Presented By: John J. Cuttica Midwest CHP Application Center www. CHPCenterMW.org Presented By: John J. Cuttica Midwest CHP Application Center www. CHPCenterMW.org CHP for Emission Control Governors’ Ethanol Coalition Meeting June 22, 2004 Madison Wisconsin Governors’ Ethanol Coalition Meeting June 22, 2004 Madison Wisconsin In Partnership with the US DOE

UIC In Partnership with the US DOE 2 Presentation Outline FEW Breakout Sessions Why CHP IN Ethanol Plants CHP, The Concept CHP, The Business Case CHP For Emission Control Further Assistance FEW Breakout Sessions Why CHP IN Ethanol Plants CHP, The Concept CHP, The Business Case CHP For Emission Control Further Assistance

UIC In Partnership with the US DOE 3 FEW Breakout Sessions Cogeneration (1): Thursday 8:30 to 10:00am –4 papers being presented Cogeneration (2): Thursday 10:15 to 11:45 am –Panel Discussion »US Energy Partners - Russell, Kansas Plant »Adkins Energy – Lena, Illinois Plant »Northeast Missouri Grain – City of Macon Missouri »EME Engineering Company »US Environmental Protection Agency Cogeneration (1): Thursday 8:30 to 10:00am –4 papers being presented Cogeneration (2): Thursday 10:15 to 11:45 am –Panel Discussion »US Energy Partners - Russell, Kansas Plant »Adkins Energy – Lena, Illinois Plant »Northeast Missouri Grain – City of Macon Missouri »EME Engineering Company »US Environmental Protection Agency

UIC In Partnership with the US DOE 4 Why CHP Is a Good Fit Energy Is The Second Largest Cost Of Production for Dry Mill Ethanol Plants Electric And Steam Demands Are Large And Coincident Electric And Steam Profiles Are Relatively Flat Both Thermal And Electric Reliability Are Very Important Energy Is The Second Largest Cost Of Production for Dry Mill Ethanol Plants Electric And Steam Demands Are Large And Coincident Electric And Steam Profiles Are Relatively Flat Both Thermal And Electric Reliability Are Very Important

UIC In Partnership with the US DOE 5 Why CHP Is a Good Fit Operating Hours Are Continuous – 24/7 Ability To Utilize Fuels Other Than Natural Gas $aves Energy And Reduces Energy Costs Hedge Against Unstable Energy Prices Potential for Emissions Control (VOC Destruction) Operating Hours Are Continuous – 24/7 Ability To Utilize Fuels Other Than Natural Gas $aves Energy And Reduces Energy Costs Hedge Against Unstable Energy Prices Potential for Emissions Control (VOC Destruction)

UIC In Partnership with the US DOE 6 What is CHP? Integrated Energy Supply System Located At or Near a Building or Facility Provides All or a Portion of the Electrical Load Utilizes the Thermal Energy –Process Heat –Heating –Cooling –Drying Integrated Energy Supply System Located At or Near a Building or Facility Provides All or a Portion of the Electrical Load Utilizes the Thermal Energy –Process Heat –Heating –Cooling –Drying

UIC In Partnership with the US DOE 7 Benefits Of CHP High Efficiency, On-Site Generation Means … CompetitivenessCompetitiveness Lower Energy CostsLower Energy Costs Better ReliabilityBetter Reliability Better Power QualityBetter Power Quality EnvironmentalEnvironmental Lower Emissions (including CO 2 )Lower Emissions (including CO 2 ) Conserve Natural ResourcesConserve Natural Resources CompetitivenessCompetitiveness Lower Energy CostsLower Energy Costs Better ReliabilityBetter Reliability Better Power QualityBetter Power Quality EnvironmentalEnvironmental Lower Emissions (including CO 2 )Lower Emissions (including CO 2 ) Conserve Natural ResourcesConserve Natural Resources SynergiesSynergies Potential Generation AssetPotential Generation Asset Especially Municipal/Co-opsEspecially Municipal/Co-ops Support Grid InfrastructureSupport Grid Infrastructure –Fewer T&D Constraints –Defer Costly Grid Upgrades Facilitates Deployment of New Clean Energy TechnologiesFacilitates Deployment of New Clean Energy Technologies SynergiesSynergies Potential Generation AssetPotential Generation Asset Especially Municipal/Co-opsEspecially Municipal/Co-ops Support Grid InfrastructureSupport Grid Infrastructure –Fewer T&D Constraints –Defer Costly Grid Upgrades Facilitates Deployment of New Clean Energy TechnologiesFacilitates Deployment of New Clean Energy Technologies

UIC In Partnership with the US DOE 8 Gas Turbine CHP

UIC In Partnership with the US DOE 9 Gas Turbine/Supplemental Firing CHP

UIC In Partnership with the US DOE 10 Boiler/Steam Turbine CHP

UIC In Partnership with the US DOE 11 CHP System Cost and Performance Gas TurbineGas Turbine w/Duct Firing Boiler/Steam Turbine Capacity, MW Electrical Efficiency, % (HHV)22 – Steam Output, Btu/kWh4,500 – 6,70012,000 – 20,00035,000 – 40,000 Overall Efficiency, % (HHV) Power to Steam Ratio0.4 – – – 0.12 Installed Costs, $/kW1, ,000 – 1, – 900* Non-fuel O&M Costs, $/kWh0.006 – 0.01 <0.004 * Incremental costs of steam turbine generator and supporting systems only

UIC In Partnership with the US DOE 12 CHP Technologies

UIC In Partnership with the US DOE 13 –Gas Turbines Reliable CHP Technologies Electric Generation Equipment –Reciprocating Engines –Steam Turbines

UIC In Partnership with the US DOE 14 Heat Recovery Systems –Steam and Hot Water –Exhaust Gases Heat Recovery Systems –Steam and Hot Water –Exhaust Gases Reliable CHP Technologies

UIC In Partnership with the US DOE 15 Other Components Grid Interconnect: –Isolation Switch –Switchgear –Protection Relays –Synchronizing Equipment Installation: –Equipment Footprint –Floor Loading –Proximity To HVAC Equipment –Number of Electrical Feeds Grid Interconnect: –Isolation Switch –Switchgear –Protection Relays –Synchronizing Equipment Installation: –Equipment Footprint –Floor Loading –Proximity To HVAC Equipment –Number of Electrical Feeds »Power »Frequency »Current »Voltage

UIC In Partnership with the US DOE 16 CHP Is A Low Technical Risk Utilize Proven Technologies Employ Standard Design Practices Incorporate Good Maintenance Practices Utilize Proven Technologies Employ Standard Design Practices Incorporate Good Maintenance Practices

CHP Business Case Analysis Done By: Bruce Hedman Energy & Environmental Analysis, Inc Under US EPA CHP Partnership Program Analysis Done By: Bruce Hedman Energy & Environmental Analysis, Inc Under US EPA CHP Partnership Program

UIC In Partnership with the US DOE 18 Plant Operating Assumptions Plant Capacity, mmgal/yr50 Operating Hours8760 Electric Use, kWh/gal0.96 Annual Electric Use, MWh48,180 Baseload Electric Demand, MW5.5 Steam Use, lb/gal19.3 Steam Use, lbs/hr110,000 Annual Steam Use, mmlbs963,600 Boiler Fuel Use, Btu/lb24,125 Annual Boiler Fuel Use, mmBtu1,206,300 Annual Drier Fuel Use, mmBtu605,000 Electric Costs, $/kWh0.07 Gas Costs, $/mmBtu6.00

UIC In Partnership with the US DOE 19 The Value Equation -Reduced purchased electricity costs +Increased fuel costs +Increased O&M costs +Increased capital expenditure -Displaced capital? -Reliability, other operational savings? -Overall Savings -Reduced purchased electricity costs +Increased fuel costs +Increased O&M costs +Increased capital expenditure -Displaced capital? -Reliability, other operational savings? -Overall Savings

UIC In Partnership with the US DOE 20 Gas Turbine CHP System Assumptions Gas Turbine Capacity, MW5.2 Run Hours8500 Gas Turbine Fuel, mmBtu/hr67.2 Duct Burner Fuel, mmBtu/hr0 Steam Output, lb/hr28,600 Power to Steam Ratio0.62 O&M Costs, $/kWh0.008 Capital Costs Turbine Genset, $/kW415 HRSG, $/kW100 Interconnect, $/kW60 Misc Equipment, $kW80 Engineering, installation, etc, $/kW 390 Total Installed Cost, $/kW1,045

UIC In Partnership with the US DOE 21 Gas Turbine CHP – Financial Results W/O CHPW/ CHP Purchased Electricity, 1000 $3, Boiler Fuel, 1000 $7,227.05,423.4 CHP Fuel, 1000 $03,344.8 Energy Costs*, 1000 $10,599.69,046.8 O&M Costs, 1000 $ Standby Charges, 1000 $ ($3/kW) Total Operating Costs, 1000 $10,599.69,587.5 Operating Savings = $1,012,100 * Does not include DDGS drier fuel

UIC In Partnership with the US DOE 22 Gas Turbine CHP – Payback Capital Costs = $5,434,000 Payback = 5.4 yrs Capital Costs = $4,980,000 Payback = 4.9 yrs CHP System $5,434,000 - Boiler credit $ 450,000 $4,984,000

UIC In Partnership with the US DOE 23 Sensitivity to Electric & Natural Gas Prices Gas Turbine CHP Natural Gas Price, $/mmBtu

UIC In Partnership with the US DOE 24 Payback – Various CHP Options CHP System Type Capital Cost - $000 Operating Savings - $000 Simple Payback – Yrs. Boiler Credit - $000 Capital Cost (2) - $000 Simple Payback (2) – Yrs. Gas Turbine 5,4341, , Gas Turbine W/Duct Burner 6,2661, , Boiler / Steam Turbine 2,1751,3901.6

UIC In Partnership with the US DOE 25 Integrate VOC Destruction With CHP (Techniques Presently Under Evaluation) Ingest VOC into the Turbine –Technical Challenge With Ethanol Dryer VOC Stream Destruction Through the Turbine Exhaust –Less of Technical Challenge, More of a Cost Effictiveness Issue Ingest VOC into the Turbine –Technical Challenge With Ethanol Dryer VOC Stream Destruction Through the Turbine Exhaust –Less of Technical Challenge, More of a Cost Effictiveness Issue

UIC In Partnership with the US DOE 26 Integrate VOC Destruction With CHP VOC Stream Destroyed In Plant Boiler –Presently Being Explored By Ethanol Industry –Adding Steam Turbine Small Incremental Cost Destroy VOC in T/O (recuperated / non-recuperated) –Recover Heat From non-recuperated T/O and Use in Steam Turbine VOC Stream Destroyed In Plant Boiler –Presently Being Explored By Ethanol Industry –Adding Steam Turbine Small Incremental Cost Destroy VOC in T/O (recuperated / non-recuperated) –Recover Heat From non-recuperated T/O and Use in Steam Turbine

UIC In Partnership with the US DOE 27 Gas Turbine/VOC Destruction CHP

UIC In Partnership with the US DOE 28 Thermal Oxidizer/Steam Turbine CHP

UIC In Partnership with the US DOE 29 Integrate VOC Destruction With CHP (Next Steps) Multi State Pre-Proposal Submitted Under STAC Science RFP (Illinois, Kansas, Minnesota) Presently Seeking Other Funding Sources to Evaluate & Test the Various Options Multi State Pre-Proposal Submitted Under STAC Science RFP (Illinois, Kansas, Minnesota) Presently Seeking Other Funding Sources to Evaluate & Test the Various Options

UIC In Partnership with the US DOE 30 CHP – Further Assistance US EPA Combined Heat & Power Partnership –Launched in 2001 –138 Partners – 851 MW of Projects Assisted –Voluntary Public-Private Partnership To Help Get CHP Projects Installed –Education, Networking, Resources, Technical Assistance, Recognition Contact Luis 202/ US EPA Combined Heat & Power Partnership –Launched in 2001 –138 Partners – 851 MW of Projects Assisted –Voluntary Public-Private Partnership To Help Get CHP Projects Installed –Education, Networking, Resources, Technical Assistance, Recognition Contact Luis 202/

UIC In Partnership with the US DOE 31 CHP – Further Assistance US DOE Sponsored Application Centers Midwest CHP Application Center –Serves 8 State Midwest Region –Information, Education, Technical Assistance –Contact: John Cuttica 312/ Five Additional Centers Throughout the US US DOE Sponsored Application Centers Midwest CHP Application Center –Serves 8 State Midwest Region –Information, Education, Technical Assistance –Contact: John Cuttica 312/ Five Additional Centers Throughout the US