introduction to cogeneration

1. Introduction to Cogeneration Stephen Karekezi, Waeni Kithyoma & Ken Muzee AFREPREN/FWD Nairobi, Kenya

6. Biomass Cogeneration Most sugar industries in eastern and southern Africa currently practicing co-generation for own use Could be replicated across all agro-industries Wood/timber, pulp and paper Coffee, sisal, palm oil, tea, cocoa, tobacco, etc Important option as agriculture and agro-industries account for close to 50% of sub-Saharan Africa�s GDP and over 70% of employment Sugar industry directly or indirectly impact on 4-7 million people in Western parts of Kenya

7. Benefits of Cogeneration Cost-competitive Local resource (security of supply) and strengthens system balance Attractive job generation (at the sugar cane plantation level) and enterprise creation potential (local technology dev) Strengthens agro-industry sector (applicable to most forestry and pulp/paper sectors) Incremental and modular - can start small (1 or 2MW investment and then grow incrementally to 50-70MW installations) which lowers initial risks and facilitates local participation

8. Improved thermal efficiency compared to traditional mills => less heat rejected Limited atmospheric emissions Particulate <100 mg/Nm3 SO2: almost non-existent with bagasse and in live with international regulations due to use of low-sulfur coal NOx: also reduced due to use of spreader-stoker technology Positive Environment Impact

9. Bagasse: a renewable fuel Can be used to secure carbon credits All co-products and waste streams have a value Bagasse (cane trash) for energy Filter cake/furnace ash as soil conditioner Molasses for ethanol and spirits Vinasse as fertiliser Positive Environment Impact

10. Eskom, South Africa Cogen Initiative5000MW Call - Expression of Interest (EOI) Initial Target 900MW Offered a standard PPA & feed-in tariff to be based on avoided cost of thermal power units Overwhelming response � 2000MW+ EOI received midway 5000MW EOIs received by end of September � approx. 10% of South Africa�s current installed capacity 5000MW > East Africa�s entire installed power generation capacity

11. Accounts for close to 40% of 651MW national generation capacity (of which 25% bagasse) Sugar industry accounted for 41.5% of total electricity generated in 2005 Began with smaller installations (1.5MW - 5MW, recently installed an 82MW plant)

12. Cogeneration in Mauritius Cogeneration attractive as it offers alternative revenue stream to Mauritius key economic sector � sugar industry Power sales revenue for some sugar millers recently exceeded that from sugar Diversified sources of power thus providing protection against unstable & high oil price increases as well as drought induced hydro-power crises

14. Success Factors Revenue sharing increased incomes of all stakeholders including small holder sugarcane farmers Key indicator of focus - one of the first degrees offered at the University of Mauritius is on �Sugar Technology� Dedicated cogen project investment teams (or separate subsidiary companies) relentlessly pursuing cogen investment opportunities Close tracking of EU and regional policies that affect the sugar industry Close collaboration between policy makers, sugar industry and utility

15. Success Factors Government played �honest broker� key role in power purchase agreements and setting feed-in tariff (key factor) � reduced the lengthy and sometimes acrimonious tariff negotiations A form of pre-defined and attractive feed-in tariff which reduces risk to investors Higher prices offered to more efficient cogen plants � key incentive Significant level of centralization which allows sugar industry to realize economies of scale Long-term commitment - key

17. Cogeneration in Sugar Industries Attractive Option in the Region

18. AFREPREN/FWD Cogeneration For Africa Project

19. Cogeneration for Africa UNEP/AfDB/GEF initiative Cash co-finance from REEEP Objective is to promote cogeneration (biomass-based mainly) in eastern and southern Africa Initial focus on biomass-based agro-industries but subsequent phases could include promotion of cogeneration in sectors that use other fuels

20. Cogen for Africa To build on success of Mauritius & relevant elements of EC-supported Cogen Asia initiative Initial 6 year phase to cover 7 countries which have endorsed project (Kenya, Uganda, Tanzania, Sudan, Ethiopia, Malawi and Swaziland) � later phases could expand to other regions of Africa Plan to establish network of national coordinating centres willing to play a key role in promoting cogeneration Overall coordination provided by AFREPREN/FWD Regional Cogen Project Office

21. Planned Cogen Installations

22. Cogen for Africa � Key Outcomes Outcome 1: Capacity of project developers, technical service providers and local manufacturers of modern and efficient cogeneration systems developed and enhanced Outcome 2: Financing for cogeneration projects made available and accessed at terms and conditions that are favorable for investments

23. Cogen for Africa � Key Outcomes Outcome 3: Commercial, technical, economic & environmental benefits of modern and efficient cogeneration systems demonstrated in new cogeneration plants & confidence on the certainty of the cogeneration market enhanced Outcome 4: More favorable policies and institutional arrangements that support cogeneration promoted

24. Questions and Discussion Other sectors where cogeneration is applicable/being practiced successfully in your country Rank top 3 sectors with highest potential