economic analysis of a jatropha biodiesel-fired power plant in nigeria
TRANSCRIPT
Economic Analysis of a Jatropha Biodiesel-fired Power Plant in Nigeria
Tosin Onabanjo; Giuseppina Di Lorenzo; Athanasios Kolios School of Energy, Environmental and Agrifood (SEEA)
1
2Outline
— Background
— Research Motivation
— Methodology
— Key Results
— Conclusion
3Background
>1.3 billion people are without access to electricity
Courtesy: The Breakthrough Institute
95%
84%
50-75%
4Background
© 2014 IEA Africa Energy Outlook
NIGERIA• >93 million people are
without access to electricity
• >40% of the population are connected to the grid -18% rural population
• ~20% of the peak demand is met
— 2400MW vs 10GW (2012)
— 1700MW vs 12.8GW (MAY 2015)
5Background
Exposed to indoor and outdoor pollution
Fuel is a scarce commodity
Self-generated electricity
Power plants often lack the required fuel
Fuel crisis situation in Nigeria
Electricity Generation by Fuel
Electricity Consumption by Fuel
6Background
Renewable Potential in Nigeria
Hydropower
Solar
Wind
Biomass
Municipal Solid Waste
Agricultural Residues
Energy Crops
• Decentralized Power Generation
• Local biodiesel production for Rural Electrification
• Existing structures: Orphan PP
• Emergency Solutions
• Substitute to conventional fuels
7Research Motivation
• Engine Performance & Emissions
≈
• Environmental Performance
8Research Motivation
• Economic Viability Jatropha
Biodiesel
Conventional Diesel
Natural Gas
?
─ Feasible? ─ Possible mechanisms to integrate?
9Methpodology
Olorunsogo Power Plant
South West, Nigeria
Jatropha Biodiesel
Power: 126 MW
PR: 12.6
Mass Flow: 418 kg/s
EGT: 543oC
Efficiency: 34%
Methodology 10
Schematics of the techno-economic and environmental framework
11
Methodology
Short, W., Packey, D.J. and Holt, T. 2005). A manual for the economic evaluation of energy efficiency and renewable energy technologies. Honolulu, Hawaii. University Press of the Pacific
Economic Parameters
Capital Cost
Maintenance Cost
Emission Cost
Fuel Cost
12
Methodology
Fuel Characteristi
cs
Performance Analysis
Emission Analysis
Economic Analysis
TurbomatchSoftware
Emission Module
Economic Module
NASA CEA
SIMPLIFIED WORKFLOW FOR THE TECHNO-ECONOMIC ANALYSIS
13
Key Results
Table 1: Economic Performance for the different fuels
a$1.8/MMBTU, b$4/MMBTU,
Economic Measures Unit Baseline
NGa
NGb
DI
JT
Simple Payback Period (SPB) Years 3 3 >20 >20
Net Present Value (NPV) $ 567 479 -3240 -3184
Levelized Cost of Electricity (LCOE) $/MWh [N/kWh] 37 [6] 51[8] 497 [80] 491[79]
non-viable when operating solely on JT fuel due to high TLCC (-ve NPV, >20 SPB, high LCOE, nearly 10 x NG case
14
Results
Table 2: Jatropha Biodiesel Integration Supported by Tax Incentives
Economic Measures Unit JT (Baseline)
+NPV LCOE [NG~JT]
Tax/Incentives $/MWh [N/kWh] 0 211 [33.9] 268 [43.2]
Simple Payback Period (SPB) Years >20 >20 2
Net Present Value (NPV) $’000000 -3184 0.001 873
Levelized Cost of Electricity (LCOE) $/MWh [N/kWh] 491 [79] 137 [22] 38 [6]
Minimum tax incentive required to integrate Jatropha biodiesel with similar plant economics as the NG case is $268/MWh
15
Results
Table 3: Jatropha Biodiesel Integration by Partial Substitution
Economic Measures Unit NG JT Fuel Mixture
100% 100% 15% 20% 20% + Govt.
Inc. ($0.21/kWh)
Simple Payback Period (SPB) Years 3 >20 16 >20 3
Net Present Value (NPV) $’000000 567 -3184 152 14 651
Levelized Cost of Electricity (LCOE)
$/MWh [N/kWh]
37 [6] 491 [79] 106 [17.1] 129 [20.7] 62 [10]
Maximum partial substitution required to integrate Jatropha
biodiesel without compromising good plant economics is 20% Improves with inclusion of a tax incentive.
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Results
Table 4: The Average Levelized Cost of Electricity in Nigeria
Parameters Business Family of Six
LCOE with Other Energy Costs1 $/kWh [N/kWh] 62.40 [10046] 14.94 [2406]
LCOE without Other Energy Costs2 $/kWh [N/kWh] 27.21 [4380] 9.41 [1515]
LCOE full hours3 $/kWh [N/kWh] - 34.64 [5577]
High LCOE as much as $6000/MWh for local business and $3500/MWh for a family of six
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Results
Power plant operating with 100% Jatropha Biodiesel in comparison to
natural gas
Power plant operating with partial substitution of fuel in comparison to
natural gas
The introduction of carbon tax would be an advantage for Jatropha biodiesel integration at > $257.5/tC
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Conclusion
— Appears uneconomically and non-competitive to NG-fired PP
— Integration can be achieved by partial substitution (up to 20%), inclusion of renewable tax incentives (up to USD 211/MWh), carbon tax levy up to $260/tC
— Opportunities for distributed and independent power generation