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Cogeneration in the

Forest Products Industry

January 2008

by Phil Zirngibl

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What is Cogeneration?

• Cogeneration is the production of electrical energy and another form of useful energy, such as heat or steam, through the sequential use of energy.

• Cogeneration is also often referred to as Combined Heat and Power or

“CHP”.

Source: US DOE

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Cogeneration – how much in the U.S.?

• CHP generation represents 9% of electricity generation capacity in the US.

• The Forest Products, Chemical and Oil Refining industries combined represent ~90% of the total CHP generation in the U.S. manufacturing sector.

• The majority of cogeneration in the Forest Products Industry is from renewable fuels (biomass).

Source: US DOE, Midwest CHP Center

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Forest Products Industry

Represented primarily by two groups; paper and lumber Meets more than half its energy requirements through highly

efficient cogeneration processes. Since 1972:

Has increased energy self-sufficiency from 40 to 60% Utilizes nearly 85% renewable resources for onsite generation Reduced total energy usage by 30% Reduced purchased energy by 53%

Source: AF&PA

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• STG = Steam Turbine mechanically coupled to a Generator

• GTG = Gas Turbine mechanically coupled to a Generator

• WHRB = Waste Heat Recovery Boiler

• Combined Cycle GTG = GTG with a WHRB combined with STG

• Simple Cycle GTG = Stand alone GTG

• Heat Rate = Amount of fuel (in btu’s) required to generate one Kwh of electricity. Commonly expressed in btu/kwh.

Common Cogeneration Terms

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0 50 100 150 200 250

GTG w/heat rec

STG supplied bystm boilers

Combine CycleGTG

STG supplied byheat recovery

Paper Products Wood Products

Types of cogeneration in the Forest Product Industry

Source: MECS 1998

Number of facilities with cogeneration

Approx 75% of existing cogeneration facilities are in the Paper Products Business

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Cogeneration from Steam Boilers in Forest Products Plants (paper)

Waste Wood Boiler

Wood-based biomass

High pressure steam

Low pressure steam

To manufacturing process

requirements

Generator

Green Power

Steam Turbine

Typical heat rate ~ 4,500 btu/kwh or 76% efficient

Recovery Boiler

Lignin

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Typical Coal-fired utility generation

Boiler

Coal

High pressure steam

Generator

Power

Low pressure steam

Condenser

Steam Turbine

Typical heat rate ~ 10,000 btu/kwh or 34% efficient

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Typical utility Combined Cycle GTG

Natural Gas

Power

Waste Heat

Recovery Boiler

Generator

Low pressure steam

Condenser

Generator

Steam TurbineHigh pressure

steam

Gas Turbine

Hot Gas

Typical heat rate ~ 7,000 btu/kwh or 49% efficient

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Typical Simple Cycle GTG

Natural Gas

Power

Generator

Gas Turbine

Hot Gas

Exhaust

Typical heat rate ~ 12,000 btu/kwh or 28% efficient

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Typical Heat Rates

0

2,000

4,000

6,000

8,000

10,000

12,000

Simple CycleGTG

Coal-Fired STG Combined CycleGTG

Ind Cogen (STG)

Typ

ical

Hea

t R

ate

(btu

/kw

h)

Utility Scale

Industrial cogeneration is significantly more efficient that other typical types of commercial electricity generation . . .

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Cogeneration – Advantages/Issues

Advantages:• More efficient than commercial generation despite lack of scale.• Potential to increase renewable generation (esp. in Forest Products Industry)• Provides a reduction in GHG emissions. • Provides advantages of distributed generation (avoids issues w/constrained

transmission system).• Potential for advantageous tax treatments• Continued development supported by provisions of the Energy Independence

and Security Act of 2007

Issues:• Cogenerated renewable electricity from older installations not valued the same

as from newer installations.• Cogenerated renewable electricity must be sold to be eligible for Sec 45 Fed

Tax Credit.• Most recent version of Lieberman-Warner Climate Security Act of 2007 doesn’t

recognize value of cogeneration. . . in fact, penalizes facilities with cogeneration.

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Green Power

Green(Renewable) Power = Brown Power + REC*

*REC = Renewable Energy Credit (renewable attributes of Green Power)

State RPS

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U.S. Electricity Generation by Fuel

Coal49.0%

Hydroelectric7.0%

Other Renewables

2.4%

Petroleum1.6%

Other0.7%

Nuclear19.4%

Natgas20.0%

* Source US DOE Oct ‘07

Total = 4,065 Million MWH/yr

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Renewable Electricity Generation by type

Coal49.0%

Nuclear19.4%

Natgas20.0%

Hydroelectric7.0%

Other Renewables

2.4%

Petroleum1.6%

Other0.7%

Woody Biomass

MSW/LFG

Geothermal

Wind

Solar

Total US Electric Generation by Fuel*

* Source US DOE Oct ‘07

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Renewable Electricity Generation from biomass

GP generates ~ 8% of the electricity generated from woody biomass in the US . . .

Coal49.0%

Nuclear19.4%

Natgas20.0%

Hydroelectric7.0%

Other Renewables

2.4%

Petroleum1.6%

Other0.7%

Wood Waste

Blk Liquor

~ 8%

38.7 MM MWH/yr

Woody Biomass

MSW/LFG

Geothermal

Wind

Solar

U.S. generation from Woody Biomass

GP Generation from Woody Biomass

Total US Electric Generation by Fuel*

* Source US DOE