewables, but from centralized to

distributed generation.

Writing in the summer issue of

its Solutions Journal, Lovins, the

cofounder and now Chairman

Emeritus of the infuential Rocky

Mountain Institute, likens traditional

power station development projects to

building a cathedral, and distributed

generation units to mass-produced,

manufactured products. He is talking

mainly about solar photovoltaic (PV)

panels, but the analogy works almost

as well for slightly larger distributed

generation technologies, including

CHP.

The point has been made before

that although the emergence of utility-

scale large wind farms garner a great

deal of attention, the parallel growth

of building-integrated solar panels,

CHP schemes feeding industrial sites

and commercial buildings, and new

district energy schemes, is more

a revolution in size, location and

ownership of generating plant than

simply from fossil fuels to renewable

sources of energy.

With giant forest fres threatening

power (and water) transmission to

the city of San Francisco at the time

of writing, the need for population

centres and industry to be less reliant

on remote, centralized electricity

generation is emphasized further. US

power grids tend to be highly reliable,

but the consequences of occasional

failure can be enormous.

Lovins other two themes are that

progress is fnally being made in terms

of the effciency with which energy is

used, both in buildings and in cars;

and that renewable projects of all sizes

are making serious gains, not only in

world-leading Germany but also in

the US. Lovins sees total US electricity

consumption steadily shrinking in the

future, rather than following traditional

growth patterns as spending on utility

energy-effciency programmes grows

to serious levels.

Meanwhile, prices of solar power

units have fallen to a point where the

technology can undercut power even

from modern gas-fred power plants.

Solar power accounted, says Lovins,

for 49% of new generating capacity

added to US grids in the frst quarter

of this year.

While new cathedrals take lots of

money and time to build, Chinese

PV panel factories are churning

out products 24/7 and solar power

prices are falling steadily. But its not

all about size and number of units

Lovins suggests that local ownership

patterns are crucial too. Denmarks

30-year transition from centralized

coal-fred power plants to distributed

wind and cogeneration plants came

about partly because most of these

units are owned either by local

farmers or communities. Likewise,

half of the renewables schemes in

Germany are owned by its citizens or

communities.

Aside from renewables, district

energy schemes are usually owned,

if not operated by, local government

units with a brief to lower energy costs

for their own buildings and, in some

cases, for publicly-owned housing,

alongside local business premises.

Operators of campus-based schemes

are in direct control of their own

energy costs.

Its certainly true, particularly in

Europe, that over recent years the

green agenda has favoured the

development of electricity-generating

renewables much more than energy

effciency, even though the impact

using (and generating) energy at

higher effciencies can have a similar

impact on carbon emissions. And

small-scale, high-effciency plants are

more easily fnanced, quicker to build,

and deliver considerable to benefts

to electricity grids.

This last advantage is diffcult to

quantify or monetize, but operators

of power grids fed from multiple

small sources with a variety of

technologies have a more resilient

power distribution system. Citizens

of San Francisco may be about to

experience the opposite of this.

Lovins is not complacent, though,

suggesting that the battle for what

he calls a more effcient, diverse,

distributed, renewable electricity

system is far from won. Plenty of

barriers still need to be dismantled to

enable the full transformation.

Steve Hodgson

Contributing Editor

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Comment

Given that gridlock in

the US Congress and

on the energy policy

scene in Washington

seems to be a semi-permanent state,

a great deal of the activity has been

shifted to the states that are not as

politically tied in knots.

The energy supply problems

experienced in the Northeast of

the US require immediate action to

make sure that the electric grid is

more resilient in the event another

weather event akin to Hurricane

Sandy should strike the region,

and cannot wait for the gridlock in

Washington to be resolved. Thus,

much of the work on policies and

programmes that can provide a

solution has shifted to these states.

That is why the most recent

meeting of the National Association

of Regulatory Utility Commissioners

(NARUC) was of great interest to

policy makers, as well as those

seeking creative solutions and

actions to the energy policy gridlock.

NARUC brings together energy

regulators from around the US, as well

as representatives from international

regulatory bodies for a dialogue on

the issues of the day. The Summer

Meeting included a great deal of

discussion of subjects relevant to the

decentralized energy community,

such as microgrids, integration of

renewable energy resources and

distributed generation.

Of particular interest was a

discussion on the Implications of

Distributed Energy Resources on

Regulatory Policies that addressed

a report from the Critical Consumer

Issues Forum (CCIF), a group that

brings together state regulators,

consumer advocates and utilities.

As the cost of solar PV has

dropped precipitously and rooftop

installations have soared, this has

given rise to a number of concerns

about the impact on the utility

business model, especially where

these distributed resources are

allowed to be net metered with the

grid. While distributed generation

offers a number of system and

customer benefts, such as

providing a cleaner source of power

generation and a more diversifed

portfolio of generation assets that

can provide greater system reliability

and security, many utilities view this

as a competitive threat. The CCIF

report identifed 21 principles in the

areas of fnancial and regulatory

issues; market development and

deployment issues; consumer issues;

and safety, reliability and system

planning issues. One of the fnancial

and regulatory principles states:

DER incentives should be based

on clear policy objectives and

periodically reevaluated based

on market conditions. Once the

underlying policy objectives are

met or as the technologies become

cost-competitive or cost-prohibitive,

such incentives should be modifed

or discontinued.

The report further clarifes that

incentives include any net metering

arrangement that provides benefts

exceeding the underlying value of

the energy received from that DER.

Interestingly, just days before the

NARUC session, Fitch, which provides

credit ratings and analyses of

utilities, sounded the warning bells

over net metering in a report that

states that the destabilization of the

power markets in Spain from feed-in

tariffs and net metering incentives is

a cautionary tale for the US.

So with existing incentives for

distributed generation under fre from

regulators, consumer advocates,

utilities and rating agencies, the

future of net metering is uncertain,

even though these policies are

proven solutions to creating a more

diverse and robust energy delivery

system that can respond to storms

and other events. CHP systems are

typically either ineligible for net

metering or severely restricted in

how they may participate. If we want

to be ready for the next Hurricane

Sandy, the states would be wiser to

consider how to expand incentives

so that all distributed resources can

participate, rather than engage in a

dialogue on their demise.

David Sweet

Executive Director, WADE

[email protected]

David Sweet

Gridlock and the grid

1309cospp_8 8 9/9/13 11:26 AM

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1309cospp_9 9 9/9/13 11:26 AM

News

Send your news to Cogeneration and On-Site Power Production: e-mail: [email protected]

News


The UKs frst carbon neutral

laboratory is to be built at

the University of Nottingham

in England and is set to cost

around $24m.

A project team including

contractor Morgan Sindall and

project manager Gleeds will

start construction of the 4500

sq m facility this autumn and

the laboratory is to powered by

renewable sources including

solar power and sustainable

biomass.

The GlaxoSmithKline Carbon

Neutral Laboratory of Sustain-

able Chemistry will provide

chemistry laboratory facilities

for 100 researchers and is be-

ing part-funded by GlaxoSmith-

Kline. It is expected that the

laboratory will become carbon

neutral after 25 years of opera-

tion.

The university claims that

excess energy created by the

building will provide enough

carbon credits over 25 years to

pay back the carbon used in

its construction.

UKS FIRST CARBON NEUTRAL LABORATORY ANNOUNCED

A research report by the

American Council for an

Energy Effcient Economy

states that utilities could

reap substantial benefts

by investing in and encour-

aging new combined heat

and power systems.

It says the major benefts

CHP offers to utilities include

cost-effectiveness, fast de-

ployment, and loss avoid-

ance and reduced strain on

transmission and distribu-

tion systems.

The report states that

policy and regulatory

changes that would allow

or encourage utilities to take

advantage of these ben-

efts include establishing an

energy effciency resource

standard or other portfolio

standard that prioritizes CHP

as a critical resource, and

allowing utilities to earn cost

recovery and economic re-

turns on investments in CHP,

as allowed for other genera-

tion resources.

The report also advises

encouragement of utili-

ties to offer dedicated CHP

programmes within overall

energy effciency program-

ming, and offering perfor-

mance incentives for excep-

tional effciency results.

Report urges utilities to invest in CHP technology

GE, Nexterra and the University

of British Columbia (UBC) have

combined to produce the frst

renewable waste combined

heat and power system in

North America.

The system involves taking

wood fuel and converting it to

synthetic gas, which is burned

to produce heat. GE asked

Nexterra to produce a syngas

that burns cleanly enough

to fuel its Jenbacher high-

effciency internal combustion

engines, and that is the core

process at the centre of the

facility.

Combining Nexterras

proprietary gasifcation and

syngas conditioning process

with the Jenbacher creates a

system capable of producing

both heat and electricity.

Nexterra spent four years

at its facility in Kamloops

developing a way to crack tars

from syngas. After more than

5000 hours of successful small-

scale trials, GE and Nexterra

approached UBC to host a

larger demonstration project.

Dubbed the Bioenergy

Research and Demonstration

Facility, the equipment is

housed in a solid wood

building on UBCs Vancouver

campus. Fuelled by renewable

syngas, the Jenbacher can

generate 2 MW of electricity

and 3 MW of thermal energy,

enough to displace up to

12% of UBCs natural gas

consumption.

Once the system logs

more runtime, GE said that

it will begin promoting

the cogeneration system

worldwide.

GE is now working with

Nexterra to explore the use of

syngas from other renewable

sources, such as biosolids from

sewage treatment plants, to

fuel the Jenbacher.

GE IN INNOVATIVE PARTNERSHIP IN VANCOUVER

A new accident and

emergency department is to

be facilitated with on-site and

combined heat and power

technology.

Balfour Beatty Engineering

Services has signed a 14m

($21m) contract with North

West London Hospitals NHS

Trust to construct the facility in

Harrow.

The building has been

designed to be highly

sustainable and features

such as a rooftop bio-diversity

garden and an array of power

providing photo-voltaic cells,

in tandem with the combined

heat and power unit.

The building work is due to

be completed next April.

LONDON HOSPITAL DEPARTMENT TO BE POWERED ON-SITE

1309cospp_10 10 9/9/13 11:26 AM

News

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As part of the drive for

greater energy effciency,

Saudi Aramco has signed

three new energy conversion

agreements with a Japanese-

Saudi consortium to build and

operate cogeneration power

plants in the kingdom.

The agreements for the

cogeneration plants were

signed with Marubeni Corp.

and JGC Corp. of Japan

and Saudi Aljomaih Energy &

Water Co.

The plants will generate

a total of 900 MW of power

and 1500 tonnes of steam per

hour when they commence

operation in 2016 at the

companys facilities at Abqaiq,

Hawiya and Ras Tanura

(pictured right).

Aramco did not disclose

the value of the deals but

said it would hold a 50%

stake in the plants, which will

have a thermal effciency of

more than 80%, compared

with conventional generation

thermal effciency of 40-50%.

JAPANESE-SAUDI CONSORTIUM TO BUILD COGEN PLANTS

Siemens has won an order to

deliver eight SGT-800 industrial

gas turbines to supply heat

and power for the $20bn Yamal

liqufed natural gas production

plant in Siberia.

Located onshore, the Yamal

cogeneration plant will power

the giant LNG project, which

develops and liquefes the

abundant wet gas ressouces

of the Yamal-Nenets regional.

The order was placed by

Technopromexport (TPE), a

Russian engineering company

wholly-owned by Rostec State

Corporation. TPE had previously

won an EPC contract in a

competitive tender process

to build the Yamal LNG power

plant with an electric capacity

of 376 MW, reports Gas to Power

Journal.

Siemens scope of

supply includes the design,

manufacture, factory testing,

delivery, installation and

commissioning of eight SGT-

800 industrial gas turbines, four

of which equipped with waste

head recovery units, and nine

additional step-up transformers.

SIEMENS SECURES DEAL TO EQUIP SIBERIAN LNG PROJECT

1309cospp_11 11 9/9/13 11:26 AM

News


Trans Gulf has emerged from

a rigorous process to win the

contract to develop Empowers

new district cooling (DC) plant

at the Business Bay complex

(pictured) in Dubai, UAE.

Construction Weekly reports

senior vice-president of

projects at the company, S.G.

Thiyagarajan, as saying that

the process was very tough.

Trans Gulf was chosen

ahead of several major MEP

contractors as its experience

in developing other local DC

plants proving vital to securing

the $42m contract.

Trans Gulfs experience

in district cooling plants

includes the operation and

maintenance of Business

Bays District Cooling Plant

2 and Dubai Health Care

Citys DCP, as well as the

reticulation works, operation

and maintenance of Business

Bays District Cooling Plant 3.

The project will involve the

construction of one building

with a built-up area of almost

9,500m and will have a total

capacity of 43,750 refrigeration

tonnes (RT).

The facility will be the frst

district cooling plant in the

region to be built in line with

green building principles,

and to follow the guidelines of

treated sewage effuent and

thermal energy storage.

The project is expected to

be completed in mid-2014.

The 2013 DOE Western

Regional Dialogue Meeting on

Industrial Energy Effciency and

Combined Heat and Power will

take place in Salt Lake City, in

the US, on October 29.

This one-day dialogue

meeting will focus on the

potential for increased

industrial energy effciency in

the region.

It will also push for successful

industrial and CHP policy

approaches, innovative policy

options, and opportunities to

work together to achieve the

many benefts of industrial

energy effciency and CHP.

The meeting builds on the

August 30, 2012, Executive

Order: Accelerating Investment

in Industrial Energy Effciency,

which sets a goal of 40 GW of

new, cost-effective industrial

CHP in the US by 2020.

It also calls for developing

and implementing state

best practice policies and

investment models that

address the multiple barriers

to industrial energy effciency

and CHP.

The European Investment

Bank (EIB) has issued the

largest ever climate bond in

the European Union.

The $857m (650m) funds

from the Climate Awareness

Bond are earmarked for

projects within the felds of

renewable energy and energy

effciency.

These include wind,

hydropower, wave, tidal, solar

and geothermal projects and

effciency schemes such as

district heating, cogeneration,

building insulation, energy

loss reduction in transmission

and distribution, and

equipment replacement with

signifcant energy effciency

improvements. The bank said

the bond generated strong

demand among a series of

investors genuinely interested

in the socially responsible

features of the transaction,

adding new investors to EIBs

distribution, particularly in the

Benelux, Germany and France,

which accounted for around

80% of fnal allocations.

Asset managers, insurance

companies and pension

funds provided more than half

of distribution by investor type.

The European Union and

the EIB have both made

climate change mitigation

and adaptation a top policy

priority.

Weltec Biopower has won

its frst contract in Belgium,

having been requested by

NPG Energy to set up a biogas


plant in the Limburg region.

The 2.4-MW plant will power

around 5000 households and

is set to go live in spring 2014.

The 19 GWh that will be

generated every year will be

consumed by the Spin-group

BV, which needs the electricity

for its production facilities

in which special carpet

yarns are manufactured in a

demanding polymerisation

process.

The plant concept ensures

effciency in all areas. The

generated heat will be utilised

directly on site: the digestate

will be extracted directly from

the 2000m3 second-stage-

digester in order to be dried

with the entire heat produced

by the plant and the dry

fertiliser will then be sold to fruit

and winegrowers across the

border.

A highly effcient mix from

grease separators and a pre-

mixed, ready-to-use substrate

will account for another major

portion of the input. Apart from

plant residue, this mix will also

contain fats and vegetable

waste. Additionally, the two

bioreactors of a capacity of

4700m3 each will be fed with

soap water from biodiesel

production and cereals prune.

This substrate mix is typical

for Belgium, where biogas

digesters have always been

charged with diverse mixtures.

WINNING BIDDER ANNOUNCED FOR DUBAI DISTRICT COOLING PLANT

EVENT CALLS FOR CHP POLICY PUSH EUROPEAN BANK SEEKS TO PROMOTE EFFICIENCY WITH $857M BOND

BIOGAS CHP DEAL MARKS WELTECS FIRST CONTRACT IN BELGIUM

1309cospp_12 12 9/9/13 11:26 AM

News


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The Shanghai Tower, which

will be Chinas tallest building

when fnally completed next

year, is using on-site power and

cogeneration to power its vast

operation.

Topping out ceremonies

were held this month to mark

the completion of the core

structure of the tower, when the

last beam was placed on top

of the 632-metre (2073-foot)

building designed by global

design and architecture frm

Gensler.

Wind turbines located

directly beneath the parapet

generate on-site power for the

upper foors of the building,

with a 2130kW natural gas-fred

cogeneration system on site

providing electricity and heat

energy to the lower foors.

Meanwhile, the towers

outer skin insulates the

building, reducing energy

use for heating and cooling.

The towers spiralling parapet

collects rainwater, which is

used for the towers heating

and air conditioning systems.

Overall, the $2.2bn Shanghai

Towers sustainable strategies

will reduce the buildings

carbon footprint by 34 000

metric tonnes per year.

CHINAS TALLEST BUILDING REACHES

DIZZY ENERGY EFFICIENCY HEIGHTS

The New York Hilton has

completed a new green

roof system and installed a

cogeneration system, both

designed to reduce the hotels

overall carbon footprint.

The 16 000-square-foot

green roof system was installed

by Xero Flor America and is

located on the hotels ffth

foor rooftop setback on the

buildings West 53rd Street side.

The system represents a major

investment by Hilton New York

to beneft efforts in carbon

capture, energy conservation,

and reduction of the Urban

Heat Island effect.

The installation of a highly-

effcient, environmentally-

friendly cogeneration system

also situated on the hotels ffth

foor roof setback, will provide

in excess of 50% of the hotels

electrical power and over

40% of its steam consumption

for heating and hot water

requirements.

As the largest hotel in New

York City with 1981 rooms, Hilton

New York consumes over 23

million kW hours of electricity

per year.

MANHATTANS LARGEST HOTEL

COMPLETES COGEN INSTALLATION

1309cospp_13 13 9/9/13 11:26 AM

News


Fortum has inaugurated the

largest biomass combined

heat and power plant in Latvia.

The plant is located in

Jelgava and will generate an

electrical capacity of 23 MW

and heat capacity 45 MW.

The inauguration ceremony

will be attended by the

Presidents of both Latvia and

Finland, and the Ambassador

of Finland to Latvia.

The plant is to use wood

chips as fuel and will provide

up to 85% of Jelgavas district

heating capacity.

Meanwhile, French

engineering giant Alstom is to

supply fue gas cleaning and

a heat recovery system at the

new $158m Tekniska Verkin

waste-to-energy cogeneration

plant in Sweden.

The CHP plant is to be run

by the state-owned waste

management and biogas

producer in the city of Linkping,

Sweden and is set to generate

80MW of power.

Alstoms fue gas cleaning

system is being used to achieve

EU level emissions.

The system includes an

Alstom NID semi-dry cleaning

step that injects lime and

activated carbon to clean fue

gas. The fue gas then goes

through a scrubber to remove

more emissions and recover

heat.

The other suppliers on the

new power plant are Fincantieri

Cantieri Navali Italiani, which will

supply the turbine, and German

Fisia Babcock Environment,

supplying the boiler. The

new plant is to be ready for

commissioning in 2016.

FORTUM INAUGURATES LATVIAS

LARGEST BIOMASS PLANT

Bharathi Indian Polar Station,

the scientifc research facility

located in the Antarctic Circle,

is being powered by combined

heat and power technology

since becoming operational

last year.

The facility (pictured), which

is comprised of shipping

containers, uses three


units, fueled by kerosene, to

generate heat and power.

Commissioned by Indias

National Center For Antarctic

And Ocean Research and

designed by Hamburg-based

BOF Architekten, the new

station is located Larsmann Hills

section of northeast Antarctica.

The treaty that governs

international research stations

on the continent stipulate

that the structure must have

the ability to be completely

disassembled and removed

from the frigid landscape

without leaving a trace, so the

designers immediate turned

to shipping containers as

their building medium, reports

EarthTechling.

Built on stilts, the Bharathi

Polar Station has three foors,

comprised of 134 shipping

containers. The containers,

which were prefabricated in

Germany, are interlocked and

covered by an insulated skin

and outer shell.

Inside the facility are 24

single and double rooms, a

kitchen, dining room, library,

ftness room, offces, lounge,

and an operating theatre

along with laboratories, storage

areas, assorted technical

spaces, and a workshop.

Nippon Paper Industries

USAs expanded biomass

cogeneration plant is fnally

set to go online in October in

Washington State.

The plant will create steam

to make paper and generate

20 MW of electricity for the mill

and for sale.

That includes hydraulic

equipment, valves, fuel lines

and a snakelike mass of

external piping that carries

water, steam and air between

the boiler and the mill.

Main components include a

30-foot cooling tower, 110-foot

boiler and a 115-foot cone-

shaped wood-waste-fuel silo.

Also being tested is a truck

dump that lifts vehicles flled

with biomass high in the air

tractor, trailer and all and

dumps the wood waste out the

back.

The project has survived

appeals before the state

Shoreline Hearings Board and

Thurston County Superior Court

that began before construction

commenced in June 2011.

Opponents have been

concerned about air pollution,

though the company has

maintained and the Olympic

Region Clean Air Agency has

agreed that Nippon has

fulflled all state and federal

pollution-control laws.

The cost of the new plant

originally was estimated at

$71m but it rose to $85m due to

higher-than-expected costs for

the cooling tower and redesign

of the fuel silo and foundation.

INDIAS ANTARCTIC POLAR STATION

POWERED BY THREE CHP UNITS

DATE SET FOR NIPPON BIOMASS PLANT TO GO OPERATIONAL

1309cospp_14 14 9/9/13 11:26 AM

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The Mexican government

has unveiled a bill that would

open up more opportunities for

cogeneration to fourish in the

country.

While the bill is mainly

concerned with changing the

Mexican constitution to let it

partner with private companies

to fnd and produce oil and

gas in a country, it also seeks

to liberalise Mexicos electricity

sector by allowing private frms

to produce and sell electricity

to consumers.

A third of Mexicos electricity

is generated by private frms

under a cogeneration plan

where they produce power

for themselves and sell the

extra to the state electric

utility.

If the legislation passes it

will continue to encourage an

environment where combined

heat and power can grow.

The move would end the

monopoly of the Federal

Electricity Commission, poten-

tially lowering electricity prices

for companies and residents.

The bill now goes to Mexicos

congress.

The conservative opposition

has said it would support the

proposals, giving Pea Nietos

Institutional Revolutionary Party

the two-thirds majority it will

need to pass the constitutional

changes.

NEW MEXICAN LEGISLATION COULD OPEN UP FRESH COGEN OPPORTUNITIES

Rhode Island-based Toray

Plastics in the US is to build a

$22.7m cogen system at its

Kingstown campus (pictured).

Toray is keen to avoid

the damage caused by

disruptive weather events and

associated power outages.

Toray already operates a

cogeneration system that

supplies continuous power

to its Lumirror polyester flm

division, which sustains

manufacturing production

even during severe weather

events and enables the frm

to provide uninterrupted

customer service.

The new system is expected

to be operational by March

next year. It will be dedicated

to powering production on-site

for the Torayfan polypropylene

flm division and other sites

around the property.

The companys decision

to build a new cogeneration

unit is supported by the

Rhode Island Public Utilities

Commission and National

Grid, which supplies 100%

of the electricity distributed

to Toray beyond Torays own

cogenerated electricity.

US PLASTIC MANUFACTURER TORAY TO UTILISE CHP AT CAMPUS

1309cospp_15 15 9/9/13 11:26 AM


ASEANs decentralized energy sector

The impetus behind decentralized energy development in the ASEAN

region is gathering pace. Elisa Wood looks at the many opportunities

that exist, counterbalanced by the challenges that remain.

Building on-site generation

in ASEAN

Distributed generation can help to serve remote locations in ASEAN where fuel delivery is diffcult Credit: Iris Scherer


Launch and learn:

1309cospp_16 16 9/9/13 11:26 AM



A launch and

learn strategy is

not the kind Chip

Bottone favours

when he participates in

an energy project in a

new country. The CEO of

US-based FuelCell Energy

would rather understand the

market before venturing into

untried territory. He would

prefer learn and launch.

But he knew this would be

impossible in Indonesia, a

member of the Association

of Southeast Asian Nations

(ASEAN). These countries

Brunei, Cambodia, Indonesia,

Laos, Malaysia, Myanmar,

the Philippines, Singapore,

Thailand and Vietnam

can be the land of both

opportunity and frustration for

international decentralized

energy companies. Doing

business here often requires

a pioneering spirit and a

measure of patience. So what

drew Bottone to Indonesia?

What we saw in Indonesia

was a fairly big population

150 million people. They had

inadequate infrastructure in

terms of electricity. They had

a growing middle class. They

did have natural resources, he

says. But Bottone adds, They

also had lot of things that are

not helpful, like corruption and

disorganization.

With long-time South Korean

partner POSCO Energy, FuelCell

Energy launched its Indonesia

project in 2011, as the frst

commercial stationary fuel cell

power plant in Southeast Asia

outside of South Korea. The

partners chose a highly visible

location to create a showcase

project that would capture

attention Ancol Dreamland,

a waterpark resort and major

tourist destination in Jakarta.

Two years later the 300 kW


(CHP) plant is still not in

operation, at the time of the

writing of this article, but is in

the fnal construction phase.

Bottone estimates the same

project would take six to nine

months to complete in the US.

Still the partners

accomplished their goal: It

was meant to demonstrate

how to interconnect to the grid,

what the economics are, what

all the approval processes

are, what all the permitting

processes are because they

dont have established policy

as other more developed

countries have, he says.

Welcome to the ASEAN

countries where the potential

for decentralized energy is

vast but not easy to capture

because of bureaucracy, lack

of clear rules, and sometimes

a dearth of infrastructure and

skilled workers.

Growing demand and

blackouts

Decentralized energy or

distributed generation,

particularly from clean

energy, remains a nascent

undertaking in much of the

region.

On-site generation or

distributed generation is not

commonly implemented in

ASEAN member countries,

which still focus on centralized

generation, says Beni Suryadi,

energy policy analyst at the

ASEAN Centre for Energy.

But there is no question that

the region could beneft from

more on-site power. Anywhere

there are transmission and

distribution grid inadequacies

market opportunities for

distributed generation open

up. And the ASEAN countries

have their share of grid

inadequacies.

Consider, for example, May

2013. Forty per cent of Luzon

Island in the Philippines lost

power, including metropolitan

Manila, because of power

plant failures. Thailand

experienced its largest

blackout on record in its 14

southern provinces following

a lightning strike, and Vietnam

saw a 10-hour blackout in

22 provinces, including Ho

Chi Minh City because of

damage to a transmission line,

according to press reports.

Such events are not unusual

because the countries have

not updated or expanded

their power infrastructure

quickly enough. The result is

a tremendous amount of

brownouts and blackouts and

tremendous loss of quality of

power, says Sridhar Samudrala,

an assistant professor at SUNY

Delhi USA and president &

CEO of International Energy

Consulting Co.

Meanwhile, the population

and economies are expanding

and demanding more energy;

some areas are becoming

electrifed for the frst time.

ASEAN is the fourth most

populated block in the world

behind China, India and the

European Union. Its middle

class is growing, and expected

to become 65% of the total

population by 2030, up from

only 24% in 2010, according

to a report by Dubai-based

investment frm, the Abraaj

Group, which invests in

emerging economies.

Further, the report says, its

population is young and will

increasingly demand more

consumer goods. The region

already has healthy growth

in gross domestic product:

5.7% for 2012 and a predicted

5.5% for 2013, according to

the International Monetary

Fund.

All of these changes

and growth require more

electrifcation. And in some

areas, demand is dramatically

outstripping supply. For

example, in Myanmar about

75% of the population is still

without access to electricity,

and the government says

that supply is only about

half of projected demand,

according to a report

Electricity in Myanmar:

The Missing Prerequisite for

Development, by the Harvard

Kennedy School Ash Center for

Democratic Governance and

Innovation and the Rajawali

Foundation Institute for Asia.

So with blackouts rampant

and central grids slow to

improve, it is no surprise

that decentralized energy is

growing at what Samudrala

described as an exponential

pace.

The current grid is unable

to expand at the level of

growth in the ASEAN countries

and therefore the industrial,

commercial, and residential

customers are opting for small-

scale generation and creating

mini grids, he says.

Coal use to grow

Electric reliability is one reason

for the ASEAN countries to

pursue advanced distributed

generation; environmental

concerns are another.

Fossil fuels account for 74%

of the regions generation,

and about 22% comes from

combustible biomass and

waste that is ineffcient and

environmentally unsustainable,

Distributed generation is not

commonly implemented in ASEAN

member countries, which still focus

on centralized generation. But

there is no question that the

region could beneft from more

on-site power

1309cospp_17 17 9/9/13 11:27 AM



according to research by

Melissa Low, energy analyst

at the National University of

Singapores Energy Studies

Institute.

Demand for coal has grown

fastest over the last decade in

Malaysia. Indonesia, Thailand

and Vietnam also are large

coal consumers, according

to the US Energy Information

Administrations (EIA)

International Outlook 2013.

The coming years are

expected to bring even more

use of coal in the ASEAN

countries, even as developed

nations like the US begin to

curb its use. The EIA forecasts

an annual increase in coal

consumption of 2.4%. Several

new, large coal-fred plants, of

at least 1 GW, are coming on

line, particularly in Malaysia,

Indonesia and Vietnam. In

Vietnam alone, 36 GW of coal-

fred generation is expected

to be installed by 2020 and

76 GW by 2030.

Another fossil fuel important

to the region is diesel.

The region relies on diesel

generators to overcome its

reliability problems. However,

this option can be expensive.

For example, in Myanmar

diesel prices were about

$1/litre in early 2012, which

is the equivalent of $0.30 to

$0.35/kWh or fve or six times

the average price charged

by the government utility for

electricity, according to the

HarvardRajawali report.

While diesel can be

expensive, it is also important

to the region because it

can mean the difference in

ASEAN countries between

power or no power, and brings

signifcant changes in quality

of life and business operations,

particularly in remote outposts.

For countries like Myanmar

and Cambodia and remote

Indonesia this option is still on

the table, Suryadi says. He adds

that great effort is being made

to install renewable energy as

a substitute, but capital costs

and lack of infrastructure

remain as barriers.

In a case study, MTU Onsite

Energy describes better

schooling for children and

a rise in small businesses

installation in the Indonesian

city of Fakfak, following

installation of its MTU Series

1600 engines. Fakfak, which

has a population of 69,000

people, is separated from

other communities by poorly

maintained mountain roads,

had relied on power from

neighbouring towns, which

meant blackouts were the

norm. The local MTU generators

now maintain Fakfaks

2.4 MWh peak demand.

Countries like Vietnam,

Lao PDR, India, Myanmar,

Philippines, Pakistan and others

generate a lot of electricity from

diesel, as the grid is unreliable.

The private sector companies

simply cannot rely on the grid

and they are converting to

alternative and renewable

energy as an option to offset

the diesel energy prices,

confrms Samudrala

Renewable goals

Indeed, several of the countries

have set renewable energy

goals. Thailand, which has

the most advanced energy

infrastructure in the region,

recently announced a new

renewable energy goal to

build 3000 MW of solar by 2021.

The country expects feed-in

tariffs (FITs) for distributed

solar to spur about 1000 MW

of new development. The FIT

is designed to attract 200 MW

of rooftop solar by the end

of this year and 800 MW of

community ground-mounted

solar by the end of 2014.

Thailand has a goal to

expand its renewable energy

from 6.3 GW in 2011 to

20.5 GW, so that renewables

make up 29% of total

generating capacity by 2030.

Hydroelectricity now accounts

for about 5% of generation, and

non-hydroelectric renewables

(mostly biomass and biogas)

2%, according to the EIA.

Thailand is the furthest

along among the ASEAN

when it comes to introducing

on-site generation, according

to Suryadi.

Its progress stems back to

the governments introduction

of the Small Power Producer

(SPP) programme in 1992, and

Very Small Power Producer

(VSPP) programme in 2001.

Under the programmes,

the state-owned Electricity

Generation Authority of

Thailand (Egat) was required

to purchase power from small

cogeneration or renewable

projects. Most of the resulting

projects were developed by

local companies to fulfl their

own energy needs.

Looking forward, Thailand

plans to continue to add

more CHP. From 2012 to 2019,

the government forecasts

that Thailand will add about

5100 MW of cogeneration,

with an additional 1368 MW

from 2020 to 2030, according

to Smart/Intelligent Grid

Systems Development and

Deployment, authored by

Samudrala and published

by the World Alliance for

Thai Decentralized Energy

Association.

In the Philippines, the

countrys Energy Regulatory

Commission (ERC) in July

issued new net metering

rules for on-site renewable

installations not exceeding

100 kW. And last year the ERC

approved a FIT for several

renewable energy resources,

including run-of-river hydro,

biomass, wind, and solar. The

fnal solar FIT of 9.69 PhP/kWh

($0.22/kWh) was far lower

than the originally proposed

17.95 PhP/kWh. ERC adjusted

the rate to account for

falling solar panel prices. The

government plans to review

the FIT rates in three years or

when the nation meets the

Department of Energys goals.

The Philippines is striving for

100% renewable generation

within a decade and hopes

to triple its renewable capacity

by 2030; it already gets more

than 50% of its electric supply

from geothermal, biomass and

hydro. The Philippines is the

second largest geothermal

generator, behind the US.

Indonesia, which has

about 43.5 GW of installed

capacity, gets about half of

its power from coal. Nine per

cent of its generation comes

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from hydroelectricity and 5%

from geothermal, putting it

third place worldwide for that

resource. About 70% of the

population has access to

electricity; the government

hopes to expand access to

80% by 2014 and 90% of the

population by 2020.

Indonesia has set up a fast-

track for power generation

development, which includes

10 GW to be completed by 2014

of clean energy sources, such

as natural gas, geothermal

and other renewable energies.

The country also has a FIT for

renewables that offers 15-year

contracts.

Distributed generation can

serve Indonesia in remote

locations where fuel delivery

is diffcult, according to a

report, Distributed Generation:

Indonesia View Point and

Case, by the Coordinating

Ministry of Economic Affairs.

The ministry also points to

non-intermittent decentralized

energy such as small hydro

as way to avert line losses and

improve voltage regulation

and grid stability. Indonesia

already has about 20 mini-

hydro stations in operation,

totalling about 44 kW, and

over 700 kW in various stages

of development. The country

also is pressing forward with

an aggressive concentrating

solar initiative.

The Future

While many of the countries

have renewable energy goals

that can help spur distributed

generation, it remains to be

seen if they can translate

goals into reality. All of these

countries have excellent

renewable energy goals on

paper, Samudrala says.

ASEAN countries are trying

to better their overall power

sector by creating a regional

power grid across member

countries. The goal is to

improve energy supplies so

that the countries can both

meet growing demand and

promote cleaner energy.

Suryadi agrees that the

spirit of the region favours

regional integration as the best

way to cope with its various

energy problems. This does

not mean that the region will

operate as one power entity,

but it is likely to consolidate into

sub-regions to pool indigenous

energy resources.

For example, the Mekong

Area, (Thailand, Cambodia,

Myanmar, Vietnam, Lao PDR)

are now working together to

develop large hydroelectricity,

he adds.

The spirit of energy market

integration will defnitely boost

the installation of on-site

generation in the region, he

says. A more open power

trade regime in the region will

encourage the development

of renewable sources such as

solar, hydro and wind for power

generation through on-site

generation. And hence the

total cost of meeting region-

wide electricity demand will

be reduced.

But Suryadi is not saying

it will be easy. The market

integration in the region

remains a challenging task,

especially to deal with the fast

growth of electricity demand in

all ASEAN member countries.

FuelCell Energys Bottone

sees problems as well. The

good news is that there is

probably demand in those

countries. The bad news is they

are not organized for it yet.

FuelCell Energy, which

manufactures more than

50 MW of fuel cells per year

at its Torrington, Connecticut

plant in the US, has continued

to expand its infuence in Asia.

The company in late 2012

executed a series of strategic

initiatives with POSCO Energy,

including a license agreement

under which POSCO will

manufacture the companys

complete carbonate fuel cell

technology in South Korea and

sell them throughout Asia.

POSCO Energy, Koreas

largest independent

power producer, intends to

produce 140 MW of fuel cell

components annually. The

company expects to begin

manufacturing in early 2015.

But would Bottone tackle

another launch and learn in

the ASEAN region if he had it

to all over again? Yes, he says,

that is the only way policy and

standards will improve and the

regions markets grow. These

Southeast Asian countries

have a need for a renewable

distributed energy strategy,

there is no question. The

question is when.

Elisa Wood is a US-based

freelance writer, who

specializes in energy matters.

This article is available

on line. Please visit

www.cospp.com

21% Coal

71% Natural gas

1% Oil

5% Hydro

2% Other renewables

Thailands electricity generation profle, 2011 The Philippines electricity generation profle, 2011

28% Coal

41.4% Geothermal

15% Natural Gas

3% Fuel Oil

11.4% Hydro

3% Fuel Oil

Several of the countries have set

renewable energy goals. Thailand,

which has the most advanced

energy infrastructure, recently

announced a new renewable

energy goal to build 3000 MW

of solar by 2021

1309cospp_20 20 9/9/13 11:27 AM


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1309cospp_21 21 9/9/13 11:27 AM


In the early 1990s,

Power for a changing

world was a well-known

marketing slogan

used by Wrtsil Power

Plants. Today that slogan

is even more appropriate,

especially in Europe, with

new renewable power

generation, such as wind

and solar, now a signifcant

part of the energy market.

The notable impact of

renewable production

changes many operational

set-ups, and presents new

challenges for the energy

industry. At the same time,

the European Commission

and European Parliament

have set, and will set forth,

energy strategies up to 2020

and 2050 that, in addition to

the use of renewable energy,

focus very much on carbon-

free, environmentally-friendly

power generation, and on

the effcient utilization of

primary fuels. This will involve

a major restructuring of the

conservative European energy

industry and market.

The work around these EU

strategies aims also to give a

well-defned framework, with

harmonized common rules

and regulations for the industry

to be equally applied in all

Member States, thus providing

the basis for investments and

healthy growth in the industry.

In order to fulfl these strategies,

new innovative solutions and

fexible multi-purpose plants

are needed in a transparent,

free-trade market with, to a

large extent, distributed energy

production.

Denmark is acknowledged

as being a frontrunner in

forming its own energy

laws, and at an early stage

adopted very liberalized rules

and regulations for its energy

industry.

Today, the country scores

very high marks for its amount

of installed renewable and

wind production, as well

as for its very effcient CHP

(combined heat and power)

electricity production, with

plants distributed evenly across

the entire country. Skagen

Varmevrk is a typical Danish

district heating company, with

its heat and power production

based to a large extent on a

gas engine plant using three

Denmark has taken a proactive role in adapting to the changing needs of the energy market. The rest of

Europe can learn from its example writes Anders Ahnger, Bent Iversen and Mikael Frejman.

Skagen Varmevrk successfully manages its heat and power production in Denmarks liberalizedenergy market

CHP and Europes changing energy market

Smart power generation for a changing world

1309cospp_22 22 9/9/13 11:27 AM



Wrtsil 28SG generating

sets. This article looks at how

Skagen Varmevrk manages

this plants operations in a

modern liberalized Danish

energy market.

Danish district heating

The very frst district heating

system in Denmark was

established in the city of

Frederiksberg in the early

1900s. This lead was gradually

followed by other cities

across the country, and today

Denmark has more than 500

district heating plants. More

than half of Denmarks energy

consumption for residential

heating is generated by

those district heating plants,

including Skagen Varmevrk.

All Danish district heating

plants are governed by a

district heating law that refects

the present energy policy of

the Danish parliament. These

regulations offer incentives for

energy effciency and, rather

importantly, ensure that the

Treasury Department collects

all the agreed energy taxes.

The law also states that district

heating companies are not

allowed to proft from heat

deliveries to its members.

Skagen Varmevrk began

operations in 1964 with

535 co-operative society

members. The district heat was

generated by a boiler plant

able to operate on fossil and

bio-oils. In 1979, by which time

the number of consumers had

grown to 1050, the municipality

of Skagen commissioned a

waste incineration plant that

was connected to the district

heating system. Fiskernes

Fiskeindustri, a private

company, started the delivery

of waste process heat to the

district heating system in 1982.

Skagen Varmevrk was

connected to the national

gas grid system in 1988,

where a new boiler station,

operating on natural gas

was commissioned. Precisely

ten years later it was time to

commission the fully automatic


station.

The plant was designed for

automatic mode, enabling

unattended operation outside

normal working hours, when

the command for starting and

stopping the plant is shifted to

the dispatch centre.

Skagen Varmevrk

The company is responsible

for supplying district heating

to the town of Skagen, the

most northern town in Jutland.

In winter, its 8400 inhabitants

enjoy a quiet life with little traffc

and few crowds. However, in the

summertime it is transformed

into a very crowded, and

popular place. This ability to

adapt to the rapid changes in

the surrounding environment

seems also to have become

part of Skagen Varmevrks

business philosophy.

The CHP plant is equipped

with effcient heat recovery

that reaches a total effciency

that exceeds 90%. Even

though the plant is 15 years

old, its performance remains

very good compared to other

modern power plants. The

engines were upgraded a

few years ago to achieve a

higher output and improve

performance.

The plant not only produces

heat for the city and power

for the distribution system

operator, but also actively

participates in the Danish

electricity regulating and

primary reserve/frequency

balancing markets.

To handle these

simultaneous production

requirements effectively, highly

fexible operation, short start-up

and shutdown capability, as

well as operator alertness,

are essential. The plant is,

therefore, equipped with: hot

water boilers operating on

natural gas and prepared for

the possible use of bio-oils and

fuel oils; an electrical hot water

boiler operating in parallel

with the gas engines; and

of course with heat storage

or an accumulator. All these

units allow very fexible and

environmentally-sustainable

production.

In addition to its own

production, a municipal waste

incineration plant and a

nearby industry are delivering

heat to the common Skagen

district heating network. The

waste incineration plant is

run as a baseload plant and

provides stable year-round

heat production. The heat from

the industrial plant is delivered

on a more occasional basis,

refecting the industrys own

schedules and working hours.

One of the three Wrtsil 28SG generating sets that power the CHP plant

Denmark is acknowledged as

being a frontrunner in forming its

own energy laws, and at an early

stage adopted very liberalized

rules and regulations for its

energy industry

1309cospp_23 23 9/9/13 11:27 AM



These two additional heat

sources adequately fulfl the

citys minimum heat demand

during the summer period.

Skagen Varmevrk

maintains its plant in good

condition and constantly

develops its operations to

be more effcient. Danes

in general are very energy

conscious and strive always to

utilize the full energy content of

the primary fuel for production.

There are even governmental

rules on how to continuously

improve CHP plant operations,

as well as for how consumers

can save energy.

Recent investments in

the Skagen plant include

new absorption chillers

installed after the exhaust

gas economizers. These

squeeze out even more

heat from the gas engine

exhaust gases to gain total

plant effciencies reaching

greater than 100%, calculated

on the lower heating value.

Furthermore, the heat

storage capacity has been

drastically increased by an

additional heat accumulator

of 350 MWhth to achieve even

greater fexibility for the plant

on the power markets. The

bigger heat storage capacity

between the heat production

and the district heating

network naturally adds

more operational freedom.

Managing production

Like all district heating

companies, Skagen

Varmevrk delivers heat

according to the demand at

the lowest possible cost. The

required heat production,

therefore, provides the

framework within which

electricity can be produced, for

participating in the regulating

and primary reserve markets.

Thus, production planning

demands a good knowledge

of the plants capabilities, as

well as good forecasting of

market behaviour.

All the above mentioned

production units are jointly

utilized in an optimal way,

based upon their specifc

operational characteristics

and upon market conditions

and fuctuations. The plant

operates very much on the

day-ahead estimates of

the heat demand, and the

regulating and frequency

balancing markets.

Depending on the balance

between these two electricity

markets, the running strategy

is somewhat different and

involves co-operation with

the dispatch centre for the

area and the other power

producers.

The predicted heat

consumption is fexibly

managed through the heat

accumulators, and provides

the framework as to how the

gas engines could or should

be run. The varying daily

spot prices on the regulating

and reserve markets have,

of course, an impact on the

running philosophy, and the

goal is always to produce

electricity when the spot prices

are high.

When operating in these

two electricity markets, the gas

engine characteristics prove to

be highly valuable. The primary

reserve market demands

fast starts and stops, and the

engines can cope with that.

In the regulating market, the

engines are run at about

7080% load, where again

the gas engines high and

constant part load effciency is

invaluable.

If it is not worthwhile to run

the engines, the corresponding

heat can be produced by

the gas boiler or even with

the electrical boiler, provided

that the electricity spot prices

and the electrical network

balances are favourable.

The 11 MWe electrical boiler

is designed to have a large

operating window, and can

in that way also participate

in the electricity markets as

a load. The excess electricity

from the renewable energy

production can, therefore, also

be dumped into the electrical

boiler and further into the

heat accumulator. Electricity

production is of course closely

coordinated together with

the electricity operator for the

district or area.

The fgure on p.26 is of

a typical production track

record for the heat production

during a full calendar week.

The diagram shows also the

spot prices on the electricity

markets, the regulating and

power reserve markets, heat

demand and production, as

well as the level of stored heat

in the heat accumulator.

The engines are kept warm

and prepared for an unlimited

Skagen Varmevrks equipment and heat sources

3 x 18-cylinder Wrtsil 28 SG 3 x 4.6 MWe / 19.4 MW

th

4 x gas hot water boiler 46 MWth

Electrical hot water boiler 1 x 11 MWth

Heat import from waste incineration plant

6 MWth (max.)

Heat import from industrial plant

6 MWth (max.)

Heat storage capacity/ hot water accumulator

250 MWhth

The former and new hot water storage units behind the power plant

The plant not only produces heat

for the city and power for the

distribution system operator,

but also actively participates in the

Danish electricity regulating and

primary reserve/frequency

balancing markets

1309cospp_24 24 9/9/13 11:27 AM

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number of daily starts and stops.

Normally though, as indicated in

the diagram, once or twice a

day is enough. The marginal

cost of the plant, in conjunction

with the electricity spot prices

and possible ancillary service,

forms the operation profle.

Electricity spot prices decrease

at night and the engines

are usually stopped. In this

operational mode, the total

yearly running hours of the

engi

Cogeneration September October 2013

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Transcript of Cogeneration September October 2013