Sustainability & Manufacturing – A focus on Renewable Energy Supply through Anaerobic Digestion
Dr Barry McDermott Campbell Stevens PM Group 17.05.2012
Midlands Manufacturing Group
Content
PM Group What is Sustainability Sustainable Manufacturing – Why ? Sustainable Energy Bioenergy & Anaerobic Digestion Project Example Finance & Business Case Development Questions
Sustainability “Global Warming”
“Resource Use”
“Climate Change”
“Carbon Footprint”
“Ecological Footprint”
“Low Carbon Systems”
“Energy Efficiency”
“Sustainability” “Whole Life Costing”
“Zero Carbon” “Green Design” “Life Cycle Analysis”
“Corporate Social Responsibility”
“Embodied Energy”
History of Sustainability 1972 – UN Conference on Human Environment
1800’s
Transcendentalism
1800’s
1900’s
Rachel Carson – Silent Spring
1960
Industrial Revolution
Social Revolution
1992 – UN Conference – Earth Summit
1987 Brundtland Report - Our Common Future
1970
1980
1990
1995
2000
2005
Love Canal & Superfund Act 1983 – UN World Commission on Environment & Development
2002 – World Summit on Sustainable Development
Environmental Revolution
Sustainability
Sustainability Defined
1987 World Commission on Environment and Development
SUSTAINABILITY Social Equity
“Humanity has the ability to make development sustainable – to ensure it meets the needs of the present without compromising the ability of future generations to meet their needs”
Concept of sustainability is much more than environmental protection in another guise Sustainabilitys Goal: To achieve human and ecosystem well-being together
Sustainability
Ecology
Materials
ENVIRONMENTAL
Waste Energy
Construction Time and Cost Whole Life Cost
Management
Growth
Economic Profitability
SOCIAL
Land
Sustainable Development
Productivity
Economic Life
SUSTAINABLE Health & Well Being DESIGN
Environmental
Pollution
Insurance
Water
Amenity Social
Function & Performance
Diversity Security
Health & Safety
Investment Employment
ECONOMIC
Quality Access
One Living Planet
12bn hectares – 6.5bn people
Per capita global quota – 1.8 hectares
European footprint - 6 hectares; North American footprint – 10 hectares
Overpopulation
Global Consumption Rates are rising‌ Humanity’s Ecological Footprint, 1961-2005
Number of planet Earths
1.8 1.6 1.4 1.2
World Biocapacity
1 0.8 0.6 0.4 0.2 0 1960
1970
1980
1990
Number of planet Earths
Source: WWF Living Planet Report 2008
2000
The Global Demand for Energy is Rising‌ World Marketed Energy Consumption 250 Projections
million GWh
200 150 100
50 0 1980
1985 1990
Industrialisation
Source Data:
1995 2000
2006 2010
2015 2020 2025 2030
Population Growth
Energy Information Administration (EIA), International Energy Annual 2006 (June-December 2008), website http://www.eia.doe.gov/iea/wecbtu.html
Enhanced Lifestyles
Rising CO2 Emissions World Energy-Related Carbon Dioxide Emissions by Fuel Type, 1990-2030 50 Projections
History
Billion Metric Tons
40
Total
30 20
Coal Liquids
10 Natural Gas
0 1990
1995
2000
Liquids
Source: Energy Information Administration (EIA)
2005
2010
Natural Gas
2015
2020 Coal
2025 Total
2030
Need for Change… ENERGY EFFICIENCY
CLEAN ELECTRONS
CONSERVATION
Visual Evidence !
Other Drivers for Sustainable development‌‌...
Why Should a Manufacturing Facility Change ?
Risk Management Future Proofing Professional Ethics Reduce Environmental Impact Best Engineering Practice Cost Savings – lower product unit cost Energy Security Customer Driven Legislative Driven Corporate Sustainability goals inc footprint Branding & Marketing
Energy Security  Energy Costs - Average domestic gas bill has doubled since 2000  Guarantee of Energy Supply
- Blackout concerns - Unavailable imports Reference: DECC & OFWAT
Sustainability – Some Focus Areas in Design & Manufacturing
Sustainable Sites
Energy & Atmosphere
Water Efficiency
Innovation Indoor Materials & Resources Environmental Quality
Opportunities…. Technology
Fuels & Feedstocks SOLUTIONS
Energy Efficiency & Renewables
Alternative / Renewables
Emission Reduction
Supply-side Biofuels
Wind Power
Hydrogen
Solar
Biomass
Biomass
Waste to Energy
Fuel Cells Energy Storage Hydro Wave, tidal, deeplake Geothermal
End-of-pipe Air pollution control Coal to gas Carbon capture and storage Waste Management W&WWT
Energy Efficiency Demand Side Green buildings Low energy appliances Building control Smart meters and grids Smart homes Energy management T&D infrastructure
Anaerobic Digestion Technology
Anaerobic Digestion
Natural process which occurs in river and lake sediments, soils and the gastrointestinal tract of animals Degradation of organic material by bacteria in the absence of oxygen. One of the oldest forms of biological wastewater treatment - 1850’s Traditionally part of sludge stabilisation process
Anaerobic Digestion Process
Generator / CHP Scrubbing
Grid Transport Biofuel
Biogas Digestate
Feed
Storage/ Handling
Digestion Process
Dewatering
Composting
Soil Conditioner Fertiliser
*calculated from Department of Energy & Climate Change Regional Gas Consumption Statistics - 2007
How it works‌..
Methane CO2 H2S NH3 Heat & Biomass
Source: IEA Bioenergy Task 24
Digestion Technology Process Temperature – Mesophilic 38 – 42 °C – Thermophilic 55 – 65 °C Feedstock – Mono-digestion or Co-digestion
Plant Design/System – Batch or Continuous; Tank or Lagoon
Digestion – Dry (>30% DM) or Wet (6 – 30%DM)
Digestion Technology CSTR Tanks, Germany
CSTR, Hungry
CSTR, Biogas Farm, Germany
Horizontal Plug Flow System, USA
… Digestion Technology Completed 200,000m3 lagoon, 10m depth, Asia
Lagoon system – HDPE roof system with gas collection, Asia
70,000 m3 lagoon system, Scotland
‌ Digestion Technology
High rate UASB/IC type – Low solids reactor
Domestic digester, Indonesia No high-end engineering required!
Feedstocks & Operations
Feedstock
Organic waste – – – – –
Biodegradable Municipal Waste Sewage Sludge Agricultural slurries Silage Crops Industrial effluents
Feedstock characteristics determines gas yield
Biogas Yields Feedstock
%Dry Matter
Biogas Yield (m3/t)
Cattle Slurry
10
25
Pig Slurry
7
26
Sour Whey
6
37
Food Waste
15
46
Veg waste
15
57
Broiler Manure
60
80
Laying Hen Litter
30
90
Grass Silage
25
150
Sugar Pulp
28
200
Maize
30
200
Cheese Whey
79
670
Biogas as a Biofuel potential Composition – Methane – Carbon Dioxide – Water Vapour
Trace Amounts:
50 – 75% 45 – 25% 2 – 5% <1%
– Ammonia – Hydrogen Sulphide
1m3 of biogas (70% CH4) calorific value 20MJ/m3: – 0.6 L of Petrol; 2.5kWh of heat; 1.7kWh of electricity – Electricity; Heat or Biofuel Beware! ATEX Regulations
Digestate Comprises feedstock not fully converted to biogas & biomass May be dewatered to fibre and liquor fractions
Fibre: – May be aerobically composted to provide a stable, marketable peat moss substitute – Alternatively, landspreading as a soil conditioner or low grade fertiliser
Digestate Liquor: – Separated liquid fraction contains large proportion of nutrients – Ideal for use as a liquid fertiliser as part of a Nutrient Management Plan Disposal of Digestate can be a limiting factor Beware! Biosolids Code of Practice & Animal By-Products Regulations
Anaerobic Digestion Process â&#x20AC;&#x201C; Potential Industry Options Electricity Boiler for Gas Engine
Steam
Exhaust
Electricity Pasteurisation Cooling/Chillers
Exhaust
Biogas
Green House
Digestate
Feed Storage/ Handling
Digestion Process
Dewatering
Composting Soil Conditioner Fertiliser
*calculated from Department of Energy & Climate Change Regional Gas Consumption Statistics - 2007
Project Study Example
Project Bioenergy Primary Objective – To reduce the Client’s exposure to the volatility and overall cost of energy. – Driving fuel independence
Secondary Objectives – Develop a working biogas business model for replication across other facilities
Additional Benefits – Reduction in Carbon footprint – Demonstrable move towards a sustainable business
This project will deliver a robust, ‘fit for purpose’ facility for the client to produce biogas from processing co-products.
Overview Replacing 25% of factory natural gas requirements – equivalent to 66% of the household consumption in local region
Feedstock
Feedstock Handling
Feedstock Ensiling
ANAEROBIC DIGESTION
Digestate Separation
Biogas Cleaning
Fertiliser For sale
AD Technology – 2 Options: 1.Continuous Stirred Tank Reactor 2. Lagoon
Effluent Treatment
*calculated from Department of Energy & Climate Change Regional Gas Consumption Statistics - 2007
Water to river
Biogas To CHP
Key Figures
Inputs – Feedstocks • Agriculture industry • Organic By-product of process – 2450tpd by-product ex process • ca. 1000tpd direct to AD • 1450tpd to ensiling – Lagoon configuration reactor • Ca 200,000m3 volume
£60m investment 5 Year Payback (IRR >20%) Construction due Q3 2012
Outputs – Biogas • 12.5M therms per annum • 50MWth/12.8MWe installed capacity • 50:50 CH4:CO2 • Up to 10,000Nm3/h – Digestate • Dewatering Plant required • Fertiliser product for market sale – Effluent • 800k-900k m3 p.a. • 8000-12000mg/l COD • 3000mg/l NH3 • Full scale effluent treatment plant required
Financing & Business Case Considerations
Global Total New Investment In Clean Energy
What technology is this money being spent on ?
Energy Storage & Smart Grid (R&D) Wind (Mature) Solar Biofuel Biomass & Waste (Mature) Geothermal Tidal (Developing) Efficiency
Follow the money………………?
Business Case Considerations Drivers for Development – Business cost avoidance/Financial Returns – Planning – Replacement of end-of-life assets
Feedstock Availability – Guarantee of supply – Cost security
By Products – Cost of disposal
Gas Utilisation – Use on site or Export? Fuel Security
Process/Project risks – Pass the ticking parcel?
Grants & Tariffs – moving sands or easy money?
Feasibility Study & Business Case Development
General Overview of Funding Support Generation Funding Tariffs – Renewable Electrical Generation – FIT if < 5MWe (Feed-in Tariff + £30/MWhe, if exported), or – RO (Renewable Obligation, 20-year Grandfathering)
RHI (Renewable Heat Incentive, 20-year Grandfathering) – £10/MWhth for dedicated biomass – £68/MWhth for Biogas upgraded to Biomethane (grid export quality)
Several Other Sources, eg – ECA (Enhanced Capital Allowance) • for verified “Good Quality” CHP • 100% Year 1 Tax incentive against validated capital value
Cost Avoidance Examples
Carbon Floor Price Climate Change Levy Gas purchase offset Electricity offset (CHP) Gas/Elec conveyance (eg, capacity reserve, ToP, MDQ reduction) Waste disposal – eg, stock food transportation – effluent treatment, PPC
$
EXAMPLE PROJECT: Possible configurations; which one? 1
2
3
4
OPTIONS
Biogas to Boiler or CHP
Biogas to Gas Engine CHP
Biomethane to Boiler or CHP
• Contamination issues?
• HW to site
• ECA
• ECA
• ECA
• FIT for MWhe
•FIT for MWhe (for CHP)
• £ Offsets;
• £ Offsets;
• £ Offsets;
• CCL
• CCL
• CCL
• ETS/Carbon Floor Price
• ETS/Carbon Floor Price
• ETS/Carbon Floor Price
• Gas purchase
• Gas purchase
• Gas purchase
Biomethane to Grid • RHI £68 MWhth + £MWh base gas price • Reduces any operational issues, eg matching demand profiles, etc, as operates discretely from site • option to switch to total site consumption in future
Most Feasible AD Configuration?
BOILER/CHP or GAS ENGINE?
AD
? UPGRADE?
? ?
GAS GRID
SITE
FEASIBLE / VIABLE? Sustainable?......in the classic context? – Feedstocks – Offtakes – CapEx / OpEx
Funding & Risk – Internal/off balance-sheet? – Ability to take direct process/technology risk? – BOO/ESCo?
Evolve the Financial Model from outset – Build simple but sound case – communicate the value (or otherwise) – Measure it how you need to…. • Simple payback, NPV, IRR, etc
Summary Sustainability is a balance of environmental, economic and social concerns. Energy will be a prime focus of environmental sustainability in the manufacturing industry. Renewable energy supply can provide environmental & economic sustainability benefits in the manufacturing industry.
Bioenergy Options such as Anaerobic Digestion offer significant potential benefits for producers of organic waste. Business Case Development to ensure viability of the project should be established early in the project and evolve with the project development to ensure success.
THANK YOU & QUESTIONS www.pmgroup-global.com Barry.McFarlane@pmgroup-global.com Campbell.Stevens@pmgroup-global.com Barry.McDermott@pmgroup-global.com