Energy efficiency investments in Kraft pulp mills given uncertain climate policy

Energy efficiency measures in pulp mills can potentially reduce the consumption of biofuel, which can instead be exported and used elsewhere. In this paper a methodology is proposed for analysing the robustness of energy efficiency investments in Kraft pulp mills or other industrial process plants equipped with biofuelled combined heat and power units, given uncertain future climate policy. The outlook for biofuel and electricity prices is a key factor for deciding if energy efficiency measures are cost competitive. CO ₂ emission charges resulting from climate policy are internalized and thus included in electricity and biofuel prices. The proposed methodology includes a price-setting model for biofuel that assumes a constant price ratio between biofuel and electricity in the Nordic countries. Thirteen energy efficiency retrofit measures are analysed for an existing Swedish Kraft pulp mill. Special attention is paid to heat-integrated evaporation using excess process heat. Four possible energy market development paths are considered that reflect different climate policies. Pulp mill energy efficiency investments considered are shown to be robust with respect to uncertain climate policy. Copyright © 2006 John Wiley & Sons, Ltd.     

Comparison of options for utilization of a potential steam surplus at kraft pulp mills—Economic performance and CO2 emissions

This paper compares different energy‐related investment options that can be implemented in a kraft pulp mill with a potential steam surplus. The options investigated include lignin extraction, electricity production, capturing of CO₂ and black liquor gasification with production of electricity or biofuels, here DME. The investment options are compared with respect to annual net profit and global CO₂ emissions for different future energy market scenarios. A further analysis of how different parameters such as policy instruments and investment costs affect the different technologies also is included. The results show that, generally, for reasonable levels of biofuel support, the best economic performance among the studied technologies is achieved by extraction of lignin valued as oil. However, if the level of support for biofuels is high, black liquor gasification with DME production generally has the best economic performance among the studied options. All the investment options investigated decrease global CO₂ emissions significantly. Capturing and storing CO₂ from the recovery boiler flue gases result in the highest CO₂ emissions reduction and also is an economically attractive option in scenarios with a high CO₂ emissions charge. Copyright © 2012 John Wiley & Sons, Ltd.     

Investments into forest biorefineries under different price and policy structures

Increasing scarcity of oil reserves and the high CO₂ emissions from using oil have contributed to the development of renewable biofuels. Pulp and paper mill integrated forest biorefineries offer one important means to increase biofuel production. This study analyzes the effects of policies to support biofuel production in the pulp and paper sector. We study the relative effectiveness of three biofuel supporting policy instruments, namely production subsidy, input subsidy and investment subsidy. We present a partial equilibrium pulp and paper market model with a biorefinery investment option. A numerical model is used to evaluate the impacts of policy instruments on wood prices, as well as input choices and investment strategies of pulp and paper industries. The data represent the Finnish pulp and paper sector. We evaluate the values and direct costs of the policy instruments in a situation of exogenous biofuel production targets. The direct costs of input and investment subsidies are higher than those of a production subsidy. With all the policy instruments, Finnish pulp and paper mills would invest in wood-gasifying technology, instead of black liquor based one. The number of biorefinery units is dependent on the subsidy type — investment and input subsidies are likely to result in more numerous but smaller biofuel production units than a production subsidy. With all the policy instruments the demand for wood increases in Finland leading to higher wood prices. This, in turn, could reflect negatively on the profitability of the pulp and paper industries. To a significant degree, the model and the results can be generalized to other countries and markets where integrated pulp and paper mills are operating.     

A Swedish integrated pulp and paper mill—Energy optimisation and local heat cooperation

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 paper mill 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.     

Profitability and off‐site CO2‐emission reduction from energy savings in the pulp and paper industry in different future energy markets

Previous studies by the authors have shown that energy savings in pulp and paper mills offer opportunities for increased electricity production on‐site or wood fuel export. The energy export implies reductions in CO₂ emissions off‐site, where fossil fuel or fossil‐fuel‐based electricity is replaced. To assess this potential and the related profitability for a future situation, four energy market scenarios were used. For a typical Scandinavian mill, the potential for CO₂‐emission reductions was 15–140 kton year^?1 depending on the scenario and the form of energy export. Extrapolated to all relevant mills in Sweden, the potential was 0.4–3.1 Mton year^?1, which is in the order of percent of the Swedish CO₂ emissions. Wood fuel export implies larger reduction in CO₂ emissions in most scenarios. In contrast, electricity export showed better economy in most of the cases studied; with annual earnings of 5–6 M€, this is an economically robust option. In the market pulp mill investigated, the wood fuel export was in the form of lignin. Lignin could possibly be valued as oil, regarding both price and potential for CO₂‐emission reduction, making lignin separation an option with good profitability and large reductions of CO₂ emissions. Copyright © 2011 John Wiley & Sons, Ltd.     

Comparison of black liquor gasification with other pulping biorefinery concepts – Systems analysis of economic performance and CO2 emissions

Black liquor gasification (BLG) is being developed as an alternative technology for energy and chemical recovery in kraft pulp mills. This study compares BLG – with downstream production of DME (dimethyl ether) or electricity – with recovery boiler-based pulping biorefinery concepts for different types of mills. The comparison is based on profitability as well as CO₂ emissions, using different future energy market scenarios. The possibility for carbon capture and storage (CCS) is considered. The results show that, if commercialised, BLG with DME production could be profitable for both market pulp mills and integrated pulp and paper mills in all energy market scenarios considered. Recovery boiler-based biorefinery concepts including extraction of lignin or solid biomass gasification with DME production could also be profitable for market and integrated mills, respectively. If the mill is located close to an infrastructure for CO₂ collection and transportation, CCS significantly improves profitability in scenarios with a high CO₂ emissions charge, for both combustion- and gasification-based systems. Concepts that include CCS generally show a large potential for reduction of global CO₂ emissions. Few of the concepts without CCS achieve a significant reduction of CO₂ emissions, especially for integrated mills.     

CO2 emission balances for different black liquor gasification biorefinery concepts for production of electricity or second-generation liquid biofuels

Black liquor gasification (BLG) is currently being developed as an alternative technology for energy and chemical recovery at chemical pulp mills. This study examines how different assumptions regarding systems surrounding the pulp mill affect the CO₂ emission balances for different BLG concepts. The syngas from the gasification process can be used for different applications; this study considers production of renewable motor fuels and electricity generation. Both a market pulp mill and an integrated pulp and paper mill are considered as host mill for the BLG plant. Furthermore, the consequences of limited availability of biomass are shown, i.e., increasing the use of biomass in a mill is not necessarily CO₂-neutral. The results show that the potential to reduce CO₂ emissions by introducing BLG is generally much higher for a market pulp mill than for an integrated pulp and paper mill. Electricity generation from the syngas is favoured when assuming high grid electricity CO₂ emissions where as motor fuel production is favoured when assuming low grid electricity CO₂ emissions. When considering the consequences of limited availability of biomass, the CO₂ emission balances are strongly affected, in some cases changing the results from a decrease to an increase of the CO₂ emissions.     

A tool for creating energy market scenarios for evaluation of investments in energy intensive industry

The energy intensive industry can be a major contributor to CO₂ emissions reduction, provided that appropriate investments are made. To assess profitability and net CO₂ emissions reduction potential of such investments, predictions about future energy market conditions are needed. Energy market scenarios can be used to reflect different possible future energy market conditions. This paper presents a tool for creating consistent energy market scenarios adapted for evaluation of energy related investments in energy intensive industrial processes. Required user inputs include fossil fuel prices and costs associated with policy instruments, and the outputs are energy market prices and CO₂ consequences of import/export of different energy streams (e.g. electric power and biomass fuel) from an industrial process site. The paper also presents four energy market scenarios for the medium-term future (i.e. around 2020) created using the tool.     

System analysis of hydrogen production from gasified black liquor

Hydrogen produced from renewable biofuel is both clean and CO₂ neutral. This paper evaluates energy and net CO₂ emissions consequences of integration of hydrogen production from gasified black liquor in a chemical pulp mill. A model of hydrogen production from gasified black liquor was developed and integration possibilities with the pulp mill's energy system were evaluated in order to maximize energy recovery. The potential hydrogen production is 59 000 tonnes per year if integrated with the KAM reference market pulp mill producing 630 000 Air dried tonnes (ADt) pulp/year. Changes of net CO₂ emissions associated with modified mill electric power balance, biofuel import and end usage of the produced hydrogen are presented and compared with other uses of gasified black liquor such as electricity production and methanol production. Hydrogen production will result in the greatest reduction of net CO₂ emissions and could reduce the Swedish CO₂ emissions by 8% if implemented in all chemical market pulp mills. The associated increases of biofuel and electric power consumption are 5% and 1.7%, respectively.     

Strategies for 2nd generation biofuels in EU – Co-firing to stimulate feedstock supply development and process integration to improve energy efficiency and economic competitiveness

The present biofuel policies in the European Union primarily stimulate 1st generation biofuels that are produced based on conventional food crops. They may be a distraction from lignocellulose based 2nd generation biofuels – and also from biomass use for heat and electricity – by keeping farmers' attention and significant investments focusing on first generation biofuels and the cultivation of conventional food crops as feedstocks. This article presents two strategies that can contribute to the development of 2nd generation biofuels based on lignocellulosic feedstocks. The integration of gasification-based biofuel plants in district heating systems is one option for increasing the energy efficiency and improving the economic competitiveness of such biofuels. Another option, biomass co-firing with coal, generates high-efficiency biomass electricity and reduces CO₂ emissions by replacing coal. It also offers a near-term market for lignocellulosic biomass, which can stimulate development of supply systems for biomass also suitable as feedstock for 2nd generation biofuels. Regardless of the long-term priorities of biomass use for energy, the stimulation of lignocellulosic biomass production by development of near term and cost-effective markets is judged to be a no-regrets strategy for Europe. Strategies that induce a relevant development and exploit existing energy infrastructures in order to reduce risk and reach lower costs, are proposed an attractive complement the present and prospective biofuel policies.     

Pathways to a sustainable European kraft pulp industry: Trade-offs between economy and CO2 emissions for different technologies and system solutions

In this paper the trade-off, in terms of annual net profit for the mill and global emissions of CO₂, between different technology pathways for utilization of excess steam and heat at kraft pulp mills is investigated for a case depicting a typical Scandinavian mill of today. The trade-off is analysed for four future energy market scenarios having different levels of CO₂ charge. The technology pathways included in this study are increased electricity production in new turbines, production of district heating, increased sales of biomass in the form of bark and/or lignin, and carbon capture and storage (CCS). The results show that the proven pathways, increased electricity production, bark export and district heating production, are economically robust, i.e. they are profitable for all of the studied energy market scenarios. The new and emerging technology pathways, that are CCS and lignin extraction, hold a larger potential for reduction of global CO₂ emissions, but their economic profitability is more dependent on the development of the energy market. All in all, it can be concluded that to realize the larger potential of reduction of global CO₂ emissions a high carbon cost alone may not be sufficient. Other economic stimulations are required, e.g. technology-specific subsidies.     

Black liquor gasification—consequences for both industry and society

The pulp and paper industry consumes large quantities of biofuels to satisfy process requirements. Biomass is however a limited resource, to be used as effectively as possible. Modern pulping operations have excess internal fuels compared to the amounts needed to satisfy process steam demands. The excess fuel is often used for cogeneration of electric power. If market biofuel availability at a reasonable price is limited, import/export to/from a mill however changes the amount of such biofuel available for alternative users. This work compares different mill powerhouse technologies and CHP plant configurations (including conventional recovery boiler technology and black liquor gasification technology) with respect to electric power output from a given fuel resource. Different process steam demand levels for different representative mill types are considered. The comparison accounts for decreased/increased electricity production in an alternative energy system when biofuel is imported/exported to/from the mill. The results show that black liquor gasification is in all cases considered an attractive powerhouse recovery cycle technology. For moderate values of the marginal electric power generation efficiency for biofuel exported to the reference alternative energy system, excess mill internal biofuel should be used on mill site for gas turbine based CHP power generation. The remaining excess biofuels in market pulp mills should be exported and used in the reference alternative energy system in this case. For integrated pulp and paper mills, biofuel should be imported, but only for cogeneration usage (i.e. condensing power units should be avoided). If biofuel can be used elsewhere for high efficiency CHP power generation, mill internal biofuel should be used exclusively for process heating, and the remainder should be exported.     

Excess heat from kraft pulp mills: Trade-offs between internal and external use in the case of Sweden—Part 2: Results for future energy market scenarios

In this paper the trade-off between internal and external use of excess heat from a kraft pulp mill is investigated for four different future energy market scenarios. The work follows the methodology described in Svensson et al. [2008. Excess heat from kraft pulp mills: trade-offs between internal and external use in the case of Sweden—Part 1: methodology. Energy Policy, submitted for publication], where a systematic approach is proposed for investigating the potential for profitable excess heat cooperation. The trade-off is analyzed by economic optimization of an energy system model consisting of a pulp mill and an energy company (ECO). In the model, investments can be made, which increase the system's energy efficiency by utilization of the mill's excess heat, as well as investments that increase the electricity production. The results show that the trade-off depends on energy market prices, the district heating demand and the type of existing heat production. From an economic point of view, external use of the excess heat is preferred for all investigated energy market scenarios if the mill is studied together with an ECO with a small heat load. For the cases with medium or large district heating loads, the optimal use of excess heat varies with the energy market price scenarios. However, from a CO₂ emissions perspective, external use is preferred, giving the largest reduction of global emissions in most cases.     

Integration of algae-based biofuel production with an oil refinery: Energy and carbon footprint assessment

Biofuel production from algae feedstock has become a topic of interest in the recent decades since algae biomass cultivation is feasible in aquaculture and does therefore not compete with use of arable land. In the present work, hydrothermal liquefaction of both microalgae and macroalgae is evaluated for biofuel production and compared with transesterifying lipids extracted from microalgae as a benchmark process. The focus of the evaluation is on both the energy and carbon footprint performance of the processes. In addition, integration of the processes with an oil refinery has been assessed with regard to heat and material integration. It is shown that there are several potential benefits of co-locating an algae-based biorefinery at an oil refinery site and that the use of macroalgae as feedstock is more beneficial than the use of microalgae from a system energy performance perspective. Macroalgae-based hydrothermal liquefaction achieves the highest system energy efficiency of 38.6%, but has the lowest yield of liquid fuel (22.5 MJ per 100 MJ_algae) with a substantial amount of solid biochar produced (28.0 MJ per 100 MJ_algae). Microalgae-based hydrothermal liquefaction achieves the highest liquid biofuel yield (54.1 MJ per 100 MJ_algae), achieving a system efficiency of 30.6%. Macro-algae-based hydrothermal liquefaction achieves the highest CO₂ reduction potential, leading to savings of 24.5 resp 92 kt CO_2eq/year for the two future energy market scenarios considered, assuming a constant feedstock supply rate of 100 MW algae, generating 184.5, 177.1 and 229.6 GWh_biochar/year, respectively. Heat integration with the oil refinery is only possible to a limited extent for the hydrothermal liquefaction process routes, whereas the lipid extraction process can benefit to a larger extent from heat integration due to the lower temperature level of the process heat demand.     

Potential impact on air pollution from ambitious national CO2 emission abatement strategies in the Nordic countries – environmental links between the UNFCCC and the UNECE – CLRTAP

This article presents results from a meta-study of Nordic low carbon dioxide (CO₂) emission scenarios. The focus of the study was to explore possible environmental impacts if selected Nordic low CO₂ emission scenarios were achieved by 2020. The impacts of concern were climate change, acidification, eutrophication and human health. Results from this study indicate that large scale reduction of CO₂ emissions by 2020 in a Nordic energy system requires large scale penetration of technical measures and structural changes. The environmental improvements achieved would most often facilitate achievement of air pollution targets as well as post-Kyoto targets for greenhouse gas (GHG) emissions. All scenarios do, however, not imply co-benefits between air pollution and CO₂ emission reductions and the net impact on climate change could be smaller than anticipated. A conclusion is that co-benefits and risks for trade-offs between air quality and climate change should be emphasised in the development of low-CO₂ energy and emission strategies.     

Using biomass: A system perturbation analysis

As a consequence of current energy and climate policies, several regional and federal measures are being implemented in Belgium to encourage the utilization of biofuels for automotive applications. The use of biomass for power and/or heat production also gets growing support through CHP and/or CO₂ certificates and most probably through new upcoming European directives. As a result, many investors, policy makers and energy companies are investigating these so-called biomass routes and there is definitely a need to gain more insight in this complex matter.This paper presents an analysis and comparison of the most promising options for utilizing the limited biomass resources in Belgium. To allow for a systematic comparison, a new method called System Perturbation Analysis (SPA) was developed. SPA differs from a classical Life Cycle Analysis (LCA) mainly because it looks to geographical system balances of resources and the resulting effects, rather than comparing well-to-wheel trajectories. Therefore SPA is able to identify the best usage of limited resources such as hectares, wood waste or imports, in terms of fossil energy savings or GHG emissions within a given system (in casu: Belgium). Comparative results of such a SPA assessment are presented and discussed in this paper, including the use of wood for transport, heat and power applications. All the considered biofuel scenarios have positive energy and CO₂eq balances. The use of wood appears as a good choice in terms of efficiency, CO₂ abatement and surface requirements.     

Assessment of transport fuel taxation strategies through integration of road transport in an energy system model—the case of Sweden

Road transport is responsible for a large and growing share of CO₂ emissions in most countries. A number of new fuel‐efficient vehicle technologies and renewable transport fuels are possible alternatives to conventional options but their deployment relies strongly on different policy measures. Even though a future higher use of transport biofuels and electric vehicles is likely to increase the interaction between the transportation sector and the stationary energy system (heat, power, etc.), these systems are often analysed separately. In this study, a transport module is developed and integrated into the MARKAL_Nordic energy system model. The transport module describes a range of vehicle technologies and fuel options as well as different paths for conversion of primary energy resources into transport fuels. The integrated model is utilized to analyse the impact of transport fuel tax designs on future cost‐effective fuel and technology choices in the Swedish transportation sector, as well as the consequences of these choices on system costs and CO₂ emissions. The model, which is driven by cost‐minimization, is run to 2050 with various assumptions regarding transport fuel tax levels and tax schemes. The results stress the importance of fuel taxes to accelerate the introduction of fuel‐efficient vehicle technologies such as hybrids and plug‐in hybrids. Tax exemptions can make biofuels an economically favourable choice for vehicle users. However, due to limitations in biomass supply, a too strong policy‐focus on transport biofuels can lead to high system costs in relation to the CO₂ abatement achieved. The modelling performed indicates that the effects caused by linkages between the transportation sector and the stationary energy system can be significant and integrated approaches are thus highly relevant. Copyright © 2011 John Wiley & Sons, Ltd.     

Biofuels in Spain: Market penetration analysis and competitiveness in the automotive fuel market

For several years the European Union (E.U.) has been promoting the use of biofuels due to their potential benefits such as the reduction of dependence on foreign energy imports (the raw materials can be produced within the E.U.), the more stable fossil fuel prices (they can replace fossil fuels on the market), the greenhouse gas (GHG) reduction (biofuels’ raw materials fix CO₂ from the atmosphere) and the fact that they can represent an additional source of income for the primary sector (biofuels’ raw materials are vegetables that can be grown and harvested).Despite the public aids (direct and indirect), biofuels are not competitive with fossil fuels at present, but it is possible that in the future the environment conditions change and biofuels might become competitive. It is difficult to assess whether this will happen or not, but it is possible to make an assessment of a future situation.This article presents two analyses with one objective: to determine if biofuels might become competitive in the future. The first analysis examines the dependencies of two quotations which have a strong relationship with fuels: the crude oil quotation and the CO₂ bond quotation. The analysis of these relationships may help to forecast the future competitiveness of biofuels. For instance, biofuels’ future competitiveness will be higher if their raw material costs are not related to crude oil quotations or if they are related in a negative way (the higher the crude oil quotations the lower the raw material biofuels’ cost). The second analysis focuses on the market penetration of biofuels in the Spanish market. There are data related to biofuels monthly consumption in Spain since 2007 and it is possible to know if biofuels are gaining market quota since then.     

Stimulating the use of biofuels in the European Union: Implications for climate change policy

The substitution of fossil fuels with biofuels has been proposed in the European Union (EU) as part of a strategy to mitigate greenhouse gas emissions from road transport, increase security of energy supply and support development of rural communities. In this paper, we focus on one of these purported benefits, the reduction in greenhouse gas emissions. The costs of subsidising the price difference between European bioethanol and petrol, and biodiesel and diesel, per tonne of CO₂ emissions saved are estimated. Without including the benefits from increased security of energy supply and employment generation in rural areas, the current costs of implementing European domestic biofuel targets are high compared with other available CO₂ mitigation strategies. The policy instrument of foregoing some or all of the excise duty and other taxes now applicable to transport fuels in EU15 on domestically produced biofuels, as well as the potential to import low-cost alternatives, for example, from Brazil, are addressed in this context.     

Benefits of using an optimization methodology for identifying robust process integration investments under uncertainty—A pulp mill example

This paper presents a case study on the optimization of process integration investments in a pulp mill considering uncertainties in future electricity and biofuel prices and CO₂ emissions charges. The work follows the methodology described in Svensson et al. [Svensson, E., Berntsson, T., Strömberg, A.-B., Patriksson, M., 2008b. An optimization methodology for identifying robust process integration investments under uncertainty. Energy Policy, in press, doi:10.1016/j.enpol.2008.10.023] where a scenario-based approach is proposed for the modelling of uncertainties. The results show that the proposed methodology provides a way to handle the time dependence and the uncertainties of the parameters. For the analyzed case, a robust solution is found which turns out to be a combination of two opposing investment strategies. The difference between short-term and strategic views for the investment decision is analyzed and it is found that uncertainties are increasingly important to account for as a more strategic view is employed. Furthermore, the results imply that the obvious effect of policy instruments aimed at decreasing CO₂ emissions is, in applications like this, an increased profitability for all energy efficiency investments, and not as much a shift between different alternatives.