Technical and economical feasibility in ESCO business

1
Technical and economical feasibility in ESCO
business

• ESCO Seminar
• St. Petersburg 12-13.5.2004
• Gaia Group Oy

2
Background

• ESCO (typically)
• provides customers with feasible means of
  improving their competitiveness by reducing
  energy consumption costs
• offers energy services to customers with
  performance guarantees
• Possible targets for ESCO-projects
• industrial sector
• public and private service sector
• buildings
• heat and power production

3
Technical solutions (1/2)

• Industry
• energy control systems
• energy efficiency improvements
• cogeneration
• lightning, HVAC system modification etc.
• Public and private sector, buildings (energy
  consumers)
• heat recovery
• insulation
• energy control systems
• lightning
• energy saving modifications (doors, windows etc.)

4
Technical solutions (2/2)

• Energy production
• New sites
• energy efficient technologies utilising renewable
  energy sources
• on-site heat or CHP/cogeneration
• Existing sites
• converting fuel into cleaner one (f. ex. natural
  gas substitutes for fuel oil)
• replacing fossil fuel by renewable energy sources
  (f. ex. biomass for heat production)
• modification of existing on-site heat or CHP
  production
• use of secondary heat from industry for
  district heating

5
Fuel usage example
Fuel consumption in municipal boiler-houses (in
Leningrad Oblast)
Source Regional Energy Partnership
6
Clean energy technologies (1/2)

• Heat production
• Boilers based on bio fuels (biomass, biogas)
• Solar energy (collectors)
• Heat pumps (ground-source, air-to-air)
• Power generation
• Wind power
• Hydropower (mini and micro)
• Photovoltaics

7
Clean energy technologies (2/2)

• Combined heat and power production (CHP)
• Biomass boiler integrated with mini turbine
• Gasification of biomass and waste-derived fuels
  (REF)
• Biogas engines suitable for biogas generated in
  municipal waste management
• Mini and micro CHP
• microturbines
• fuel cells
• ORC and Stirling engines

8
Characteristic of clean energy technologies
9
Feasibility of investments for energy efficiency
and on-site generation

• Factors influencing on feasibility
• Selected technology and efficiency
• Business concept (ESCO concept/model)
• Project financing
• Final investments costs
• Production costs
• Energy savings
• Tariff system
• Fuel price
• Taxation of electricity and fuel
• Optimisation and control of power unit
• Emission trading

10
Project identification, analysis and project phase

• Identification of potential sites
• Different sectors industry, municipal level,
  energy production
• Paying attention to possibility to use clean
  energy sources (RES)
• Analysis of selected sites
• Utilisation of environmentally friendly
  technologies
• Calculation of repayment period (feasible level
  less than 5-6 years)
• Sensitivity analysis of feasibility (fuel,
  energy, investment prices)
• Decision to implement project
• Based on the result of analysis
• Project financing (energy savings/ESCO, energy
  incentive program)

11
Gaia Group Oy
Gaia Group is an environmental and energy
consulting company focused on sustainability www.g
aia.fi

• Services
• Environmental and Energy consulting
• Environmental assessments
• Distributed generation (GaiaPower)
• Technology and Foresight studies
• Risk management
• Main office located in Helsinki

• Customers
• Industry and energy companies
• International organisations
• Public organisations
• Experts
• Totally 11 experts of which
  5 D. Sc. (Tech)
• Comprehensive know-how