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Free fuel – growth opportunities for using waste gases in microturbines in Asia and Germany

Growth, modernization and urbanization in many regions of Asia have created both energy supply shortages and a growing source of free fuel: biogas. Here, Phil Vessa and Peter Dorner explore the experiences of using biogas and other waste gases for energy production using microturbines.

Alternative energy sources can potentially help fulfil the acute energy demand and sustain economic growth in many regions of the world. One type of such energy source is ‘free fuel’. Free fuel includes any fuel generated as a process by-product that is not suitable for many conventional uses but can be used for power generation. Examples of this type of free fuel include methane gas generated from landfills and wastewater treatment plants, and natural gas extracted as a by-product of the oil exploration process (onshore and offshore). In many situations today, this free fuel is flared (burned) instead of being used to generate power.

An additional benefit of using these gases as a fuel source is the minimization of the environmental impacts that result from gas venting or flaring. The burning of such gases releases airborne pollutants which can also enter groundwater sources and pollute farmlands.

The microturbine is an excellent power generator for projects where this gas by-product is available. Low maintenance and clean exhaust make microturbines a reliable choice for the conversion of this free fuel into clean power. Microturbines range from 30 kW to 350 kW capacity. They can be modular in design, allowing for correct matching of fuel availability to the power equipment required. The microturbine can be installed individually or multi-packed to power applications up to 1.5 MW and larger. Power can be produced in parallel with or independent from the grid. The use of microturbines to consume biogas in a clean and economically viable manner has been proven in many regions of the US, Europe, and a few sites in Asia.

Biogas

Biogas is a generic term for gases generated from the decomposition of organic material. As the material breaks down, methane (CH4) is produced. Sources that generate biogas are numerous and varied; these include landfill sites, wastewater treatment plants and anaerobic digesters.


Natural gas is a common by-product of the oil production process and can be used for energy generation on-site, such as on this offshore platform in the Gulf of Mexico
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Anaerobic digesters break down the organic materials from food processing, ranches, or dairies. Microbes in the digesters consume the waste materials and emit methane (along with water, carbon dioxide and small amounts of other gases). The amount of methane in the biogas typically falls within the range of 55%-85%.

Microturbine exhaust can be used to heat the water in order to maintain proper temperatures in the digesters, and it can supplement or even replace conventional boilers and burners used today. The result is overall energy savings using clean technology and free fuel.


Landfill methane gas serves as the fuel for microturbines at this Los Angeles landfill
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Microturbines have been deployed in many biogas applications. For instance, Capstone, a manufacturer with experience in landfill, wastewater treatment, food processing, and animal waste biogas operations, has an installed base of more than 230 systems in North America and hundreds more in the European and Japanese markets. The first two biogas systems operating at a dairy farm in West Bengal, India, were commissioned in the third quarter of 2006. A number of projects are under evaluation in China.


Biogas by-products can be used by microturbines for on-site energy use, such as at this Wisconsin wastewater treatment plant
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Asia can find great promise in addressing the shortage of energy by tapping into large sources of biomass there. This may be from animal waste in India or plant waste from the palm oil manufacturing plants in Indonesia and Malaysia. Asia is experiencing huge growth, not only in terms of population but also economic development and energy demand. So if the technology exists and the source of fuel is available, then why have they not been more widely adopted throughout Asia? The root causes have often been short-term economics or the lack of funding sources. By focusing on the short-term costs to install the generator system, potential operators/developers have sometimes overlooked the true benefits of the free fuel source.

Natural gas by-product from oil drilling

Natural gas is extracted as a by-product during the oil production process. In the past and in many parts of the world today, this natural gas has been flared or burned off. In many cases this is due to the composition of the gas. Natural gas can be classified as ‘sweet’ or ‘sour’ based on the percentage of hydrogen sulphide (H2S) in it. Natural gas that contains trace amounts of H2S or no H2S is considered ‘sweet’; when H2S is present, even in relatively small amounts, the gas is classified as ‘sour’. When burned in conventional generators (turbine or internal combustion generators), the H2S can cause severe damage to the equipment. The costs associated with the cleaning, or ‘scrubbing’ of the fuel to remove the H2S can be excessive, driving many oil producers to flare the gas. Today, flaring continues to be practised on both land-based as well as offshore (oil platforms or rigs) production sites.


Natural gas from the oil drilling process is fed into microturbines to produce energy on site
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With the introduction of microturbines and the advances in combustion, it is now possible to take advantage of the free fuel source. Microturbines can use the natural gas by-product with a Hà‚­2S content as high as 7% for generating electricity at the oil platform itself and therefore avoid the gas being flared. With its small footprint and low-maintenance features, a microturbine system offers a good value proposition for offshore platforms. The power generated can be consumed by the platform equipment. Microturbines have been successfully deployed on offshore platforms in the North Atlantic, the Gulf of Mexico, the Gulf of Alaska, the Mediterranean, and off the coast of Malaysia.

Market potential – wastewater treatment example

There is a great scope for biogas development in Asia. The wastewater treatment industry in China and Hong Kong alone give an idea of this immense scope.

Hong Kong produces approximately 2 million m3 of sewage per day. Of this, 70% receives primary treatment, while 65% receives secondary treatment. All treated and untreated wastewater is discharged into the sea. This is polluting the waters off the coast of Hong Kong and causing harm for humans and sea life alike.

China’s plan for environmental protection is intended to increase the sewage treatment rates (thus increasing the potential sources and volumes of biogas). The goal is to increase the treatment rate from the current overall level of 10%-45%. In cities with populations greater than 500,000, the goal will be 60%. In 2003, the rate as reported by the government was 40%. The plan also requires all cities to establish wastewater facilities. By the end of 2003, a total of 516 sewage treatment plants had been built and commissioned for operation, and their sewage-handling capacity was more than 32 million tonnes per day. According to the plan, China will spend US$36 billion on new treatment plants and pipelines. China is expected to spend $1 billion per year on treatment plants by the end of the decade. Most of the future projects identified in the plan are in the wastewater sector.

Competition

The competition for distributed generation in Asia is very different from that in North America and the EU. In the West, where the main competition is the utility grid, electricity is generally available, reliable and affordable. However, many areas of Asia, where the utility grid infrastructure is poor or non-existent, must tolerate regular blackouts, some daily and scheduled, as in parts of India.

In much of South, East, and South-east Asia, the primary competition is low-cost, diesel reciprocating engines. Many are made locally which helps to keep costs low and prices affordable. Prices can range as low as US$150-$350/kW. With the strong requirement for continued growth in many regions, concerns about pollution are secondary. A successful strategy will need to be different from that in North America or the EU. It will need to seriously consider ways to create a value proposition when compared to these low-cost alternatives.

The next level of competition would be larger generators including internal combustion and turbine generators, which generally have a size above 1.2 MW. Their lead times can be more than one year and in some cases more than 2.5 years. Countries such as China are absorbing most of the larger generators being produced today.

Opportunities

Still, there are real opportunities for the use of by-product gas fuel in Asia now. The current level of projects is small compared to the potential, but this is primarily due to the fact that microturbine manufacturers in North America have been focusing on exploiting local opportunities rather than overseas markets. Overseas opportunities will not turn into reality without the focused efforts of the manufacturers, existing and new distributors, as well as education. Education is required at all levels of the adoption chain. This includes end-users, distributors, and perhaps most critical, at the political and legislative level to help reduce the barriers to entry.

Why is education so critical? In countries with the largest potential applications for using free fuel, such as India and China, the majority of individuals in the adoption chain are only aware of the status quo in power generation – i.e. reciprocating engines. These are machines with low capital cost, shorter life, higher maintenance, and higher pollution; however, many individuals believe that they are a lower-risk option because they already know about them. Education is required to train the adoption chain in viewing power projects, and more importantly, the overall energy strategy/policy for their country/region, as a long-term issue. There is no quick fix to the under-capacity and pollution issues that the regions face.

As mentioned earlier, the areas of high growth and under-capacity are China and India. However, smaller countries, perhaps with less economic resources, can also be fertile ground for the adoption of microturbines and free fuel. The cost of building large-scale plants are often prohibitive to many smaller countries. Funding from the World Bank and NGOs has been slow to materialize for these large-scale power plants. Alternatively, funding has been made available through different partnerships and NGOs for the initial deployment of microturbines. These sites must serve as educational tools, teaching and proving to those along the adoption chain that microturbines operating on gas by-products are a viable solution today.

Detailed studies are underway in many of the target countries to understand the near-term potential, define the market segments, and identify the ways to lessen the barriers. It is possible that the scale of impact could be greater in some of the smaller regions, thus they should not be ignored.

With many of the utilities being state-owned, there exists the opportunity for partnership. Gas companies want to sell gas; electrical companies want to sell electricity. Distributed generation in general could help both parties. However, in the case of using free fuel, the electric utilities can benefit in many ways. They gain increased supply in a short time. Their cost to deploy and gain additional generating capacity is less than with other technologies. They can increase their delivery infrastructure into regions currently not accessible due to limited or no fuel supplies. Through alliances and partnerships, the goals of all parties can be met. The same approach can be used at other levels of government to gain support.

Conclusion

The use of microturbines fuelled with biogas has been proven and is ready to be deployed in Asia and elsewhere today. The technology is available, it is economically feasible, and it is reliable.

Phil Vessa is a former Executive Director, Asia, for Capstone Turbine Corporation, Chatsworth, California, US. Peter Dorner is Managing Director of Greenvironment GmbH, Berlin, Germany, and a Distributor for Capstone Turbine Corporation. e-mail: thynes@capstoneturbine.com

The German biogas boom

Germany offers an example of how biogas utilization can be deployed. In Germany the market for renewable energy is booming. Continuing high prices for fossil fuels, together with improved political and business conditions, ensure a favourable and lasting investment climate for renewable energy sources. The energy security available through decentralized energy sources will become increasingly important in the long term.

Investing €6.5 billion in renewables in 2005 alone, Germany is the world’s technology leader in renewable energy production technology and is well ahead internationally. The rapid market development of renewable energy requires a professional management of supply and demand. Almost 4000 biogas plants have been installed, mainly in the agricultural sector. The estimated number of biogas plants with an average size of 500 kW will be about 30,000 by 2020.

In Germany a milestone in the development of biogas plants was the so-called Electricity Feed-in Law (Stromeinspeisegesetz) of 1992. This law guaranteed fixed rates to all producers of renewable energy for each electrical kilowatt-hour delivered into the public electrical grid. This law not only included biogas plants but also all the other renewable energies such as wind. But amongst some of the main effects at the beginning of the 1990s was the breakthrough of biogas plants. Later, in February 2000, the Electricity Feed-in Law was replaced by the Renewable Energy Law (Erneuerbare Energien Gesetz), which granted even higher rates for each electrical kilowatt-hour delivered into the public electrical grid.

Greenvironment develops biogas utilization projects

One European biogas company, Greenvironment, has developed and provides advanced solutions for the combustion and utilization of biogas. The company’s microturbine-based technology converts gases into heat and electricity on site, in farms and landfills. The first landfill plants were installed in Finland in 2005, and currently five plants are successfully operating in Finland.

The environmental performance of microturbines is excellent. Exhaust emissions are far below the values of traditional gas engines. The price of power produced with microturbines is very competitive compared to existing systems and it is often considerably more profitable than wind power. The service interval in biogas use is 8000 hours and a major overhaul after 40,000 hours of use. ‘The utilization of biogas would help in the performance of the EU’s emissions trading and the obligations in the Kyoto Protocol’, says Matti Malkamàƒ¤ki, CEO of Greenvironment.

The company’s strategy in Germany and ultimately throughout Europe is to operate its own bioenergy power plants and sell the electricity produced to local energy companies. The heat which is a by-product of the power plant will be sold to residents and companies in the area.

The company’s operating mode and technology bring several advantages to the farmer. As the company operates the plant, the farmers’ only task is to produce the biogas needed. It also invests in the power plant, which lowers the farmer’s initial investment and no investments in maintenance are needed.

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