stephen palmer, mwh
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Leeds UniversityC fl 10th M h 2010Confluence: 10th March 2010
Energy and the Water Cycle: Carbon E i i f th W t I d tEmissions from the Water Industry
Strategic Investment towards 2050Strategic Investment towards 2050Dr Steve Palmer and Adrian Johnson
Presentation outline
• Current and future risks facing the water industry
• The need to shift from developing assets to meetThe need to shift from developing assets to meet drivers to strategic investment in systems to maximise resource efficiencyresource efficiency
• Opportunities
• Wastewater case study example
Legislation, climate change and other pressures demand long‐term visiondemand long term vision
REACTIVE:
Climate change legislationWFD objectivesCapped budgets
VISION
REACTIVE:harder, higher cost
pp gCustomer priorities
VISION:Transformed assets: adapted to climate PLANNED: change and carbon
efficient;Risks controlled
easier, lowest costAnticipate future trendsReduce operating cost riskAvoid stranded assetsControl and manage
Climate change impacts/ b
3
Control and manage risks to whole life costs
Rising energy / carbon pricesDemographic & social changes
Particular issues for water industry
• Assets have long livesAssets have long lives
what is built now will serve for decades into the future
• Assets have high write-off costs
stranded assets reduce investment returns and efficiency
• Capital investment needed so assets can accommodate:
energy cost inflation (to ensure operating cost efficiency)
regulatory risksregulatory risks
climate change mitigation
strategic resources risks
… while obtaining value for money
Operating cost risk: Effect of annual power cost inflation on 40yr power costs of a 160 000 pe STWinflation on 40yr power costs of a 160,000 pe STW
From To %inc. per annum Source1979 2007 6 7 BERR
Inflation in UK industrial power 1979 2007 6.7 BERR
1997 2007 3.3 Eurostat2004 2007 11.0 Eurostat
industrial power costs
£30
£35 0.00% 1.00%
2006 2007 18.5 BERR2007 2008 14.2 BERR
£25
£30
ns
2.00% 3.00%
4.00% 5.00%
£15
£20
£ M
illio
n 6.00% 7.00%
8.00% 9.00%
10 00% 11 00%
£5
£10
£ 10.00% 11.00%
£-0 10 20 30 40
Regulatory risks: water environment
Water Framework DirectiveWater Framework Directive• Significant investment to enhance capability
C b t li itl t d f i fi t l• Carbon not explicitly accounted for in first cycle –opportunity lost?
• Inequalities of whole life cost calculation –capex pressures override opex costs
Most water cos forecastMost water cos. forecastsignificant increases inCO2 emissions to meetCO2 emissions to meetwater legislation
Regulatory risks: climate change mitigation
Government target 80% reduction by 2050Government target 80% reduction by 2050 plus interim budgets set by Climate Change Committee
CRC ffi i h l h d i 2010CRC energy efficiency scheme launched in 2010
• Affects orgs. using more than 6000MWh/yr of electricity
• Power largest element in water co. carbon footprint
Potential increase in• Potential increase in cost of permits from 2013 is significant risk2013 is significant risk
Expectations of future development
“…meet our long term sustainability duties….align with wider policy on GHG reductions…”
OFWAT Climate Change Policy Statement 2008
“The group believes that the Price Review, together with the ongoing work of the WFD, could provide an important impetus to th t t th t it f ll i it lf t t th tthe sector to ensure that it fully equips itself to meet the acute environmental challenge posed by climate change, in the most
sustainable way possible ”sustainable way possible.
All Party Parliamentary Water Group: The future of the UK Water Sector (2008)Sector (2008)
Strategic resources risks: Phosphorus
• P essential to food productionproduction
• P fertiliser price up 300% in last two yearsin last two years
• ‘Peak’ year predicted to be 2034be 2034
• Government regulation likely: China has placed alikely: China has placed a 135% tariff on P reserves
• P in sewage is recoverable
Peak phosphorus ‘Hubbert’ curve, (based on Cordell, Drangert and • P in sewage is recoverable
strategic resourceWhite, 2009)
A new focus on resource efficiency management
Focus on achieving carbon efficiency: minimise the carbon emissions …
per customer served• per customer served• per unit volume conveyed (pumped)• per unit of pollution load removedper unit of pollution load removed
Wherever possible …
Avoid the use of energy and resources Modelling is key
Reduce energy and resource useRecover energy and resourcesReplace existing energy (and resources) with low carbon alternatives
The biggest opportunities are in the early stages
Deliver toachieve OperationProblem Business
model & Solution Deliveryachievesavings
Operationdefinitionmodel & strategy choice Delivery
unity
Opp
ortu
Allow ‘what if’ projects
Wastewater and sludge treatment:Invest in energy efficiency and energy recoveryInvest in energy efficiency and energy recovery
Wastewater and sludge treatment:A new approach to asset developmentA new approach to asset development
For carbon efficiency: Maximise the pollution load removal per kWMaximise on-site renewable energy generationMaximise on site renewable energy generationBuild in the capability for resource recovery
• Upgrade asset standards and guidelines• Adopt a thermodynamic approach to optimise• Adopt a thermodynamic approach to optimise
• Avoid waste … think resource recovery
Energy Efficient Energy Efficient Wastewater Treatment WorksWastewater Treatment Works
Exploit wind resources
CHPCHPEnhanced Digestion
Minimise sludge transport
Gasification
Real Time Control
resources DigestionIncrease Biogas
Production Sewage heat recovery
FOG DigestionFOG Digestion
Enhanced primarytreatment
Reduce Aeration
Costs
Production g y
High Efficiency Aeration Devices
treatment
Energy ManagementPump Drive
Unit Efficiency
Management
Sustainable
RAS RatesReduce
PumpingCosts
Sustainable Buildings
Minimise costs by applying enabling technologies to existing assetstechnologies to existing assets
Chemical
Preliminary treatment
Primary treatment
Aerobic secondary treatment
Final effluent
Real time controlChemical dosing
treatment treatment treatment effluent
Secondary sludgePrimary sludge
FOG removal
sludge
Sludge thickening CHPEnergythickening
Anaerobic
Site export, ROCs
Gas
digestion
Advanced digestion
(MAD l fl )
Dewatering and drying Gasification
Algae growth(MAD plug flow)
Fuel, MAD, Gasifier Class A sludge, P to land Char, SyngasVFAs
Outcomes: process flowsheets capable of energy neutrality and productionneutrality and production
Katri Vala heat pump plant generates multiple MW of energy direct from sewage ffl t f i t t H l i kieffluent for input to Helsinki
district heating
Heat recovery from sewage Enhanced primary treatment
Enhanced Digestion Digested sludge gasification for CHPMaking use of any available subsidies (e.g. ROCs )
Sludge and biogas value chain
1st order 2nd order 3rd order
Heat
1st order treatment e.g.
sludge digestion
2nd order treatment e.g. sludge drying
3rd order treatment e.g.
gasification
Beneficial use of biosolids
Combustion of biogas
On-site processes
Biogas
Heat
Power
Power
biogas processes
Surplus powerSurplus heat
Direct export National gridDistrict heating
Assess options for best value outomes
Enabling factors e.g.
Large site
L tPotential benefits
Large power costs
Local agriculture paying for sludge
Energy/carbon neutral
Class A sludge
P return to landPrimary sludge
Secondary
MAD capacity
Sludge tankering
Possible future N&P
P return to land
Upgrade biogas for use as vehicle fuel or for i j i id
Cost‐benefit analysis of optionsSecondary
sludgePossible future N&P
consent
Renewable energy i d l ll
injection to gas grid
Export renewable power
Char to land‐carbon
options
Best value end required locally
ROCs
Policy to reduce C
sequestration
VFAs and Oils
uses
yfootprint
Municipal Wastewater Case Study
Baseline design for Whole life cost comparison: Conventional plant for approx 160,000PE
Standard preliminary treatmentp yStandard primary treatmentActivated sludge secondary treatment (FBDA)g y ( )Sludge digestion and drying to pelletConventional best practiceConventional best practice(methane used to heat dryer at 90% efficiency and dryer waste heat heats to digesters)y g )
Plant refurbishment: Potential for significant reductions in operating cost and whole life costg
Whole life cost of 160,000PE Conventional Flowsheet versus Sustainably UpratedFlowsheets when power exported and ROCs claimed at 10% power cost inflation
160
180Flowsheets when power exported and ROCs claimed at 10% power cost inflation
Conventional UHT gasifier
120
140Ehcd PSt, Ehcd MAD &UHT gasifier
Natural gas co-fired gasifier
Biogasfi d ifi
Incinerator
80
100
120
ons
co-fired gasifier
Ehcd PSt, Ehcd MAD &Incinerator
60
80
£ M
illio
20
40
00 5 10 15 20 25 30 35 40
Year of Operation after Refurbishment
Plant Refurbishment: Potential for reductions in operating cost and whole life cost without ROCs
Whole life cost of 160,000PE Conventional Flowsheet versus Sustainably Uprated Conventional Flowsheets with no power subsidies at 10% power cost inflation
C ti l
160
180 Conventional
Uprated with UHT Gasifier only
120
140UHT Gasifier only
Uprated with UHT Gasifier &Encd PSTs
80
100
Mill
ions
Uprated with UHT Gasifier Encd MAD
Uprated with UHT Gasifier &PSTs&Encd MAD
40
60
£ M UHT Gasifier &PSTs&Encd MAD
20
40
00 5 10 15 20 25 30 35 40
Year of Operation after Refurbishment
Power Cost Inflation Risk Analysis: Effect on whole life cost of digested sludge incinerationg g
180
Plant upgraded with digested sludge combustion: conventional facility WLC as a function of energy cost inflation versus upgrading options for Incineration with CHP (1 ROC)
160
180
s)
Plus Incinerator with CHP only
Plus Incinerator with CHP; PST and MAD enhancements
120
140
s (£
Mill
ions
Conventional Design
80
100
PV a
t 30Y
rs
40
60
STW
NP
0
20
00 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
% Annual Electrical Power Cost Inflation
Power Cost Inflation Risk Analysis: Effect on whole life cost of digested sludge gasificationg g g
180
Plant Upgraded with Digested Sludge Gasification: Conventional Facility WLC versus upgrading options for UHT gasification with CHP (2 ROCs), as a function of energy cost inflation
C ti l D i
140
160
Conventional Design
Conventional uprated with gasifier claiming ROCs
120
140
llion
s)
Conventional with Enhanced PSTs & MADs and Gasifier claiming ROCsConventional with enhnaced PSts and MADs and Gasifiers: NO ROCs
80
100
30Y
rs (£
Mil
40
60
W N
PV
at 3
0
20
STW
00 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
% Annual Electrical Power Cost Inflation
A new approach to address risks and maximise operational efficiency for 2050maximise operational efficiency for 2050
• Need a focus on carbon efficiency (systems level) • There are barriers to be addressed to deliver full potentiale e a e ba e s to be add essed to de e u pote t a• Energy efficiency improvements per se are only a small part
of obtaining reductions in operating cost and carbon footprintg p g p• Significant gains offered by in situ power generation on large
sewage works and sludge processing centresBut …• the projects which offer best potential require higher levels
of capital investment and longer payback periods• To effectively mitigate power cost inflation and other risks,
investment in these projects needs to begin now
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