1. 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

2. 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

3. 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

4. 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

5. 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)

6. 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

7. 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

8. UIC In Partnership with the US DOE 8 Gas Turbine CHP

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

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

11. UIC In Partnership with the US DOE 11 CHP System Cost and Performance Gas TurbineGas Turbine w/Duct Firing Boiler/Steam Turbine Capacity, MW1 - 15 0.5 - 5 Electrical Efficiency, % (HHV)22 – 3212 - 176 - 10 Steam Output, Btu/kWh4,500 – 6,70012,000 – 20,00035,000 – 40,000 Overall Efficiency, % (HHV)65 - 7080 - 8575 - 85 Power to Steam Ratio0.4 – 0.60.17 – 0.270.08 – 0.12 Installed Costs, $/kW1,800 - 9002,000 – 1,000350 – 900* Non-fuel O&M Costs, $/kWh0.006 – 0.01 <0.004 * Incremental costs of steam turbine generator and supporting systems only

12. UIC In Partnership with the US DOE 12 CHP Technologies

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

14. 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

15. 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

16. 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

17. 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

18. 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

19. 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

20. 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

21. UIC In Partnership with the US DOE 21 Gas Turbine CHP – Financial Results W/O CHPW/ CHP Purchased Electricity, 1000 $3,372.6278.6 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 $0353.6 Standby Charges, 1000 $ ($3/kW)0187.2 Total Operating Costs, 1000 $10,599.69,587.5 Operating Savings = $1,012,100 * Does not include DDGS drier fuel

22. 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

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

24. 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 5,4341,0125.44504,9844.9 Gas Turbine W/Duct Burner 6,2661,4764.29005,3663.6 Boiler / Steam Turbine 2,1751,3901.6

25. 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

26. 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

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

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

29. 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

30. 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 Troche @ 202/343-9442 WWW.epa.gov/chp 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 Troche @ 202/343-9442 WWW.epa.gov/chp

31. 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 312/996-4382 WWW.chpcentermw.org 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 312/996-4382 WWW.chpcentermw.org Five Additional Centers Throughout the US