Economics of P2G integration to wastewater treatment plant. RESEARCHER S SEMINAR NEO-CARBON ENERGY Risto Hyyryläinen, Master Thesis worker

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1 Economics of P2G integration to wastewater treatment plant RESEARCHER S SEMINAR NEO-CARBON ENERGY Risto Hyyryläinen, Master Thesis worker

2 Content of the study Utilization of biogas and SNG Basic wastewater treatment technologies Biogas production in wastewater treatment plants (WWTPs) Integration of P2G to WWTP Integration possibilities (benefits, technology demand) Studies of economics of the integration

3 Integration possibilities, why WWTP? WWTP needs oxygen and heat for treatment processes, (O2 for aeration and heat for digestion) and it produces CO2 P2G produces both oxygen and heat that can be utilized at WWTP and it needs CO2 Wastewater treatment is compulsory for modern day society, at least 1 WWTP in every city Some WWTPs also produce already biogas as a by-product Wastewater A good platform for integration Aeration Clarification Water Sludge Digestion Biogas O2 Heat CO2 H2O Electrolysis H2 Methanation SNG

4 Integration potentials Aeration process causes the largest electricity costs(~30%) P2G integration reduces the aeration costs with oxygen supply Aeration process can use air, pure oxygen or advanced oxygen processes Integration only to WWTP that use pure O2. Approximately several hundreds commercial WWTPs globally that use only oxygen

5 Integration possibilities EU region: - Investments to upgrade existing plants, especially in Germany municipal WWTPs - About 7000 suitable for integration* - Production potential: 5,95 million tons SNG/a, 83 TWh/a China: - Severe problems with fresh water supply and water treatment - Major investments to build new WWTPs (217 new plants in 2012) municipal WWTPs - About 3000 suitable for integration* - Production potential: 3,11 million tons SNG/a, 46 TWh/a *WWTPs in EU generally smaller than in China Sources: Pordata.pt, Environmental Performance Index

6 Economics of the integration Studies of the payback time (NPV) of the integration and profitability Net Present Value= All values discounted to present time Finding the main factors of the profitability (electricity price, investment, SNG price..) 3 cases (some calculations in this presentation): -Finland -China -Germany Each country has different prices and costs and profitability Overall profitability evaluated with payback time and annual returns

7 What has been done Flow chart of the integration (WWTP and P2G processes and mass flows) Calculation of mass flows of integration (H2, CO2, O2..) Money streams of the integration with evaluated prices Economy calculations (default prices, fixed values, profitable scenarios, FCR not yet included)

8 Case Finland Based on WWTP in a major city in southern Finland -35 million m3 of wastewater annually -Plant has own biogas production P2G plant values: -10 MW (electrolyser) - Operating hours: 2500 h (operated only with profitable electricity prices) tons of SNG/a annually Source: Kangas, Jätevesipuhdistamojen toiminta ja toteutukset

9 Case Germany Based on WWTP in a major city in northern Germany -160 million m3 of wastewater annually - Own biogas production -Recently upgraded aeration system P2G plant values: -10 MW (electrolyser) - Operating hours: 2000 h tons of SNG/a annually Source: gaccmidwest.org

10 Case China Based on WWTP in a very large city in northeastern China - One of the Chinas largest WWTP million m3 of wastewater annually P2G plant values: -10 MW (electrolyser) - Operating hours: 3000 h tons of SNG/a annually Source: Chinagate.cn

11 Cases, inputs Country China Germany Finland Investment [M ] 8,13 11,8 12,2 Electricity price [ /MWh] Investment support Operating hours Production [tons] SNG price [ /t] % 22 % 18 % WACC: 9 %

12 Outcomes, first year results Returns, first year Costs, first year High investment and electricity costs Returns mainly from SNG sales, but also from heat and O2

13 Outcomes, profitability and payback times China: -Profitable after 3 years -Payback time: 4 years Finland: -Profitable after 8 years -Payback time: 15 years Germany: -Profitable after 10 years -Payback time: 20 years

14 Fixed input values Decreasing the investments in Finland and in Germany to China level -FIN: 12,2 m ->8,13 m -GER: 11,8 m ->8,13m Finland: -Profitable after 7 years -Payback time: 13 years Germany: -Profitable after 8 years -Payback time: 15 years

15 Next steps in the study Finding the profitable scenarios -Study of the key factors of the profitability -Industrial sector WWTPs -Complete sensitivity analysis of the key factors - The FCR in calculations

16 BioCat- project in Denmark 1 MW electrolysis plant in Spildevandscenter AvedØre, Denmark Hydrogen production with surplus energy Methane is produced from hydrogen and raw biogas/ CO2 and methane is fed to gas grid Source: Hydrogenics

17 THANK YOU!

18 TABLE OF CONTENTS Table of symbols 1 Introduction 2-4 sivua 2. Utilisation of biogas and synthetic natural gas 10 sivua 2.1 Electricity and heat production 2.2 Transportation fuel 2.3 Price development (past, current, future) 3. Power-to-Gas technologies 5-8 sivua 3.1 Principles, (basic idea of the concept) and application areas 3.2 Electrolysis +hydrogen generation, storage, methanation 3.3 Costs(CAPEX,OPEX) 4. Wastewater treatment 20 sivua 5. Intregration possibilities of Power-to-Gas technologies to Wastewater treatment sivua 5.1 Benefits, technology demand 5.2 Utilisation of by-products 6. Economics of producing synthetic gas at water treatment plants 5 sivua 6.1 Cost factors of gas production 6.2 Income and profit expectations 7. Business Opportunities sivua 7.1 Case study approach 7.2 Finland 7.3 China 4.1 Basic technology, main technology 4.2 Future technology 4.3. Biogas production at wastewater treatment plant 4.4 Global demand (China) 4.5 Costs (CAPEX, OPEX) Liitteet (7.3) Germany 8. Discussion 5 sivua 9. Conclusions 4 sivua Sources