BIG Heating Fuel Savings Jim Van Valkenburgh, VP Sales & - - PowerPoint PPT Presentation

Thermal RECs + Biomass = BIG Heating Fuel Savings

Jim Van Valkenburgh, VP Sales & Marketing

Office & PDC Production Facility:

590 Hancock Road, Peterborough, NH

Biomass Boiler System Installations

School Buildings and Campuses Commercial Buildings Industrial Buildings Residential Homes & Multifamily Buildings

What We Do:

➢Biomass Boiler System Installations

➢Retrofits with Integration into Existing Heating Systems ➢New Construction

A Self-Performing Contractor Focused on Biomass ➢ Project Development

➢We Assist Engineers, Architects, Owners with Project Feasibility, Design

Mechanical Specifications, Estimating, Value Engineering

➢Mechanical System Installations ➢Project Management ➢ Procurement ➢ Construction & Commissioning

What we’ve learned--2016 to 2019:

✓ Projects are Bigger ✓ Reliability is a Priority ✓ Cost Justification Very Important ✓Thermal-RECs (and PDCs) Make Projects Happen!

Thermal RECs

REC = Renewable Energy Certificate

"the record that identifies and represents each Megawatt-Hour (MWh) generated by an eligible renewable energy generating source

under RSA 362-F:6."

1 Megawatt = 1 REC

The Official New Hampshire Definition:

RECs exist due to state laws called Renewable Portfolio Standards (RPS).

• RPS laws require utilities to produce electricity

from renewable resources Solar, Wind and Biomass

• 29 states and Washington, D.C. have RPS Laws
• 8 other states adopted renewable energy Goals

Most Electric Utilities don’t produce any electricity from renewable sources

• To meet RPS requirements, they purchase RECs

from someone who does…

• Or they pay Alternative Compliance Payments

(ACP) at a price set by their state

• RPS in some states have carve-outs that set

percentages for specific renewables

• New Hampshire and Massachusetts are the
• nly two states that have RPS percentages for

Renewable Thermal energy

1 Megawatt of Energy = 1 REC 1 Megawatt of Heat Energy = 3,412,141 BTU 1

4 T-RECs per Ton 3 T-RECs per Ton 2 T-RECs per Ton

PE PELL LLET ETS PDC PDCs GREEN CHIPS

Calculations use HHV energy content of hardwood burned at 84% Efficiency Approximate values:

Solar RECs are most common (S-RECs)

Thermal RECs work the same way

Meet t Bob

His School bought a Biomass Boiler that burns 249 tons of Wood Pellets instead of Oil each year He generates 972 Thermal RECs in one year. He sells the T-RECs for $16 each Net Earning him

$15,552

per year

Plus their savings from their Fuel Switch from Oil to Biomass!

= = Significa icant t Savings! ngs!

Thermal RECs work the same way

Their Biomass Boiler burns 249 tons of wood Pellets at per year at $240/ton =$59,76

9,760

Bob ‘s School was burning 30,000 gallons of #2 Fuel Oil at $2.30/gal =

$6 $69,00 000

Bob’s School has cut their Cost Syste

$4 $45

They sell 972 NH Thermal RECs each year for a profit of

$15, 5,55 552

Their new net annual fuel cost is

$44,208 4,208

That is an annual fuel cost savings of

35%

30,000 Gal allons

• ns of #2

2 OIL = 24 249 tons of Wo Wood Pellets ts

30,000 gal oil x $2.30/gallon = $ 69,000 249 tons ns Pell llets ets x $240/ 0/to ton n = -$ $ 59,760 ,760 = Oil l at $1.9 1.99/gal /gal

Fuel Switch Savings = $ 9,240 (-13.4%)

Total T-RECs Generated = 972 Net Income of $16 per T-REC = $15,552 New w ann nnual ual cost st of Pellets lets = $44,2 $44,208 08 = Oil at $1.48/gal

Annual al Sa Savings ings = $ $ 24 24,792 2 >> 35% Reduc uction tion

Annual al Savin ings gs from: :

Therm rmal al REC ECs & Wood Pell llets ts

30,000 Gal allons

• ns of #2

2 OIL = 320 20 tons of PDCs

30,000 gal oil x $2.30/gallon = $ 69,000 320 tons ns PDCs Cs x $120 20/t /ton

• n = -$

$ 38,40 400 0 = Oil il at $1.28/ga .28/gal

Fuel Switch Savings = $ 30,600 (-44%)

Total T-RECs Generated = 972 Net Income at $16 per T-REC = - $15,552 New w ann nnual ual cost st of PDCs s = $22 22,848 ,848 = Oil at 76.2¢/gal

Annual al Sa Savings ings = $4 $46,1 6,152 52 >> 66% Reduc uction tion

Annual al Savin ings gs from: :

Therm rmal al REC ECs & & PDCs (Dry ry Chip ips) s)

30,000 Gal allons

• ns of #2

2 OIL = 454 4 tons s of Gre reen n Chip ips s

30,000 gal oil x $2.30/gallon = $ 69,000 454 4 tons ns Chips ips x $60/t 0/ton

• n = -$

$ 27,240 40 = Oil Oil at 90.8¢/gal 0.8¢/gal

Fuel Switch Savings = $ 41,760 (-60%)

Total T-RECs Generated = 972 Net Income at $16 per T-REC = - $15,552 New w ann nnual ual cost st of Chips ps = $11, 11,68 688 8 = Oil at 39¢/gal

Annual al Sa Savings ings = $5 $57,3 ,312 12 >> 83% Reduc uction tion

Annual al Savin ings gs from: :

Therm rmal al REC ECs & & Gre reen n Chip ips

Any Biomass Fuel can Generate NH Thermal RECs

With these requirements:

❑ Boilers must meet Efficiency and Emissions Regulations

❑ Factory Emissions Data for small and medium sized boilers. ❑ Large boilers (over 1.7 MMBTU/Hr Fuel Input) require on-site tests

❑ BTU collection & recording methods must be approved & verified ❑ An Independent Monitor needed to verify quarterly generation ❑ Boilers must be installed after January 1, 2013 (NH)

PE PELL LLET ETS GREEN CHIPS PDC PDCs

And Data Logger

Required Monitoring Equipment A Qualified BTU Meter with

• Data Logger & Output Software
• Water Flow Meter
• 2 Temperature Sensors

What are the Requirements?

NHPUC REGULATIONS REQUIRE:

• Formal Application
• NHDES Approval of Boiler
• Use of approved BTU Meter Equipment
• Installations must be verified by a NH

Registered Professional Engineer

• An official 3rd party Independent Monitor

must verify REC generation every Quarter

• RECs are traded in NEPOOL Exchange by

authorized firms

Initial itial Costs sts: BTU Meter er Data ta Logg gger er BTU Meter er & Data ta Logg gger er Install stallatio ation n Forma matti ting ng of Data ta Logg gger er Outp tput ut Hook k up to Buil ildin ding g Router uter/Se Set t up conne necti tion

• n

Verificat rification

• n of BTU Meter/Data

ter/Data Logg gger er Insta stall llatio ation Typical pical Total tal Initial itial Cost st $12,0 2,000 00 Annual nual Costs: sts: Sales les Commissi mmission

• n of Therma

ermal l RECs Cs = app approx rox. . 10% 0% Quar arterl terly Verificat rificatio ion n of Thermal ermal REC C Gener eratio ation n = $1000 000/yr yrest. BTU Meter er Calib ibrat ratio ion n costs sts $600 00 eve very ry 3 year ars s = $200/ 0/yr yrest. t.

Annual al Costs s to Generat erate e Therm rmal al REC ECs:

972 Therm rmal al RECs Cs Generate nerated d Agent ent sell lls s them em for $22.75 .75 each h = $22,1 ,113 13 Agent ent Commi miss ssion ion at t 10% % -2,211 211 Net et Incom

• me

e = $ 19,902 9,902 Quar arterl terly Verificat rificatio ion n of Thermal ermal REC C Gener eratio ation n = $10 1000/ 00/yr yr BTU Meter er Calib ibrat ratio ion n $600 00 eve very ry 3 yea ears rs = $20 200/yr yr Typical pical Total al Initial itial Syste stem m Cost st = $12,0 2,000 0 / 10 yrs rs= = $1,200 1,200 /yr yr Typical pical Annual nual fixed ed costs ts = $2,4 2,400/ 00/yr yr $19,902 - $2,400 = $15,702 Net Profit/yr

$15,702 / 972 = $1 $16.21 21 pro rofit t per r T-REC C genera rated ed

Ex Example ple of Net Annual ual Income e fro rom T-REC ECs

Propane at $2.75/gal = $3.97 Oil Equiv Oil at $3.00/gal Propane at $2.00/gal =$2.88 Oil Equiv Oil at $2.50/gal Propane at $1.50/gal =$2.16 Oil Equiv Oil at $2.00/gal …at $240/ton = $1.98/gal Oil Equiv Oil at $1.50/gal Propane at $1.00/gal = $1.44 Oil Equiv …at $120/ton = $1.28/gal Oil Equiv …at $75/ton = $1.13/gal Oil Equiv Oil at $1.00/gal …at $60/ton = $ .91/gal Oil Equiv

PE PELL LLET ETS PDC PDCs GREEN CHIPS

Net Cost of Delivered Heat In Oil Equivalent

Calculations use HHV energy content of Hardwood burned at 84% efficiency, Oil at 80% and Propane at 85% efficiency

PE PELL LLET ETS PDCs PDCs GREEN CHIPS

Net Cost of Delivered Heat In Oil Equivalent

Calculations use HHV energy content of Hardwood burned at 84% efficiency, Oil at 80% and Propane at 85% efficiency

Propane at $2.75/gal = $3.97 Oil Equiv Oil at $3.00/gal Propane at $2.00/gal =$2.88 Oil Equiv Oil at $2.50/gal Propane at $1.50/gal =$2.16 Oil Equiv Oil at $2.00/gal …at $240/ton = $1.51/gal Oil Equiv Oil at $1.50/gal Propane at $1.00/gal = $1.44 Oil Equiv Oil at $1.00/gal …at $120/ton = $ .80/gal Oil Equiv …at $75/ton = $ .68/gal Oil Equiv …at $60/ton = $ .39/gal Oil Equiv

Net Cost of Delivered Heat… $ per MMBTU

Propane at $2.75/gal = $35.95 Oil at $3.00/gal = $27.02 Propane at $2.00/gal = 26.14 Oil at $2.50/gal = $22.52 Propane at $1.50/gal = $19.61 Oil at $2.00/gal = $18.02 …at $240/ton = $17.95 Oil at $1.50/gal = $13.59 Propane at $1.00/gal = $13.07 …at $120/ton = $11.55 …at $75/ton = $10.22 Oil at $1.00/gal = $9.06 …at $60/ton = $8.18

PE PELL LLET ETS PDC PDCs GREEN CHIPS

Calculations use HHV energy content of Hardwood burned at 84% efficiency, Oil at 80% and Propane at 85% efficiency

Propane at $2.75/gal = $35.95 Oil at $3.00/gal = $27.02 Propane at $2.00/gal = 26.14 Oil at $2.50/gal = $22.52 Propane at $1.50/gal = $19.61 Oil at $2.00/gal = $18.02 Oil at $1.50/gal = $13.59 Propane at $1.00/gal = $13.07 …at $240/ton = $12.09 Oil at $1.00/gal = $9.06 …at $120/ton = $5.69 …at $75/ton = $4.37 …at $60/ton = $3.13

PE PELL LLET ETS PDC PDCs GREEN CHIPS

Net Cost of Delivered Heat… $ per MMBTU

Calculations use HHV energy content of Hardwood burned at 84% efficiency, Oil at 80% and Propane at 85% efficiency

Questions?

Jim@FrolingEnergy.com

603-924-1001 www.FrolingEnergy.com