Heat and energy cooperation

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I came over an interesting paper discussing the possibilities of industry and energy companies cooperating to put excess industry heat to use as energy and heat sources: A Swedish integrated pulp and paper mill—Energy optimisation and local heat cooperation. I’m afraid the paper is behind a paywall, so I’ll quote the abstract here:

Heat cooperation between industries and district heating companies is often economically and environmentally beneficial. In this paper, energy cooperation between an integrated Swedish pulp and paper mill and two nearby energy companies was analysed through economic optimisations. The synergies of cooperation were evaluated through optimisations with different system perspectives. Three changes of the energy system and combinations of them were analysed. The changes were process integration, extending biofuel boiler and turbine capacity and connection to a local heat market. The results show that the single most promising system change is extending biofuel and turbine capacity. Process integration within the pulp and papermill would take place through installing evaporation units that yield less excess heat but must in this particular case be combined with extended biofuel combustion capacity in order to be beneficial. Connecting to the local heat market would be beneficial for the pulp and paper mill, while the studied energy company needs to extend its biofuel capacity in order to benefit from the local heat market. Furthermore, the potential of reducing CO2 emissions through the energy cooperation is shown to be extensive; particularly if biofuel and turbine capacity is increased.

The findings are interesting, as they point towards an economically viable way to increase energy efficiency, and thus realize some benefits for society. If this could be implemented large scale, there is probably a lot to be gained in terms of savings of both energy, money and CO2 emissions. The following graph shows the CO2 cuts to be had from implementing cooperation, depending on whether you measure against standard Northern European electricity production (coal) or Swedish (hydro/nuclear):

Three different scenarios measured against two types of electricity production. The middle one is recommended by the authors, being also the cheapest one.

Three different scenarios measured against two types of electricity production. The middle one is recommended by the authors, being also the cheapest one.

Of course, all is not well. This paper suffers from the same ailment as many system modeling approaches, namely in that it assumes that the only thing standing in the way of implementation is lack of will or knowledge. However, as we here at the institute know all too well, the problem is more complex[1]. First of all, there is reason to take the methodology itself with a grain of salt. The authors model both existing and potential costs with “mixed integer linear programming”, which on closer inspection turns out to be a standard procedure for optimization within operations research[2].

Now, there’s nothing wrong with trying to establish best practice through setting up a system of parameters and examining outcomes by manipulating input data. It often forms the basis upon which political and practical discussions can take place. However, I think the method has some limitations which are seldom mentioned in the articles applying it (although I’m sure these reservations exist in the background methods training of most operations researchers). Most importantly, the underlying assumption is that implementation of the changes discussed is simply a matter of deciding on a course of action. The problem with this is of course the frequent intervention of real life. There are a million reasons why leaders of businesses and industry (or politicians, or individuals) regularly shy away from decisions that would benefit their companies, so I won’t go into that right here. To the authors’ credit, they include a paragraph on why changes to the system might not be implemented:

Cooperation between industries and energy companies is not always initiated even though it would be both economically beneficial and resource efficient. Other parameters, such as different business cycles, believed advantages of being independent and historical conflicts are examples of barriers to cooperation.

One might object that the purpose of this particular paper is not to discuss possible barriers to implementation, and One would be entirely correct. That discussion is the one that comes after this paper, and is why this is a valuable contribution to the discussion of how one can reduce energy spending and CO2 emissions, even if all the implications are not included in the paper itself.

[1] Ah, one day I hope to be able to say of a phenomenon: “this is actually not complex at all”.

[2] Although, apparently, the mixed integer approach seems to not be so straight-forward. I assume the authors have taken any computational problems into account when using the method.

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Klugman, S., Karlsson, M., & Moshfegh, B. (2009). A Swedish integrated pulp and paper mill—Energy optimisation and local heat cooperation Energy Policy DOI: 10.1016/j.enpol.2008.09.097

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