October 2017

WHat is cogeneration and how can it help your business?

As energy costs continue to increase, businesses face pressure to reign in expenditure in other, more predictable areas. Needless to say, this can have effects on wages growth, productivity and even the quality of products being produced. Increasingly, businesses are looking for cleaner, greener and more cost-effective solutions to their energy needs, lest risk cut-backs throughout the rest of their operations. Cogeneration, or combined heat and power (CHP) involves the simultaneous production of heat and electricity, and offers businesses a real opportunity to save on both emissions and costs in their energy usage.
As much as 65% of primary energy used in creating electricity is wasted (expelled as heat and CO2 into the atmosphere) in traditional production methods. More energy is then lost in transit as the electricity generated moves throughout the network to its destination. In the production of ‘useful heat’, cogeneration, and even trigeneration (combined cooling, heating and power or CCHP) make better use of biproducts such as heat and steam; instead utilising these otherwise wasted resources to produce heating and cooling for businesses, at a reduced cost, and with better environmental outcomes.
Evo Energy Technologies
(Img src: Evo Energy Technologies)

Firms like Evo Energy Technologies, who specialise in both cogeneration and trigeneration technologies, have developed systems which overcome this wastage by integrating usable heat and electricity generation into one process. Using either natural gas, or biogas, Evo Energy’s systems generate power and heat (and cooling, in the case of CCHP) onsite, and reduce the reliance of businesses on the grid. This diagram from Co-Energy America simplifies the energy savings model for cogeneration, where heat is captured and used rather than expelled.

Cogeneration America
(Img src: Cogeneration America)

How can it help your business?

Energy and heating are two of the most significant costs of doing business in Australia, no matter what sector you operate in. With rising energy costs, large and small businesses alike are suffering from rapidly increasing power bills. Unpredictability in the Australian energy market has made it difficult for businesses to plan for their power and heating costs, while prices continue to rise; making the cost of doing business unbearable for many. The closure of the Hazelwood Power Station in Victoria on April 1st  2017 only added to these woes, and saw the doubling of energy bills for some manufacturers in the area. According to Financial Review’s article, Manufacturers Slugged by Power Prices:
“Business power retailer ERM Power has reported a 170 per cent hike in electricity contract prices for commercial customers in Victoria and South Australia from two years ago as wholesale prices surge.
Average spot power prices in February across the states were between 98 per cent and 360 per cent higher than a year earlier, with prices in Queensland averaging $239.60/MWh, according to Citigroup. Forward prices are up in all states by as much as 33 per cent month on month, with all states now above $100/MWh for 2017-18.
The chief executive of Australia's largest aluminium smelter said they had to curtail production in recent months because of the spike in electricity prices which was "crippling" the business.”
Of course, these kinds of struggles are not exclusive to the manufacturing industry. Developing systems which reduce reliance on the grid, unshackle businesses from the astronomical costs of energy, and reduce emissions is imperative not only the success of many Australian businesses, but also to the environment. Cogeneration represents an opportunity to mitigate each of these factors, by using fuels and emissions more efficiently, reducing both wastage and costs.

Evo Energy at Rivalea

Evo Energy’s installation of a custom-built biogas generator for Rivalea (one of Australia’s leading agri-food companies) has resulted in reduction of methane emissions, the offsetting of 28,000 tonnes of CO2 per year, and now generates 25% of the site’s power. Furthermore, the cogeneration system boasts a 90% energy efficiency. In comparison to traditional energy wastage of 50 – 60%, the results of the cogeneration model’s efficiency speak for themselves. Not only has this system enabled Rivalea to reduce their carbon and methane emissions, it has saved the firm a staggering sum on their energy and heating costs.

ETS at Bulla Dairy Foods Frozen Goods

The installation of a 2.7MW cogeneration system at the Bulla Dairy Foods Frozen Goods facility in Victoria has resulted in a whopping $1 million per annum saving for the dairy firm. The site’s 50-year old steam system, which was inefficient and costly, was made redundant by the new cogeneration system, as a result of a federal government grant for $2 million. Furthermore, the installation of the system did not interfere with the manufacturing facility’s ability to continue business as usual. Not only is the investment paying dividends for Bulla, it has reduced their carbon emissions significantly. The firm were the recipient of the 2014 International Ice Cream Consortium’s Best Technical Business Solution award, as a result of this innovative undertaking.
Cogeneration is, without a doubt, an integral part of the smart energy solution for Australian businesses going into the future. Rising energy costs, environmental concerns and the dwindling of our finite resources makes these technologies imperative to Australia’s energy future; not to mention, vital to the success of many Australian businesses.

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