12th International Symposium on District Heating and Cooling

The <strong>12th</strong> <strong>International</strong> <strong>Symposium</strong> on District Heating and Cooling,September 5 th to September 7 th , 2010, Tallinn, EstoniaHEAT PRICE CALCULATIONSCalculations of heat prices are provided incorrespondence with principles described in sectionPrinciples for evaluation of CHP technologiescompetitiveness.Heat prices are evaluated for different scenarios.Scenarios include described heat demands, consideredfuels and technologies.Heat prices are calculated for 7% and 12% IRR.Heat price for CHP plant developing scenarios whichsatisfy the requirements described in regulation [X],which define conditions for grant payments to expandrenewable energy production and construction of CHPplants in Estonia, are calculated separately.For calculating heat prices in addition to informationfrom previous paper sections, some other figures haveto be specified: Cash flows are calculated for 20 years; CHP starts energy production in the beginning of2013; Expected rate of inflation is 1.5%; Heat loses in district heating network are 15%; Heat load profile is estimated based on heat loadmodel described in [15] taking as a basis the heatload duration curve shape of Tallinn.The results matrix of heat price calculations is shown inTable 2.CONCLUSIONThe technologies for smaller CHP applications aremore expensive (specific price) and less efficient thanthose for larger CHP plants.At present peat is considered as a good alternative forwood chips. Lower fuel price (11.7 EUR/MWh) smoothover higher than for wood chips ash handling costs andpollution charges. At the same time wood chips aremore preferable because of higher feed-in tariffs forproduced electricity.The advantages of gas engine CHP plants arerelatively low investment costs and high electricalefficiency. But because of high natural gas price(MWhfuel price is 2.5–3 times higher than for woodchips and peat) and relatively high fixed O&M costs thecalculated heat prices are the highest. Heat price forexpected 7% IRR is between 53 and61 EURO/MWhheat depending on heat demand.Under 5 MWel ORC is competitive to SE/STtechnology. Calculated heat prices are lower for1–4 EURO/MWhfuel, where higher fuel price differencecorresponds to places with lower heat demands.Heat prices for places with annual heat demand under20 000 MWh are mainly above 45 EURO/MWhfuelwhere an average heat prices for biomass boilerhouses are between 40–45 EURO/MWh [16].Developing of CHP plants in such heat demand areasis feasible in the case of receiving of grant paymentsfor investments.CHP plant development based on wood chips or peatcould be feasible without grant payments in the placeswhere heat demand exceed 3000-40000 MWh annual.Carefully selected CHP technology and capacity canafford higher IRR when keeping competitive heatprices.The most feasible places for CHP expansion in Estoniaare Maardu, Viljandi, Rakvere, Valga, Haapsalu, Võru,Paide and Põlva.Calculation results are valid for assumed cases only.Other particular cases should be calculatedindividually.REFERENCES[1] C. Dötsch and A. Jentsch, ―District heating (DH) inareas with low heat demand density (HDD):A chance for the integration of renewable energysources (RES)‖, 10th <strong>International</strong> <strong>Symposium</strong> onDistrict Heating and Cooling, 3–5, September2006, p. 2www: http://www.lsta.lt/files/events/20_doetsch.pdf[20.01.2010][2] Electricity Market Act www:https://www.riigiteataja.ee/ert/act.jsp?id=13279771[14.05.2010][3] Schwaiger, H., Jungmeier, G, (2007) Overview ofCHP plants in Europe and Life Cycle Assessment(LCA) of GHG emissions for Biomass and FossilFuel CHP Systems CIBE Conference„Cogénération biomasse dans l'industrie et sur lesréseaux de chaleur opportunités – retoursd'expérience-perspectives―[4] Obernberger, I., Thek, G, Techno-economicevoluation of selected decentralised CHPappications based on biomass combustion in IEApartner countries Graz (2010)[5] Bryson, T., Major, W., Darrow, Ken. Assessment ofOn-Site Power. Opportunities in the IndustrialSector, Carlsbad (2001) www:http://www.uschpa.org/files/public/Assessment%20of%20Onsite%20Power%2001.pdf[14.05.2009][6] Kirjavainen, M., Sipilä, K., Savola, T. Small-scalebiomass CHP technologies. Situation in Finland,Denmark and Sweden, VTT Processes (2004)271