Biomass and Bioenergy 24 (2003) 27 37

Development and optimization of power plant concepts for local wet fuels
Markku O. Raikoa ; , Tom H.A. Gronforsa , Pauli Haukkab
b Tampere a Fortum

Energy Solutions, P.O.B. 10, 00048 Fortum, Finland University of Technology, P.O.B. 589, 33101 Tampere, Finland

Received 15 November 2001; received in revised form 21 June 2002; accepted 9 July 2002

Abstract Many changes in business drivers are now a ecting power-producing companies. The power market has been opened up and the number of locally operating companies has increased. At the same time the need to utilize locally produced biofuels is increasing because of environmental benets and regulations. In this situation, power-producing companies have on focus their in-house skills for generating a competitive edge over their rivals, such as the skills needed for developing the most economical energy investments for the best-paying customer for the local biomass producers. This paper explores the role of optimization in the development of small-sized energy investments. The paper provides an overview on a new design process for power companies for improved use of in-house technical and business expertise. As an example, illustrative design and optimization of local wet peat-based power investment is presented. Three concept alternatives are generated. Only power plant production capacity and peat moisture content are optimized for all alternatives. Long commercial experience of using peat as a power plant fuel in Finland can be transferred to bioenergy investments. In this paper, it is shown that conventional technology can be feasible for bioenergy production even in quite small size (below 10 MW). It is important to optimize simultaneously both the technology and the two businesses, power production and fuel production. Further, such high moisture content biomass as sludge, seaweed, grass, etc. can be economical fuels, if advanced drying systems are adopted in a power plant. ? 2002 Elsevier Science Ltd. All rights reserved.
Keywords: Energy investment; Design process; Wet biofuel; Power plant; Drying system

1. Introduction Traditionally, power investments are developed on the basis of business parameters like price of electricity, price of fuel, and power-production capacity. The power plant concepts are preselected and their cost
Corresponding author. Tel.: +358-10-453-2095; fax: +35810-453-3404. E-mail address: markku.raiko@fortum.com (M.O. Raiko).

basis is scaled when power plant size is optimized [1,2]. In this study, a new method for systematic development of power investments is presented and tested in the case of small-sized peat-fueled power plants. The work procedure has been systematized by Markku Raiko and it is published for the rst time in this paper. Its target is to improve the utilization rate of the in-house system-level knowledge of power-producing companies. Systematization of the work process of developing energy investments gives a basis for quality controlling and thereby self-learning of this business

0961-9534/03/$ - see front matter ? 2002 Elsevier Science Ltd. All rights reserved. PII: S 0 9 6 1 - 9 5 3 4 ( 0 2 ) 0 0 0 9 0 - 9

28

M.O. Raiko et al. / Biomass and Bioenergy 24 (2003) 27 37

Nomenclature c Ctr dr e I P Q q r R t y w Subscripts i; j e p pp prod tr Process unit indexes Electricity Peak power Power production Production Transportation process unit investment cost ( ) transportation cost from the distance r ( ) di erence of harvesting area radius (m) specic cost or price ( ) harvesting intensity (m3 = m2 a) power (MW) annual consumption of peat (J) lower heating value (MJ/kg) radius of harvesting area (m) outer limit of harvesting area (m) period of maximum power use (s) binary variable (dimensionless) fuel moisture content (dimensionless)

far from populated areas and therefore transportation costs would cancel out the economical bioenergy production. One option to solve this dilemma is to develop new and more biomass-oriented power plant technology such as gasication; another is to rene biomass to more transportable form like liquid or solid fuels. This paper shows the importance of the systematic development of power investment in line with the local circumstances of fuel production. The role of fuel moisture can be of great importance in making bioenergy investment economically feasible. Tom Gronfors is responsible for the technical data of this study and Markku Raiko and Pauli Haukka have performed the optimizations. 2. Methodology 2.1. Present practice 2.1.1. Planning process Preplanning or preengineering di ers from detailed design in several ways, including rapid and simplied evaluation of competing processes along with identifying potential problems. The goal of these preliminary studies is to nd the most favorable process alternatives for additional study. In contrast, the goal of detailed design is to generate complete and accurate design and operation parameters. In preliminary design, cycle conguration itself is the major design variable which denes signicantly the future economical functioning of the power plant. The goals of di erent design phases are illustrated in Fig. 1. The management of design data and knowledge has been found to be problematic because typically the work in di erent design phases is carried out in different organizations [5]. 2.1.2. Optimization methods There are several methods suitable for di erent optimization tasks in the case of thermal systems [1]. This design process varies according to companies, projects and the amount and quality of expertness used. The biggest di culty in power plant optimization is caused by the process nature of design work. At the starting point of the design process most comprehensive optimizations should be done, but the lack of needed dimensioning work weakens its accuracy.

function. The present development standard can be improved. The inadequate preselection of power plant concepts can result in an unoptimal concept choice for the investment. The work process cannot normally have iterations if new concept alternatives are identied in later design phases because of project schedule and expanding design cost. Sensitivity analysis can take into account the inherent change in optimum in power plant systems. Bioenergy is the local fuel. Its production capacity is linked to the annual growth of biomass. It cannot be produced in such quantity that the economy of power plant size can be utilized. In Finland this can be compensated by co-production of power and heat for process industry or district heating [3,4]. Globally, this is not a possible way to improve the economic feasibility of bioenergy because most biomass is grown

M.O. Raiko et al. / Biomass and Bioenergy 24 (2003) 27 37

Feasibility Study Energy Production Specifications System Level Designing: Capasities, Fuels, Processes Basic Engineering Preplanning of Power Plant Dimensioning of Power Plant Components and Layout Designing: Efficiencies, Heat Surface Areas Detailed Engineering Designing of Power Plant Detailed Designing: Components, Buildings

29

Fig. 1. Nature of power plant optimizing in di erent design phases.

If high accuracy is aimed at in comprehensive optimization tasks, then iterative designing such as dimensioning and costing should be done. In practice, many dimensioning routines have been adopted to control predimensioning in the optimization phase. Typically, process component costing information is described in the form of simple scaling exponent functions of production capacities, sizes, etc. The rst optimization phase is the power process generation phase (Fig. 2). It is based on several thermal rules and it is carried out at the starting point of energy concept development. The aim of the process generation phase is to identify and thermally optimize all concept alternatives for energy investment. Design rules for generation process connections and optimal energy regeneration can be identied. Thus, the thermodynamic optimum of each power process can be determined. The necessary knowledge includes information from the areas of both thermal expertise and basic designing of power plants. The objects for optimization can be determined for each design phase. For the feasibility study (preplanning) phase of an energy investment project, the optimization objects include the size of the production capacities of the power plant and its equipment, the specications of fuels and the technical and operational concepts. This design phase can be controlled by a group of optimization methods called mathematical programming. Mathematical programming includes mathematical model of the optimization task as a mathematical objective function and its constraints. Objective functions and constraints can be linear or nonlinear, called linear programming (LP) or nonlinear programming (NLP). If some design variables can have only integer values, then the optimization is called mixed integer programming. Mixed integer

Concept generation Preliminary screening

Concept analysis - thermal - fuel - costing - reliability - environmental - etc.

Concept screening

Concept alternatives - structural optimization - parameter optimization

Flowsheets Detailed design

Fig. 2. Procedure for optimization of thermal systems [1].

programming can be realized with linear (MILP) or nonlinear functions (MINLP). NLP is probably the most feasible optimization method for the concept

30

M.O. Raiko et al. / Biomass and Bioenergy 24 (2003) 27 37

development phase. The use of several integer parameters may not be meaningful in energy concept optimization because of its design process nature where designers want to proceed stepwise. 2.2. New development procedure The systematization of the development work in the feasibility study phase of an energy investment project can be improved in many di erent ways and in many separate sectors. In this study, the focus of the systematization is on thermodynamic expert work. The main target of thermodynamic experts work is not the basic or detailed designing of a power plant but the developing of power plant concept alternatives and helping in the selection process. No matter how sophisticated computer models are, they cannot generate a single new idea. This creative process is di cult to atomize and therefore a more interactive process between models and designer is required. To systematize expert work, the Catther procedure has been developed by Markku Raiko. It denes the tasks for the thermodynamic expert in the development of power plant concepts. The Catther procedure can form the basis of quality-controlled concept development in power companies [6]. Energy investment business can be described with nancial models [7]. They include a few technical parameters, which therefore can be the natural focus of life cycle cost (LCC) optimization. These parameters can be classied in the following major groups by the nature of their in uence: thermodynamics, fuel-related chemistry, and reliability. If these parameters are analyzed properly for the energy system optimization and described as functions, a comprehensive optimization procedure can be determined for the rst and most powerful design phase. The determination of the technical specication of an energy investment can be based on comprehensive thermal analysis. Thermal analysis helps to systemize the description of the object functions for the optimization of energy investment. Many optimizations, which are normally done during the basic design phase, can be done already in the energy investment development phase and therefore the outer parameters (energy business related) and the inner parameters (dimensioning of equipment) can be optimized as one optimization task.

Survey Phase
-thermodynamics -fuel chemistry -reliability

Generation Phase
thermodynamics -fuel chemistry -reliability

Selection Phase
thermodynamics -fuel chemistry -reliability

Specification

Fig. 3. Three-phased work process for the concept development of energy investments.

In this study, three phases are used for the concept development process for energy investments (i.e. during the feasibility study phase). These phases are the survey phase, the generation phase and the selection phase according to the main role of the phase. This process is shown in Fig. 3. The Catther method takes into consideration the fact that the development work on the power plant concept is only partly thermodynamic development. Comprehensive development expertise is connected with the fuel selections. Expertise in fuel-related chemistry can be considered to be as important as thermodynamics. By combustion development expertise is meant expertise in fuel prehandling and feeding systems, combustion systems, boilers, ue gas treatment, y ash systems, etc. Another expertise area relevant in concept development is the reliability expertise connected with the specications of reliability criteria for automation and maintenance of process equipments. Fuel-related chemistry and reliablity are both excluded from this study. However, they can be developed

M.O. Raiko et al. / Biomass and Bioenergy 24 (2003) 27 37

Definition of the Development Basis of the Investment Description of the Subprocesses of the Energy Investment

31

Screening 1 Generation of the Connection Alternatives of the Subprocesses Definition of the TQ Diagrams of the Connection Alternatives Definition of the Energy Balances of the Connection Alternatives Definition of the Exergy Balances of the Connection Alternatives Description of the Energy Concepts

Rejected Subprocesses

Screening 2

Technically Rejected Concepts

Optimization of the Energy Concepts

Screening 3

Economically Rejected Concepts

Specification of Optimal Energy Investment

Fig. 4. Description of phased Catther procedure in energy concept development.

parallel to thermodynamic development in the same design process. The Catther procedure (Fig. 4) consists of the following phases, which can be identied with the help of illustrative questions: 1. Denition of the development basis for the energy investment: What project fundamentals or development fundamentals a ect the selection of the power plant technology? 2. Description of the subprocesses of the energy investment: What subprocesses used in power plants can be applied in this development target?

3. Screening the feasibility of the subprocesses: Are the selected subprocesses feasible in the project? 4. Connection alternatives of the subprocesses: How can di erent subprocesses be connected with each other as di erent power plant processes? 5. TQ diagrams: At which temperatures is the energy transferred between the subprocesses? 6. Denition of energy balances: How is energy transferred between the subprocesses? 7. Denition of energy balances: How is energy transferred between the subprocesses?

32

M.O. Raiko et al. / Biomass and Bioenergy 24 (2003) 27 37

8. Description of the energy concepts: What are the thermal connections and parameters of power plant processes? 9. Screening the feasibility of the energy concepts: Are the power plant concept alternatives feasible for the concept development phase? 10. Optimization of the energy concepts: What are the dimensioning values of the thermal processes and the costs and protability of power plant concepts in the target project? 11. Screening the economy of the energy concepts: What is the economic feasibility of power plant concepts from the point of view of the target project? The Catther procedure or method is divided into three parts (survey, generation, and selection) between which iterations are not needed inside a single development project. The rst part (survey) includes steps 13, the second part (generation) includes steps 4 9, and the third part (selection) includes steps 10 and 11. A limited number of power plant process alternatives is identied as a result of the second part of the procedure. In the third part of the Catther procedure, the concepts are economically optimized and the best alternative is selected as the basis of the energy investment as its technical specication. The optimization routine can, however, be iteratively linked to a database of basic designing. 3. Power plant investment using wet peat 3.1. Power plant concepts Wet fuel-driven power plants are well suited for the analysis of power plant planning since the number of connection possibilities increases considerably because the drying of the fuel forms its own subprocess which has to be integrated in the power production. Following Catther procedure, three concept alternatives have been developed. The design tasks are not shown in this paper; only the results are shown as energy concept owsheets. A. No fuel drying; preheating of combustion air is done by ue gases (so-called luvo) (Fig. 5). B. No fuel drying; preheating of combustion air is done by extraction steam airheaters (Fig. 6).

C. Fuel is dried in the mixing dryer [8] and preheating of combustion air is done by steam airheaters. The energy for drying is taken from the combustion process and the dryer produces low-pressure steam for the condensing turbine (Fig. 7). The dryer in connection C is a steam dryer which produces 0:1 MPa saturated steam from fuel moisture for the low-pressure part of the steam turbine. The heat for the dryer is taken from the uidized bed by hot bed material which is circulated through the dryer [8] and fed back to the furnace mixed with dried fuel. 3.2. Fuel production Fuel peat production is, in Finland, typically based on the so-called milling principle. The original moisture content of peat in a bog is about 90%. First, the bog is prepared for production by ditching and removing the surface growth. This phase can take several years. In the production phase, thin layers of peat eld are ground and left on it for drying. After some time (a couple of days) the peat has dried su ciently (40 70%) for combustion. Then it is collected in long stacks. Peat production is carried on only during summer. Peat is delivered from the stacks to the power plant continuously all year round and it is not stored at the power plant site longer than a couple of days. Moisture content lower than 40% is not possible, because the risk of re arises. Peat production is dened by harvesting intensity, which is described as a function of fuel peat moisture content. Transportation is a function of the range of the required harvesting area (Fig. 8). The average harvesting intensity depends on the local area size suitable for fuel peat production. Milled peat harvesting intensity is a function of fuel moisture content (Fig. 9). The production cost with milled peat therefore depends on fuel moisture content. One relevant factor for peat production is the thickness of the peat layer in the bog. For milled peat production the production on one peat eld can last typically 10 20 years. Thus, too intensive harvesting can in uence the need to open new production areas. Mechanical drying is possible above 70% moisture content and extremely high harvesting intensities would be possible (although still not utilized).

M.O. Raiko et al. / Biomass and Bioenergy 24 (2003) 27 37

33

Steam Turbine

Fuel

Preheater

Condenser

Fluidized Bed Boiler

Air

Feedwater Tank

Fig. 5. Concept owsheet of connection A.

Fluidized Bed Boiler

Steam Turbine

Fuel

Preheater

Condenser

Air Preheaters

Feedwater Tank

Air

Fig. 6. Concept owsheet of connection B.

34

M.O. Raiko et al. / Biomass and Bioenergy 24 (2003) 27 37

Steam Generator

Fluidized Bed Boiler

Mixing Dryer

Steam Turbine

Preheater

G
Fuel

Condenser
Hot Bed Material

Air Preheaters

Feedwater Tank

Air

Fig. 7. Concept owsheet of connection C.

Mechanical Drying

I/I40 Harvesting Intensity

Milling and Wind Drying

1 40 50 60 Peat Moisture Content % 70

Fig. 8. Description of transportation range by peat harvesting.

Fig. 9. Harvesting intensity as a function of production moisture. I40 refers to harvesting intensity when peat moisture content is 40%. Discontinuity in the harvesting intensity curve is due to change in drying technology.

M.O. Raiko et al. / Biomass and Bioenergy 24 (2003) 27 37

35

Mechanical drying would allow the use of diggers for harvesting and therefore fuel production all year round from virgin bogs. 3.3. Optimization The protability model of di erent process alternatives includes fuel acquisition cost (harvesting, transportation), investment cost (described using scaling correlations for main components), and operational cost [1]. The task of developing an optimal specication for energy investment is limited so that the power process connections, their production capacity, and the moisture content of fuel are optimally specied. Details of the protability model are given in Appendix A. In this paper, one power plant site in the center of a favorable peat production area is optimized for the alternative concepts. The outer range of the production area is limited to 30 km. Then the optimization is focused to power generation capacity and the fuel moisture content. The main data relevant to descripe wet local fuel, transportation, harvesting and economic parameters used in optimization are summarized in Table 1. 4. Results The following optima (Tables 25) have been calculated for power plant capacity and fuel moisture. Power plant equipment has been dimensioned on a commercial design basis. The scaling criteria for equipment cost have been both the capacity basis and the fuel moisture basis. Operation and maintenance costs are on a commercial basis. The price of electricity varies constantly in Northern Europe, but the economical limit for new condensing power capacity is about 42 = MWh (1 =0:9 US$). Therefore, quite high price level has been studied. The target function for NLP optimization is the return on investment (ROI). As a result of the optimization, economically feasible solutions can be detected. If ROI is at least 810%, the investment is interesting for nancing. Alternative B or C seems to has the best economy, depending on parameters of energy business. Alternative C is not very sensitive to power market uc-

Table 1 Operation parameters Parameter Fuel (Peata ) Production intensity Lower heating value Dry fuel density Combustion air ratio Price in the eldb Transportation costs Economic parameters Electricity price Plant operation time E ciencies Feed pump Steam turbine Steam turbine Inlet pressure Inlet temperature Outlet pressure
a Dry

Value 35 cm3 = (m2 a) 21 MJ= m3 350 kg= m3 1.14 a + bw + cQprod 0:03 = (m3 km) 4259 ( = MWh) 7000 h= year 75% 83% 60 bar 510 C 0:032 bar

= MWh

peat composition C=55%, H=5:5%, S=0:2%, O=32:6% and ash = 4:6%. b a; b; c are constants, w is the fuel moisture content, Q prod is the peat production capacity. Table 2 Optimized concepts (price of electricity 42 Concept A B C Capacity (MW) 6.306 6.641 6.883 Fuel moisture (%) 63.0 59.4 70

= MWh) Range (km) 30 30 30 ROI (%) 4.8 7.9 8.0

Table 3 Optimized concepts (price of electricity 42 content 50%) Concept A B C Capacity (MW) 5.949 6.155 6.561 Fuel moisture (%) 50 50 50

= MWh, moisture Range (km) 30 30 30 ROI (%) 4.5 7.6 6.7

tuations and its business basis has the potential to be further developed through improvements in wet fuel production technology.

36

M.O. Raiko et al. / Biomass and Bioenergy 24 (2003) 27 37

Table 4 Optimized concepts (price of electricity 58 Concept A B C Capacity (MW) 5.949 6.155 7.240 Fuel moisture (%) 59.2 57.0 65.7

= MWh) Range (km) 30 30 30 ROI (%) 12.0 15.4 15.4

Table 5 Optimized concepts (mechanical drying in production is supposed to decrease production costs to 1/4 of the production cost of milled peat) Concept C Capacity (MW) 6.883 Fuel moisture (%) 70 Range (km) 30 ROI (%) 13.0

The optimization results show also that changes in optimization procedure can result in di erent specications for energy investment. Table 2 illustrates the common practice in energy investment development. The power investment is optimized with constant fuel moisture content and constant fuel price. In order to optimize these two businesses together, one has to cost the basis of both businesses. The technical design basis of the parameters to be optimized should also be known in order to capitalize them for the cost basis. 5. Discussion The work process for developing the most economical power plant concept for an energy investment can be compared to scientic work. You have a problem, you analyze it, and then you generate one or more solutions and nally test them. Business-based optimization is the way of testing in power business. For generating energy investments you can improve the present work procedure by widening the problem area, including in it more technical and business details. The development of information techniques will change power plant design probably in such a way that design routines can be solved more extensively than before with planning tools and the so-called knowledge-based design systems. However, these

instruments will not replace the engineers creativity needed for generating alternative solutions nor his role in decision making. Probably, the responsibility for optimization of technical parameters must always be left with the expert. Instruments which support optimization can be developed, of course. The signicance of design tools in power plant design can be compared with word processing programs in personal computers. The content of the text remain the authors responsibility, but the formal revision and checking of the spelling can be automated. The development of the technology of power plant components concentrates on the big technology companies which operate worldwide. This creates a necessity for power companies to concentrate their technology development at the system level or to specialize their business. The competitive ability of Finnish energy technological know-how at its best is related to the use of wood as fuel. Drying of biomass increases signicantly the energy amount obtainable from it and helps to limit global warming of the atmosphere. The recommendations of this study should be adapted individually for each power company according to its business strategy. 6. Conclusions The feasibility of small-sized energy investments is very much dependent on the production options of local fuels. Therefore, the technical concept of a power plant should be generated in close relationship with fuel production and power business development. Technical concept alternatives can result in a totally di erent production volume when they are optimized. So the development procedure is also relevant. Finnish energy producers have long commercial experience of using peat as the main fuel in power plants. The lessons learned from peat can be adopted also in the development of new bioenergy-based energy investments. The following conclusions and recommendations for bioenergy investors can be given: (1) The technical and economical development should be done in close relationship. (2) Conventional technology can be used. (3) Fuel drying systems can be economical.

M.O. Raiko et al. / Biomass and Bioenergy 24 (2003) 27 37

37

(4) The moisture content of biofuel has to be studied carefully. (5) Wet biomass harvesting gives many benets: more e ective biomass production; new potential fuels (e.g. sea weed, biowaste, sludge); new potential biomass farming (continuous green harvesting, alga, etc.); lower risks of res. Appendix A. Protability model for di erent process alternatives

Table 6 Investment cost (million Process unit Steam turbine Steam boiler Steamair preheater Flue gasair preheater Fuel drying system Other xed costs X

) correlations, cost = a + bX a 1.230 0.614 0.093 0.131 0.402 0.701 b 0.159 0.127 0.066 0.086 0.043 0.539

Turbine power (MW) Flue gas ow rate (m3 = s) Heat load (MW) Heat load (MW) Heat load (MW) Turbine power (MW)

A.3. Investment costs Terms ci in Eq. (A.1) are investment costs of the main components (Table 6). The conguration of the process is taken into account using binary variables yi having value 1 if the unit exists and 0 if not. References
[1] Bejan A, Tsatsaronis G, Moran M. Thermal design and optimization. New York: Wiley, 1996. [2] Dornburg V, Faaij A. E ciency and economy of wood-red biomass energy systems in relation to scale regarding heat and power generation using combustion and gasication technologies. Biomass and Bioenergy 2001;21:91108. [3] Aijala M, Hulkkonen S. Technology is not a barrier for biomass power. Experiences from 130 biomass plants. PowerGen98, Milan, 1998. [4] Raiko M. IVOs use of AFBC with low-grade fuels for energy generation. EPRI Conference of Fluidized Bed Combustion for Power Generation, Atlanta, 1994. [5] Maki E, Jarvenpaa E Hamalainen L. Managing knowledge processes in knowledge intensive work. Proceedings of the ECKM 2001; The Second European Conference on Knowledge Management. Slovenia: Bled School of Management, 2001. [6] Harrington H. Business process improvement. New York: McGraw-Hill, 1991. [7] Allen D. Economic evaluation of projects. Rugby: Institute of Chemical Engineers, 1991. [8] Hulkkonen S, Raiko M. An advanced fuel drying technology for uidized bed boilers. Proceeding of the 13th International Conference on Fluidized Bed Combustion (ASME), San Diego, 1995.

A.1. Object function (return on investment=ROI) Maximize ee Ptp eprod Q e tr Q

I i=1

yi c i +

J j =1 cj

100:

(A.1)

The rst term in the numerator stands for annual electricity incomes and the following two terms are peat production and transportation costs. The price of peat in the eld is descriped with the following equation: eprod = a + bw + cQprod ; (A.2) where a, b, and c are constants, w is the fuel moisture content, and Qprod is the fuel production. A.2. Transportation costs Assuming that the power plant is located in the middle of peat elds, transportation costs are Ctr = etr
R 0

r d Q = etr

R 0

(rI 2 r ) d r (A.3)

3 = etr ( 2 3 IR ):

Average transportation costs are then (since Q = I R2 ) 2 Ctr = Retr : e tr = (A.4) Q 3 Annual peat production has to correspond to the peat consumption Ptp Q= : (A.5) npp q