SEGI-AT Sp. z o. o. Energy from the biomass 2

Production of energy from the biomass - an option for the sustainable development of

industrial land

SEGI-AT Sp. z o. o. Energy from the biomass 3

Main idea of the project

• Creating an integral system of renewable energy production comprising 2 main elements:

– Pellets production line (production capacity: 1 t/h)

– Plantation of an energy plant – a hollyhock species Sida hermaphrodita as a source of biomass for pellets production

• within the industrial area

SEGI-AT Sp. z o. o. Energy from the biomass 4

Project developer

Limited partnership founded for the purpose of the project:

• SEGI-AT Sp. z o. o. (Ltd.)

• KGHM Polska S.A.

• Other investors

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Shareholders

Shareholders

Initial capital: 670.000 EUR

40%

40%

20%SEGI-AT

KGHM

Other investors

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Location of the project

• South-western Poland

• community Rudna with a deteriorating agriculture and industrial areas

• High unemployment rate: ca. 20%

• Protective area around copper works and the flotation waste reservoir (ca. 14 km2)

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Plantation of Sida hermaphrodita (1)

• size: 300 ha (ca. 25.000 plants per ha)• very high annual yields

(up to > 20 t dry biomass/ha)• low climate and soil requirements • suitable for industrial land • easy in cultivation, traditional methods• low moisture content in the biomass (25%)• good parameters as a fuel (comparable with

wood)

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Unique annual productivity - compared with Salix

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Plantation of Sida hermaphrodita (2)

• harvesting: December – March

• stored in the open air

• easily cut into pieces

• raw material for pellets production in form of chips

• cost of dry biomass production: 25 EUR/t

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Sida hermaphrodita – an energy plant

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Plantation of Sida hermaphrodita

Spring Autumn

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Pelleting plant (1)

• Placed in the vicinity of the plantation within the existing infrastructure

• Production capacity: 1 t/h

• Expected annual output: 6000 t pellets

• Energy consumption: 600 MWh/year

• Energy output from the produced pellets– ca. 30.000 MWh/year (=108.000 GJ/year)

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Pellets production line

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Pelleting plant (2)

• Consists of 3 main elements:– a dryer– hammer mill– pellet mill

• Raw material supply for pellets production:– In the initial stage: waste wood from the wood

industry – In the long run (after 2-3 years` operation): biomass

of Sida hermaphrodita

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High density pellets – environmentally friendly solid bio-fuel, very comfortable

in use for both households and industrial plants

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Product characteristics

• diameter: 6-8 mm

• length: 2-3 cm

• density: 1,15 kg/m3

• calorific value: 18 MJ/kg

• low ash content (0,5% - 1%)

• without binding agents

• high grade of homogeneity

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Financial details (1)• Total cost of the investment:

1 mln EUR over 2 years (2005-2006) – Pellet production plant: 650.000 EUR – Plantation: 350.000 EUR

• Initial capital of a new SEGI-KGHM partnership: 670.000 EUR

• Grant in frames of EU structural funds and PHARE Programme

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Financial details (2)

• Annual operating costs: 330.000 EUR

• Annual revenues from pellets sales: 480.000 EUR (80 EUR/t)

• Annual operating profit: 150.000 EUR

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Prospects for the future • EU target: 12% energy from RES by 2010

• Polish Strategy for Development of Renewable Energy Sources sets following targets:

– 7,5% energy from RES by 2010

– 14% energy from RES by 2020

• Biomass = over 90% RES in Poland

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Comparison of different energy generation

systems in family houses

Type of fuel Pellets Gas Oil

Cost of 1 GJ of energy [EUR]

5 8 10

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Risks• Grant for the project not awarded

RE: search for additional investors

• Incompetitiveness of bio-fuel on the Polish marketRE: focus on foreign markets, search for pellets consumers

• Lower than expected productivity of Sida hermaphrodita plantation RE: supplementing Sida biomass with waste wood or other

energy plants

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Future developments (1)

• Establishing a network of local pelleting plants (1-2 t/h) combined with a system of Sida hermaphrodita plantations

• Pellets for the individual use (family houses)• Segi-KGHM partnership as a pilot project

– model system for the production of renewable energy from the biomass

• Searching for investors for projects based on a similar scenario

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Future developments (2)

• In the long run: developing pellet market• Modernisation of small district heating systems

(power of several MW) as well as heating plants (200 kW - 1 MW) in industrial plants and public utilities (schools, hospitals etc.)

• Package offer: heating plant for pellets + continuous supply of fuel

• Looking for partners offering technologies of pellets’ combustion to apply in such heating plants

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Questions

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