ISA

April 23rd, 2009

www.f4energy.com

Reducing Site Energy Costs

with

Combined Heat and Power Generation

Presentation Outline• Introduction to F4energy & Combined Heat and Power

• Background to the Irish Energy Market & Energy Prices

• Examples of CHP Applications in Ireland

• Fossil Fuel CHP, Renewable CHP, Trigeneration

• CHP Installation Considerations

• CHP Design Philosophies

• Investment Payback Example

• Questions…

About F4energy• F4energy was founded in late 2001 by former ESB and Siemens

professionals to provide Combined Heat and Power (CHP) solutions in the Irish market.

• Comprehensive CHP Offering including Feasibility Assessment, Design, Installation and Maintenance.

• F4energy currently operates ~ 70 CHP plants in Ireland

• District Heating, Shopping Centres, Industry, Hospitals, Hotels, Office Blocks, Universities, Local Government

What is Combined Heat and Power (CHP) ?- Generation of Power & Heat from Single Fuel Input -

WASTE….

WASTE….

Electricity Output

Electricity Output

Heat Output

~ 40% Efficiency

~ 80% Efficiency

Combined Heat and Power in Europe

In Europe, 9% of all power production is produced using Combined Heat and Power…..

In Ireland……. less than 3% of the nation’s power production is CHP

Background to the Irish Energy Market

• Rising National Demand and Security of National Grid SupplyEirgrid’s Generation Adequacy Report for 2008-2014: shortfall of 500MW over next five years with an estimated 2.6% p.a. growth in national demand.

• Ireland’s reliance on imported fuels for Energy (gas/oil/coal)The upward shift in world energy prices will be fully passed on to Irish consumers due to Ireland’s 90% energy import dependency.

• Regulatory DriversBuilding Energy Ratings & New Part L compliance driving energy efficiency

• CAPITAL GRANT AID SCHEME FOR COMBINED HEAT AND POWER30% Capital Grant Aid for CHP Unit, Installation & Consultancy Costs

Examples of CHP ApplicationsDistrict Heating uses a Centralized Energy Centre to produce Energy for

multiple clients.

Example ►Elm Park Site, Dublin City

• €300m, 100,000m2 scheme inc. Office Blocks, Daycare Centre, 400 Apartments

• Energy Efficient Design includes a centralized Energy Centre with 1.2MWe CHP

• Site Tenants are invoiced for Heat & Electricity by Energy Supply Company

District Heating Applications

District Heating Energy Centre

1200kW Electrical Output Servicing Mixed Use Development

Retail Applications

- Tesco Nutgrove CHP Used for Space & Hot Water Heating - 6 month, 24/7 Operation

- New Maynooth, Tramore, Drogheda Trigeneration Sites producing Heat, Cooling and Electricity- 12 month 24/7 Operation

Hospital Applications

Industry Applications

CHP & Trigeneration Solutions Producing Heat, Cooling & Electricity for Production Processes

Hotel Applications

University Applications

Local Government Applications

Inside a CHP Plant

Renewable CHP TechnologiesBiomass Fuel Conversion

Thermal Conversion Options:► Using Heat for Combustion or GassificationPower Generation: Biomass Steam Boiler + Turbineor Biomass Gassifier + Reciprocating Engine/Stirling Engine

Chemical/Biochemical Conversion Options:► Transesterification of Oils into BiodieselPower Generation: Biodiesel refining + Recip Engine

► Anaerobic DigestionPower Generation: Anaerobic Digester + Recip Engine

Gassifier & Reciprocating Engine

Anaerobic Digester & Recip Engine

AD in operation…

Trigeneration (CCHP)

Trigeneration is the generation of Heat, Cooling and Power from a single fuel input

Absorption Chiller(s)

Chilled Water Circuit

Conventional Chillers

Heat Rejection

CHP Plant(s)

Heating Circuit

Seasonal Energy Demand profile heat/cold/electricity

Jan .

Feb.M

ar.Apr.M

ayJu

neJu

lyAug.Sept.O

ct.

Nov.Dec.

M W h

800

700

600

500

400

300

200

100

0

E lectric ity

C o ldH eat

Absorption Chiller Plant

CHP Installation Considerations

Five primary interface points:

1) Low Pressure Hot Water Piping Connection to Boiler

2) Natural Gas Piping Connection to Gas Manifold

3) Combustion Exhaust

4) Ventilation Air

5) Power Cable Connection to LV Switchgear

CHP Gas, Water & Exhaust Connections

CHP Gas, Heat & Exhaust Connections

CHP LPHW Piping Connection

CHP Installation ConsiderationsPoints to Consider:

1) Thermal: Centralized/Distributed on-site?STEAM / Hot Water? CHP/Boiler Control Philosophy?Location of Heat Rejection Unit

2) Natural Gas: Pressure Considerations?

3) Combustion Exhaust: Common Manifold?

4) Ventilation Air: Duct to External?

5) Power Cable Connection: LV/MV? Switchgear?

CHP Design Approach: Modulating, Buffer or Base Load Design PhilosophyCHP Plants are available in a wide output range. The Feasibility Study matches the client’s Energy Demand Profile with the optimal CHP output range.

CHP Design Philosophies

CHP Design Philosophies

0

50000

100000

150000

200000

250000

300000

1 2 3 4 5 6 7 8 9 10 11 1212 monthly consumption

He

at

Co

ns

um

pti

on

(k

Wh

)

Site Heat Demand Modulating CHP Base Load CHP

The ‘SPARK GAP’ Explained CHP uses low cost commodity input (natural gas) to produce higher value commodity outputs ( Heat and Electricity).

‘Spark Gap’ is difference between Gas prices and Electricity prices.

Cost of gas is ~ 2.5cent/kWh Versus ~ 11cent/kWh for Electricity….

Energy Economics for 1MWe Plant hourly daytime production:

+ 1MW electricity output @ 11 cent/kWh = € 110+ 1MW Heat output @ 3.1 cent/kWh = € 31Less- 2.6MW Gas input @ 2.5 cent/kWh = (€ 65)- Lifecycle Maintenance cost per hour = (€ 12) = TOTAL ENERGY SAVINGS FROM CHP PLANT = € 64 per hour

@ 7 Day x 24 Hours Annual Operation = € 512,000 Savings per year

Economics of 1MWe Combined Heat and Power

Input Outputs

2.6 MW Nat. Gas

21 GWh annually

1MW Electricity

8 GWh annually

1MW Heat

5GWh annually

~ € 520,000

• 1MW electrical output/1MW thermal output (low pressure hot water)

• 8,000 annual operating hours (24 Hours Daily)

~ € 248,000

~ € 880,000

Net Annual Energy Savings ~ € 512,000

Maintenance

~ € 96,000

CHP Project Risk AssessmentA) Design Risk: Is the CHP Plant Output Sized Correctly?

- CHP Feasibility Study should address Site Thermal, Cooling & Electrical Load and map the optimal CHP Plant against this demand.

B) Technical Risk: Will the CHP Plant Operate Correctly (LIFECYCLE)?

Under Capital Purchase Contract…..Technical Risk can be transferred in full to CHP company via the Lifecycle Warranty (covers all parts, labour, consumables etc.)

Under Discounted Energy Supply Contract….Technical Risk carried by CHP company

C) Energy Price Risk: Will ‘Spark Gap’ change significantly?

Under Capital Purchase Contract…..Irish Electricity Prices are locked into gas price relationship so CHP plant reflects National Grid Pricing Structure

Under Discounted Energy Supply Contract….Energy Price Risk carried by CHP Company

Questions….

Thank You.

Aidan McDonnellBusiness Manager

F4energy Ltd.Unit 14, Penrose Wharf

Cork CityTel: 021 4861420Fax: 021 4552628

www.f4energy.com