A CUSTOMER GUIDE TO DISTRIBUTED GENERATION
BROUGHT TO YOU BY
AND ITS DIVISIONS
TABLE OF CONTENTS Introduction
01
Backup Generation
04
Combined Heat and Power
08
Microgrids
28
Available Resources
32
This guide is intended to provide an overview of distributed generation systems, benefits associated with such systems as well as market opportunities.
ONE Gas: • Makes no warranty or representation, express or implied, with respect
to the accuracy, completeness or usefulness of the information contained within, and • Assumes no liability, including but not limited to liability for damages, arising
or resulting from the use of any information contained in this guide. The background and understanding of the applications for distributed generation is a good starting point to take the next steps and get involved in more detail about the facets of the market, specifically the technology, drivers, economics, environmental benefits and future potential of distributed generation.
01
INTRODUCTION TO DISTRIBUTED GENERATION For every business, resiliency is paramount. Whether it be a natural disaster, electrical grid disruption or other unforeseen situation, it is important that your business has strategically positioned itself as much as possible to continue operating normally. The natural gas infrastructure system can provide you with that peace of mind. The United States has the most extensive natural gas delivery network in the world with: • More than 300,000 miles of natural gas transmission pipelines • More than 2.2 million miles of natural gas distribution pipelines
As a natural gas utility, ONE Gas can provide you access to that infrastructure and offer you solutions which can be tailored to your business needs. These solutions can lower energy cost, increase efficiency, improve reliability and reduce the environmental footprint of your business. The following are some examples of the solutions ONE Gas can help you implement:
Natural Gas Backup Generation Onsite natural gas generators can provide the power reliability your business needs. With this solution you can avoid some of the pitfalls of diesel generation. The units have lower emissions and operate at much quieter levels. There is also no need for onsite storage, refilling or the odor associated with diesel.
02
A Customer Guide to Distributed Generation
Combined Heat and Power System (CHP) A CHP system uses natural gas to generate electricity onsite while capturing the heat generated during that process to then also use in your operations. Those uses could be to heat the building, cool the building or as part of your manufacturing process. The use of this heat significantly increases the energy efficiency of your business and reduces not only costs, but environmental impacts as well.
Microgrid A microgrid system will include one of the above solutions as well as a mix of renewable energy such as solar, wind and energy storage technologies. By having a natural gas backbone, the microgrid can avoid the downside of intermittent solar and wind energy while providing a resilient, environmentally friendly solution.
Consider the following questions when reviewing goals for your business. Do you have: • Need for high reliability and resiliency of operations? • Concern over current or future electricity prices? • Interest in reducing environmental impact? • Planned facility expansion? • Equipment replacement or new construction?
If your answer is “YES” to one or more of the questions above, ONE Gas can help you navigate the solution that is best for your business. We have established relationships with leading firms in the industry and will work with you to determine which one will help you reach the goals for your organization.
03
BACKUP GENERATION What is it? The installation of a natural gas generator to back up critical business infrastructure or the entire customer site during a loss of power.
How does it benefit the customer? • Provides business continuity during an electrical outage • Prevents lost revenue, inventory loss and shutdown/startup costs due
to an outage • Can be used as part of a Demand Response Program to reduce electric
demand charges
˚
Demand Response Program - A voluntary program that provides end-use customers with the ability to manage their electricity use in response to conditions in the market. They can reduce their electricity consumption when prices are high, or the reliability of the grid is threatened, achieving economic benefits for the reductions they make.
EFFECTS OF DEMAND SIDE MANAGEMENT (DSM) MW
Hours in a Day
04
A Customer Guide to Distributed Generation
Who needs backup generation? • 24-hour operations • Manufacturing facilities • Products that could go bad during a loss of power (refrigeration) • Older diesel generators • Any customer who has an interest in resiliency
NATURAL GAS VERSUS DIESEL Diesel • Standby generation is dominated by diesel • Primarily runs when there is a grid outage • Limited run time outside of a grid outage • Higher emissions • Onsite fuel storage and fuel maintenance • Hard to run Demand Response or Energy Management Programs due to
emissions requirement • Needs to be Tier 4 diesel engine • Cost 50% more than comparable natural gas engine
Natural Gas • Favorable for Demand Response or Energy Management Programs • Fewer emissions • No onsite fuel storage or fuel maintenance • Lower fuel costs • Resilient delivery infrastructure
05
TOP MANUFACTURERS OF BACKUP GENERATORS* Caterpillar www.cat.com/en_US/products/new/power-systems/electric-powergeneration/gas-generator-sets.html
Cummins www.cummins.com/generators
*ONE Gas does not endorse any particular product, manufacturer or distributor, and encourages customers to check contractor references and do independent research before moving forward with any project.
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A Customer Guide to Distributed Generation
Generac www.generac.com/all-products/generators/commercial-generators#?cat=317
Kohler www.kohlerpower.com/en/generators/industrial/products/Gaseous+Generators
07
COMBINED HEAT AND POWER Combined Heat and Power (CHP) is the generation of two forms of energy from one common source of fuel also known as Cogeneration.
FUEL
Waste Heat Recovered
HEAT & HOT WATER
Prime Mover & Generator
ELECTRICITY
Conventional Heating & Electric The CHP system is typically located at or near your building and generates
CHP System
power Power Plantwith the added benefit of 35 recovering the waste 110 electricity or mechanical ELECTRICITY ELECTRICITY FUEL % steam or warm air to meet thermal needs. This 32 water, Efficient Units Units heat in the form of hot high quality and reliable power system provides a secure energy source along CHP 80% Efficiency with the ability to provide hot water, heating, cooling or de-humidification of 56 your facility. FUEL Units
Furnace/Boiler 80% Efficient
HEAT
The key to an efficient and economical CHP system is having the need for simultaneous use of both electricity and heat.
Heat to users Recuperator
xhaust 08
A Customer Guide to Distributed Generation
45 Units
HEAT
CHP is not a single technology, but an integrated energy system that can be modified depending upon the needs of the energy end user. These systems simply capture and utilize excess heat generated during the production of electric power. CHP systems offer economic, environmental and reliabilityrelated advantages compared to power generation facilities that produce only electricity. Distributed power generation systems, which are frequently located near thermal loads, are particularly well-suited for CHP applications. The total CHP system efficiency is the combination of electrical efficiency and the efficiency of capturing the usable waste heat. By capturing and using the waste heat, CHP systems consume approximately 40% less energy than grid power and heating with a boiler. Because greenhouse gas emissions are related to energy consumption, CO2 emissions are generally lower with CHP than using conventional grid power and Waste Heat Recovered
a boiler.
FUEL
HEAT & HOT WATER
Prime Mover & Generator
High Temp Heat
ELECTRICITY
CONVENTIONAL HEATING & ELECTRIC
CHP SYSTEM
Conventional Heating & Electric 110 Units
FUEL
Power Plant 32% Efficient
CHP System
ELECTRICITY
35 Units
ELECTRICITY CHP 80% Efficiency
56 Units
FUEL
Furnace/Boiler 80% Efficient
SYSTEM EFFICIENCY ˜48%
HEAT
45 Units
FUEL
100 FUEL Units
HEAT
SYSTEM EFFICIENCY ˜80%
93% CH4 GAS Heat to users Exhaust
Fuel Process
Recuperator
09
21% 79%
PRIME MOVERS There are five types of prime movers for CHP systems: • Reciprocating Engines • Combustion Turbines • Microturbines • Steam Turbines • Fuel Cells
10
A Customer Guide to Distributed Generation
92
EFFECIENT
About 8% lost in generation and delivery Exhaust CO2 & N2
+
93% CH4 GAS
Heating Loop
HYDROGEN Fuel Processor
Heat to users
Hot Water Outlet
Exhaust
Fuel Cell Stack
Co
Water Inlet
AIR
Combustor
FUEL
ol
Co
Buffer Tank
Generator
Excess Power to Grid
21% O2 79% N2
Potential waste heat recovery
Heat Exchanger Engine
AIR
in g
Compressor
Electricity to plant or utility grid
Turbine
Generator
Residential Commercial Industrial
Generator
Energy Demand
Monitor Control Balance
Electric Vehicles
•
High fuel efficiency
•
30 – 200 ekW sizes available
•
Lower initial costs vs. larger turbines
•
Lightweight and small footprint
•
Best for variable load applications
•
Multi-fuel capability
•
More tolerant to high ambient % conditions and high elevations 32
• Air-cooled
EFFECIENT
Waste Heat Recovered
HEAT & HOT WATER
Prime Mover & Generator
ELECTRICITY
Lower fuel pressure requirement
About 68% lost in generation and delivery
Conventional Heating & Electric
•
Accepts low BTU fuels
•
% Online in less than 30 seconds
•
Offers “black start” capability
92
110 Units
FUEL
Power Plant 32% Efficient
ELECTRICITY
35 Units
56 Units
FUEL
Furnace/Boiler 80% Efficient
HEAT
45 Units
•
Ultra low emissions
•
High reliability
•
Minimal scheduled maintenance
High Temp Heat
Low Temp Heat
Generating Bank
Economizer
CHP System
ELECTRICITY
•
CHP 80% Efficiency
HEAT
FUEL
100 FUEL Units
Accept various fuel sources
Shell & Tube Heat Exchanger
About 8% lost in generation and delivery Exhaust CO2 & N2
93% CH4 GAS Heat to users
Heating Loop
Exhaust
+ HYDROGEN Fuel Processor
Fuel Cell Stack
Co
Buffer Tank Generator
Water Inlet
21% O2 79% N2 Combustor
FUEL
Electricity to Building
Compressor
AIR
in g
i n g Loop
HEAT
L o op Heat Exchanger
Electricity to plant or utility grid
AIR
COMBUSTION TURBINES
ol
Co
Potential waste heat recovery
Heat Exchanger
Excess Power to Grid
AC
Customer Load
ol
WATER
Engine
Inverter
DC
_
Recuperator
Turbine
FUEL CELLS Generator
Residential Commercial Industrial
Energy Demand
Utility Grid
Generator
Monitor Control Balance
Electric Vehicles
Renewables
Storage
•
Grid-independent operation
•
Electric load following
High exhaust temperatures: 480 C / 900 F
•
Multi-megawatt capacity
•
Require low pressure natural gas
Low weight and minimal space requirement
•
Low noise and vibration
•
Ultra-low emissions
•
Very simple design
•
~10-year cell stack life
•
Lower emissions capabilities
•
Ideal for 24/7 operation
•
Accept high or low BTU fuels
•
Require high pressure natural gas
• • •
Well-suited for CHP w/ large heat to ekW ratio
Renewa
Storage
EFFECIENT
Hot Water Outlet
L o op
MICROTURBINES
Electricity to Building
FUEL
i n g Loop
Heat Exchanger
Utility Grid
•
AC
Customer Load ol
WATER
RECIPROCATING ENGINE
Inverter
DC
_
Recuperator
11
RECIPROCATING ENGINES Reciprocating engines are the most common and technically mature of all CHP technologies. They are available from small (e.g., 1 kW for residential generation) to large generators (e.g., 7 MW). Typically, any power generation system smaller than 50 kW is considered micro-CHP. Current available natural gas engines offer low first-cost, fast start-up, proven reliability when properly maintained, excellent load-following characteristics and significant heat recovery potential. Electric efficiencies of natural gas engines range from 28% lower heating value (LHV) for small engines (<100 kW) to over 40% LHV for very large lean burn engines (> 3 MW). Waste heat can be recovered from an engine exhaust, jacket water and oil cooling systems to produce either hot water or low pressure steam for CHP applications. Overall CHP system efficiencies (electricity and useful thermal energy) of 70% to 80% are routinely achieved with natural gas engine systems. Reciprocating engine technology has improved dramatically over the past three decades, driven by economic and environmental pressures for power density improvements (more output per unit of engine displacement), increased fuel efficiency and reduced emissions. Computer systems have greatly advanced reciprocating engine design and control, accelerating advanced engine designs and making possible more precise control and diagnostic monitoring of the engine process. Engine manufacturers and worldwide engine R&D firms continue to drive advanced engine technology, including accelerating the diffusion of technology and concepts from the automotive and marine markets to the stationary market.
12
A Customer Guide to Distributed Generation
92
EFFECIENT Electric Vehicles
Storage
About 8% lost in generation and delivery
COMBUSTION TURBINES
Heat to users
Hot Water Outlet
Heating Loop
Exhaust
Potential waste heat recovery
Heat Exchanger Buffer Tank
Engine Generator
Excess Power to Grid
R
Water Inlet
AIR
Compressor
Electricity to Building
Conventional combustion turbine (CT) generators are a very mature technology. They typically range in size from about 500 kW to over 100 MW for central power generation. They are fueled by natural gas, oil or a combination of fuels (dual fuel). Modern single-cycle combustion turbine units typically have efficiencies in the range of 20% to 45% at full load. Efficiency is somewhat lower at less than full load. Gas turbine CHP systems burn fuel to generate electricity and then use a heat recovery unit to capture heat from the combustion systemâ&#x20AC;&#x2122;s exhaust stream. This heat is converted into useful thermal energy, usually in the form of steam, hot water or heated air. Gas turbines are ideally suited for large commercial or industrial CHP applications requiring ample amounts of electricity and heat. Gas turbines can be used in a simple cycle combined heat and power operation, or combined cycle operation in which high pressure steam is generated from recovered exhaust heat and used to create additional power using a steam turbine. Some combined cycles extract steam at an intermediate pressure for use in industrial processes as well. Gas turbines produce high-quality exhaust heat that can be used in CHP configurations to reach overall system efficiencies of 70% to 80%. The efficiency and reliability of smaller gas turbines (1 to 40 MW) are an attractive choice for industrial and large commercial users for CHP applications.
13
CHP 80% Efficiency 56 Units
92
%
Furnace/Boiler 80% Efficient
FUEL
45 Units
HEAT
FUEL
100 FUEL Units
HEAT
S
EFFECIENT
About 8% lost in generation and delivery
MICROTURBINES
93% CH4 GAS
HYDROGEN Fuel Processor
Heat to users
Hot Water Outlet
Heating Loop
Exhaust
Recuperator
WATER
Buffer Tank
Engine
Water Inlet
Generator
Excess Power to Grid
21% O2 79% N2
Potential waste heat recovery
Heat Exchanger
Combustor
FUEL
AIR
Compressor
Electricity to Building
AIR
Electricity to plant or utility grid
Turbine
Generator
Res Com Ind
Microturbines are small combustion turbines that produce between 30 kW and 200 kW of power. Microturbines were Utility Grid
derived from turbocharger technologies found in large trucks or the turbines in aircraft auxiliary power units
El Ve
(APUs). Most microturbines are single-stage, radial flow devices with high rotating speeds of 90,000 to 120,000 revolutions per minute. Waste Heat HEAT & HOT WATER
Recovered
A few manufacturers have developed alternative systems with multiple stages Prime Mover & FUEL
ELECTRICITY
and/or lower rotation Generator speeds.
High Temp Heat
Gen
Microturbine generators can be divided in two general classes: Conventional Heating & Electric
CHP System
Recuperated microturbines , which recover heat from the exhaust gas to Power Plant 35 110
•
FUEL
ELECTRICITY
ELECTRICITY
32 Efficient Units boost the temperature of combustionUnits and increase the efficiency %
CHP
FUEL
100 FUEL
Efficiency Units Unrecuperated microturbines , which have lower 80% efficiencies but also lower Furnace/Boiler 56 45
•
FUEL
Units capital costs
80% Efficient
HEAT
Units
HEAT
Sh
While most early product introductions featured unrecuperated designs, today’s products are focused on recuperated systems. The recuperator recovers heat from the exhaust gas and boosts the temperature of the air stream supplied to the combustor. Further, the exhaust heat recovery can be used in a CHP configuration. The figure below illustrates a recuperated microturbine system. 93% CH4 GAS Heat to users Exhaust
HYDROGEN Fuel Processor
Recuperator
WATER
Potential waste heat recovery
21% O2 79% N2 Combustor
FUEL
Electricity to plant or utility grid
AIR
Compressor
AIR
Turbine
Generator
Resid Comm Indu
14
A Customer Guide to Distributed Generation
STEAM TURBINES Steam turbines are one of the oldest prime mover technologies that are still used to drive a generator or mechanical machinery. Power generation using steam turbines has been in use for over 100 years, when they replaced steam engines due to their higher efficiencies and lower costs. Most of the electricity produced in the United States today is generated by conventional steam turbine power plants. The capacity of steam turbines can range from 50 kW to 1,500 MW for large utility power plants. Steam turbines are widely used for CHP applications in the U.S. and Europe. Unlike gas turbine and reciprocating engine CHP systems where heat is a byproduct of power generation, steam turbines normally generate electricity from heat (steam). A steam turbine is captive to a separate heat source and does not directly convert fuel to electric energy. The energy is transferred from the boiler to the turbine through high pressure steam that in turn powers the turbine and generator. This separation of functions enables steam turbines to operate with a wide variety of fuels. In CHP applications, steam at lower pressure is extracted from the steam turbine and used directly in a process or for district heating, or it can be converted to other forms of thermal energy, including hot or chilled water. Steam turbines offer a wide array of designs and complexity to match the desired application and/or performance specifications. Steam turbines for utility service may have several pressure casings and elaborate design features, all designed to maximize the efficiency of the power plant. For industrial applications, steam turbines are generally of simpler single-casing design and less complicated for reliability and cost reasons. CHP can be adapted to both utility and industrial steam turbine designs.
15
High FUEL CELLS Temp Heat
Generating Bank
than traditional prime mover technologies. Fuel cell stacks available and under development are silent, produce no pollutants, have few moving parts and have FUEL
100
FUEL Units relatively high fuel efficiencies.
Shell & Tube Heat Exchanger
Fuel cell systems with their ancillary pumps, blowers and reformers maintain most of these advantages. A schematic of a fuel cell-based CHP system is shown below.
Exhaust CO2 & N2
93% CH4 GAS
+ HYDROGEN Fuel Processor
Fuel Cell Stack
Inverter
DC
AC
_ Customer Load
Co
ol
WATER 21% O2 79% N2
ol
Co
city t or grid
Economizer
Fuel cells offer an entirely different approach to the production of electricity
m
ncy
Low Temp Heat
AIR
in g
i n g Loop
HEAT
L o op
Heat Exchanger
Fuel cells produce power electrochemically from hydrogen delivered to the negative pole (anode) of the cell and oxygen delivered to the positive pole (cathode). The hydrogen can come from a variety of sources, but the most economic method is by Residential reforming of natural gas. There are several different Generator
Commercial
Industrial liquid and solid media that support these electrochemical reactions â&#x20AC;&#x201D;
phosphoric acid (PAFC), molten carbonate (MCFC), solid oxide (SOFC) and proton exchange membrane (PEM) are the most common systems. Each of these media comprises a distinct fuel cell technology with its own performance. Fuel cell efficiencies range from 35-40% for the PAFC to upwards of 60% for the SOFC Utilitysystems. Grid
16
Energy Demand
Monitor Control Balance
A Customer Guide toElectric Distributed Generation Vehicles
Renewables
Storage
32
%
MICRO-CHP
EFFECIENT
About 68% lost in generation and delivery
Micro-CHP systems in small commercial buildings are generally designed to be controlled by heat-demand, delivering electricity as the byproduct. Although similar to large CHP systems, these small systems generate heat that is pumped
92
through a heat exchanger and used for water heating or heating loads. The
%
generator provides power for onsite consumption and may exceed actual facility
EFFECIENT
use. In this case, there may be an option to sell power back to the local electric utility lowering the total operating cost. About 8% lost in generation and delivery
Hot Water Outlet
Heating Loop
Heat Exchanger Buffer Tank
Engine Generator
Excess Power to Grid
Water Inlet
Electricity to Building
There are several prime movers that can be used for micro-CHP applications.
Micro-CHP Size For the purpose of this guide, micro-CHP appliances are cogeneration systems less than or equal to 50kW in size.
17
DIFFERENCE BETWEEN MICRO-CHP AND LARGE CHP Many large commercial and industrial CHP applications are electricity-led where electricity is the main output and heat is a byproduct. These systems are typically sited in “campus” type environments such as office complexes, hospitals and college buildings where the heat can be efficiently utilized for space heating or cooling applications. Micro-CHP systems in residences or smaller commercial applications are more often heat-led. Heat is the main output and electricity is the byproduct. Depending on application, the CHP system can be either electric-led or heat-led.
DRIVERS AND ADVANTAGES OF MICRO-CHP Micro-CHP product development started in the 1990’s in Europe and Japan and was spurred on by increasing energy prices as well as a concern for air quality/ emissions issues in those regions. Energy awareness is the main driver for the changes coming in the micro-CHP field. Interest in micro-CHP is growing due to: • High electric costs versus natural gas costs (spark spread) • Increased number of power outages and duration • Interest in renewable energy and energy efficiency,
both from a consumer and utility standpoint • System costs are decreasing as the market grows • More new products are entering the market • Government policies and utility awareness have led to
changes to incorporate new technologies
18
A Customer Guide to Distributed Generation
WASTE HEAT RECOVERY A waste heat recovery unit is a heat exchanger that recovers heat from exhaust streams with potential high energy content, such as exhaust gases or from cooling water from a CHP system.
Numerous options exist for the use of waste heat including: • Steam (low pressure and high pressure) • Hot water • Chilled water
There are many commercially available heat recovery systems and technologies. • Heat recovery steam generator (HRSG) • Shell and tube, plate and frame heat exchangers • Absorption chillers
Typical system exhaust temperatures are: • Combustion Turbine: 900 – 1,000°F • Recuperated Micro-Turbine: 500 – 600°F • Reciprocating Engine: 900 – 1,000°F • Fuel Cell: 600 – 700°F
A HRSG is a steam boiler that uses hot exhaust gases from the gas turbines or reciprocating engine to heat up water and generate steam. The steam, in turn, drives a steam turbine or is used in commercial applications that require heat. Sometimes a duct burner may be incorporated into the exhaust stream to increase temperatures to provide higher quality steam from the HRSG. Heat exchangers are available in several configurations that offer very economical heat recovery options.
19
Plate and frame heat exchangers are composed of multiple thin, slightly separated plates that have very large surface areas and fluid flow passages for heat transfer. Shell and tube heat exchangers consist of a series of tubes. These tubes contain the fluid that will be either heated or cooled. The second fluid is in the shell and is pumped around the tubes to transfer the heat to the initial loop. Waste heat recovery process systems have many benefits for CHP applications. The recovery process adds to the efficiency of the CHP system, decreasing the fuel and energy consumption needed for other applications at the facility (i.e. water or space conditioning). Other benefits can include the reduction in equipment sizes. As fuel consumption is reduced (due to the recovered heat), the size of the heating or water heating equipment normally used for that application can be downsized.
High Temp Heat
Low Temp Heat Generating Bank
Economizer
00 nits
% CH4 GAS
Shell & Tube Heat Exchanger
Exhaust CO2 & N2
+ HYDROGEN Fuel
Fuel Cell
DC
Inverter
Stack 20Processor A Customer Guide to Distributed Generation
AC
_
Customer Load
C
SITE VS. SOURCE Today, energy efficiency and environmental impacts are on everyone’s mind. Understanding the real costs of the energy we consume in our buildings is also very important. Statements about electricity being 100% efficient can be misleading. That analysis simply focuses on the efficiency at the end-use device — an energy-using piece of equipment — and doesn’t take into account the entire energy delivery process from generation-to-end use. A significant amount of energy is wasted just to produce the electrical power that is ultimately delivered to your facility. Natural gas comes directly from the well to your facility. More natural gas energy potential is delivered to your equipment onsite, making natural gas a far more efficient energy choice overall. Industry analysis shows that the production, transmission and delivery of electricity to the market has an overall efficiency of just 32%. This compares to natural gas efficiency at 92%. These numbers reflect the total energy expended during the productionthrough-delivery process compared to the net energy delivered for use.
FUEL
Co 110 Units
FUEL
56 Units
FUEL
Exhaust
AIR
21
ENVIRONMENTAL BENEFITS CHP plays an important role in meeting energy needs as well as in reducing the environmental impact of power generation. Because less fuel is burned to produce each unit of energy output, CHP reduces air pollution and greenhouse gas emissions. Natural gas CHP is the best choice for lowering carbon-based emissions. Below is an example of a 1,000 kW CHP system compared to purchasing grid power.
CO2 EMISSIONS FOR U.S. AVERAGE MARGINAL POWER MIX FROM 1,000 KW RUNNING 8,500 HOURS PER YEAR 8,000
6,000
4,000
2,000
0
U.S. Marginal Grid Power Mix
IC Engine
Combustion Turbine
Micro Turbine
Fuel Cell
According to the U.S. Energy Information Administration, gas-fired CHP equipment offers the lowest carbon emissions versus alternate fueled technologies. Further, additional exhaust treatments, including Selective Catalytic Reduction (SCRs), are available that can further improve the total exhaust emissions.
22
A Customer Guide to Distributed Generation
Fuel cell systems have inherently low emissions profiles because the primary power generation process does not involve combustion. The fuel processing subsystem does not require any emissions control devices to meet current or projected regulations. While not considered a pollutant in the ordinary sense of directly affecting health, CO2 emissions do result from the use of fossil fuel-based CHP technologies. The amount of CO2 emitted in any of the CHP technologies discussed depends on the fuel carbon content and the system efficiency. Only 117 pounds of CO2 are produced for every MMBTU of natural gas burned versus 161 pounds per MMBTU for fuel oil and 205 pounds per MMBTU for coal. The use of natural gas is emerging as the preferred fuel choice for CHP. This is due to natural gas being widely available and competitively priced versus other fuel sources. Further, public policy and the local â&#x20AC;&#x153;green marketâ&#x20AC;? are causing businesses and institutions to rethink and consider gas-fired CHP. In addition to cost-savings, CHP technologies offer significantly lower emissions rates compared to separate heat and power systems. The example below compares a 1,000 kW engine-driven CHP system to emissions from grid power for the U.S. marginal power mix. SO2 AND NOX EMISSIONS FROM THE GRID VS. 1,000 KW IC ENGINE RUNNING 8.500 HOURS PER YEAR 14,000 10,500
GRID POWER 7,000
IC ENGINE CHP
3,500 0 SO2
NOX
23
ECONOMICS Cost is an important factor when considering the purchase of any product, including CHP. However, determining the cost of CHP technology can be difficult. In addition to equipment or capital costs, there are other expenses related to installing the equipment. Once the system is installed and operational, there are energy costs and ongoing maintenance costs. Substantial energy savings should be expected as well. The system should generate power at a cost below purchasing electricity from the gridÂâ&#x20AC;&#x201D; also known as Spark Spread, and the use of the waste heat generated from the CHP system reduces use of thermal energy. Equipment costs for CHP technologies are often quoted in terms of their cost per kilowatt of electricity produced, or $/kW. The larger the CHP system, the lower the installed cost per kW. Purchasing a system that matches your thermal need will offer the best economics with payback estimated to be 3-5 years. A Life Cycle Cost analysis should be conducted, which considers all costs of operating the system over the expected life of the equipment. This type of analysis is useful when comparing different system options to that of continuing with business as usual purchasing electric from the grid.
24
A Customer Guide to Distributed Generation
Residential Commercial Industrial
Generator
A typical CHP system life expectancy is 20 years. A CHP life cycle cost analysis will consider 3 things over the 20-year life: Utility Grid
Energy Demand
Monitor Control Balance
Renewables
110 Units
• All capital costs amortized over 20 years at current loan interest rate. • Expected energy costs for the 20 years. The cost in year one uses current
56 Units
energy rates and each subsequent year should increase slightly as we Electric Vehicles
Storage
assume energy will cost more in 20 years than it does today. A typical annual energy escalation clause is 1%-2%. • Maintenance costs for each of the 20 years.
˚
The assumption is that the CHP system will require more maintenance in later years of operating. Some manufacturers offer maintenance plans that include costs for minor updates as well as major overhauls of the system.
A CHP analysis tool that calculates simple payback, IRR, Life Cycle Costs and CO2 emissions is available at: https://understandingchp.com/resources/payback-tool/ This tool compares four prime movers to the ‘do-nothing’ scenario.
25
SPARK SPREAD
A 3 or higher is a good spark spread.
26
A Customer Guide to Distributed Generation
Spark spread is the relative difference between the price of fuel and the price of power. Spark spread is highly dependent on the efficiency of conversion. For a CHP system, spark spread is the difference between the cost of fuel for the CHP system to produce power and heat onsite and the offset cost of purchased grid power.
AVERAGE RETAIL U.S. COMMERCIAL ENERGY PRICES INCLUDING SHORT TERM ENERGY INFORMATION ADMINISTRATION (EIA) OUTLOOK ($/MMBTU)
27
High Temp Heat
P System
CHP Efficiency
Low Temp Heat
MICROGRIDS FUEL
Generating Bank
Economizer
100 FUEL Units
• A microgrid is a hardware/software solution to a critical, localized need for Shell & Tube Heat Exchanger
continuous electricity regardless of power or climate conditions
˚
Software solution manages the generation equipment based on a predetermined set of goals to reduce cost, emissions, etc. Exhaust CO2 & N2
• Resiliency is provided by multiple pieces of generation equipment, which
could include: 93% CH GAS 4
+
HYDROGEN
Fuel Processor
Fuel Cell Stack
WATER
Electricity to plant or utility grid
ol
Co
21% O2 79% N2
AIR
Inverter
DC
AC
_ Customer Load
Co
˚ Natural gas engines ˚ Combined Heat and Power system ˚ Solar ˚ Wind ˚ Battery storage
ol
in g
i n g Loop
HEAT
L o op Heat Exchanger
• Can disconnect from the grid and operate autonomously
Residential Commercial Industrial
Utility Grid
Energy Demand
Generator
Monitor Control Balance
Electric Vehicles
28
A Customer Guide to Distributed Generation
Renewables
Storage
BENEFITS OF A MICROGRID • Provides resiliency and business continuity • Improves electric reliability • Lowers energy costs for customers • Lowers emissions • Strengthens the central grid
Community Microgrid Benefits A community microgrid brings communities four benefits not provided by today’s centralized energy system: 1. Lower costs and increased economic investment 2. Improved overall performance 3. Resilience and security 4. Replicable, scalable model
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Considerations • Electric provider is key to project success:
˚
Need ability to power back, disconnect and reconnect to
˚
Electric companies see it as a load loss
the grid
• New concept and industry
Who can benefit from a Microgrid? Settings where buildings are close together and/or critical services are provided are perfect for microgrids.:
Examples include • Hospital complexes • Universities • Data centers • Military facilities • Businesses or industrial parks • Residential communities • Cities looking to add resiliency to their critical municipal services, such as
police departments, fire departments, water treatment plants, shelters and transportation services
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A Customer Guide to Distributed Generation
Microgrid Articles and White Papers for Additional Information https://microgridknowledge.com/white-paper/guide-to-community-microgrids/ https://microgridknowledge.com/white-paper/reciprocating-engine-generatorsand-microgrids/ https://microgridknowledge.com/white-paper/chp-microgrid/ https://microgridknowledge.com/white-paper/rise-clean-energy-microgrids/ https://microgridknowledge.com/white-paper/microgrids-resiliency/ https://microgridknowledge.com/white-paper/guide-gas-turbine-microgrid/
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AVAILABLE RESOURCES www.understandingCHP.com www.GasAirConditioning.com
U.S. Department of Energy and Federal Energy Management Program www.energy.gov/eere/amo/combined-heat-and-power-basics www.energy.gov/eere/femp/federal-energy-management-program https://chp.ecatalog.lbl.gov
CHP Installation Database https://doe.icfwebservices.com/chpdb/
U.S. Environmental Protection Agency (EPA) www.epa.gov/chp
Policies & Incentives Database www.epa.gov/chp/dchpp-chp-policies-and-incentives-database
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A Customer Guide to Distributed Generation
FOR QUESTIONS OR MORE INFORMATION, PLEASE CONTACT YOUR ONE GAS REPRESENTATIVE.
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Revised 01/20