[Gasification] SPAM: Borealis / Spanner RE2 CHP

Sat Sep 20 13:49:31 CDT 2014

Larry,

Thanks for the information about the Borealis/Spanner. The general question
is, what are the economic circumstances that make small scale gasification
worthwhile?

If I understand the German farm market correctly there is, as you indicate,
a financial incentive to generate heat. Also I understand that If you are on
the grid and generate power in Germany you must sell to the grid but you
receive favorable rates.

Assume 6500 hrs/year

Spanner requires that you run the gasifier system at a minimum of 80%
capacity (i.e. no load following) to run reliably with no tars, etc. 

80% x 6500 = 5,200 at full capacity equivalent. 

5200 hours/8760hrs/yr = 59% capacity factor (% of potential full load/year).

5200 hours x 100 kWhth = 520,000 kWhth/yr

5200 hrs x 45 kWe = 234,000 kWhe/yr

Assume that a customer is heating with oil or propane in New Hampshire At
$25-$34/MMBtu. Assume 80% efficiency or $31/MMBtu for oil and $43/MMBtu for
propane.  

http://www.nh.gov/oep/energy/energy-nh/fuel-prices/index.htm

$31/MMBtu / 293 kW/MMBtu = $0.10/kWhth x 520,000 = $55,017/year displaced
oil

$43/MMBtu / 293 kW/MMBtu = $0.10/kWhth x 520,000 = $76,314/year displaced
propane

Electricity in NH is reported at $0.1531/kWh

$0.1531/kWh x 234,000 kWh/yr = $35,825/yr

Total potential heat and power offset $112,139/yr for propane and $90,842/yr
for oil. 

The system could consume about 234,000 kg wood at 0.95 kg/kWhe (23%
efficiency), 222 tonnes or 244 short tons. Assume a delivered fuel cost of
$60/ton, or $15,000/year. So the gross benefit of the gasifier-genset (with
net metering) for a farm or nursery in New Hamphsire would be about
$97,000/year for propane and $76,000 for oil. Assume about $8,000 for labor
(10 hours/week x 40 weeks) and $12,000/year for repairs (3% x $400,000).
Total fuel, labor and repairs $35,000. So that gives us a margin for
ownership of $77,000/year for propane and $56,000/yr for oil. So 6-8 years
payback, except that these small systems always cost a lot more than you
think. 

If we apply German conditions at EUR 1.40/litre for a diesel, USD $1.79/l
(1.28 USD/EUR), 10 kWh/l (36.4 MJ), 80% efficiency, heating with diesel
would cost about $0.224/kWh.

Electricity at EUR $0.20/kWh would cost USD $0.26/kWh (1.28 UD/EURO).

Gross benefits for substituting oil would be:

Thermal - $0.224/kWh th x 520,000kWh = USD $116,480

Electric - $0.26/kWh e x 234,000 = $60,840

Total $177,320

If you can use all the heat and sell all the power then benefits in Germany
are almost twice those in the US ($177,320/$90,842). If my assumptions are
reasonable the net payback would be about 3 years in Germany compared with
diesel.

I have heard that Spanner's customer service is excellent. They reportedly
meet with owners (250+) once every three months. That is unheard of in small
scale gasification. It means that they can attend to Thomas Koch's "baby"
when it cries. (Thomas told us that you must be no more than 1 km away from
your "baby" gasifier for every hour that you can leave it without crying.) 

These factors combine to make well supported small scale gasification
feasible in Germany. The US would seem to be a greater challenge. At the
industrial scale low cost oil and gas from fracking has killed a lot of
biomass projects. Will this be true of small scale systems? Or will previous
projections of increased prices for diesel and heating oil favor biomass
gasification?

Tom

From: Gasification [mailto:gasification-bounces at lists.bioenergylists.org] On
Behalf Of Larry Gooder
Sent: Thursday, September 18, 2014 11:49 AM
To: gasification at lists.bioenergylists.org
Subject: SPAM: [Gasification] Borealis / Spanner RE2 CHP

Tom

Borealis Wood Power is the North American distributor of the Spanner
Holz-Kraft CHP that delivers 45kWe and 110 kWt

As to make a decent ROI we need to have the end user to have a need for
6,500 hours or more of the demand.

Spanner RE2 is over the 250 unit mark in the European Union market and the
large majority of these are 7,000 plus hours/year customers.

And as noted some of the countries have a premium feed in tariff and that
helps on the electrical side, but the thermal has to be considered first.

I get regular e-mails and phone inquiries from people who want to explore
generating electrical power using their wood chips, but when asked what they
are going to use the thermal for, they draw a blank, as they were only
considering the electrical side. Competing with more expensive and highly
fluctuating cost fuels as propane or oil there is a good ROI and electrical
generated heat comes in as well.

The overall efficiency of the plant, using wood chips with moisture content
of 13%, thermal efficiency: 56.1% and electrical efficiency of 23.3%.

Our full scale demonstration plant is running at our facility in Burlington
Ontario Canada (40 minutes from Toronto International Airport) and welcome
you to come and have some hands on experience.

Larry Gooder

Enthusiastically,

Larry Gooder

O: +1 905 319 0404 x 2

C: +1 519 671 6153

LOGO_final

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