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Technical, economic, and regulatory analysis of the implementation of micro-cogeneration technology in the Brazilian manufacturing sector

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Abstract

Small-scale distributed power generation offers environmental benefits through the improvement of global energy efficiency, in addition to increasing the reliability of the power supply. In this study, the technical and economic viability of the implementation of micro-cogeneration technology in the manufacturing sector was studied in light of the Brazilian regulatory situation. The thermal efficiency potential for the manufacturing sector is introduced for further exploration by decision-makers. This study also investigated the behavior of micro-cogeneration in distributed generation through the Brazilian Energy Compensation System. The technical viability was studied by simulating a Brayton cycle with the operation parameters of a 100 kW micro-turbine. This simulation allowed an estimation of the avoided cost of natural gas compared to an industrial process without cogeneration. Rate projections were performed by linear regression during the system’s depreciation period. The economic evaluation was performed using the following indicators: net present value (NPV), internal rate of return (IRR), and discounted payback. Finally, a sensitivity study was performed to project how the micro-cogeneration efficiency and the Brazilian regulations can address future variations of natural gas and electricity rates. Given the conditions of this study, the increase in energy prices favors micro-cogeneration; however, the economic viability is affected if the system operates below 70% of heat use in industrial processes, which reduces the effect of public policies toward the incentive to cogenerate.

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Notes

  1. ANEEL – Agência Nacional de Energia Elétrica (National Electricity Agency).

  2. Agência reguladora de Saneamento e Energia do Estado de São Paulo (State of Sao Paulo Sanitation and Energy Regulatory Agency).

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Acknowledgements

This work was sponsored by the Brazilian Federal Agency for the Support and Evaluation of Graduate Education (Coordenação de Aperfeiçoamento de Pessoal de Nível Superior (CAPES)).

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Correspondence to Clesio L. Landini Jr.

Annex 1

Annex 1

Rates

Time series (year)

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Electricity-Industrial [R$/kWh]

0.1317

0.1574

0.1994

0.2213

0.2331

0.2204

0.2406

0.2422

0.2492

0.2588

0.2326

0.2582

0.3873

Natural Gas-Cogeneration-Class 2 [R$/m3]

0.5702

0.5632

0.5974

0.6565

0.6346

0.7227

0.7300

0.7810

0.7978

1.0446

1.2015

1.2544

1.3821

Natural Gas-Industrial -Class 1 [R$/m3]

0.9432

0.9857

1.0184

1.1267

1.1538

1.4500

1.3729

1.3269

1.3293

1.5888

1.7653

1.8268

2.0114

Rates

Projection (year)

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

Electricity-Industrial [R$/kWh]

0.3231

0.3360

0.3488

0.3617

0.3745

0.3874

0.4002

0.4131

0.4259

0.4387

0.4516

0.4644

0.4773

0.4901

0.5030

Natural Gas-Cogeneration-Class 2 [R$/m3]

1.3140

1.3816

1.4491

1.5167

1.5842

1.6517

1.7193

1.7868

1.8544

1.9219

1.9895

2.0570

2.1245

2.1921

2.2596

Natural Gas-Industrial -Class 1 [R$/m3]

1.9621

2.0457

2.1293

2.2129

2.2965

2.3801

2.4637

2.5474

2.6310

2.7146

2.7982

2.8818

2.9654

3.0490

3.1326

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Landini, C.L., de Mello Sant’Ana, P.H. Technical, economic, and regulatory analysis of the implementation of micro-cogeneration technology in the Brazilian manufacturing sector. Energy Efficiency 10, 957–971 (2017). https://doi.org/10.1007/s12053-016-9496-x

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