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Industrial Cogeneration in Alberta

Cogeneration, also known as combined heat and power (CHP), is the process where a single fuel source is used to produce both electrical and thermal energy. Generating electricity usually results in unused heat, so using equipment to capture that heat and transfer it for other functions within the same facility or a facility nearby, results in greater efficiency and cost savings for the end user. If you would like to know more on heat recovery then you can look at this site for more information.

“A refinery is a great example of a large industrial process that needs electricity and heat at the same time,” said Chris Vilcsak, President and CEO of Solution 105. Due to its high electricity and heat intake, this industry seemed perfect to try the cogeneration method to try and minimize wasted heat. However, they aren’t the only industry that is in need of more sustainable heating oil. There are so many industries that use a high amount of energy constantly. These companies should really consider looking into the cogeneration method or sourcing some more environmentally-friendly heating oil. They could always look for some industrial heating oil suppliers in their local area that could supply them with high quality heating oil for their industiral site, saving them money and reducing their carbon fortprint. This could make more businesses sustainable. However, the cogneration method is becoming more and more popular, so industries need to decide which option is more beneficial for them.

Imperial Oil has applied to construct and operate a cogeneration power plant within the boundary of its current refinery in Strathcona County. This power plant would consist of a gas turbine generator, heat recovery system steam generator and related electrical facilities, as well as many protective measures that are available online at dynatect.com and from other providers. The Alberta Utilities Commission is holding a hearing to review their application early next year.

In light of this project, Vilcsak noted that building new high-voltage transmission lines in Alberta seems to be focused on facilitating the building of more cogeneration plants at key locations in the province. He specifically used the plants in Fort McMurray, which have very high heat loads, as an example.

“If an oil sands company wanted to build a cogeneration plant, they would likely make it large enough to provide all the heat that they would need for their processes. I’m guessing that this size of plant would create a large excess of electricity generation, way more than they would need on site. This means they’d need transmission lines so they could ‘export’ the excess power out of Fort McMurray and use it elsewhere, which is exactly what the province has pushed ahead with Bill 50. Building large cogeneration plants in Fort McMurray will greatly improve the economics as well as reduce the emissions per barrel of oil”, stated Vilcsak.

“However, it’s obvious that the people who would benefit most from this would be the shareholders of the oil sands companies – so they should be paying for the costs for the new transmission lines… not the consumers in the province.”

Solution 105 shared an example of cogeneration in the post “Combined Heat & Power Program Saves Money for Building Owners” summarizing a CHP program released by Atco Gas. These CHP units use natural gas to generate heat and electricity at the same time, increasing efficiencies, reducing greenhouse gas emissions and operating costs for small to medium sized building owners.

“This is a good example of a small-scale operation with viable heat and electricity mix, especially an apartment or condo building and hospitals,” said Vilcsak.

One of the first projects under the ATCO CHP program is underway at a Red Deer leisure centre. ATCO predicts that the 250,000 square foot centre in Red Deer will save nearly $35,000 per year in energy costs as a result of the project, reducing demand of electricity by about 2 million kWh each year.

Vilcsak again, however, questions the motives of the province in supporting an ATCO project while not providing the same benefits to any company or individual that wants to install a cogeneration unit at their site.

“In the ATCO program, a sizable portion of the capital cost of the equipment is paid for by the province’s climate change management fund and then ATCO owns the equipment and sells the electricity and heat to the site. Any customer who wants to put in a cogeneration unit should be able to get the same benefit which is half the cost of the equipment and then keep the savings from the improved efficiency for themselves,” said Vilcsak.

“Or is this just another handout from the provincial government to one of their Chosen Few?”

Alberta Utilities Commission: Notice for Public Hearing

In regards to the cogeneration plant in Strathcona County application, the public is invited to present written evidence to the AUC prior to the hearing before November 18th. An information session regarding the proceeding will take place on October 14th. This will provide the public with information about how to become involved in the proceeding and the funding which may be available, however the project and its merits will not be discussed at this meeting.

For more information, click to download the official notice.