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Methane Recovery from Animal Manures The Current Opportunities Casebook

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Methane Recovery from Animal Manures The Current Opportunities Casebook ( methane-recovery-from-animal-manures-the-current-opportuniti )

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METHANE RECOVERY FROM ANIMAL MANURES: THE CURRENT OPPORTUNITIES CASEBOOK TABLE 3.6: Plug-Flow Digester Capital Budgeting Summary Plug-Flow Digester Energy Plant Digester Plant Solids Recovery Plant Engineering Fees Contingency TOTAL CAPITAL COST 13 Engine O&M costs were estimated to be $0.0125/kWh of electricity generated, 109,684 97,825 31,000 23,851 23,851 286,211 which came to a total annual expense of $5,662 during the first year of operation. The first year expenses associated with the digester system were $9,783, and solids recovery O&M was $1,550. Total expenses during the first year of the project were $16,995. The value of the digester was established by the amount of saleable coproducts generated. These included electric energy, thermal energy, and separated fiber. Fiber recovery from a dairy manure digester is a well-proven coproduct of considerable valuable. A number of coproducts have no assumed value in the analyses. For example, if the digestion system were large enough, carbon dioxide gas could be separated from biogas before combustion. However, in small facilities such as this one, the chance for an economic return is small and no value was assumed. Additionally, no value was assumed for reducing environmental externalities. In determining the offset cost of purchased power, the electricity rate used was assumed to be representative of rates in New York. To help simplify analysis, electric rates were assumed to be a 14 blend of demand and energy charges. Based on a review of average commercial rates for the state, this project could offset an average of about $0.113/kWh. Given the kWh generated during the course of a year, this system could offset enough purchased power sufficient to save $51,187 during the first year of operation. The value of the thermal energy recovery system was based on offsetting the delivered cost of purchased propane that was assumed to cost $0.85/gal. This translates into a cost of about $12.41/million Btu. Given the total amount of thermal energy produced during the course of a year, this system could provide a saving of $10,476 in propane costs during the first year of operation. Fiber product sales were estimated to be $16,671. Total revenue for the first year of the project summed to $78,333. 3.2.3 Economic Evaluation First year plant income on the pro forma is defined as the sum of depreciation ($30,653), annual revenue, and annual expenses. Because depreciation is a negative value, total system before tax 13 Biomass Energy Program. p. 7-10. Ross, C., et al. (1996). Handbook of Biogas Utilization, Second Edition. Muscle Shoals, AL: Southeastern Regional 14 Energy Information Administration (1998). Monthly Electric Utility Sales and Revenue Report with State Distributions (Form EIA-826) Estimated U.S. Electric Utility Average Revenue per Kilowatt-hour to Ultimate Consumers by Sector, Census Division and State. Washington, DC: U.S. Department of Energy. The table is available at: http://www.eia.doe.gov/cneaf/electricity/epm/html/table55.html. 3-14

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