1. Leeds University
Confluence: 10th M h 2010
C fl March
Energy and the Water Cycle: Carbon
Emissions from the Water Industry
E i i f th W t I d t
Strategic Investment towards 2050
Dr Steve Palmer and Adrian Johnson
2. Presentation outline
• Current and future risks facing the water industry
• The need to shift from developing assets to meet
The need to shift from developing assets to meet
drivers to strategic investment in systems to maximise
resource efficiency
resource efficiency
• Opportunities
• Wastewater case study example
3. Legislation, climate change and other pressures
demand long term vision
demand long‐term vision
Climate change legislation
WFD objectives
Capped budgets
pp g
REACTIVE: Customer priorities
harder, higher cost
VISION:
VISION
Transformed assets:
PLANNED: adapted to climate
change and carbon
easier, lowest cost
efficient;
Anticipate future trends Risks controlled
Reduce operating cost risk
Avoid stranded assets
Climate change impacts
Control and manage
Rising energy / carbon prices
/ b
risks to whole life costs
Demographic & social changes 3
4. Particular issues for water industry
• Assets have long lives
what is built now will serve for decades into the future
• Assets have high write-off costs
stranded assets reduce investment returns and
efficiency
• Capital investment needed so assets can accommodate:
energy cost inflation (to ensure operating cost efficiency)
regulatory risks
climate change mitigation
strategic resources risks
… while obtaining value for money
5. Operating cost risk: Effect of annual power cost
inflation on 40yr power costs of a 160 000 pe STW
160,000
Inflation in UK From To %inc. per annum Source
industrial power 1979 2007 6.7
67 BERR
costs 1997 2007 3.3 Eurostat
2004 2007 11.0 Eurostat
2006 2007 18.5 BERR
£35 2007 2008 14.2 BERR
0.00% 1.00%
£30 2.00% 3.00%
£25 4.00% 5.00%
ns
£ Million
£20 6.00% 7.00%
£15 8.00% 9.00%
10.00%
10 00% 11.00%
11 00%
£10
£5
£-
0 10 20 30 40
6. Regulatory risks: water environment
Water Framework Directive
• Significant investment to enhance capability
• C b not explicitly accounted f i fi t cycle –
Carbon t li itl t d for in first l
opportunity lost?
• Inequalities of whole life cost calculation –
capex pressures override opex costs
Most water cos. forecast
cos
significant increases in
CO2 emissions to meet
water legislation
7. Regulatory risks: climate change mitigation
Government target 80% reduction by 2050
Government target 80% reduction by 2050
plus interim budgets set by Climate Change Committee
CRC energy efficiency scheme launched in 2010
CRC ffi i h l h d i 2010
• Affects orgs. using more than 6000MWh/yr of electricity
• Power largest element in water co. carbon footprint
• Potential increase in
Potential increase in
cost of permits from
2013 is significant risk
2013 is significant risk
8. Expectations of future development
“…meet our long term sustainability duties….align with
wider policy on GHG reductions…”
OFWAT Climate Change Policy Statement 2008
“The group believes that the Price Review, together with the
ongoing work of the WFD, could provide an important impetus to
the sector to ensure that it fully equips itself to meet the acute
th t t th t it f ll i it lf t t th t
environmental challenge posed by climate change, in the most
sustainable way possible.
sustainable way possible ”
All Party Parliamentary Water Group: The future of the UK Water
Sector (2008)
Sector (2008)
9. Strategic resources risks: Phosphorus
• P essential to food
production
• P fertiliser price up 300%
in last two years
in last two years
• ‘Peak’ year predicted to
be 2034
be 2034
• Government regulation
likely: China has placed a
likely: China has placed a
Peak phosphorus ‘Hubbert’ curve, 135% tariff on P reserves
(based on Cordell, Drangert and • P in sewage is recoverable
P in sewage is recoverable
White, 2009) strategic resource
10. A new focus on resource efficiency management
Focus on achieving carbon efficiency:
minimise the carbon emissions …
• per customer served
• per unit volume conveyed (pumped)
• per unit of pollution load removed
Wherever possible …
Modelling is key
Avoid the use of energy and resources
Reduce energy and resource use
Recover energy and resources
Replace existing energy (and resources) with low carbon
alternatives
13. Wastewater and sludge treatment:
A new approach to asset development
For carbon efficiency:
Maximise the pollution load removal per kW
Maximise on-site renewable energy generation
on site
Build in the capability for resource recovery
• Upgrade asset standards and guidelines
• Adopt a thermodynamic approach to optimise
• Avoid waste … think resource recovery
14. Energy Efficient Wastewater Treatment Works
CHP Gasification Minimise sludge
Exploit wind Enhanced transport
resources Digestion
Real Time FOG Digestion
Increase
Control
Biogas
Sewage heat recovery
g y
Reduce Production
Aeration
Enhanced primary
Costs
treatment
High Efficiency
Aeration Energy
Devices Management
Pump Drive
Unit Efficiency
Sustainable
Reduce
Buildings
Pumping RAS Rates
Costs
15. Minimise costs by applying enabling
technologies to existing assets
Chemical
Real time control
dosing
Preliminary Primary Aerobic secondary Final
treatment treatment treatment effluent
FOG
removal Primary
Secondary sludge
sludge
Energy Sludge
CHP
thickening
Gas Site export,
ROCs
Anaerobic
digestion
Dewatering and
Gasification
Advanced drying
Algae growth digestion
(MAD plug fl )
l flow)
Fuel, MAD, Gasifier VFAs Class A sludge, P to land Char, Syngas
16. Outcomes: process flowsheets capable of energy
neutrality and production
Katri Vala heat pump plant
generates multiple MW of
energy direct from sewage
effluent for input to Helsinki
ffl tf i t t H l i ki
district heating
Heat recovery from sewage Enhanced primary treatment
Enhanced Digestion Digested sludge gasification for CHP
Making use of any available subsidies (e.g. ROCs )
17. Sludge and biogas value chain
Heat
1st order 2nd order 3rd order
Beneficial use
treatment e.g. treatment e.g. treatment e.g.
of biosolids
sludge digestion sludge drying gasification
Heat Power
Biogas Combustion of Power On-site
biogas processes
Surplus heat Surplus power
Direct export District
National grid
heating
18. Assess options for best value outomes
Enabling factors e.g.
Large site
Potential benefits
Large power costs
L t
Energy/carbon neutral
Local agriculture
Class A sludge
paying for sludge
P return to land
P return to land
Primary MAD capacity
sludge Upgrade biogas for use Cost‐benefit
Sludge tankering analysis of
as vehicle fuel or for
Secondary Possible future N&P
Possible future N&P options
injection to gas grid
i j i id
sludge consent
Export renewable power
Renewable energy
Char to land‐carbon Best value end
required locally
i d l ll
sequestration uses
ROCs
VFAs and Oils
Policy to reduce C
y
footprint
19. Municipal Wastewater Case Study
Baseline design for Whole life cost comparison:
Conventional plant for approx 160,000PE
Standard preliminary treatment
p y
Standard primary treatment
Activated sludge secondary treatment (
g y (FBDA))
Sludge digestion and drying to pellet
Conventional best practice
(methane used to heat dryer at 90% efficiency and
dryer waste heat heats to digesters)
y g )
20. Plant refurbishment: Potential for significant reductions in
operating cost and whole life cost
g
Whole life cost of 160,000PE Conventional Flowsheet versus Sustainably Uprated
Flowsheets when power exported and ROCs claimed at 10% power cost inflation
180
Conventional UHT gasifier
160
Ehcd PSt, Ehcd MAD Natural gas
140 &UHT gasifier co-fired gasifier
Biogas Incinerator
120
co-fired gasifier
fi d ifi
100 Ehcd PSt, Ehcd MAD
&Incinerator
ons
£ Millio
80
60
40
20
0
0 5 10 15 20 25 30 35 40
Year of Operation after Refurbishment
21. Plant Refurbishment: Potential for reductions in operating
cost and whole life cost without ROCs
Whole life cost of 160,000PE Conventional Flowsheet versus Sustainably Uprated Conventional
Flowsheets with no power subsidies at 10% power cost inflation
180 Conventional
C ti l
160 Uprated with
UHT Gasifier only
140
Uprated with
UHT Gasifier &Encd PSTs
120
Uprated with
100 UHT Gasifier Encd MAD
£ Millions
Uprated with
80 UHT Gasifier &PSTs&Encd MAD
M
60
40
20
0
0 5 10 15 20 25 30 35 40
Year of Operation after Refurbishment
22. Power Cost Inflation Risk Analysis:
Effect on whole life cost of digested sludge incineration
g g
Plant upgraded with digested sludge combustion: conventional facility WLC as a function of energy
cost inflation versus upgrading options for Incineration with CHP (1 ROC)
180
Plus Incinerator with CHP only
160
Plus Incinerator with CHP; PST and MAD enhancements
s)
STW NP at 30Yrs (£ Millions
140
Conventional Design
120
s
100
80
PV
60
40
20
0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
% Annual Electrical Power Cost Inflation
23. Power Cost Inflation Risk Analysis:
Effect on whole life cost of digested sludge gasification
g g g
Plant Upgraded with Digested Sludge Gasification: Conventional Facility WLC versus upgrading
options for UHT gasification with CHP (2 ROCs), as a function of energy cost inflation
180
Conventional D i
C ti l Design
160
Conventional uprated with gasifier claiming
ROCs
140 Conventional with Enhanced PSTs & MADs
and Gasifier claiming ROCs
llions)
120 Conventional with enhnaced PSts and
MADs and Gasifiers: NO ROCs
STW NPV at 30Yrs (£ Mil
100
80
3
60
40
W
20
0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
% Annual Electrical Power Cost Inflation
24. A new approach to address risks and
maximise operational efficiency for 2050
• Need a focus on carbon efficiency (systems level)
• There a e ba e s to be add essed to de e full pote t a
e e are barriers addressed deliver u potential
• Energy efficiency improvements per se are only a small part
of obtaining reductions in operating cost and carbon footprint
g p g p
• Significant gains offered by in situ power generation on large
sewage works and sludge processing centres
But …
• the projects which offer best potential require higher levels
of capital investment and longer payback periods
• To effectively mitigate power cost inflation and other risks,
investment in these projects needs to begin now
