Sustainable Indigenous Sustainable Indigenous Energy for Tea Industry in Energy for Tea Industry in Sri LankaSri Lanka

L P Jayasinghe L P Jayasinghe

Bio Energy Association of Sri Lanka

Sri Lanka Energy Mix Sri Lanka Energy Mix

Energy Mix

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1995 2005 2015

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Hydro

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Oil Price and Tariff Change

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1999 2000 2001 2002 2003 2004 2005 2006 2007

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Dollar Parity Oil Price

Now5000 Years ago

5000 Years hence

Mankind’s use of fossil fuel

Total Energy Consumption 7.1 kWh/kg of MT 100%

Electrical 0.75 kWh/kg of MT 15% [1]Potential Optimum 0.23 kWh/kg [4]

Thermal 21700 kJ/kg of MT - 85%

Potential Optimum ???

Energy Needs for Tea Energy Needs for Tea Production in Sri LankaProduction in Sri Lanka

Options for Energy SavingsOptions for Energy Savings

• Improvement of Efficiency of usage – Improvement of Efficiency of usage – Potential national savings Rs 400 Potential national savings Rs 400 Million per year Million per year

• Fuel switching – 50% saving in fuel Fuel switching – 50% saving in fuel wood or > Rs 10/kg MT by oil to wood or > Rs 10/kg MT by oil to wood changeover wood changeover

Efficiency Improvements Efficiency Improvements

• Withering fans the prime candidate – Withering fans the prime candidate – 40% saving in electricity by VSDs40% saving in electricity by VSDs

• Dryers – improved combustionDryers – improved combustion– Better heat exchangers - current 20- Better heat exchangers - current 20-

40% to 65% - 40% to 65% - – Switching to SRC wood from logs – 50% Switching to SRC wood from logs – 50%

reduction in wood consumptionreduction in wood consumption

Concerns & Barriers Concerns & Barriers

• High cost of funds and lack of credit High cost of funds and lack of credit

• Perception that the tea quality will Perception that the tea quality will suffersuffer

• Inadequate appreciation of the Inadequate appreciation of the potentialpotential

• Lack of dissemination of considerable Lack of dissemination of considerable available informationavailable information

Quality !!!Quality !!!

&&

Consistency of Consistency of Quality !!!Quality !!!

is possible only is possible only through measurement through measurement and control and control

Alternate Energy Sources Alternate Energy Sources

• Grow you own fuel and fertilizer Grow you own fuel and fertilizer

• Use fuel at optimum size and moisture Use fuel at optimum size and moisture content for better combustion efficiencycontent for better combustion efficiency

• Use combined heat and power option Use combined heat and power option and maximize waste heat usage and maximize waste heat usage

CHP Options CHP Options

• Option II

GasifierGas Engine

Alternator

Waste HeatExchanger

Tea Drier

Wet Tea535 kg/hr

Dry Tea250 kg/hr

Atmospheric Air

10,000 cfm

ElectricalEnergy

250 kWe

Fuel Wood

ProducerGas

Waste HeatFrom

Engine Exhaust

Hot Air10,000 cfm

Hot airGenerator

Energy for Additional Energy for Additional Revenue !Revenue !

• Using Steam Turbine Technology Using Steam Turbine Technology

• Minimum capacity 500 kWMinimum capacity 500 kWWater Cooled or Air Cooled options Water Cooled or Air Cooled options

• Grid Connection needed for export of Grid Connection needed for export of powerpower

• Using own fuel wood plantationsUsing own fuel wood plantations

• Foliage and added benefitFoliage and added benefit

• Carbon Credits Carbon Credits

• Option III Self Generation & Export to Grid

Direct FireBoiler

STG Alternator

Radiator TypeAir Heater

Tea drier

Wet Tea535 kg/hr

Dry Tea250 kg/hr

Atmospheric Air10,000 cfm

ElectricalEnergy

500 kWe

Fuel Wood

Steam@30Bar/400C

Steam@3Bar/180C

Hot Air10,000 cfm

Export

Factory

Steam Turbine Generator 300 Steam Turbine Generator 300 kWkW

Carbon Credits Potential Carbon Credits Potential

• CO2 Equivalent of 500 kw – 3000 TonsCO2 Equivalent of 500 kw – 3000 Tons

• Current CER Prices – $10-15 per Ton Current CER Prices – $10-15 per Ton

• Potential revenue per factory - $ Potential revenue per factory - $ 30,000/yr30,000/yr

• The CERS from thermal energy not The CERS from thermal energy not included included

• National potential > $ 15,000,000National potential > $ 15,000,000

Barriers to OvercomeBarriers to Overcome

• Funding for the capital expenditureFunding for the capital expenditure

• Generation of adequate energy Generation of adequate energy plantationsplantations

• Grid connection issues Grid connection issues

• Bundling to get full benefits of Bundling to get full benefits of Carbon CreditsCarbon Credits

• Lack of appreciation of true potential Lack of appreciation of true potential

500 kW Dendro Plant with Grid Connection

EquityEquity40,376,00040,376,000

LoansLoans 60,564,00060,564,000

IncomeIncome 54,970,20054,970,200

Costs before interestCosts before interest 21,730,00021,730,000

Profit after Interest before TaxProfit after Interest before Tax 23,307,70423,307,704

Capital EmployedCapital Employed 100,940,000100,940,000

ROC (Return On Capital)ROC (Return On Capital) 33%33%

ROSEROSE 58%58%

Tax at 30%Tax at 30% 6,992,3116,992,311

Profit after Interest and TaxProfit after Interest and Tax 16,315,39316,315,393

IRR IRR 13%13%

Payback Period (Yrs)Payback Period (Yrs) 3.03.0

Cost of wood /kg dryCost of wood /kg dry 1,000.001,000.00

Interest rateInterest rate 0.160.16

O D RateO D Rate 0.200.20

Capital Cost US$/KWCapital Cost US$/KW 1,750.001,750.00

Tariff Rs /KWhTariff Rs /KWh 12.0612.06

No of days Run/YrNo of days Run/Yr 330 330

Wood Consumption Wood Consumption kg/kWhkg/kWh

1.80 1.80

Operating Parameters

Carbon Revenue not included

Lets Grow

Our Own Energy

Lets Grow

Our Own Energy

Re-Greening Sri Lanka

Money Does Grow On Trees

Bio Energy Association of Sri Lanka

465/1 Sunethradevi Road

Pepiliyana

Sri Lanka

Tel + 94 11 2812373,

Email bioenergy@sltnet.lk

www.bioenergysrilanka.com