Application of Micro Turbines & Smart Grid for Municipal Buildings

1. ANNUAL FALL CONFERENCE; 2009 Application of Micro Turbines & Smart Grid for Municipal Buildings www.preon.com Presented by Tim Tawoda

2. Outline • Technology Basics: Micro Turbine, Absorption Chiller & Smart Grid • Micro Turbine “Muni” Drivers: Environment, Economics & Security • City Implementation of CHP (Cogen) • City-Specific Issues • Case Study: Chicago Police • Applying CHP City-Wide • How Do I get Started? • Q & A

3. What is a Micro Turbine? • Small, light, self-contained Power Plant: 100 – 250 kW per MT – depending on Vendor • Fueled (primarily) by Natural Gas • Reliable, quiet and clean-burning • Similar to jet engine • Value Proposition: improves Environment, Economics and Security/Reliability 7’ High Weighs 4,000 lbs 10’ Long 3’ Wide Turbine assembly weighs 200 lbs

4. Technology: How Micro Turbines Work Heat for Absorption Chiller or Boilers Electric Output Recuperator Fuel Battery Inverter Combustor Rectifier 68 k RPM Turbine Generator and Starter Intake Air 4 Compressor

5. Technology: How Absorption Chillers Work Micro Turbine Exhaust is source of “free” energy for Absorption Chiller

6. Technology: Components of a “Smart Grid” Distributed Generation Smart Meters Like Solar and Wind Power, Micro Turbines are a form of “Distributed Generation” Controls & Communications Electric Utility Grid

7. Technology: Traditional (on-site) Generator vs MT Reciprocating Engine Generators (also known as “Internal Combustion” Engine Generators) vs Micro Turbine Generators

8. Environment is Main Driver MT CHP = Micro Turbine Combined Heat & Power • Traditional Power Plant Delivers 33% of Input Energy • MT CHP Delivers 50% + 30% = 80% of Input Energy • Traditional Power Plant Requires 2.42 X’s as much Energy: 2.42 X’s carbon footprint 45% Thermal 30% Electric 100% Fuel

9. Environment: MT & RENEWABLE Energy Applications Normal City Application: Utility Natural Gas (NOT “Renewable” Gas) as fuel source *However, MT CAN Operate on “Renewable” Gas: • Bio Gas • Digester Gas • Landfill Gas • Bio Diesel MT operating on coal bed methane @ 4,000 feet and -40 def F. Why Natural Gas vs “Renewable” Gas for Cities? Natural Gas is readily available and consistent via Utility Gas Grids – HOWEVER, Technology Advances is changing this!

10. Environment: City Sources of “Renewable” Gases for MTs: • Bio Gas can be produced from Solid Waste via a.) Cellulosic or b.) Pyrolization gasification processes • Digester Gas can be produced from natural gassing at Waste Water Treatment Plants • Landfill Gas can be produced from natural decomposing of garbage at Landfills MT operating on landfill gas Municipal Pyrolization Plants may be around the corner: solid waste converted to free energy

11. Environment: Enhanced by Smart Grids of the Future Micro Turbines Smart Grids allows City to aggregate all base load (“green” coal gasification plant) and supplemental Renewable Energies: Micro Turbines run on “syn” gas and methanol created by coal gasification plant: gas is blended with utility gas for redundancy/reliability

12. Economics: Fed, State and Utility Incentives ARA = American Recovery Act = Federal Stimulus • ARA: 10% of cost –Up to $200 per kW • NYSERDA: 10-50% of capital cost • ICAP: $66,000 per 1,000 kW (annually) • State of New Jersey: $1000 per kW • State of Oregon: $1000 per kW • State of California: considering 2010 • Fed Solicitations: NETL $500M Grants • 13 States + DC consider Waste Heat as “Renewable” http://www.dsireusa.org/ This Link Provides an Update on Grants, Credits and Subsidies State-by-State ARA: Micro Turbines Operating on “Renewable” Gas or Bio Diesel qualify for 30% vs 10% ARA Grants

13. Economics Vary from City to City NYC Chicago Example: 200 kW CHP Plant: 2 x 100 kW Micro Turbines + 60 Tons of AC; Average Electrical Consumption: 150 kW

14. Economics: Utility Electric Ideal MT CHP Cost Metrics: Expensive Electric Utility & Cheap Natural Gas Utility Electric Utility Consumption decreased by 2.8% in 2009: USDOE Electric Utility Cost INCREASED by 4.2% in 2009: USDOE The Key to MT CHP Economics: Micro Turbines produce 2.72 X’s as much output energy as traditional power plants

15. Economics: Utility Natural Gas “US Estimated Gas Reserves have surged by 35%; US holds far larger reserves than previously thought. The jump is the largest increase in the 44-year history of reports from the committee”: Potential Gas Committee – Wall Street Journal 6-18-9 US Reserves increased due to Shale Gas deposits: technology advances makes gas @ 4,500’ depth viable If Cities used Landfill, WWTP and Bio Gas: cost of energy is Zero $

16. Security: Vital @ Police Stations Traditional Police Station Chicago Police Station Dual Primary Power: Electric AND Natural Gas Secondary Power: Diesel Genset Potential Enhancements: a.) Secondary Power via Micro Turbine with LP (Eliminate Diesel Genset); b.) Redundant AC with Absorption Chillers Lowers Stress on Local Electric Utility Grid • Single Primary Power: Electric • Secondary Power: Diesel Genset On a NATIONAL LEVEL, United States becomes less dependent (more SECURE) when utilizing renewable fuels (bio gas, digester gas, landfill gas and bio diesel ) OR CBM, Shale gas and domestic natural gas . CBM, Shale gas and domestic natural gas and LP, unlike oil and diesel fuel, is very plentiful.

17. Security: Enhanced by Smart Grid Micro Turbine CHP Plants MT CHP Plants + Smart Grid provides the ultimate City Power Infrastructure

18. CHP Implementation: Classic Approach Spec Engineer works with vendors on equipment sizing and selection; Contract award based on “bid-spec” or “Performance Contract”. Security or Environ Criteria Met; Funding Alternative Made; City Consensus for MT CHP City instructs Architect to embrace MT CHP; Architect allocates footprint and complies with LEED criteria Architects instructs Spec Engineer to integrate MT CHP into Electrical and HVAC infrastructure

19. CHP Implementation: Reality of City Politics • Mayors embrace CHP for Environment & Security merits • Energy Czar may be weak link; transient (political) position: gets promoted to different Department - by the Mayor • Mayor must transcend Czar disruption (promotion) • Energy Integrator: keeps the focus of Mayor/City agenda, Architect & Engineer - also facilitates the design Continuity of Energy Czar office/tenure varies greatly City-to-City. Many smaller Cities have no Energy Czar. A forceful Mayor is Key Ingredient for CHP Implementation

20. Smart Grid Implementation: Challenges for Cities Bottom Line: Comprehensive Smart Grids could take decades to perfect. However, CHP can accomplish key objectives of Smart Grids today: demand reduction, improved reliability/security and better economics. CHP can be integrated with the Smart Grid as it evolves • Expense • Cultural Barriers • Resource Constraints • Short-term thinking • Lack of collaborative spirit • Lack of coordinated R&D b/w utilities and vendors • Lack of standards, definitions, interoperability • Unwillingness to deconstruct the paradigm • Scope of Technology Change

21. City-Specific Issues: MT CHP Response Density of City Electric Loads Increasing: PC’s and Internet is 2.5% of US power consumption total but is doubling every 5 years: concentration is much greater in Cities. Electric Plug-in Vehicles require 8 kWh electric re-charge per 40 miles: 100 cars recharging in the building garage could increase the demand by 800 kW: 10-30% increase in demand.

22. City-Specific Issues: Crisis Management • East Coast Blackout on August 14th 2003: Problem could have been averted with less stress on the grid • During electric outage, buildings can operate if gas grid is up • LP (Liquid Propane) can power MTCHP if gas grid is also failed • Hurricane Katrina August 29th 2005: MT CHP could have provided electric power and cooling at time of crisis East Coast Blackout

23. Chicago Police: Timeline Time line MT Operating on Roof Each new Chicago Police Station will have a 100 kW Micro Turbine on the roof: total of 12 new Stations

24. Chicago Police: Project Specifics • Qty (1) 100 kW Micro Turbine – expandable to 2 MT: MT in parallel with Electric Grid; MT provides 90% of Electric Power Needs • Encorp Controls • 350 kW Diesel Genset • Commissioning • 5-Year Service Agreement • Utilization of Waste Heat: Boiler & future absorption chiller • Continuous Monitoring and Control of Micro Turbine via Internet by Energy Integrator Electric Grid Building Electric Load Future Export Power Encorp Controls GPC Gold Box Standby-Backup Diesel Genset MT Genset Future export of Diesel Genset Power via GPC, Internet and Smart Grid MT Turbine Exhaust to Boilers Natural Gas Grid Internet

25. Chicago Police: “Smart Grid Upgradable” • Engine Control/Monitor • Utility Relays • PLC Logic & Network Communications • Local/Remote Communications Interface Smart Controls Traditional Controls Encorp GPC (controls) replaces numerous mechanical relays with a single solid state controller: accommodates export of aggregate diesel gensets/buildings in the future via “smart grid”. GPC

26. Applying MT CHP City-wide • CHP requires viable use of waste heat: Often heating/cooling of building space • Typically requires 7 x 24 habitation such as Police Stations • How do we utilize the waste heat for other buildings – such as High Schools? • Calnetix Micro Turbines manufacturers Organic Rankin Cycle (ORC) • ORC converts waste heat from (4) micro turbines to 100 kW additional “free” electricity ORC Expansion Module

27. How Do I Get Started? Start with New Construction vs Rehabs: Easier to Move Lines on Paper vs Knocking Down Walls Consider Police Stations: Smaller CHP Plants, Easy Use of Waste Heat due to 7 x 24 Habitation; Police Stations have need for Higher Security Benefit Engage your Local Energy Integrator: • Access to MT CHP Technologies • Post-Factory Upgrades to Micro Turbines • Application Engineering • Project Management • Commissioning Capabilities • Continuous Maintenance and Monitoring of MT CHP Plant

28. Questions and Answers Thank You for Your Time! www.preon.com ; ttawoda@preon.com