Enhancing Competitiveness, Increasing Reliability and Reducing Emissions with Combined Heat & Power

Transcription

1 Enhancing Competitiveness, Increasing Reliability and Reducing Emissions with Combined Heat & Power Gearoid Foley, Senior Technical Advisor Mid-Atlantic CHP Technical Assistance Partnership NCSL Natural Gas Policy Institute Natural Gas Applications: Technology and Policy Omni William Penn Hotel, Pittsburgh, PA Wednesday September 9 th, 2015

2 CHP Technical Assistance Partnerships Key Activities Market Opportunity Analysis. Supporting analyses of CHP market opportunities in diverse markets including industrial, federal, institutional, and commercial sectors Education and Outreach. Providing information on the energy and non-energy benefits and applications of CHP to state and local policy makers, regulators, end users, trade associations, and others. Technical Assistance. Providing technical assistance to end-users and stakeholders to help them consider CHP, waste heat to power, and/or district energy with CHP in their facility and to help them through the development process from initial CHP screening to installation. /distributedenergy/chptaps.html Slide 2

3 Agenda Definitions & CHP Drivers CHP Societal Benefits Economic Development Emissions Reduction Thermal & Electric Reliability Challenges & State Policy Role Slide 3

4 CHP: A Key Part of Our Energy Future Form of Distributed Generation (DG), An integrated system, Located at or near a building / facility, Provides at least a portion of the electrical load, and Uses thermal energy for: Space Heating / Cooling Process Heating / Cooling Dehumidification Source: Slide 4

5 Conventional Power Generation Is Inefficient Slide 5

6 CHP Recaptures the Waste Heat from Power Generation, Increasing Overall Efficiency.. Traditional System CHP System Power Plant Electricity CHP Boiler Heat ~50% Efficiency ~75% Efficiency Slide 6

7 ...and Reducing CO 2 Emissions Traditional System CHP System Power Plant Electricity CHP Boiler Heat ~50% Efficiency ~75% Efficiency 30 to 55% less CO 2 emissions Slide 7

8 CHP Today in the United States Other Industrial 6% Other Manufacturing 6% Metals 5% Existing CHP Capacity (MW) Commercial/ Institutional 14% Food 8% Paper 14% Chemicals 28% Refining 19% 82.7 GW of installed CHP at over 4,400 industrial and commercial facilities 8% of U.S. Electric Generating Capacity; 14% of Manufacturing Avoids more than 1.8 quadrillion Btus of fuel consumption annually Avoids 241 million metric tons of CO 2 compared to separate production Sources: DOE/ICF CHP Installation Database (U.S. installations as of December 31, 2014); EIA Energetics, US Manufacturing Energy Use and Greenhouse Gas Emissions Analysis, November 2012 Slide 8

9 CHP Capacity by Fuel and Prime Mover Waste*, 7,366 MW Oil, 1,152 MW Wood, 1,375 MW Other**, 459 MW Biomass, 2,705 MW (82.7 GW) Coal, 12,307 MW Recip. Engine, 2,315 MW Combustion Turbine, 10,234 Fuel Cell, 78 MW Microturbine, to Power, Waste Heat 93 MW 471 MW Other, 66 MW Boiler/ Steam Turbine, 26,707 MW Natural Gas, 57,365 MW Combined Cycle, 42,765 MW *Waste includes MSW, black liquor, industrial off gasses, and waste heat **Other includes hydrogen, purchased steam, and unknown fuel types Source: DOE/ICF CHP Installation Database (U.S. installations as of December 31, 2014) Slide 9

10 CHP Is Used in Every State Natural gas based CHP concentrated in Northeast, Gulf Coast, Midwest and California Northwest and Southeast have high concentration of sites in forest products and paper industries Source: AGA CHP Market Study 2013 Slide 10

11 The CHP Market Is Expanding and Evolving CHP Capacity by Application, Additions (2,200 MW) Other Ind, 146 MW Agr/Mining, 119 MW Other Com, 152 MW Paper, 203 MW Colleges/Univ, 301 MW Chemicals, 425 MW Healthcare, 114 MW Multi-Family, 84 MW Source: DOE CHP Installation Database, March 2014 DE/Utilities, 84 MW Solid Waste, 68 MW WWTP, 168 MW Refining, 336 MW Slide 11

12 The Potential for Additional CHP Is Nationwide CHP Technical Potential (MW) <1,000 MW 1,000-3,000 MW 3,000-5,000 MW Source: DOE Internal Estimates (2014) > 5,000 MW

13 Industrial Process Integration, PA Food Processing, CT University Campus, NJ Hospital, NY Office Building, CA CHP Applications 100 MW CHP plant will provide most of the plant s electric and thermal energy needs driven by local Shale Gas. Food processing plant gets 100% of its power and 80% of its thermal energy from a 4.6 MW CHP plant. The 15 MW CHP plant provides steam and chilled water and is integrated with the wholesale and transmission markets. 500 kw Reciprocating Engines CHP plant designed to island from grid during outage. Provided 100% of electric and thermal needs for 15 days during and after Hurricane Sandy. 1 MW Reciprocating Engine Plant with 320 Ton Chiller providing power, space heating and space cooling. Reduces grid peak loads with chiller output as well as generator output. Slide 13

14 CHP Is a Cost-Effective Generation Resource Levelized cost of electricity across power generation technologies, Q ($/MWh) Source: Bloomberg Sustainable Energy Factbook 2014 Slide 14

15 Economic Development Efficient use of Natural Gas through CHP provides a competitive advantage for existing and new energy intensive industries New manufacturing, engineering and construction jobs as well as operation and maintenance jobs are created in the development of CHP plants. A high portion of CHP technologies are made in the US Existing jobs are protected through reduction of energy costs and increased grid reliability High load factor CHP can help to offset connection costs for low load factor applications such as residences and space conditioning only applications. Furthermore, connecting stranded communities to the gas infrastructure could be justified and/or accelerated with CHP end-use. Increases US natural gas use not only allows local resources to be used but also increases local disposable income through reduction of energy bills. Slide 15

16 Chemical Industry view of CHP Keeping the United States Competitive The American Chemistry Council welcomes today s Executive Order that recognizes the important contribution of CHP in improving energy efficiency and easing the major transition underway in America s electricity sector. The President s CHP goal is ambitious, and represents about a 50 percent increase in deployed CHP capacity. Expansion of CHP capacity can make American manufacturers more competitive in the global economy and can stretch our nation s natural gas supplies that benefit a wide variety of industries across the country. Energy-Efficiency-and-CHP-Capacity.html Slide 16

17 CHP s Higher Efficiency Results in Energy and Emissions Savings Category 10 MW CHP 10 MW PV 10 MW Wind 10 MW NGCC Annual Capacity Factor 85% 22% 34% 70% Annual Electricity 74,446 MWh 19,272 MWh 29,784 MWh 61,320 MWh Annual Useful Heat Provided Footprint Required 103,417 MWh t None None None 6,000 sq ft 1,740,000 sq ft 76,000 sq ft N/A Capital Cost $20 million $60.5 million $24.4 million $10 million Annual Energy Savings, MMBtu Annual CO 2 Savings, Tons 308, , , ,649 42,751 17,887 27,644 28,172 Annual NOx Savings Source: Combined Heat and Power A Clean Energy Solution: August 2012: DOE and EPA Slide 17

18 According to the EIA, Electric Grid outages have increased significantly over the past 20 years. Total losses due to Superstorm Sandy estimated between $30 to $50 billion including a two-day shutdown of the NY Stock Exchange, costing an estimated $7 billion from halted trading. Reliability/Resiliency Rutgers estimates economic losses of $11.7 billion for New Jersey GDP significantly impacting state tax income. CHP, when properly configured can work without the grid to provide power to critical facilities, government services and industrial facilities. Slide 18

19 Relative Value of Benefits Owner/Host Site Benefits Cost Savings Environmental Stewardship/Good PR Power Quality/Availability Reliability Keep Operations Running Societal Benefits Lower Energy & Infrastructure Costs Job Creation/Retention Increased Grid Reliability Emissions Reductions/Health Care Benefits Resource Extension/National Security Underpin Expansion of NG Distribution Network Slide 19

20 The Final Clean Power Plan (CPP) Provides Opportunities for CHP and Efficiency Although EPA removed the energy efficiency building block from setting state targets in the final rule, it did so in order to strengthen its goal-setting framework against legal challenges. This change does not affect states ability to utilize energy efficiency, including CHP, as a robust compliance option. EPA has made it clear that energy efficiency is likely to serve as an integral component of, or complimentary policy to, many state compliance plans EPA identified a variety of energy efficiency measures, programs, and policies that can count toward compliance. These include utility and nonutility energy efficiency programs, building energy codes, combined heat and power, energy savings performance contracting, state appliance and equipment standards, behavioral and industrial programs, and energy efficiency in water and wastewater facilities, among others. Slide 20

21 CHP As a CPP Compliance Option CHP offers air quality, economic and reliability benefits CHP is a cost-effective energy-efficiency resource available in all states CHP produces low cost CO 2 reductions CHP is included in many existing state efficiency and cleanenergy programs CHP meets EPA s requirements for an approvable compliance option Slide 21

22 Barriers to Increased Use of CHP Financial uncertainty CHP cost and performance uncertainty Regulatory uncertainty Electric Utility uncertainty Electric Utility goals include affordable and reliable power Generally can be neutral to negative on CHP CHP represents a loss of revenue to the electric utility and can result in the deferral of investment This can result in unfavorable tariffs, drawn out interconnect and other utility roadblocks to CHP Slide 22

23 State Policies that Support CHP Financing Grants and Loans Incentive Programs ESCOs PPAs UESCs (Utility Energy Service Contracts ) PACE (Property assessed clean energy) Other Regulatory Relief Streamlined Permitting Standby/back-up rates Markets Critical Infrastructure Portfolio Standards Slide 23

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