1DATA2 (\\SNL2C) :\PDSConfidential\Classified PDS Marketing\2013 PDS Executive PDS Executive Overview_June2015.pptx

Sargent & Lundy Webinar

• Thank you for joining our presentation!• Our phone is currently muted• Please check to ensure your volume is turned up• Please submit questions via the chat window,

participant phones are muted to avoid noise disturbances

• Today’s presentation will be available for download on S&L’s website www.sargentlundy.com

2

What Role Can Combined Heat and Power Play in Meeting Your Industrial

Energy Needs?January 19, 2017

3

“…concurrent production of electricity or mechanical power and useful thermal energy…from a single source of energy”

Energy.gov, Office of Energy Efficiency & Renewable Energy

4

U.S. Market Share: Number of Units

Electric Utility 9,578

IPP non-CHP 7,323

Commercial non-CHP

472Industrial non-CHP

444

Industrial CHP 1,184

Commercial CHP618

IPP CHP543CHP

2,345

Source: U.S. eia

5

U.S. Market Share: Capacity

Electric Utility667,286

IPP non-CHP427,427

Commercial non-CHP

1,267

Industrial non-CHP2,144

Industrial CHP29,584

Commercial CHP2,917

IPP CHP36,974

CHP69,475

Source: U.S. eia

6

Applications

Industrial Commercial District Energy

Food Processing Waste Water Treatment Colleges & Universities

Chemicals Hospitals Downtown loops

Refining Multifamily Industrial complexes

Metal Manufacturing Colleges & Universities

Paper Military Bases

7

U.S. Installations by Fuel Type

Source: US eia

37,096

10,020

7,268 7,214

3241,612

691 5882,621

791,130

98 354 430 9 18 4 30

5000

10000

15000

20000

25000

30000

35000

40000

0

100

200

300

400

500

600N

atur

al G

as F

ired

Com

bine

d C

ycle

Nat

ural

Gas

Fire

dC

ombu

stio

n Tu

rbin

e

Woo

d/W

ood

Was

teB

iom

ass

Con

vent

iona

l Ste

amC

oal

Nat

ural

Gas

Inte

rnal

Com

bust

ion

Engi

ne

Nat

ural

Gas

Ste

amTu

rbin

e

Petr

oleu

m L

iqui

ds

Oth

er W

aste

Bio

mas

s

Oth

er G

ases

Con

vent

iona

lH

ydro

elec

tric

All

Oth

er

Land

fill G

as

Mun

icip

al S

olid

Was

te

Petr

oleu

m C

oke

Sola

r Pho

tovo

ltaic

Oth

er N

atur

al G

as

Ons

hore

Win

dTu

rbin

e

Bat

terie

s

Cap

aity

(MW

)

No.

of G

ener

ator

s

8

Planned CHP’s (Nationwide)

Source: US eia

315

1,040

95

7

107

575

20

200

400

600

800

1000

1200

0

1

2

3

4

5

6

7

8

Nat

ural

Gas

Fire

dC

ombu

stio

nTu

rbin

e

Nat

ural

Gas

Fire

dC

ombi

ned

Cyc

le

Nat

ural

Gas

Stea

mTu

rbin

e

Oth

er N

atur

alG

as

Con

vent

iona

lSt

eam

Coa

l

Oth

er G

ases

Woo

d/W

ood

Was

teB

iom

ass

Oth

er W

aste

Bio

mas

s

Ave.

Nam

epla

te C

apac

ity (W

M)

No.

of G

ener

ator

s

9

U.S. CHP Potential

65,381

75,930

7,624

81,048

10,660

On-site IndustrialOn-site CommercialOn-site WHPExport IndustrialExport District HeatingSource: U.S. DOE

10

Does it Make Sense to Consider?

11

Benefits

• Higher efficiency vs. conventional generation

– Less fuel per MWe– Lower emissions (GHG)– Lower water usage

• Improved reliability– Process steam– Heating/cooling– Quality electric power

• Improved energy security

• Energy cost savings• Multi-fuel capability• Demand Response

12

Obstacles

• Not core business of industry end-user• Reluctance to make a long-term investment

due to market uncertainties• Payback periods beyond current company

policy• Complexity of permitting and siting

13

Energy Policy Act of 2005

Source: ICF CHP Installation Database, 2012

Eliminated PURPA “mandatory purchase”

14

Approaches

•Topping CycleGenerate electricity first, then surplus used for thermal

•Bottoming CycleGenerate thermal energy first, then surplus used for electricity

15

Alternatives: Traditional

Waste Heat Boilers RICE Microturbines Gas Turbines

Dependent on WH temperature and mass flow

10 kW – 10 mW 30 – 330 kW 30 – 300+ mW

Steam quality sufficient for manyprocess

Steam quality sufficient for many process

500 – 600ºF, hot water and low pressure steam

800 – 1,200ºF

Waste heat from process

Various gaseous and liquid fuels

Various gaseous and liquid fuels

Various gaseous and liquid fuels

Generally quiet Acoustic enclosure building

Moderate High energy fluids & high speed machinery

Limited ramp ranges, potentiallycomplex metallurgy

Well-suited forpart load operation

Significant loss of efficiency for part load operation

Significant loss of efficiency for part load operation

16

Industrial Green Initiative

•Corporate Goals•State and Community Programs•Community

17

Alternatives: Renewable

Solar PV Wind< 1 MW < 1.5 MW

Light industrial & commercial

Light industrial & commercial

Sun Wind

Quiet Quiet

Dependent on weather conditions

Dependent on weather conditions

18

Battery Storage and CHP

• Current CHP model beneficial for concurrent consumption of electric power and heat

• Renewable Cogen facilities

• Electric power storage for non-coincidental thermal and electric power demand

19

CHP: Related Incentives & Policies

FederalInterconnection Standards for Small Generators Interconnection

USDA _ Rural Energy for America Program Loan Guarantees

Loan Program

USDA - Rural Energy for America Program (REAP) Grants Grant Program

Modified Accelerated Cost-Recovery System (MACRS) Corporate Depreciation

Business Energy Investment Tax Credit (ITC) Corporate Tax Credit

Green Power Purchasing Goal for Federal Government Green Power Purchasing

IndianaInterconnection Standards Interconnection

Electric Efficiency Standard Energy Efficient Resource Standard

Clean Energy Portfolio Standard Renewable Portfolio Standard

City of Bloomington – Sustainable Development Incentives Financial Incentive

Community Conservation Challenge Grant Program

20

Clean Power Plan: Existing Units

Some Units May Be Affected if They are:• Fossil fuel fired• Connected to utility/transmission grid

> 25 MW• Heat Input >250 mmBtu/hr

21

Clean Power Plan: New Units

• New CHP units are not defined as affected units• Plan suggests states include cogen in their SIPs• CO2 emissions calc. accounts for electrical and useful

thermal energy• Implications:

– CO2 emissions lower than SIP limits can trade surplus allowances or emission reduction credits

– Whether mass-based or rate based– Possible revenue stream– Smoother approval & permitting

22

Profile Slides

23

Combined Cycle CHP

• EPC, Owners Engineer• GE 7EA, 85 MW• HRSG, 800,000 lb/hr steam• (2) Aux Boilers, 200,000 lb/hr

steam

24

Simple Cycle CHP

• (4) GE 7EAs• (3) new boilers with SCRs• Aux boiler replacement,

EPC JV

25

If you have any questions concerning this webinar, please contact:

Paula Guletsky, Vice PresidentPaula.M.Guletsky@sargentlundy.com

(312) 269-6763