Post on 12-Feb-2017
Biomass-based heat-generation systems
Efficiency, Reliability,Business
Purpose of the presentation 1.
Olajterv Energy set the goal of setting up and applying a business model in which it implements
Heat-generation projects in Hungarywith the help of subsidies and financial investorsthat are to be supported from environmental protection and employment policy perspectiveson a renewable basis
.
Purpose of the presentation 2.The model’s key components have already been set up.
What is already in place:– Engineering and project management experience and
capacity for the implementation of projects
– Appropriate potential for securing funds in applications through strategic partners (MAPI, OTP Hungaro Project)
– Financial investors with capital strength are available for funding projects in addition to funding available in applications
A presentation of the theory of the heat generation cycle
Forests absorb CO2 in the course of photosynthesis
CO2 re-enters the air
Biomass may be used to generate heat
Forest trees may be cut down to produce biomass
in a sustainable way
Model components
1. Presentation of development locations; Head consumption demand in the energy market (industry, agriculture, heat generation plants)
2. Composition of the underlying fuels, presentation of the efficiency arising out of the price differences between fuels
3. Types of investments, return on investments
4. Financial and non-financial proceeds of development projects
5. EU applications for supporting development projects
Goal to be achieved:- Setting up a model that can be reproduced
1. Project locations
Industrial companies (in the form of technological
heating and hot water)
food industry laundries, dryers metalworking de-greasing
Agricultural companies
hothouses animal husbandry farmsfodder dryers
District heating stations
heating plants for blocks of flats institutional heating plants (hospitals, universities)village heating plants
1.1 Why are district heating stations the main target group?
• They have a stable market but are subject to increasing
pressure due to household heating prices, whilst they
have no capital to invest.
• They have no trade information on the technology and
will not start such investment projects on their own.
• This is the field most preferred by application funding (30
to 85% support intensity).
1.2 Is the district heating station model viable?
• There are currently some 400-500 district heating systems
operating in Hungary, 95% of which use hydrocarbons for
fuel.
• EU directives (reduction of CO2 emission) and economic
aspects also promote the dissemination of cheaper
biomass-based systems.
2. Fuel background
Biomassfuel
Woody base material 80% proportion
Low-quality forestry wood
Timber industry by-products
(edges)
Energy woods grown for
energy purposes
Herbaceous agricultural base
material 20%
Corn cobsSunflower seed
shellsMilling industry
by-products
BiomassHUF 1,400 / GJ
Natural gasHUF 3,400 / GJPrice difference to fund
the projectHUF 2,000 / GJ
2.1 The energy content of the underlying base materials
Low-quality milled forestry timber
Trees from energy
plantations
Timber industry by-products (sawdust, edges, cutting-area
waste)
Agricultural waste (sunflower seed
shells, corn cobs)
Available stocks ton/year 2,000,000 100,000 810,000 3,100,000
Energy capacity GJ / ton 10,5 10,5 13 14
Purchase price HUF / ton 13,000 12,000 14,000 9,000
Moisture content % 40 40 25 15
Base material unit cost HUF/GJ 1,238 1,143 1,077 643
Energy cost HUF/GJ Boiler
efficiency between 85-90%
1,399 1,291 1,217 726
3. Major types of investment projects
Existing system with central boiler house
Installation of biomass boiler Alteration of boiler house to receive timber chips Development of a building that may be serviced in logistic terms
Existing district heating system with new boiler
house to be built
Installation of biomass boilerConstruction of new boiler house with timber chip storageConstruction (extension) of backbone pipeline
Installation of complete district heating system (boiler house + district
heating pipeline + timber chip storage)
Installation of biomass boiler Construction of new boiler house with timber chip storage Alteration of the complete district heating network to accommodate consumption Connecting city institutions
3.1 Return period of investments
System volume
Total project cost thHUF
Support in applications (45%) thHUF
Composition of owner’s own resources
Recovery of own
resources in years
Recovery of total capital expenditure
in years30% trade investor 70% financial inv.
Existing system with central boiler room
1MW 100,000 45,000 16,500 38,500 2.8 5.0
3MW 230,000 103,500 37,950 88,550 2.1 3.8
Existing district heating system
with construction of
new boiler house
1MW 140,000 63,000 23,100 53,900 3.9 7.0
3MW 300,000 135,000 49,500 115,500 2.8 5.0
Installation of complete
district heating network
1MW 189,500 85,275 31,268 72,958 5.2 9.5
3MW 600,000 270,000 99,000 231,000 5.5 10.0
4. Financial proceeds of development
• Savings allow for a reduction of 5-25% of energy costs for consumers compared to gas prices (subject to credit rating and project financing)
•Establishment of income-generating activity in unused agricultural areas, in the form of energy plantations
• Utilisation of timber chips from the timber waste generated in and collected from public municipality areas represents extra income
4.1 ‘Non-financial’ benefits of development
•Elaboration of a long-term independent energy strategy for the city that can be calculated with easily (connecting the new consumers who appear later may bring extra profit)
• Provision of employment opportunity for less qualified
labour (collection and production of base materials, performing logistic tasks)
•Once timber waste is collected from municipality areas and parks, the landscape will be more orderly
• Reduction of Hungary’s dependence on hydrocarbon-based energy, transformation of the energy structure
Applications for increasing energy efficiency (EEOP)
Applications to promote technological development (EDOP)
Applications to support
employment creation (SROP)
5. The EU applications that may promote projects
Overall, the operating conditions for development
are in place
A wide range of EU support
and/or financial investors support
future investments
Use of cheaper fuels has become a requirement of households and municipalities
Technological progress allows
for creating reliable and operational
energy centres based on
renewables
Thank you for your attention.
We are convinced that the economic calculations prepared by us properly
support project viability.
If you have any questions or comments on how the model operates, feel free to
contact us.