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</o:shapelayout></xml><![endif]--></head><body lang=EN-US link="#0563C1" vlink="#954F72"><div class=WordSection1><p class=MsoNormal><span style='color:#1F497D'>Larry,<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>Thanks for the information about the Borealis/Spanner. The general question is, what are the economic circumstances that make small scale gasification worthwhile?<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>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.<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>Assume 6500 hrs/year<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>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. <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>80% x 6500 = 5,200 at full capacity equivalent. <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>5200 hours/8760hrs/yr = 59% capacity factor (% of potential full load/year). <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>5200 hours x 100 kWhth = 520,000 kWhth/yr<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>5200 hrs x 45 kWe = 234,000 kWhe/yr<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>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. <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><a href="http://www.nh.gov/oep/energy/energy-nh/fuel-prices/index.htm">http://www.nh.gov/oep/energy/energy-nh/fuel-prices/index.htm</a><o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>$31/MMBtu / </span>293 kW/MMBtu = $0.10/kWhth x 520,000 = $55,017/year displaced oil<o:p></o:p></p><p class=MsoNormal><span style='color:#1F497D'>$43/MMBtu / </span>293 kW/MMBtu = $0.10/kWhth x 520,000 = $76,314/year displaced propane<o:p></o:p></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>Electricity in NH is reported at $0.1531/kWh<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>$0.1531/kWh x 234,000 kWh/yr = $35,825/yr<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>Total potential heat and power offset $112,139/yr for propane and $90,842/yr for oil. <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>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. <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>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.<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>Electricity at EUR $0.20/kWh would cost USD $0.26/kWh (1.28 UD/EURO).<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>Gross benefits for substituting oil would be:<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>Thermal - $0.224/kWh th x 520,000kWh = USD $116,480<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>Electric - $0.26/kWh e x 234,000 = $60,840<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>Total $177,320<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>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.<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>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.) <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>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?<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'>Tom<o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'> <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'> <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><span style='color:#1F497D'> <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'> <o:p></o:p></span></p><p class=MsoNormal><span style='color:#1F497D'><o:p> </o:p></span></p><p class=MsoNormal><a name="_MailEndCompose"><span style='color:#1F497D'><o:p> </o:p></span></a></p><div><div style='border:none;border-top:solid #B5C4DF 1.0pt;padding:3.0pt 0in 0in 0in'><p class=MsoNormal><b><span style='font-size:10.0pt;font-family:"Tahoma","sans-serif"'>From:</span></b><span style='font-size:10.0pt;font-family:"Tahoma","sans-serif"'> Gasification [mailto:gasification-bounces@lists.bioenergylists.org] <b>On Behalf Of </b>Larry Gooder<br><b>Sent:</b> Thursday, September 18, 2014 11:49 AM<br><b>To:</b> gasification@lists.bioenergylists.org<br><b>Subject:</b> SPAM: [Gasification] Borealis / Spanner RE2 CHP<o:p></o:p></span></p></div></div><p class=MsoNormal><o:p> </o:p></p><p class=MsoNormal><span lang=EN-CA>Tom<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA>Borealis Wood Power is the North American distributor of the Spanner Holz-Kraft CHP that delivers 45kWe and 110 kWt<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA>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.<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA>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.<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA>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.<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA>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.<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA>The overall efficiency of the plant, using wood chips with moisture content of 13%, thermal efficiency: 56.1% and electrical efficiency of 23.3%.<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA>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.<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA>Larry Gooder<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA><o:p> </o:p></span></p><p class=MsoNormal><span lang=EN-CA><o:p> </o:p></span></p><p class=MsoNormal><span lang=EN-CA style='mso-fareast-language:EN-CA'>Enthusiastically,<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA style='mso-fareast-language:EN-CA'>Larry Gooder<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA style='mso-fareast-language:EN-CA'>O: +1 905 319 0404 x 2<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA style='mso-fareast-language:EN-CA'>C: +1 519 671 6153<o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA style='mso-fareast-language:EN-CA'><o:p> </o:p></span></p><p class=MsoNormal><span lang=EN-CA style='mso-fareast-language:EN-CA'><img border=0 width=187 height=47 id="Picture_x0020_1" src="cid:image001.jpg@01CFD4AE.1E8F0080" alt="LOGO_final"><o:p></o:p></span></p><p class=MsoNormal><span lang=EN-CA><o:p> </o:p></span></p></div></body></html>