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What’s Green and Clean and RED All Over?

RP Siegel | Friday March 19th, 2010 | 0 Comments

Fact: Electric utilities contribute 42% of greenhouse gases in the US.
Fact: Heat and power contribute 69% of all greenhouse gases in the US.
Fact: The efficiency of US electric power plants has not improved since the 1950s.

(Barriers: Breaking through energy recycling obstacles from Recycled Energy Development on Vimeo)

The average efficiency of power plants in Eisenhower’s day was 33%, same as it is now, despite unbelievable technological advances in every other sector of society.

These are the words of Tom Casten, CEO of Recycled Energy Development, imploring citizens and business leaders to take action. But Casten is not just a cheerleader. He knows how to do it. He knows that the other 67% of the energy that goes into a power plant and doesn’t produce electricity is given off as heat. Waste heat. The same kind of heat that we need to warm our homes and offices, heat our water, and support industrial processes. Yet we throw that heat away and then use lots more fossil fuels, to get more heat. This is where Recycled Energy Development (RED) comes in.

RED helps manufacturers reduce energy costs and raise productivity. Backed by a $1.5 billion of funding from Denham Capital Management, RED increases energy efficiency by a factor of two or more by capturing and recovering waste energy that can either be used to produce additional electricity or simply passed along as useful steam. In the industry, these two techniques are known as cogeneration or combined heat and power (CHP), and waste heat recovery. Producing heat and power at the same time turns out to be far more efficient than producing them separately.

Harvesting the energy potential in hot exhaust, flared gas burn-off, and compressed gas discharge, which is routinely wasted, can potentially provide, according to Casten, as much as 28 trillion kilowatt hours (kWh) per year. This is the equivalent of six to seven nuclear plants, or roughly 150 billion in solar energy installations.

Examples of some of the projects Casten has been involved with:
•    using excess heat from a blast furnace to produce  95 MW of electricity and close to a million lbs. of steam.
•    a coal plant at a major brewery that makes electricity first and then steam, resulting in an 80% efficiency
•    a silicon foundry that will generate power so cheaply that the company will be pulling jobs back from China

Why has this not been implemented before?
Because electricity is not a free market. Because utilities make money on a cost plus basis, there is no incentive to become more efficient. In fact, the more they spend, the more they make—that’s expense, not capital. Which is why the average power plant in the US is 40 years old.

Government policy often stands in the way. Even the Clean Air Act has elements that discourage efficiency improvements. Casten is a supporter of market-based cap and trade. He also proposes a Clean Energy Standard Offer Program where regulators first figure out the true cost of creating and delivering electricity to your home or business from the best new power plants. Utilities then offer long-term contracts to any clean energy plant that can do it 15% cheaper.

There is a mindset here, in that companies don’t think twice about spending money on fuel; they see it as something unavoidable. But they often think three or four times about investing in capital projects. But if, in Casten’s words, “we can substitute capital for fuel, get the energy out of energy that we were throwing away,” then we can end up saving money.

In other words, wasted energy is energy we pay for, whether we capture it or not.


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