Considerations for Implementing Combined Heat and Power in Highrise Residential Buildings:

Lessons Learned

February 4th 2010

Accelerating the adoption of green building technologies and contributing to the transformation of the built environment.

Objectives:

• Evaluate new green building technologies & equipment through in-situ testing and monitoring in new and existing high rise buildings;

• Leverage knowledge and experience of leading developer and building owner(s) to strengthen the cleantech product development and commercialization value chain.

Sewage Treatment

What is Combined Heat & Power

• CHP, or Cogeneration, utilitizes the waste heat from electricity generation to produce simultaneous hot water (thermal energy)

Primary types of equipment:• Microturbines• Reciprocating Engines

Fuel Choices:• Natural Gas (common)• Biofuels (eventually)

Source: www.powerecosystems.com

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Equipment Choices

Advantages Disadvantages

Reciprocating Engines •High power efficiency•Lower $/kw•Wide range of sizes•Part load operation•Fast start-up time•Multi-fuel capability•Maintenance well understood•Can operate with low pressure gas

•Must be cooled•Low power:weight ratio•Out-of-balance forces require substantial foundations and anti-vibration isolation•High levels of low frequency noise•High maintenance costs

Micro Turbines •High reliability due to small number of moving parts•Simplified installation•Low maintenance required•Compact size & Light weight•Acceptable noise levels•Some fuel flexibility•Low emissions•High temperature heat exhaust for heat recovery•Acceptable power quality

• Higher Cost/kwh• More specialized expert/qualified service personnel•Extended downtime potential

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Potential Benefits: CHP + DG

• Energy Efficiency and Potential Emissions Reductions• Reduction in building electricity demand• Uninterrupted emergency power generation• Distributed generation:

• Enables self reliance & fuel switching flexibility• Reduces efficiency losses from distribution networks• Reduces investment requirements in upstream capacity

(smaller centralized power plants)

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Tridel’s Combined Heat & Power Feasibility Studies

1. Single Condominium Building• Tridel, TAF, TRCA, OPA, Enbridge, Provident Energy Management

2. Tandem Towers in New Development Complex• Tridel, Enbridge, Private 3rd Party Utility

Grand Triomphe II540 KW CHP

Solaris I & II @ Metrogate1.2 MW CHP

INPUTS / ASSUMPTIONS$0.035$0.075$0.105

9.87$

1222.19382.18

0.55

539

0.3530.506

$0.012$0.450

SH MMBtuTotal MMBtu Requirement

Co Gen kWhNet kWh from LDC Supply

Co Gen MM BTU InputCo Gen MM BTU Output AvailableCo Gen MM BTU Output Utilized

Co Gen MM BTU Output Not Utilized

Co Gen Gas Input m3Building Gas m3 displaced

Net Gas m3 increasekWh Energy costs Avoided

kWh Regulated Costs AvoidedTotal kWh avoided costs

Increased Gas CostCo Gen Mtce Cost

Net $ Benefit

Net $ Benefit incl. GST

Reduced kW Demand Benefit incl. GST

Total $ Benefit incl GST

Indices% of Total kWh supplied by Co-Gen

% of COGen MMBTU utilized% of Building MMBTU load met by CoGen

% net increase in gas usage

Peak Ann. kW Building - Base CasePeak Ann. kW Building - Co Gen Operation

Building kWh provided by Go-Gen

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

7X24

Mid + On Peak

On Peak

% of CoGen MMBTU Utilized

0%

20%

40%

60%

80%

100%

120%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

7X24

Mid + On Peak

On Peak

% of Building MMBTU provided by CoGen

0%

20%

40%

60%

80%

100%

120%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

7X24

Mid + On Peak

On Peak

Size system to deliver less

than base Power load

But you will still have too much

heat in summer

• To optimize system performance, thermal storage is necessary on larger systems

• Then• THen

• To optimize system performance, thermal storage is necessary on larger systems

• Then• THen

Off-PeakTotal54%Mid-Peak

26%

20%Peak

Typical Time of Use for power in

MURBs

Design Considerations

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Key Factors in Designing a System

1. Scale• Do not exceed the building’s base load. Stay behind the meter. Too

complicated to grid connect.• Do not exceed the summer thermal (DHW) load. You’ll be dumping hot

water and eroding the environmental benefits.• Size for emergency back-up generator• (Check economics on smaller systems)

2. Operating Schedule• Plan to run the equipment during Peak Periods mainly - and maybe Mid-

Peak.• Do not operate during off-peak, or you’ll erode environmental benefits.• System will mostly likely not be thermal load following for economic

reasons.

3. Thermal Storage• Probably required on residential installations• Adds cost but preserves environmental benefit and system efficiency

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Key Factors in Designing a System

4. Location• Installing near the ground may require special exhaust venting• Installing on the roof may require additional sound and vibration

attenuation

5. Cost• Approximately $1000/kw for equipment• $2500/kw installed

6. Maintenance• Use a reliable operator. These systems can be too complex for a condo

board.

7. Design-Build/Own-Operate • A third party can design-build-own-operate, but be mindful of above

considerations

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Illustrative Economics of a 540 KW CHP in a New Building

Assuming Time of Use Rates apply

Operating Schedule: 8 hrs/day @ Peak + 6 hrs/day @ Mid (7 months) = 3,036 hrs/year

Avoided Costs from Operation: $277,000/yr

Operating Costs (at $0.38/m3): $186,000/yr

Operating Margin (before interest): $91,000

Install Costs: $1,361,000 - $250,000 (Generator)- $86,400 (Incentive*)- $X (boiler reduction) = $1,024,600

Sensitivity

• $/kwh + 20% improves Operating Margin to $131,500

• + $/m3 + 20% drops Operating Margin to $80,500

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Enabling Conditions

1. CSA-282 rule change for emergency back-up systems

2. Retiring old appliances

3. Low input fuel prices

4. Time of Use Rates

5. Coincident Power/Thermal demand

6. Provincial price support mechanism

7. FIT for Biogas ($ $.16/kwh)

1. Equipment start-up times must meet other code requirements

2. Install costs higher for retrofit

3. NG price volatility risk

4. Existing regulated price plan

5. Non-alignment in summer

6. No viable Clean Energy Standard Offer for NG

7. Availability & Price

Constraints

THANK YOU

Jamie Jamesjjames@350capital.com