&EPA
United States
Environmental Protection
Agency
Industrial Environmental Research
Laboratory
Cincinnati OH 45268
Research and Development
EPA-600/S7-82-017 August 1982
Project Summary
An Assessment of Central-
Station Cogeneration
Systems for Industrial
Complexes
N. B. Hilsen, G. R. Fletcher, D. L Kelley, J. S. Tiller, S. W. Day, M. E. Denen, and
B. L Blaney
This project assesses the potential for
central-station cogeneration system
development based on an analysis of the
economic, environmental, energy effi-
ciency and social impacts of such sys-
tems. In this study the cogeneration sys-
tem consists of a utility-sized power
plant which supplies both the electrical
and steam needs of a number of nearby
industries. Such a system can result in
increased energy efficiency, reduced
pollutants, and reduced overall cost. A
number of methodological approaches,
including environmental impact analysis,
cost-benefit analysis, and social impact
analysis were used to investigate issues
relevant to cogeneration system devel-
opment.
This Project Summary was developed
by EPA's Industrial Environmental Re-
search Laboratory, Cincinnati, OH, to
announce key findings of the research
project that is fully documented in a sep-
arate report of the same title (see Project
Report ordering information at back).
Introduction
The type of cogeneration system con-
sidered in this report is one in which a
large utility power plant supplies both
electricity and steam to a group of local
industries. The industries are located
within a few kilometers of each other.
The study compares such a system with
one in which electricity and process
steam are supplied from separate energy
sources. The latter, decentralized energy
supply system, is called a "conventional
energy system"
Figure 1 shows two hypothetical sys-
tems which were compared in depth in
this project. Six, 909 Mg/day (1000
TPD) chlorine-caustic soda plants are to
be supplied with a total of 660 MW of
electrical power and 363 kg/sec
(2,880,000 Ib/hr) of steam at 303 kPa
(30 psig) and 288 °C (550 °F). In the
conventional energy system this energy
is supplied by a 1100 MW(e) power
plant and six industrial boilers. In the Co-
generation system most of the electricity
and all of the steam is supplied from the
power plant, while additional electricity
is supplied from another power plant in
the utility's grid. (The dashed lines in the
Figure bound those parts of the cogener-
ation system which are located in close
proximity.)
The idealized industrial complex which
was analyzed in depth in the project con-
sists only of chlorine-caustic soda plants.
Pulp and paper mills, textile mills and
phosphoric acid plants, were originally
considered for possible inclusion. The
most important characteristics of these
industries are the quantity and quality of
steam required. In general, these indus-
tries use large amounts of electrical
energy, as well as steam at pressures
below 3450 kPa (500 psiy. Although the
study focussed on coal-fired utility power
plants, the economic and social impacts
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of using nuclear power were also consid-
ered. Industrial boilers were assumed to
be coal-fired.
The energy analysis included compar-
ing the total energy consumption of the
cogeneration system and the conven-
tional energy systems. A computer
model was developed to calculate the
significant operating parameters of both
systems. The energy system included
boilers, turbines, generators and piping.
Energy use by the air pollution control
system employed on coal-fired boilers
was also included in the analysis.
A cost-benefit analysis determined
the economic viability of the cogenera-
tion system. A computer program called
Model for Assessment of Integrated
Energy Systems (MAIWS)*, was used
to compare costs of the cogeneration
and conventional energy systems. A
sensitivity analysis on factors which ef-
fect the cost of system energy produc-
tion was also made. The factors included
power plant and industrial boiler capa-
city, fuel type, nuclear reactor type, fuel
costs, and steam transport distance.
The study considered the following
environmental impacts for industrial
boiler and coal-fired power plants: (1) air
emissions, (2) water consumption, (3)
solid waste production, and (4) water
quality. The costs of different types of
air pollution and water pollution control
systems were also compared.
An analysis was made to determine
how wastewater treatment costs could
be reduced in industrial complexes
which incorporate several different
types of industries. The recycling of
wastes, as well as using wastes from
one industry to treat those from another
was considered. The study determined
both capital, and operation and mainte-
nance (O & M) cost savings for these
two options.
The study identified the institutional
constraints on developing and operating
a central-plant cogeneration system and
analyzed the socioeconomic impacts
which would occur from such concen-
trated industrial development. Major im-
pacts that would be caused by demo-
graphic changes in the host community
during the construction and operation of
a cogeneration system were estimated.
(For example, the influx of construction
workers and their families may put a
strain on the local school system.) The
study also identified general policies and
siting considerations which might miti-
gate undesirable impacts due to large
demographic changes.
Since this study considered a hypo-
thetical system, the quantitative results
are not directly applicable to other Co-
generation systems. However, the me-
thodology used to analyze these hypo-
thetical systems should be applicable to
real ones and the observed trends lead to
important general conclusions about the
benefits and drawbacks of cogeneration
development.
Findings and Conclusions
Both benefits and problems were
found with central-station cogeneration
systems. But with proper design, most
significant problems can be overcome.
Energy Efficiency Impacts
As expected, fuel savings occurred
when switching from the conventional
to a cogenerating energy supply system.
For the case study considered here, fos-
sil fuel consumption was reduced by 1 5
percent (assuming that industrial boilers
in the conventional energy system oper-
ate at 80% efficiency). The efficiency of
the central-station power plant increased
from 32% to 57% when it was convert-
ed to the cogeneration mode. Energy
production efficiency of the whole sys-
tem (including supplementary utility ca-
pacity) increased from 46% to 54%.
Economic Impacts
Costs for construction, O&M, and fuel
for the conventional energy and Co-
generation systems were evaluated.
Table 1 presents the capital costs and
the first year O&M and fuel costs for
both systems. Fuel savings achieved by
using cogeneration offset the incremen-
tal costs of the cogeneration system
Conventional Energy System
12.4 TJ/hr
(11,800 Mbtu/hr)
660
Mw
£
1
Industry
5450 Mg/day
(6000 TPD)
C/2
Stea
\363i
(2,88
Boiler
m
kg/sec
0.000 Ib/hr)
Cogeneration System
12.4 TJ/hr
Utility
Steam (Crossover)
I" 367 kg/se
Condensate
'906~Mw ~'
Industry
5450Mg/day
C/2
. 660 Mw
Figure 1. Hypothetical energy systems compared in study.
Table 1. Comparison of System Costs (Millions of 1977 Dollars)
A B
•Previously developed by Oak Ridge National
Laboratories.
Cost component
Capital
First year O&M
First year fuel
Conventional
System
538.2
21.9
129.8
Cogeneration
System
560.8
22.0
109.1
Net
B - A
22.6
0.1
-20.7
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after less than 2 years of operation. In
terms of 1977 dollars, the 30-year life
cycle net present value (NPV) of choos-
ing the cogeneration system was $ 234.5
M, or approximately ten times the addi-
tional capital costs.
The economic sensitivity analysis
showed that final costs and discount
rates have the greatest influence on NPV
of the cogeneration system. Next in im-
portance are the capital and O&M costs
of utility power plants and industrial
boilers. Capital and O&M costs of cool-
ing towers, piping, and pollution control
equipment have much less influence on
NPV.
Environmental Impacts
Reduced coal consumption in industrial
complexes which have central-station
cogeneration systems reduces the pro-
duction of environmentally harmful resi-
duals, and has the potential for reducing
pollution control costs. However, high
emission densities may occur at the site
of the industrial complex causing local
environmental problems.
For the cogeneration system analyzed
in this report, substantial reductions in
criteria pollutant emissions occurred
from those generated by the conven-
tional energy system. Pollutant reduc-
tions are listed in Table 2. Total reduc-
tion in air pollution control costs was
approximately $7M.
Compared with a conventional system,
a cogeneration system reduces water
consumption because of its increased
efficiency. Total water requirements for
the industrial complex will depend on the
industries located there. From a national
viewpoint, significant amounts of water
can be saved. However, there is the pos-
sibility that water demands from a par-
ticular cogeneration system and indus-
trial complex will be so high that signifi-
cant demands on the local water supply
will occur.
Coal-fired cogeneration systems will
use substantial amounts of land for dis-
posal of solid waste. However, land de-
voted to the disposal of solid waste is
reduced in comparison with a conven-
tional energy system by the percentage
increase in efficiency. If flue gas desul-
furization is used for control of sulfur ox-
ides emissions, the reduction in land re-
quired is important because the land
committed for disposal of flue gas desul-
furization solid waste cannot be used for
any other purpose until the land has been
properly reclaimed.
Table 2. Annual Residual Reductions (Kg/Yr)
Air Pollutants
Particulates 8.2 x 1Q5
Sulfur Oxides 3.6 x 106
Nitrogen Oxides 3.2 x 706
Carbon monoxide 8.6 x 10s
Hydrocarbons 4.1 x 10s
Solid Waste*
Ash and flue gas desulfurization (FGD) sorbent 1.8 x 108
Ash and fluidized bed combustion (FBC) sorbent 2.7 x 108
*Reduction in solid waste was calculated for each of two different SO2 reduction options
The advantages of centralizing waste-
water treatment facilities are an impor-
tant indirect impact of cogeneration
which result from the close proximity of
different industries. The financial bene-
fits are small compared to the savings
from energy efficiency improvements;
however, they are significant when com-
pared to pollution control costs. For in-
stance, combining wastewater treat-
ment facilities of a 909 Mg/day (1000
ton per day) pulp and paper mill with a
189 Mg/day (208 ton per day) carpet
mill would result in $980,000 in capital
cost savings and $495,200 in annual
O&M costs (1977 dollars). Four other
similar combinations of industries were
analyzed in the report to determine the
financial benefits of combined waste-
water treatment.
Institutional and Social Impacts
The social impacts of cogeneration are
inversely related to the size of the host
community. Large host communities
have a greater capacity to accommodate
the cogeneration system needs than
small communities. A cogeneration sys-
tem located in a sufficiently large com-
munity would induce a moderately posi-
tive rate of economic growth. Changes
in small host communities arising from
cogeneration system construction may
be so large and so sudden that the
changes will be detrimental.
One factor which was an important
determinant of social impacts on com-
munities of any size was the degree to
which industrial and power plant con-
struction were coordinated. A properly
phased construction schedule can reduce
peak adverse impacts by 20% to 50%.
Only slightly larger social impacts aris-
ing from demographic changes will occur
if a nuclear plant is constructed instead
of a coal-fired plant. This difference is
principally due to higher labor demands
during nuclear power plant construction.
Recommendations
Cogeneration System Planning
and Design
Energy efficiency is optimized when
industries locate as close as possible to
utility power plants. The power plant
should maximize the amount of low
pressure steam extracted for industrial
use. Industrial processes should be de-
signed with process steam requirements
which easily interface with the cogener-
ation system.
Steam extracted for industrial use
should not exceed 6.9 MPa (1000 psi)
or 430 °C (800 °F). The minimum pres-
sure of transported steam should be 700
kPa (100 psi) and at saturated condi-
tions. Industries should require large
quantities of low pressure steam to ob-
tain maximum system efficiencies. The
industries should condense the steam
and return it to the power plant for reuse.
In-plant generation of steam would be
an economically better approach when
distances between industries and utilities
exceed several kilometers. The specific
distance depends on technical and eco-
nomic factors of each individual system.
Centralization of other facilities (e.g.
air pollution control and wastewater
treatment) should be undertaken when
possible. Industrial cositing should be
particularly sought when opportunities
exist for waste products from one indus-
try to be used as raw materials for
another.
The host community for the cogenera-
tion system in this study should have
greater than 30,000 employees in a
population of 100,000 to avoid signifi-
cant negative social impacts. The con-
struction schedule should be closely
managed in order to reduce the extra de-
mands on public facilities. In particular,
manpower planning should minimize the
need for new workers. Strict housing
regulations should be used to control
.short-term housing problems.
US. GOVERNMENT PRINTING OFFICE: 1982-559-017/0772
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Further Research and Program
Development
Cogeneration systems have the po-
tential for producing energy savings and
environmental benefits which coincide
with federal energy and environmental
goals. However, each proposed system
must be analyzed on a case-by-case
basis. The authors of the study recom-
mend the development of programs to
provide incentives and guidelines for en-
vironmentally safe cogeneration systems.
Site-specific impact analyses of hypo-
thetical cogeneration systems located in
communities with different characteris-
tics could be conducted using ambient
air quality modeling, social impact analy-
sis, and institutional barrier identifica-
tion and evaluation. Two areas which
are particularly in need of further study
are: (1) reduced cost of pollution control
through centralized treatment facilities
which utilize process or power plant
waste heat, and (2) land use impacts of
pollution control alternatives (e.g. fluid-
ized bed combustion) which produce
large quantities of solid wastes. Although
the impacts of each system will be site-
specific, a series of case studies should
be made to obtain impact trends.
An overall environmental study should
be performed to examine the impact of
environmental regulations on cogenera-
tion development and to study the im-
pact of formulating environmental stan-
dards which encourage proper siting of
cogeneration systems. The use of ex-
tracted heat for industrial processes,
and the use of cogenerated heat for dis-
trict heating and cooling, and for agricul-
tural and aquacultural applications could
be incorporated in any future research
and environmental policy development.
A detailed guidebook on the use of
power plant or process waste heat for
wastewater treatment is also recom-
mended.
N. B. Hilsen, G. R. Fletcher, D. L. Kelley, J. S. Tiller, and S. W. Day are with
Georgia Institute of Technology, Atlanta, GA 30332; the EPA authors M. E.
Denen and B. L. Blaney (also the EPA Project Officer, see below) are with the
Industrial Environmental Research Laboratory, Cincinnati, OH 45268.
The complete report, entitled "An Assessment of Central-Station Cogeneration
Systems for Industrial Complexes," (Order No. PB 82-232 372; Cost: $18.00,
subject to change) will be available only from:
National Technical Information Service
5285 Port Royal Road
Springfield, VA 22161
Telephone: 703-487-4650
The EPA Project Officer can be contacted at:
Industrial Environmental Research Laboratory
U.S. Environmental Protection Agency
Cincinnati, OH 45268
United States
.Environmental Protection
Agency
Center for Environmental Research
Information
Cincinnati OH 45268
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