4th meeting of SAVE II project

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4th meeting of SAVE II project

• REGIONAL ACTION PLAN FOR PROMOTION OF COMBINED
  HEAT AND POWER PRODUCTION IN THE NEISSE-NISA-NYSA
  EUROREGION
• Analysis of CHP Technology Options and CHP
  Economic Potential
• ZITTAU, 22-23 January 2002

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Analysis of CHP Technology Options and CHP
Economic Potential - Czech part of ERN
7 case studies, representing the most common or
potential CHP installations - based on the
identification of potential CHP installations by
technical solution, mode of operation and sector
of installation - Technical analysis - power and
heat production, fuel consumption, operating
hours - Standard economic analysis - PB time,
NPV, IRR, project cash flow - Sensitivity
analysis - economic viability of CHP project
(indicated by Pb time, NPV, IRR) based on
variation of input variables Aim to identify
viable/not viable types of projects (under given
conditions), to help in identification of gaps
and possible sources of financing/support of CHP
projects
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Methodology (1)
NECESSARY INPUTS - description of each case study
based on the identification of potential CHP
installations by technical solution, mode of
operation and sector of installation - Common
parameters used for all case studies - discount
rate (10), project lifetime (25 yrs), exchange
rate etc, inflation, energy prices escalation
rate (0) - Economic parameters - price of fuel
(nat. gas), price of produced/purchased heat and
electricity Investment costs, fixed and variable
operating costs - Technical parameters - no. of
CHP units, heat and power capacity, nominal
capacity utilisation time, overall efficiency
share of heat/electricity sold/used for own
consumption
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Methodology (2)
SENSITIVITY ANALYSIS Input variables -
Investment costs of the CHP (may also indicate
amount of subsidy) - Discount rate (may also
indicate availability/conditions of financing) -
Heat price of the purchased/produced heat -
Power purchase price (if produced el. used for
own cons.) - Power feed in price to the grid
(if produced el. fed into grid) - Fuel
price Output - table of evaluation of economic
viability of CHP project (indicated by discounted
PB time, NPV, IRR) based on variation of input
variables (range /- 50) Detailed outputs of
analysis conclusions available in the paper.
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Methodology (3)
EXAMPLE OF RESULTS OF SENSITIVITY ANALYSIS
CASE 1 - CHP in swimming pool complementary to
existing own gas heat source
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Conclusions (1)
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Conclusions (2)
CONCLUSIONS - CHP projects are much more
sensitive to changes in feed-in price of
electricity and fuel price than to investment
costs and discount rate - Small CHP units in the
is viable in the cases where produced heat and
power for own use. - Full (or partial)
replacement of heat supply from DH network and
use of produced electricity for own use proved to
be extremely viable from the point of view of
operator of the CHP (discounted payback time
approx. 5 years), however, there are not
considered the negative impacts on the operator
of DH source and network - Small CHP ( 150
kWe) supplying produced electricity into the grid
did (bth baseline and peak tariff) not prove to
be economically viable due to low feed-in prices
of electricity, both in base and peak tariff.
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Conclusions (3)
CONCLUSIONS - CHP units with larger capacity (
1000 kWe) supplying baseline electricity to the
grid show generally better economic results due
to lower unit costs (per kW), lower unit
operating costs and lower fuel price (more
favourable gas tariff due to higher
consumption). - Larger CHP units ( 500-700 kWe)
supplying both heat and electricity for own use
may be very profitable from the economical point
of view on condition that CHP unit is dimensioned
correctly so high utilisation time gt 5000h/year
is guaranteed. - The investment subsidies for CHP
project make sense only for CHP projects that are
very close to breakpoint or in order to decrease
investors risk. - Support of CHP projects by the
subsidizing the feed-in price of electricity may
prove to be more effective than support oriented
in investment costs.