Block Island
Vermont CHP and Customer Generation Potential Study
September 15th Study Team Progress Report
Presented by:
La Capra Associates, Inc.
Stantec Consulting Inc.
Presented to:
VSPC Study Team
September 15, 2010
Agenda

Objectives for today’s briefing

Existing CHP/Customer Generation

CHP Technology Overview

CHP Potential Methodology -

Assumptions and Economic Testing
John Athas

Summary of Issues from Discussion
Patty Richards

Next Steps
John Athas
Dan Kelly, Jose Donnell
Dan Kelly
John Athas, Patty Richards,
Barbara Stoddard, Melissa Whitten
Patty Richards, John Athas

2
Objectives for today’s briefing
1. Provide an Update of the current CHP /
Customer Generation Investigations
2. Provide an Update on the CHP Potential
including an understanding of:

Methodologies and approximations

Progress in Data Gathering
3. Discuss any study issues and obstacles with the
VSPC Study Committee
– Sub-bullet
3
Existing CHP/Customer Generation
 Data Gathering
 Industrial Database review
 Vermont Utility Survey by La Capra Team
 VT PSB
• Net-metering applications
• Posted CHP Existing Facilities
 Host Customer Electric Load Information Request?
 Mapping of Locations
 Summaries of Technology and Operations
 Customer Phone Interviews
 Economic Review
4
Existing CHP/Customer Generation –
Preliminary Tabulation
PLANT_NAME
PHYS_CITY
COUNTY
Brattleboro Kiln Dry Company
Ethan Allen, Inc.
Bellow Falls High School
Crescent Manor Nursing Home
Berkshire Cow Power
Brattleboro Retreat
Omega Optical
Blue Spruce Farm
Vermont Energy Investment Corporation
Hinsdale Farms
East Ryegate Wood Energy
Pompanoosuc Mills
Essex Junction Wastewater Treatment
Florence Project
Gilman Mill
Bell Gates Lumber
Middlebury College
Foster Brothers Farm, Inc.
North Country Hospital
Norwich University
Green Mountain College Biomass Facilitiy
Westminster Farms
Green Mountain Dairy Farm
Rock Tenn
South Burlington School
Southern State Correctional Facility
Montagne Dairy Farm
Green Mountain Coffee Roasters
Battleboro
Beecher Falls
Below Falls
Bennington
Berkshire
Brattleboro
Brattleboro
Bridport
Burlington
Charlotte
East Ryegate
East Thetford
Essex Junction
Florence
Gilman
Jeffersonville
Middlebury
Middlebury
Newport
Northfield
Poultney
Putney
Sheldon
Sheldon Springs
South Burlington
Springfield
Swanton
Waterbury
Windham
Essex
Windham
Bennington
Franklin
Windham
Windham
Addison
Chittenden
Chittenden
Caledonia
Orange
Chittenden
Rutland
Caledonia
Lamoille
Addison
Addison
Orleans
Washington
Rutland
Windham
Franklin
Franklin
Chittenden
Windsor
Franklin
Washington
ZONE_VEL
CO
IND_DESC
O
A
O
O
P
O
O
J
G
I
E
K
B,I
L
F
C
J
J
A
E
M
O
B,C
B,C
G
N
B,P
E
Wood Products
Furniture
Schools
Nursing Homes
Agriculture
Misc. Education
Instruments
Agriculture
Office Buildings
Agriculture
Pulp and Paper
Furniture
Wastewater Treatment
Minerals
Pulp and Paper
Wood Products
Colleges/Univ.
Agriculture
Hospitals/Healthcare
Colleges/Univ.
Colleges/Univ.
Agriculture
Agriculture
Pulp and Paper
Schools
Justice/ Public Order
Agriculture
Food Processing
START
FUEL_TYP
PRIME_MVR E1
GEN (kW)
2000 ERENG
1940 B/ST
1991 ERENG
1996 ERENG
2006 ERENG
1988 ERENG
2005 ERENG
2005 ERENG
1988 ERENG
2005 ERENG
1992 B/ST
2008 B/ST
2004 MT
1992 CT
1982 B/ST
1988 B/ST
1982 B/ST
1982 ERENG
2005 B/ST
1987 B/ST
2010 B/ST
2009 ERENG
2007 ERENG
1994 B/ST
1999 ERENG
2005 ERENG
2007 ERENG
2003 ERENG
NG
WOOD
OIL
NG
BIOMASS
OIL
OTR
BIOMASS
NG
BIOMASS
WOOD
WAST
BIOMASS
NG
WOOD
WOOD
OIL
BIOMASS
WOOD
OIL
WOOD
BIOMASS
BIOMASS
OTR
NG
NG
BIOMASS
NG
380
1,232
433
60
600
1,000
461
392
60
65
20,000
30
60
7,600
4,000
75
1,885
142
274
625
300
225
275
1,135
60
600
300
375
CHP
YES
NO
YES
YES
YES
YES
YES
YES
YES
YES
NO
YES
YES
NO
NO
YES
NO
YES
YES
YES
YES
YES
YES
NO
YES
YES
YES
YES
5
CHP Technology Overview
 Prime Mover Technologies to be Studied
 Internal Combustion Turbine
 Diesel Based Configurations
 Fuel Cells
 Combustion Turbine
 Steam Turbine / Back Pressure Steam Turbine
 Key assumptions being finalized
 Available Sizes and Fuel
 Electric and overall thermal efficiencies
 Cost & Performance
6
CHP Potential Methodology
 Overview of analysis
 Customer / Segment Characteristics
 Segment Size
 Electric Load
 Thermal Load
 Natural Gas Availability

CHP / Customer Generation Equipment
Operation
7
CHP Potential Methodology - Overview
 Begins with estimation of Customer segment
sizes represented by a typical customer
 SIC Code – two digit
 Load Zone
 Fuel availability
 Electric and Thermal Use Characteristics, potential for CHP and
Electric to Thermal Switching such as Absorption Chilling
 Various Generation technologies and sizes
tested for each segment.
Analysis approximates the operation of a CHP
unit based upon electric and thermal match
Lowest cost per kWh plant will be chosen
8
CHP Potential Methodology – Electric Load Data
 MWH by Zone

Statewide - EVT Data

Burlington - BED Data

Retail Sales (no distribution, transmission or sub-transmission
losses)

Missing IBM 2008 and 2009 data set
– Used average 2005 to 2007 for missing IBM data

Missing ~ 8% of the load data from the zone counts.
– Per EVT missing data :
» OMYA
» Stowe Mount Mansfield Load
» Unknown Loads
» Will make adjustment to load zones per above

9
CHP Potential Methodology – Electric Load Data
 Customer Count by Zone
 SIC

MWH by Zone by SIC

Number of Customers by Zone by SIC
 No KW… yet (EVT)

If no data produced may need “typical load” factor

Will have to back into KW
10
CHP Potential Methodology - Sample Customer Data
Number Customers per Load Zone per Type (C= Commerical, I=Industrial, R= Residential)
Sum of CountOfUPremise
LoadZone
A
B
C
D
E
F
G
H
I
J
K
M
N
O
P
Grand Total
ZoneDescription
Newport
St. Albans
Johnson
Morrisville
Montpelier
St. Johnsbury
Burlington
IBM
Chittenden\Addison GMP
Middlebury
Central - Barnard
Rutland
Ascutney
Southern
Highgate
Sector
C
1,980
2,236
1,098
2,538
5,182
1,938
3,722
7,220
1,499
4,699
5,938
1,830
7,179
1,263
48,322
I
4
6
4
9
2
13
1
11
3
4
9
2
14
1
83
R
Grand Total
14,640
16,624
17,744
19,986
11,007
12,109
11,262
13,800
33,815
39,006
11,412
13,352
16,293
20,028
1
41,980
49,211
9,027
10,529
28,436
33,139
36,266
42,213
12,300
14,132
45,515
52,708
10,111
11,375
299,808
348,213
11
CHP Potential Methodology – Sample Load Zone Data
Sales KWH Average (2007 through 2009)
Sum of KWH (Avg '07-'09)
LoadZone
A
B
C
D
E
F
G
H
I
J
K
M
N
O
P
Unknown
Grand Total
Sector
Zone
Commercial
Industrial
Residential
Unknown
Grand Total
Newport
69,659,778
30,866,073
83,614,924
184,140,775
St. Albans
103,448,666
84,367,278
136,617,733
324,433,677
Johnson
31,920,910
52,837,304
78,019,063
162,777,277
Morrisville
75,106,752
73,593,970
148,700,722
Montpelier
196,122,954
74,853,804
225,812,447
496,789,204
St. Johnsbury
73,957,128
22,938,649
75,903,868
172,799,645
Burlington
215,256,667
49,632,000
88,089,333
352,978,000
IBM
225,431,785
225,431,785
Chittenden\Addison GMP
436,347,593
85,216,134
312,905,919
834,469,646
Middlebury
60,622,871
48,355,935
72,955,409
181,934,215
Central - Barnard
148,893,221
36,991,422
202,185,166
388,069,809
Rutland
227,723,347
97,049,549
260,818,338
585,591,233
Ascutney
71,284,266
11,059,939
86,981,782
169,325,987
Southern
305,780,389
135,891,646
324,318,285
765,990,320
Highgate
51,398,438
55,529,543
66,950,910
173,878,891
Vermont
103,537,847
103,537,847
2,067,522,979 1,011,021,060
2,088,767,147
103,537,847
5,270,849,033
Statewide Avg
Delta
Missing
- OMYA
- Mount Mansfield
- Unknown Accounts
5,696,793,053
460,456,636
8%
Action
Zone
Assign to
L
Assign to
D
load weight avg
all zones
12
CHP Potential Methodology: Estimated Thermal Load
 How to obtain Thermal Load – Load not served by
electricity

Sources for natural gas usage by Industry may exist:

Vermont Natural Gas:
– Service territory does not include entire state
– Availability: to be determined

Need total thermal load served by all fuels not just gas

Input-Output data collected annually by SIC code
– Annual tables have limited detail
– Benchmark years have more detail but released with a lag –
latest year is 2002
– Provides metric for electric, gas, coal, and petroleum used to
produce each industry’s output.
13
CHP Potential Methodology: Estimated Thermal Load
 Input – Output Table: Bureau of Economic Analysis (BEA)

Provides value of fuel used as a share of output

Correspondence to 4-digit SIC code level detail (*)

Paper Mills (SIC 26): for every $1.00 of output produced:
– Electricity: 3 cents
Natural Gas: 2.7 cents
 Algorithm to Estimate Electric to Total Thermal Load:

Relative fuel prices to electric prices for Benchmark Year 2002

Developed algorithm to estimate Electric to Total Thermal Load

Combined ratio of each fuel’s share of output to electricity’s value – in
algebraically correct manner

* Fuel price ($/ mmBtu ) divided by Electricity price ($/mmBtu)
 Apply to EVT, et al, kWh by SIC to obtain Thermal Load for
use as input to Customer Economic Model.
14
Historical Price by Fuel Type: create price ratios
EIA Electric Power Annual - State Historical Tables for
2008 Released: January 21, 2010
Average Price of Electricity by Provider, 1990-2008
Year
State
Industry Sector Category
2002
US-TOTAL
Total Electric Industry - Cents per k Wh
8.44
7.89
4.88
6.75
7.20
$ per MWhr
84.40
78.90
48.80
67.50
72.00
$ per MMBtu
24.73
23.12
14.30
19.78
21.10
Source: http://www.eia.gov/dnav/ng/ng_pri_sum_dcu_nus_a.htm
(Note: Thousand Cubic Feet = Mcf)
2002
U.S.
Residential
Commercial
Other (street
lighting,
agricultural &
irrigation,
transporation)
Industrial
U.S. Price of Natural Gas Delivered to Sector (Dollars per Mcf)
Residential
Commercial
Industrial
Electric Power
U.S. Natural Gas Prices $/Mcf
7.89
6.63
4.02
3.68
mmBtu/Mcf
1.03
1.03
1.03
1.03
$/MMBtu
8.10
6.81
4.13
3.78
Source: EIA AEO 2005, Reference Case Forecast
Table A3. Energy Prices by Sector and Source, and
Table A19. GDP Price Deflator Index
2002
U.S.
Petroleum Products (Wgtd Average)
2002
U.S.
Steam Coal
2002
U.S.
GDP Deflator
Ratio of Electric / Gas Price $/MMBtu
Total Price
All Users
0.00
U.S. Price of Fuel Delivered to Sector (Dollars per MMBtu)
Residential
Commercial
9.86
0.98
3.05
Industrial
6.83
0.98
3.40
Electric Power
All Users
6.41
4.29
8.93
1.57
1.25
1.27
0.98
0.98
0.98
3.46
3.78
2.36
Ratio of Electric / Petroleum Price $/MMBtu
2.23
3.33
16.65
Ratio of Electric / Coal Price $/MMBtu
9.10
11.46
16.65
15
Example: Thermal Load Estimation for one SIC
U.S. BUREAU OF ECONOMIC ANALYSIS (BEA) INPUT-OUTPUT (I-O) ACCOUNTS
2002 BENCHMARK YEAR (Detailed SIC Code Data)
TABLE: Commodity-by-Industry Direct Requirements, after Redefinitions (1987, 1992, 1997 to 2008)
EVT / La Capra / BEA SIC
Concordance
(NAICS) IOCode
26
322120
INPUT / OUTPUT:
Each Industry Uses these Sources of Energy as a Commodity
INPUT. The values shown represent the cost of that INPUT as a
share of $1.00 of each industry's OUTPUT.
212100
Coal mining
221100
Electric power
gen, transm, distr
221200
Natural gas
distribution
324110
Petroleum
refineries
Industry Name (NAICS Description)
Paper mills
Electric / Other Fuel Input as a share of Total Output:
0.0028467
0.0309194
0.0266901
0.0084476
10.86
1.16
3.66
Electric Price / Other Fuel Price - Industrial Sector:
9.10
3.46
2.23
Fuel Prices $/MMBtu
1.57
4.13
6.41
0.33
1.64
Interim Step
Estimated Electric to Total Thermal Load:
14.30
1.19
0.23
EVT & Segments kWh (converted to Btus) / Estimated Electric to Total Thermal Load = Thermal Load Btus
Used as Input to Economic Analysis
16
CHP Potential Methodology: CHP Operation
Customer Segment Characteristics
 Electric Peak Demand Estimation
 Split of High Quality (e.g. Steam) and Low Quality (e.g. Hot
Water) Thermal Usage
 Capture Existing Fuels used for Thermal Energy Production
 Allowance for Thermal Use Characteristics
 Thermal Match Factor (reduces customer thermal)
 Thermal Requirement Split (reduces hours of CHP
operation)
 CHP Unit Assumptions
 Sizes Evaluated – Max Customer Peak, Minimum based on
Load factor
 Units Operate whenever Thermal output is utilized on-site
 Excess sold at Market Prices to grid
17
CHP Potential Methodology: Potential Definitions
Technical Potential
 Generation Plant Sized ‘optimally’ for each segment
 Customer Thermal Load dependent
 Will not include creation of aggregated thermal loops such as
district heating and cooling
 Segment CHP Cost of Electricity
 Net Cost of Electricity for the “Technical Potential” Blocks
Economic Potential
 Sizes Evaluated – Max Customer Peak, Minimum based on
Load factor
 Units Operate whenever Thermal output is utilized on-site
 Excess sold at Market Prices to grid
18
Assumptions and Economic Testing
Assumptions
 EVT Assumptions
 Cost of Money
 Discount rate
 Avoided Costs
 Escalation Rates
 ‘Core’ Fuel Price
 Externality ‘costs’ of emissions
 Electric Utility Rates – specific local utility
19
Assumptions and Economic Testing
 Economic Testing
 Net Cost of Electricity
 Host Customer Economics – value based upon
electric rates and market prices
 20 year NPV, Simple Payback, Internal Rate
of Return
 Electric Utility Resource Economics – value
based on market prices for energy and capacity,
avoided distribution and transmission
 Societal Test, Total Resource Cost Test, Utility
Cost Test
20
Economic Testing – Net Cost of Electricity
CHP Fuel
Thermal
Credit
Net Cost
of
Electricity
O&M
Capital
21
Summary of Issues from Discussion
Existing CHP
Customer Data
Methodology
22
Next Steps
23
  
Thank you
Contact Information:
One Washington Mall,
9th Floor
Boston, MA 02108
www.lacapra.com
617-778-5515
277 Blair Park
Suite 210
Williston, VT 05495
802-861-1617 or
802-861-1618
John Athas
jathas@lacapra.com
24