Opportunities for On-Site Industrial Renewable Energy David Sjoding

1. Opportunities for On-Site Industrial Renewable Energy David Sjoding Northwest Clean Energy Application Center April 21, 2010

2. Northwest Clean Energy Application Center • About the Center • A multi-state effort – AK, ID, MT, OR & WA • WSU Extension Energy Program serves as lead • 100 plus Regional CHP projects totaling over 1,300 MWc • 94% industrial projects • Technical assistance information, reports and case studies • Problem solving & trouble shooting • Website www.northwestcleanenergy.org • Support of regional & state CHP initiatives • CHP, district energy and waste heat recovery Alaska • Idaho • Montana • Oregon • Washington

3. Industrial Energy Efficiency and Renewables Fit Together • A major national effort is underway • 25% Reduction in energy intensity by 2017 • Goal of U.S. Department of Energy Industrial Technologies Program • Goal of an 18% reduction in carbon intensity by 2018 • Save Energy Now – Reduce energy intensity by 25% in 10 years – Lots of state energy office support Alaska • Idaho • Montana • Oregon • Washington

4. Industrial Energy Efficiency and Renewables Fit Together • A major national effort is underway • (cont.) • Energy Intensity – Accommodates production variation • Excellent fit for CHP, district energy and waste heat recovery • Especially Renewable CHP • http://www1.eere.energy.gov/industry/ Alaska • Idaho • Montana • Oregon • Washington

5. CHP - Combined Heat and Power • National Industrial CHP Goals • 241 GW by 2030 – 85 GW Today • 20% of U.S. electricity capacity for CHP – 9% today • CO2 Reduction of 848 MMT – 248 MMT today • Equivalent to 154 million cars off the road – 45 million today • How does this work? – CHP is very efficient 60-90% • It exceeds power production only systems • Needed policy and incentive changes vary by state and region • http://www1.eere.energy.gov/industry/distributedenergy/ Alaska • Idaho • Montana • Oregon • Washington

6. Where does CHP fit? • Both sides of the equation • Is it an energy efficiency measure - Yes • Washington Energy Independence Act (I-937) • High efficiency CHP is included (33% thermal) • Is it renewable? Yes, if from a renewable energy source • A major opportunity for pulp and paper/forest products • Is it its own third category? Sometimes • Northwest Power Act treats CHP as a third priority behind energy efficiency and renewables Alaska • Idaho • Montana • Oregon • Washington

7. Where does CHP fit? • Both sides of the equation • (cont.) • Waste heat recovery fit? – Hmm, energy efficiency • Organic Rankine Cycle – An emerging technology for the Northwest • Seattle City Light with Nucor Steel kudos Alaska • Idaho • Montana • Oregon • Washington

8. Renewable CHP • Pulp and Paper/Forest Products • Yields a competitive advantage • Rough & Ready Lumber, Cave Junction – 1.28 MW • Simpson Tacoma Kraft – 60 MW • Reduce the Moisture! – Biomass Drying & Dewatering for CHP - Moisture reduces efficiency • Ensure you have the wood waste supply – If you own it, you control it • Washington – 142 MW of CHP ARRA Stimulus Projects – Most are wood waste CHP Alaska • Idaho • Montana • Oregon • Washington

9. Renewable CHP • Food processing, WWTFs, dairies, high solids composting • Anaerobic digesters • Ensure the technology/design works • Northern Climate precludes some designs – Insulate • Scrub the biogas – Be kind the genset and use the H2S • Parasitic load concerns • Good history & Bad • Multiple revenue streams • Vander Haak Dairy in Lynden, WA – 9 Revenue Streams • No longer any reason for technology problems Alaska • Idaho • Montana • Oregon • Washington

10. CHP Project Economics • Many options to improve the economics • Buy all, Take all power purchase arrangements • CHP Wheeling – Need willing utilities – Sierra Pacific • Additional co-products • Tradable Renewable Energy Credits • Selling carbon credits – See NW CEAC report • Utility ownership co-location – Amalgamated Sugar in Nampa • Integrated resource plans for base case • Fulfilling RPS & EPS requirements • Selling carbon credits – See NW CEAC report • Key Point: The days of simple “What’s your power rate?” calculations are gone Alaska • Idaho • Montana • Oregon • Washington

11. CHP Project Economics • And more options to improve the economics • State incentive grants and loans • Federal grants and loans – USDA Rural Development, U.S. & ARRA • Tax reduction incentives • Utility incentives • Key Point: Work with the project economics to get a win! Alaska • Idaho • Montana • Oregon • Washington

12. CHP Policies & Incentives • Kudos to Oregon • An amazing set of policies and incentives • A key was the OPUC report: Distributed Generation in Oregon: Overview, Regulatory Barriers and Recommendations www.northwestcleanenergy.org See Policy - Oregon • Standby rates, PURPA, net metering, decoupling, IRPs and interconnection • Plus BETC, Energy Trust of Oregon, Climate Trust • Comparative OR study by Bill Carlson: “Biomass Power as a Firm Utility Resource: Bigger Not Necessarily Cheaper” • Interconnection grades: Oregon a ‘B’, Washington a “D” – Source is “Freeing the Grid” by IREC Alaska • Idaho • Montana • Oregon • Washington

13. Contact information • Northwest Clean Energy Application Center • Dave Sjoding • (360) 956-2004 • sjodingd@energy.wsu.edu • www.northwestcleanenergy.org • Regional list of Industrial Qualified Specialists – See www.northwestcleanenergy.org • Regional State Energy Office Industrial Programs • Christine Love • Industrial Service Project Manager • (360) 956-2172 • epis@energy.wsu.edu • www.energy.wsu.edu See Industrial Services Alaska • Idaho • Montana • Oregon • Washington