Transcript The bioenergy opportunity for the UK

UK policy for supporting the development
of solid waste management infrastructure
and its application to India
Dr Daniel Wright
Dr Jim Scott
Prof. Prasanta Dey
Aston Business School
Presentation Agenda
 UK waste production and developments
 Enablers to the UK and EU SWM policy
 Waste Framework Directive
 Landfill Directive
 Landfill tax & effects
 Energy Production incentives
 MSW composition trends
 SWM infrastructure case to India
UK Waste Production and Developments
350
 Estimates that 27.5 Mt of
residual waste arising from LA
MSW and C&I sources
2012/2013
 wider residual waste treatment
capacity either operating or
under construction approx 18.2
Mt, resulting in a 9.3 Mt
capacity gap
 It all facilities in the planning
stage are successfully
commissioned = overcapacity
of 12 Mt (if the waste remained
static)
300
Million tonnes (Mt)
250
200
Secondary, sewage and other*
Households
150
Commercial and industrial
Mining and quarrying
100
Construction
50
0
Figure 1: Total UK waste generation by sector, 2004 to 2010
(DEFRA 2013)
*
Other includes healthcare wastes, batteries &
accumulators, and wastes containing PCB
UK Waste Production and Developments
 The UK generated:
 518kg per person (2011)
 which was then treated with:
 landfilling (49%);
518kg
MSW waste produced per
person in 2011
 incineration (12%);
 recycling (25%);
 composting (14%) (Eurostat 2013)
• We send approximately 330 ktpa to Tyseley’s
incinerator
• Struggle to know what is in the ‘black bag!
UK & EU Policy
Non-waste
 2008 Waste Framework
Directive (2008/98/EC)
 Hierarchy of activities
Prevention
Preparing for re-use
Waste
 The largest component of MSW
Recycling
is organic matter
 Tick box exercise
Recovery
 Leaders such as germany:
Disposal
organic matter greater than 3%
is not allowed to be landfilled
x
Figure 2: Waste hierarchy
16
16.23
14
14.20
12
12.17
10
10.15
8
8.12
6
6.09
4
4.06
2
2.03
Very Small
Small
Small/Medium
Very Small
Figure 3: Quarterly non-domestic electricity price trends (DECC 2013)
 approximately doubled from 2004 to 2013
Electricity INR/kWh
Electricity p/kWh (inc. CCL)
UK & EU Policy
ROC Bandings
Fit AD
Large
Medium
Small
Sewage gas
Landfill gas
Energy from waste
Co-firing of biomass
Dedicated biomass
Pyrolysis
Gasification
Anaerobic digestion
Incentive (p/kWhel)
16.0
16.2
14.0
14.2
12.0
12.2
10.0
10.1
8.0
8.1
6.0
6.1
4.0
4.1
2.0
2.0
0.0
0.0
(INR/kWhel)
Technology incentives (ROC and FiT)
9
9.1
8
8.1
7
7.1
6
6.1
5
5.1
4
4.1
3
3.0
2
2.0
1
1.0
0
0.0
Small
Medium
Large
Biomethane
/ biogas
RHI Commercial Biomass
(INR/kWhth)
Incentive (p/kWhth)
Technology incentives (RHI)
80
8116.0
70
7101.5
60
6087.0
50
5072.5
40
4058.0
30
3043.5
20
2029.0
10
1014.5
0
600,000
60
500,000
50
400,000
40
300,000
30
200,000
20
100,000
10
-
0
0.0
Year
Standard landfill tax rate
Figure 4: Standard landfill tax rate
Capacity
Disposal (HIC)
Figure 5: Landfilling capacity and disposal in the UK
(EA 2013)
Disposal (mtpa)
9130.5
Non-inert landfill
Capacity (km3)
90
INR/tonne
£/tonne
UK & EU Policy
UK & EU Policy
Technology
group
Detail / subgroup
All
MRF
Contracts post 2011
Open Air Windrow
In vessel composting
Organics
AD
Non-hazardous gate fee
only
Non-hazardous plus
Landfill
landfill tax
Pre-2000 facilities
Post - 2000 facilities
<200kt
Incineration/ 200kt - 300kt
EfW
350kt - 450kt
WRAP 2008
WRAP 2013
(£/tonne)
(£/tonne)
Median Min Max Median Min
£21
-£4 £70 £9
-£40
-£7
-£40
£22.50
£17 £33 £24
£6
£40
£20 £69 £46
£28
n/a
£30 £60 £41
£25
Max
£82
13
£45
£60
£66
£21
£11
£8
£49
£45
£71
£80
£35 £64 £93
£31 £136 £58
£65 £136 £90
£111
£78
£68
£80
£32
£62
£80
£57
£59
£121
£76
£126
£135
£105
£80
£40
£21
Table 1: Comparison of gate fees by technology from (WRAP 2013)
 xxxx
MSW Composition – Comparative Assessment
UK
India
Classification
DEFRA (2009) (2006/7)1 Classification
Food waste
Garden waste
Other organic
17.84%
14.08%
1.73%
Paper & card
Glass
22.69%
6.64%
Metals
4.30%
Plastics
Textiles
Wood
WEEE
Total
9.99%
2.83%
3.73%
2.19%
86.02%
Drives the
MRF
economics
Paper and paperboard
Plastics
Metals (mainly ferrous
and aluminium)
Glass
Ash and fine earth
Palanichamy, Babu et
al. (2002)
3%
3%
0.5%
1%
14%
Vegetable matter
69%
Yarn and rags
5%
95.5%
MSW Composition – Comparative Assessment
Figure 6: Trends in household-collected waste composition 1935–1980 (percentage by weight) (Bridgwater, 1986)
 Previous MSW composition similar to that currently in India –
Future systems
 MRF not currently viable in India
SWM Technology Support – AD case study
 wholesale rate estimated
at 4Rs/kWhel (MNRE
2013)
 The investment term has
been set at 10 years @
15%
253.63
253.63
R² = 0.9168
2020
202.90
202.90
CAPEX (INR Crore)
CAPEX (INR Crore)
 System efficiency
36.5%, 84% annual load
availability,
25
25
CAPEX (£m)
CAPEX (£m)
 3 scenarios for the
capital and operating
costs (100%, 90%, 80%)
1515
152.18
152.18
1010
101.45
101.45
55
50.73
50.73
00
00
2020
4040
100
6060
8080
100
Capacity(ktpa)
(ktpa)
Capacity
UKCAPEX
Food Waste AD Plants
CAPEX @ 90%
Figure
120
120
0.00
0.00
140
140
Log.
(UK
Food
Waste
Plants)
UK
Food
Waste
ADAD
Plants
CAPEX
@ 80% costs
7: Published
AD facility
The exchange rate of 101.45:1 INR to GBP
is maintained throughout the model.
SWM Technology
Support – AD case
study




Example:
68 ktpa food waste
Feedstock cost = 0Rs
4Rs Power (kWhel) + 10Rs
GPC
 Missing costs & cost of
finance
 SPB 5 years
 Meets the financial target
‘hurdle rate’
UOM
Value
ktpa
INR/t
68
0.00
Reciprocating gas engine size
CAPEX
Digester and gas engine
OPEX
Feedstock
MWel
2.87
Crore
131.57
Crore/pa
0.00
O&M
Crore/pa
3.12
Total
Production
Biogas yield
Biogas energy content
Crore/pa
3.12
m3/pa
kWh/m3
8,500,000
6.81
Total
MWh/pa
57,882
Electricity generation
Revenue
Electricity sales
MWhel/pa 21,126.78
Crore/pa
8.45
Green production cert
Total
Less total costs
EBITDA
Crore/pa
21.13
Crore/pa
Crore/pa
29.58
3.12
26.46
Term Discounted NPV
Simple payback
Crore/pa
Yrs
1.22
4.97
System
Feedstock input
Feedstock cost
Table 4: Example techno-economic case
 What is the minimum
size of food waste AD
plant to meet this
target?
 Low to no gate fee +
low to no GPC = very
large systems
 Higher rates = smaller
systems
Viable AD scale (ktpa)
SWM Technology Support – AD case study
At 100% cost
At 80% cost
* the surface shown displays the minimum size the AD scheme can be to
meet the required threshold return over the investment term
Figure 9: Viable AD sizes under different feedstock and green
certificate rates
SWM Technology Support – AD case study
GPC (INR/kWhel)1
Scale
Electricity rate
(INR/kWhel)
@100% @90% @80%
Small (20ktpa)
4Rs
Medium (60ktpa) 4Rs
Large (100ktpa) 4Rs
19
10
5
16
8
4
13
6
2
Small (20ktpa)
7Rs
Medium (60ktpa) 7Rs
Large (100ktpa) 7Rs
16
7
2
13
5
1
10
3
0
1 To
the nearest INR
Table 5: Green production certificate rates
 Lets assume a going rate of -£1500 Rs/t
 Low to no reliance on a Government run GPC system to meet the
investment target
Concluding remarks

UK has benefited from clear and enforced policy (sticks and carrots)

Indian waste composition is similar to that of the UK in the past

MRFs do not seem economically viable as a solution currently

GPC and Gate fees improve the economics of food waste AD under the
assumptions

Smaller systems (decentralised) require more support than larger
systems

Increasing electricity rates help support SWM technology viability

We would like to get your contribution for ways to improve the Indian
economic analysis
Thank you for listening
Contact:
Dr. Dan Wright [email protected]