implementing renewable energy at water utilities

© 2012 Water Research Foundation. ALL RIGHTS RESERVED.© 2012 Water Research Foundation. ALL RIGHTS RESERVED. No part of this presentation may be copied, reproduced, or otherwise utilized without permission.

© 2012 Water Research Foundation. ALL RIGHTS RESERVED.© 2012 Water Research Foundation. ALL RIGHTS RESERVED.

Implementing Renewable Energy at

Water UtilitiesProject 4424

November 8, 2012

© 2012 Water Research Foundation. ALL RIGHTS RESERVED.

Outline

• Why renewable energy? • Renewable energy technologies• Implementation considerations• Procurement options• Funding opportunities• Case studies - opportunities,

challenges, and barriers to project implementation


Why renewable energy?

• Economic Benefits—Offset purchased power—Possible green credits, REC, carbon

credits

• Environmental Benefits—Reduce carbon footprint—Mitigate effects of the water-energy

nexus

• Social Benefits—Very positive public perception


Projected Electricity Price


Cost To Treat Water Is Increasing

Cost of energy is increasing

Water demands are increasing

Energy to treat water is increasing


Renewable Energy Outlook


Environmental Benefits• 1000 KWH of purchased electric utility

power releases an average of 0.61 tons of CO2 equivalent.

• Renewable reduces grid losses. US average grid losses = 6.5%

• 1000KWH generated locally actually saves 1065KWH of electric utility generation

(Source: USEPA eGRID2012)


Water-Energy Nexus

• 1kWh of purchased electric energy requires ~25 gallons of fresh water to produce

• Water treatment and distribution average energy usage: 1250 - 2500 kWh/MG

• For every million gallons treated, an additional 31,250 to 62,500 gallons of water resources are consumed.


Renewable Energy Technologies

• Solar• Wind• Micro-hydro• Geothermal• Tidal • Biomass


Solar• Advantages:

—Widely available—Mature technology—Low maintenance costs—Prices are decreasing

• Disadvantages: —Intermittent power generation—Power output depends on solar irradiance—Large footprint


Types of Solar Systems

• Photovoltaic Systems – Converts sun light energy into electric energy

• Thermal Systems – Recovers thermal energy from sun light


Wind

• Advantages: —Small site footprint—Mature technology

• Disadvantages: —Low persistent noise

depending on design—Aesthetic concerns—Intermittent nature—Sufficient wind not available in

many areas


Micro-hydro• Advantages:

—Low maintenance costs

—Mature technology—Installation in a

pipeline or outfall• Disadvantages:

—Power output is dependent on elevation changes

—Limited availability in small sizes


Types of Micro-hydro Systems

• Hydroturbines• Pumps as Turbines

Source: VATech Hydro


Tidal

• Advantages: —Predictable—High energy density

• Disadvantages:—High capital investment—Location limited to tidal areas—Effect on marine life—Not a mature technology

Image Source: www.reuk.co.uk


Geothermal

• Advantages: —Geothermal HVAC is a

mature technology—Predictable

• Disadvantages:—High capital investment—Potentially high

maintenance costsImage Source: www.geothermalhvacsystems.com


Biomass• Advantages:

—High energy generation potential

—Large variety of feedstock

• Disadvantages: —Air Emissions—Controversial NIMBY (not in my

backyard)—High capital investment—Potential air permitting issues


LEED

• Constructing a LEED building is also a means of reducing energy consumption—Building thermal efficiency—HVAC and lighting efficiency—“Green” building materials


Implementation Considerations

• Space constraints• Cost of purchased energy• Utilization of renewable energy

considerations• Coordination with the electric utility• Community impacts• Funding opportunities• Project delivery considerations


Utilization of Renewable Energy

WATER TREATMENT FACILITY

UTILITY METER

UTILITY SERVICE

RENEWABLE ENERGY SYSTEM

Offset Purchased Utility Power

Source

OR

Sell Energy Directly To Electric Utility


Utilization of Renewable Energy

• Offsetting purchased power benefit depends on the purchased power rate—Time of use energy and demand

charges—Demand ratcheting—Minimum billing demand limits

• ALL UTILITY RATES ARE DIFFERENT!


Renewable energy systems may not always offset demand charges

1 3 5 7 9 11 13 15 17 19 21 23 25 27 290

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

Billing Period Demand Profile

Plant De-mand kW

De

ma

nd

(k

W)

Period of low or no renewable energy generation during peak period (rain event, downtime, etc.)

No offset during peak period


Selling Energy Directly to Electric Utility

• Generated energy can be sold to electric utility

• Many electric utilities are required to meet Renewable Energy Portfolio Standards

• Energy generated from renewable sources may be “valuable” to some electric utilities


Renewable Portfolio Standards and Goals

Source:dsireusa.org


Electric Utility Coordination Considerations

• Parallel operation protection requirements—System modification can be expensive

• Billing rate contract impacts—“Grandfathered” rates


Community Impacts

• View shed impacts—Solar and wind systems

• Noise—Biomass and wind systems

• Air emissions—Biomass systems


Procurement Options

• Direct ownership• System owner finances design,

construction, and operation and maintenance

• Third party project delivery• A third party finances design,

construction, and / or operation and maintenance through a power purchase agreement (PPA)


Direct Ownership

• Advantages• Control power output• Can be built using traditional design-

build or design-bid-build practices

• Disadvantages• Requires upfront capital• Direct negotiation with electric utility • Municipalities generally do not qualify

for government tax credits


Third Party Project Delivery

• Advantages• No or reduced upfront capital costs• Possibly no maintenance costs• Reduced risk

• Disadvantages• Lower economic return• Long term price changes• May have protracted negotiation• PPA’s not available in all states


Power Purchase Agreements


Third Party Agreements Vary

1. Locate renewable energy on-site, and buy power through a PPA

2. Use a PPA to buy renewable energy generated off-site

3. Generate revenue from leasing land — Locate renewable energy on-site, but

power is sent to the electric utility grid


Funding Resources

• Incentives are constantly changing• Appendix to the report lists current

federal and state incentives • EPA, Energy.gov, Grants.gov• DSIRE – Database of State Incentives for

Renewable Energy • State and local energy offices


Funding Opportunities

• Government and non-profit grants—ARRA (2009) funds have been committed

• Bonds and Loans• Tax Rebates and Tax Credits• Tax Rebates: Increase tax refund• Tax Credits: Reduce the tax liability

• Federal Investment Tax Credit until 2016• Not available to municipal governments, but

would be advantageous to non-municipal entities


Project Steps

1. Review plant energy use, the available technologies and determine how the energy will be used

2. Evaluate the capital investment, financing options, and incentives

3. Identify the project barriers and risks4. Identify public impacts 5. Determine the project delivery

method


Project Challenges

• Upgrading existing structures• Roofs, walls, valve vaults, etc.

• Electrical upgrades• Renewable energy equipment

compatibility with electric utility requirements

• Coordination with electric utility • Paralleling

• Community Feedback


Case Studies1 City of Portsmouth NH LEED Silver Building2 City of Raleigh NC Solar PV3 Dania Beach FL LEED Gold Building4 East Bay MUD – Sobrante WTP CA Solar PV5 East Bay MUD – Walnut Creek WTP CA Solar PV6 Inland Empire CA Wind7 Metropolitan Water District CA Solar PV8 Portland Water Bureau OR Solar PV9 Portland Water Bureau OR Micro-hydro

10 Southern Nevada Water Authority NV Solar PV11 Southern Nevada Water Authority NV Solar Thermal12 Sydney Water, NSW AUS Micro-hydro


Case Study Sections

Part 2: Renewable Energy DataTechnology Year InstalledRated Power Output, kW Annual Energy Generated, kWhCapital Cost, USD O&M Cost, USDSimple Rate of Return Average Utility Energy Cost, $/kWhFinancing Energy Savings, USD

Part 3: Project Implementation

Project Drivers

Project Risks

Project Barriers

Type of Contract

Special Permits

Mandates or incentives

Community Acceptance

Part 1: Treatment Plant Information Raw Water Source Population Served

Design and Average Flow

Annual Electricity Consumption

Annual Energy Consumption

Utility Governance Structure


Case Studies

• Solar – Sothern Nevada Water Authority, NV

• Wind – Inland Empire Utility Agency, CA

• Micro-hydro – Portland Water Bureau, OR


SolarSouthern Nevada Water AuthorityAlfred Merritt Smith Water Treatment Facility

About the project• 130 kW solar PV system• Demonstration project with a local university• Most power comes from a gas-fired

combined cycle power plant and smaller hydropower facilities

• SNWA wrote the RFP, completed the preliminary design, and contracted the final design and permits to a consulting engineering firm



Project Drivers• Project was an opportunity to

become familiar with the technology

Project Risks• Approval by the purveying members that control the budget

Type of Contract• Design-Build Contract

Community Acceptance• The facility is in the Lake Mead National Recreation Area,

however, there no concerns about the solar installation.



Renewable Energy Data

Technology Solar PV Year Installed 2007

Rated Power Output, kW 130 Annual Energy Generated, kWh 240,000

Capital Cost, USD $1.4 Million O&M Cost, USD NA

Simple Rate of Return 30+ years Average Utility Energy Cost, $/kWh 0.06

Financing Government Energy Savings, USD /yr $14,400

www.snwa.com/env/sustain_solar.html


WindInland Empire Utility AgencyRancho Cucamonga, CA

About the project: • Average flow of 5 MGD• Provides recycled water to the surrounding

community• Includes primary, secondary, and tertiary

treatment processes for producing recycled water in accordance with California Title 22

• To offset high-carbon emitting operations, IEUA set a goal to operate off the grid by 2020

• Wind power was selected as a viable technology due to its low cost per kilowatt hour and reliability with minimal maintenance

• Additional renewable energy projects by IEUA include solar systems and fuel cells



Project Drivers• Cost containment, operational reliability,

electricity rate stabilization, and carbon footprint reduction

Project Barriers• Approval from Federal Aviation Administration

Type of Contract• 20 year Power Purchase Agreement with Foundation Wind

Power

Community Acceptance• Positive



Renewable Energy DataTechnology WindRated Power Output, kW 1,000Capital Cost, USD None

Simple Rate of Return NA

Financing Third Party

Year Installed 2011

Annual Energy Generated, kWh 1,500,000

O&M Cost, USD None

Average Utility Energy Cost, $/kWh 0.115

Energy Savings, USD/yr $100,000+

www.ieua.org


Micro-hydroPortland Water BureauVernon Tank, Portland, OR

About the project • Installed a grid tied micro-hydro turbine rather than replace a 16” PRV• Designed in-house for a flow rate 6.4 – 8.25 cfs through the turbine • The pipeline is 24” reduced to 10” at the turbine

Challenges• Replacement of deteriorated piping and construction of a new valve vault

Financing• $55,000 grant from American Recovery and Reinvestment Act of 2009• $50,000 grant from Oregon Energy Trust upon completion of the project • Energy Trust also paid consultant fees up front for FERC and Oregon

Water Right permitting• Portland Water Bureau also had approximately $35,000 earmarked from

State of Oregon Business Energy Tax Credits (BETC)



Project Drivers• Portland Water Bureau seeking to meet the City’s renewable energy goals

Project Risks• Installing a new generator on an existing 80 year old pipe and providing

adequate thrust restraint for the equipment

Project Barriers• Cost of structures to house the energy generation equipment, and the

cost of upgrading the power supply to meet the generation requirements

Type of Contract• Power Purchase Agreement (PPA)

Community Acceptance• The project is in an underground vault and not seen by the community



Renewable Energy Data

Technology Mirco-hydro Year Installed 2012

Rated Power Output, kW 30 Annual Energy Generated, kWh 150,000

Capital Cost, USD 155,640 O&M Cost, USD 1500

Simple Rate of Return 15 years Average Utility Energy Cost, $/kWh 0.07

Financing Third Party Energy Savings, USD/yr $10,500

www.portlandoregon.gov/water/


Summary

• Electricity costs are expected to increase• Installing renewable energy can:

—Reduce electricity costs—Generate revenue for your utility—Reduce carbon footprint

• A variety of funding sources and contract arrangements exist

• Case studies demonstrate that there are a varieties of way to successfully implement projects


Technical Resources

• National Renewable Energy Laboratory

• Department of Energy • Environmental Protection Agency • EPA-NREL Solar Decision Tree


Acknowledgements• Thank you to Linda Reekie and the

Water Research Foundation • Fred Bloetscher (Florida Atlantic University)

• Bill Becker, Ben Stanford (Hazen and Sawyer)

• Thank you to all of the utilities which participated in this project.


Questions

implementing renewable energy at water utilities

Documents

water research foundation

waterenergy nexus1kwh

water utilitiesproject

gallons of fresh water

gallons of water resources

light energy

thermal energy

increasingcost of energy