Renewable Energy Asia 2013 BITEC, Bangkok,Thailand 5 … · Why should everyone start Energy...

©EEI All Rights Reserved

Strictly confidential – For discussion purposes only

MAKING ENERGY INVESTMENT PROJECT

WORKS BY COGENERATION TECHNOLOGY

WITH ESCO

By Excellent Energy International Co., Ltd. (EEI)

"Renewable Energy Asia 2013”

BITEC, Bangkok,Thailand

5 June 2013

Thailand ESCO Pilot since 1999

ESCO Excellence Award 2009-2012


2 Strictly confidential – For discussion purposes only

• About EEI

• Successful ESCO projects - Cogeneration

• Why EEI ESCO?

• What is Cogeneration?

Agenda



Excellent Energy International Co., Ltd. (EEI):-

A well-known ESCO (Energy Service Company) in Thailand established since 1999 with the registered capital of 26 MB

An ESCO who offers guaranteed-payback on EE/RE/AE* projects for clients in various Industries and Commercial buildings

The first one, and only ESCO in Thailand who

successfully implemented “Thailand ESCO

Pilot Project” with excellent base of support

from the Thai Government & the World Bank.

*Energy Efficiency/ Renewable Energy/ Alternative Energy

An ESCO with Over 6,000 MB of on-going projects distributed over Cogeneration system, Renewable Energy, Energy Management Information System (EMIS), Heat Recovery projects, etc

Awarded 4 consecutive years of “ESCO

Excellence Award 2009 - 2012”, by The

Federation of Thai Industries, supported by

the Ministry of Energy, to the leading ESCO

of Thailand.

The only ESCO in Thailand whom was invited to contribute a regional perspective as a Co-writer in two books of World- God Mother of ESCO, Dr. Shirley Hansen!!! Namely “ ESCOs Around The World: Lessons Learned in 49 Countries”(published in 2009) and “World ESCO Outlook” (just released and available now!!!)

Some of EEI Clients



Certified Measurement and Verification

Professional



Project in

EE: Energy Efficiency

RE: Renewable

Energy

AE: Alternative Energy

− ESCO Fund by DEDE

− BOI for EE, RE, Environmental, and ESCO Project

− VSPP Adder By MINISTRY OF ENERGY

− National Innovation Agency: NIA

Various support from Government such as

taxes, duties, and grant to accelerate economy

Industry Trend: Why should everyone start Energy Efficiency project now?

Energy price is moderately increased.

Effective CSR Solutions

Save : Energy, Environment ,The World

with Positive Cash Flow + Low Risk

New Energy Efficient Technologies.



Comparison of Crude Price, Fuel Price and Ft



EEI Movement

Excellence ESCO Award

EEI, Mr.Arthit Vechakij, received the token "ESCO Excellence Award 2009-2012" in

Thailand ESCO Fair 2009 - 2012, as the Leading Thai ESCO for 4 consecutive years.

This Award conducted by The Institute of Industrial Energy, The Federation of Thai

Industries, supported by Ministry of Energy.

Award 2009 Award 2010 Award 2011 Award 2012



EEI’s Solution

ECMs for Industrial Facility

ECMs for Commercial Building

Ozone for Laundry

Heat Pump

Gas Turbine

Steam Turbine

Gas Engine

Biogas

Coal

Biomass

Natural Gas

Cogeneration System

Absorption Chiller Waste Heat

Recovery / ORC

Refrigeration & HVAC

Boiler System

Motor Optimization Lighting

EMIS (Energy Management Information System) Productivity

Improvement

Power Generation –

Renewable Energy

Plant Simple Cycle

Gasification

Biomass Power

Waste to Energy

Solar Power Plant



Plant Monitoring System

EEI’s Service

1 ESCO Performance Guaranteed

2 ESCO Performance Base

3 Project Management Consultancy & System Integration

4 Investment & Financial Arrangement

5 Independent Engineering/Lender Engineer

6 O&M Management Service

Investment

Potential Study,

Feasibility Study

Engineering

Design,

Conceptual

Design

Construction

and Installation

Supervision &

Management

Bidding and

Procurement

Management

Commissioning

Operation &

Maintenance

Supervision

7

Contract

management

Permit,BOI and

Regulation

management



• About EEI

• Successful ESCO projects- Cogeneration

• Why EEI ESCO?


Agenda



Business Case Example: Thailand ESCO Pilot Project

Bangkok Produce Merchandising Public Co., Ltd.

(SET: BKP)

Cogeneration Power Plant

4.5 MW, 12 TPH, Gas Turbine

Generator (GTG) (Fuel: Natural Gas)

BKP Cogeneration, the one-and-only Thailand ESCO Pilot

Project since 1999, has been supported by World Bank, Thai

Government , EGAT, and private co-operations as to drive

ESCO business in Thailand. Located: Saraburi, Thailand

Gas Turbine Generator (GTG)

Cogeneration Power Plant Project Investment Cost = 183 MB

Energy Cost Savings = 37 MB/Year

Payback Period = 4.95 Year

IRR = 20%

Operation and Maintenance Phase



9 New Cogeneration Power Plants after

The Success of BKP Pilot Project

After the pilot project has been greatly succeed, CP Group has consider to expand the implementation of Energy Efficiency Management Project through a Cogeneration Power Plant in it others 9 daughter companies.

Why CPF Group has repeated EEI ESCO Service?

EEI Value receiving from BKP ESCO Pilot Project EEI walks the talk - Real deficit saving compensated by EEI under EPC-

Guaranteed savings Bargaining power in combined Bidding and Procurement Getting large energy cost savings as soon as Project Commercial Operation Date (COD) Starting



C.P. RETAILING AND MARKETING CO.,LTD.


6 MW, 4.2 TPH, Gas Engine (GE)

(Fuel:Natural Gas)

Project Investment Cost = 242 MB


Payback Period = 5 Years

IRR 15 Years = 20.6 %

[email protected]%Discount Rate = 672 MB

Start Savings = March 2015

Business Case Example: Cogeneration Power Plant for 7-11

Development Phase

CPRAM has entrusted EEI to be a consultant under ESCO Performance Guaranteed Contract for

project of cogeneration power plant using natural gas in frozen food processing for 7-11 around

Thailand.



Thai Central Chemical Public Company Limited (TCCC)

Business Case Example: Cogeneration Power Plant for Fertilizer Plant

TCCC has high potential to develop the Cogeneration

Power Plant project with Gas Engine Technology. EEI

whose expertise in the Cogeneration Power Plant, has

been engaged to provide ESCO Performance Guaranteed

service.



Payback Period = 6.64 Years

IRR 15 Years = 15.73 %

NPV (DR@ 6.5%) = 131 MB




(Fuel: Natural Gas)

Operation & Maintenance Phase



PERFECT COMPANION GROUP CO., LTD.



(Fuel: Natural Gas)




IRR 15 Years = 20 %

NPV (7% Discount Rate) = 3.17 MB

Start Savings = June 2016

Perfect Companion Group (PCG) is one of the biggest Pet Food Manufacturer in Thailand with

brands like Smartheart, MeO, etc. With an attempt to improve overall energy efficiency and to

increase reliability of this manufacturing unit, PCG had engaged with EEI to develop a Natural Gas

Cogeneration Power Plant which will utilize waste heat from power plant to serve their current

thermal requirement in form of steam and hot air. The excess electricity will be exported and sold to

the grid under a VSPP license.

Business Case Example: Cogeneration Power Plant for PETS FOOD

Development Phase



Business Case Example: Cogeneration Power Plant for Modified Starch Plant

C. Gigantic Carbon Co., Ltd. (CGC)




IRR 15 Years = 27 %

NPV = 392 MB

Start Savings = Dec 2004

EEI was introduced by IFCT to C.Gi who is the starch

manufacturer would like to explore the Renewable Energy

project. According to C.Gi had consumed the steam so

high that C.Gi had the potential to develop the Biomass

Cogeneration.


2.8 MW, 28.7 TPH, High Pressure Boiler &

Steam Turbine Generator (HP-STG)

(Fuel: Solid)




Nan Yang Knitting Factory Co., Ltd. (NYK)


1.8 MW , 22 TPH, High Pressure Boiler & Steam Turbine

Generator (STG) (Multi-Solid-Fuel: Coal & Biomass)




IRR 15 Years = 31.7 %

NPV (15 Year DR@4%) = 334 MB

Start Savings = October 2006

End of Guaranteed Period = December 2011

3 years after EEI has implemented EMIS with guaranteed

savings to NYK, EEI obtained other opportunities in the 3rd

project by mean of energy efficiency consultancy along with

providing Guaranteed savings of Cogeneration System.

This Cogeneration System contributes in 10-30% reduction of

NYK Fuel consumption.

Located: Samutsakorn , Thailand

Business Case Example: Cogeneration Power Plant for Textile Plant

Dyeing & Printing

Weaving & Knitting

Spinning

Yarning Textile Process


ESCO Project Award 2009 By F.T.I



E-Saan Sugar Industry Co., Ltd. (ESI)

Business Case Example: Modified Cogeneration Power Plant for Sugar Refinery Plant




IRR 15 Years = 17%

NPV (20Year DR@ 6.5%) = 229 MB

Start Savings = Nov 2012


2.7 MW, 45 TPH High Pressure Boiler & Steam Turbine

Generator (HP-STG) (Fuel: Biomass)

ESI then has entered into the Energy Performance Contract with EEI.

Contributing EEI’s combined experience in Biomass, Food Industry,

Seasonal Operation thus multiple Energy Consumption profiles,

Cogeneration, and VSPP, EEI started from exploring every possible

schemes for this improvement initiative under variety of constraints,

facts, and forecasts for ESI. Innovative technology such as

Gasification is also introduced into the picture to ensure

comprehensive coverage of all choices for Owner.

Development Phase



Business Case Example: VSPP Power Plant from Rice Husk

TRC Clean Energy Co., Ltd. (TRCCE)




IRR 15 Years = 23 %

NPV (0% Discount Rate) = 1,586 MB


TRCCE has developed the Biomass Cogeneration Power

Plant with Rice Husk which is the TRCCE by-product. EEI

has been engaged into the ESCO Performance Guaranteed

Contract since 2009. The project has started to save in June

2011. The plant contributes the gross electrical power

generation of 7.8 MW together with the steam 45 tons per

hour.


7.8 MW, 45 TPH, High Pressure Boiler & Steam Turbine

Generator (HP-STG) (Fuel: Biomass)




Business Case Example: Cogeneration Power Plant for Saw Mill

Plan Ecoenergy Co., Ltd. (PEC)


5.2 MW, 3.4 TPH, Gasification + Gas Engine

(Fuel: Biomass)




IRR 15 Years = 19.6 %

NPV (15 Year [email protected]%) = 326 MB


Plan Ecoenergy project will be the first successful large scale

commercial project of gasification project in Thailand. The

project needs the real expert who can develop, implement, and

guarantee the technical thus financial feasibility of gasification

project. The Power Plant will be designed to export electricity

to Grid and supply steam to existing process of saw mill.

Implementation Phase

Supported by



Business Case Example: Cogeneration Power Plant from Wood Chip

Nongbua Green Power Co., Ltd. (NGP)


Energy Cost Savings = 9.7 MB/Year


IRR 15 Years = 10.9 %

NPV (15 Year [email protected]%) = 20.3 MB


Nongbua Green Power Co., Ltd. has implemented

Community Based Biomass Power Plant, which is the

successful cooperation between Thailand and Austria.

This energy project was supported by the National

Innovation Agency (NIA) and local community as well.

Cogeration Power Plant

1 MW Gasification + Gas Engine

(Fuel: Biomass)

Supported by

Implementation Phase



Business Case Example: Cogeneration Power Plant from Rice Husk

Boon Chareon Green Energy Co., Ltd. (BGC)


Energy Cost Savings = 56.33 MB/Year


IRR 15 Years = 12.67 %

NPV (15 Year DR@7%) = 128.7 MB

Start Savings = December 2013

Boon Chareon Green Energy Co., Ltd. (BGC) has

engaged with EEI to develop cogeneration power plant

with gasification technology. This power plant uses

biomaterial from milling and agriculture as a fuel to

produce electricity 5.3 MW.


5.3 MW, 3.4 TPH Gasification (GF)

(Fuel: Biomass)

Utilities System in Rice Mill (Dryer & Boiler)

Development Phase

Supported by



Industrial Waste Management to Energy Project - Daily 165 TPD

Waste to Energy System - Separate line

- Power Generator :

Incinerator and Steam Turbine Generator 5 MW.

Business Case Example: VSPP Power Plant from Industrial Waste


Project net cash flow (Avg.) = 113 MB/Year


IRR 20 Years = 15.49%

NPV @ 7.5%Discount Rate = 450 MB

Entrepreneur has a capability on gathering industrial

waste disposal and confined in EEI to be a consultant for

Industrial Waste Management to Energy Project. This is

the first project in Thailand that produces electricity from

industrial waste.

Development Phase



Business Case Example: VSPP Power Plant from Municipal Solid Waste

Municipal Solid Waste Project

- Daily 200 TPD

-Landfill : 500,000 Tons

Waste to Energy System -Separate line

- Power Generator :

Bio-Dry

MP Boiler and Steam Turbine Generator 6.5 MW.


Project Net Cash Flow (Avg.) = 94 MB


IRR 25 Years = 19.78 %

NPV @ 12%Discount Rate = 299 MB

Entrepreneur focus is interested in implementing a

“Municipal Solid Waste or MSW cogeneration power plant

by Refuse Derived Fuel (RDF). The key success factors

of MSW project are started from project feasibility study

and confidence level of MSW quantity, quality and

concession.

Development Phase



• About EEI


• Why EEI ESCO?


Agenda



Guaranteed Savings

Total Savings

Old Energy Cost New Energy Cost

No extra expense required for ESCO investment Total Investment Cost will be handled by EEI ( ESCO) / Investor solely. The payback to the project come only from Monthly Savings achieved. Guarantee Investment EEI guarantees that total investment will be paid up by Savings* Share risk, share loss, share benefit During the contract period, Client, Investor and EEI (ESCO) will share the savings achieved Client owns the Asset ‘til its life-time After the contract period, the asset will be totally transferred to client. All the savings gained goes to client only.

Financing Scheme for ESCO in Thailand:

ESCO Performance Guaranteed Concept

O&M Expense

Energy Cost (New)

O&M Expense

Other Energy Expense

Other Energy Expense

Bank Loan

Client as Equity

Equity

ESCO Shared Saving

Total Energy Expense



EEI ESCO Performance Guaranteed

Concept



Performance Guaranteed EEI fee 50 % of access Guaranteed Savings with obligation of deficit saving

Performance Base EEI Fee 25 % of access Target Savings without obligation of deficit saving

EEI ESCO Service Clarification

IGA

Bidding &

Procurements

Implementation

Operation & Maintenance

Project Management Consultancy & System Integration

ESCO Performance Base

ESCO Performance Guaranteed 1

2

3

Guaranteed %IRR Guaranteed Return Period Guaranteed/Target Savings

----------------------- Consulting Fee --------------------------->

SCOPE OF SERVICE

<----------EEI Fee---------

After bidding,% IRR will be converted

to return period for guarantee.

After COD, project investment cost will be concluded

Then EEi will identify guaranteed/target figure and

maintain guaranteed return period as same as

commitment in implementation period.



Why EEI?

1. EEI has Professional personnel, who has true/real experiences in

various technologies to be responsible for every phase of project

including Payback period.

2. EEI can provide the Performance guaranteed to share risk , share

loss and share benefit as same as owner along payback period.

3. EEI achieves reputation for being regarded ESCO in Thailand by

government organization, leading financial institute, and industry expert

in local and global, and also receive additional projects (repeat orders).

4. EEI enables Project owners to run their core business on worry-free

mode, since EEI provides Performance Guaranteed to the project by

many experts.

5. EEI performance absolutely supports Business competition since

generated energy cost savings from EEI project will directly contribute to

lower production cost.

6. EEI can manage the optimized return for Project owners. With EEI

System integration, it isn’t necessary to have Turnkey contractor

anymore whereas we are also able to pursue the effective cost.



<---------EEI Fee------ -------------------------- Consulting Fee --------------------->

Sign EPC

IGA

Bidding &

Procurement

Implementation

Operation & Maintenance

EEI: ESCO Procedure : Next Step for Client to start

project development and implementation

Step 1 Step 2 Step 3 Step 4 Step 5

1-3 Months 1-3 Months 3-24 Months 1 – 8 Years

Under the Agreed

Condition of __% IRR

1. EEI guaranteed period starts

from the date designed on

Notice to Proceed/EPC

including all phases during

contract

2. Shall EEI mistakenly

perform the task at any step,

Client will be subject for

no payment.

•Detailed Energy Audit

•Recommended Project

•Conceptual Design, Bill of

Quantity(BOQ)

•Technical Feasibility

•Financial Feasibility

•Commercial Feasibility

•Legal Feasibility

•M&V Plan

•Project Schedule

•Bid Design, Technical

Specification

•Request for Proposal

•Proposal Clarification with

Bidders

•Bid Evaluation Report

•Equipment Contract

Negotiation

•Equipment Contract

Preparation & Closing

•Review Detailed

Engineering

•Bidding & Procurement on

Minor Equipments & Service

•Construction and

Installation Management

•System Integration

•Commissioning

•O&M Development

•Post Commissioning

•O&M on site Supervision

•O&M remote Supervision

<---------Permit, BOI and Regulation management --------->



• About EEI


• Why EEI ESCO?


Agenda



What is Cogeneration?


Cogeneration (Combined Heat and Power or CHP) is the simultaneous

production of electricity and heat, both of which are used. The central and most

fundamental principle of cogeneration is that, in order to maximize the many

benefits that arise from it, systems should be based according to the heat

demand of the application.



The Cogeneration System, a.k.a.

Combined Heat & Power (CHP)

System, is a Simultaneous

generation of two different forms of

useful energy using one single

primary energy source

Cogeneration System efficiency is

increased to the 80%+ level

compared to the 30-60% level of

Traditional Separated Electricity and

Steam Generation System

Power Station 60

Heating Boiler 40

Steam 34

Electricity 24

Fuel = 100

Loss 42

Fuel = 68

Cogeneration or CHP Plant

Electricity 24

Steam 34

Loss 10

Traditional Separated

Electricity and Steam

Generation System

Benefit of Cogeneration Solution



Preliminary Design for Cogeneration

Gas Engine Generation

Electricity

HRSG

Steam

Heat Exchanger

Hot Water Gas Engine

Natural Gas

Electricity

Steam

Factory

Absorption Chiller

Chilled

Water

Hot Water




Gas Turbine Generation

Electricity

HRSG

Steam

Heat Exchanger

Hot Water

Natural Gas

Electricity

Steam

Factory

Absorption Chiller

Chilled

Water

Gas Turbine Hot Water




High Pressure Boiler and Steam Generator

Electricity

Steam

Electricity

Steam

Factory

Solid Fuel

HP Boiler

ST Generator

HP Steam




Gasification + Syngas Engine Generation

Electricity

HRSG

Steam

Heat Exchanger

Hot Water

Syngas

Electricity

Steam

Factory

Absorption Chiller

Chilled

Water

Hot Water

Solid Fuel

Syngas Engine



Cogeneration’s advantage

Generating significant cost savings, providing additional competitiveness

for industrial and offering affordable heat.

Increasing availability and reliability of utility supply to the process.

Lower CO2 emissions to the environment, Serving the Corporate Social

Responsibility (CSR) and providing Green Image to the company.

Cogeneration Project is entitled to gain various available privileges

supported by the Government

Very low risk investment solution under ESCO Performance Guaranteed

Contract. EEI ESCO would provide the optimization design, long term price

performance evaluation as well as performance guaranteed along the project

payback period.



Example: Load Shading

BOP

LOAD

PEA

LOAD

1.7 MW

LOAD

1.0 MW

t

t

t

MW

PEA

Factory Load

GEN

G 2.0 MW G 2.0 MW

2.7

2.7

1.0

1.7

PEA

LOAD

1.0 MW

1.7

Synch.

(Close SWG)

Auto

Open SWG

Load Shedding

Open ACB

Back Synch.

Close SWG

Close ACB Synch. Load

Shedding Back

Synch.

Synch. period

Island Synch. period

Critical Load Non-Critical Load Non-Critical Load

PEA

Outage

PEA

Back to

normal

Load Shedding

Program

performed



Example Case BKP: How Cogeneration Works?

Before Implementing Cogeneration System

3.2 Ton

BKP Factory

BUNKER OIL

TRANSFORMER TRANSMISSION

LINE PEA

Steam

12 Ton

Electricity

10 MW

5 Ton NATURAL GAS

5 Ton BUNKER OIL

10 Ton COAL



Example Case BKP: How Cogeneration Works?

3.2 Ton BUNKER OIL

TRANSFORMER TRANSMISSION

LINE PEA

Steam

12 Ton

Electricity

10 MW

5 Ton NATURAL GAS

5.5 MW

10 Ton

4.5 MW

After Implementing Cogeneration System

BKP Factory



Thank You

Excellent Energy International Co.,Ltd 12th Fl., Siripinyo Bldg., 475 Sri-Ayudhaya Rd., Thanon Phyathai, Rajthevee, Bangkok, THAILAND, 10400 T. +66 (0) 2201 3466-7, +66 (0) 2640 0270 F. +66 (0) 2201 3465 http://www.eei.co.th

http://www.eei.co.th/

http://www.eei.co.th/

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