Profitability of cogeneration in a chemical industry

Abstract: A high demand of both electricity and heat exists in Arizona Chemical (a chemical plant dedicated to the distillation of Crude Tall Oil) for production processes. Due to the rising cost of resources and electricity, more and more companies are trying to decrease the energy expenses to increase their competitiveness in a global market, thus increasing their profit. Some companies look at their energy consumption in order to diminish it or to explore the opportunity to generate their own and cheaper energy. In companies where the production of steam already takes place, cogeneration can be a good solution to palliate the cost of the energy used. This study addresses this issue through three actions such as the characterization of the boiler, a better steam flow measurement grid and the generation of electricity. The first one addresses the state of one of the key parts of steam production, the boiler, through the calculation of its efficiency with two different methods (direct and indirect calculation). These methods require some measurements which were provided afterwards by the company supervisor. This will allow the company to identify the weaknesses of the boiler to be able to improve it in the future. The second one aims to improve the knowledge about the steam system. New flow measurement points were suggested after doing an analysis of the current controlled flows to have a better overview outline of the steam use.The third one studies the generation of electricity with a Rankine cycle. The limitations in the characteristics of the steam were identified and different configurations are proposed in accordance to the restrictions identified. An efficiency of 93% is obtained for the boiler with the direct method and 82.3 % for the indirect one. The difference between them can be explained by the use of datafrom different time frames for both methods. The main contributors to the losses are the ones related to the dry flue gas and the hydrogen in the fuel. In the current status only 40% of the steam flows are identified, a number which is expected to raise with the new measurement points. It was not possible to estimate the effect of the new points due to the desire of the company to not disturb the current production. Due to the fuel price the production of steam for only electricity was not profitable and instead the generation of both electricity and heat from the same steam is proposed. This integrated system is now possible to implement due to its low payback time (2.3 years). This solution can generate 758 kW of electricity and provide the company with 6437 MWh of electricity each year. Then, the effect of the variation of different variables over the performance of the cycle were studied: different electricity prices, steam rate production, fuel cost and the state of the condensate recovery were discussed. The variation of both the condensate recovery and fuel cost did not affect the payback time due to their costs being neutralised by the revenues obtained from them. The variation of the electricity prices and steam production affects the payback but due to the high revenue that is expected it does not hamper the good nature of the investment. The generation of electricity is recommended due to the low payback time obtained. The different variations studied in the system did not change the payback time notably and showed that the investment is highly profitable in all the scenarios considered. The use of two smaller turbines instead of the one chosen (with a maximum rated power of 6 MW while only 758 kW is generated with the proposed solution) should be studied since the turbines would work closer to their maximum efficiency.