Msc: Sustainable Engineering : Chemical and Process Engineering
Economic Analysis
Aspen Plus software was used to estimate the capital and operational costs for the various equipment required for the biogas upgrading plant. The breakdown of these costs is presented in the table and figure. The upfront costs encompass all major components, including
Capital Cost
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Biogas Upgrading: Scrubbing tower, stripping tower, compressor, and flash vessels tanks.
Anaerobic Digestion: Reactor, heat exchanger, and mixer.
Injection System: Propane storage, injection equipment, metering, odorization equipment, and telemetry.
Gas Grid Connection: Piping to connect to the local distribution zone.
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Operational Costs
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Maintenance: Based on industry practices, maintenance costs are estimated at 2% of the capital cost (Rotunno, 2017).
Labor: The plant is assumed to require 8 full-time employees
Electricity: The estimated annual electricity consumption for the entire process is 132 kWh.
Propane: Propane gas is purchased for injection into the biogas stream.
This economic analysis provides a comprehensive picture of the financial considerations involved in operating a biogas upgrading plant, including civil works and other miscellaneous expenses.
Data Analysis
In a comparative analysis based on real evidence from existing AD plants, the government estimates the cost of such plants sourced from BEIS (2021) within their "Final Stage Impact Assessment: Green Gas Support Scheme/Green Gas Levy" and the latest Annual Tariff Review. These reports highligts the significant upfront capital expenditure (CAPEX) and ongoing operating expenditure (OPEX) associated with AD plants. The government estimates a typical 6 MW plant to incur a CAPEX of £17 million and an annual OPEX of £1.6 million.
The cost of Anaerobic Digestion plants with biogas upgrading mainly relies on the size of the plant. Investment costs per biomethane produced are cheaper for large-scale plants but increase significantly for smaller-scale systems. This is because the required components, like pipes, valves, sensors, control systems, and analysis equipment, are largely consistent regardless of plant capacity (Kapoor et al., 2019). Therefore, increasing feedstocks could be a viable option to enhance the feasibility of the plant
Revenue Stream
For plants injecting biomethane into the gas grid, the main revenue stream typically from the government's Green Gas Support Scheme (GGSS) tariff and its Estimated to be £258,411 per annum. However, it might not suffice to cover operational expenses independently. Therefore, its important to explore other revenue sources, particularly from by-product sales, to ensure the plant's financial viability. By-products from Anaerobic Digestion with biogas upgrading, such as digestate and carbon dioxide, offer promising avenues for additional revenue. Moreover, gate fees represent another significant potential revenue stream to consider.
Other Potential Revenue
Digestate
Biogas digested slurry represents a nutrient rich material with the potential to serve as a substitute for inorganic fertilizers and raw manure. This slurry constitutes high-quality manure are free from pathogens, and contaminants such as heavy metals or infectious microorganisms. Through anaerobic digestion of organic wastes, substantial quantities of macro- and micronutrients like nitrogen, potassium, and phosphorus are preserved. The nitrogen present in the bio-fertilizer is in the ammoniacal form, which can be readily absorbed by the soil for crop cultivation.Therefore, Biogas digested slurry could be utilized as bio-fertilizer which could be marketed to generate revenue (Bernhard et al., 2015).
Gate Fees
As outlined in the Future Policy Framework of Biomethane Production by DENZ, gate fees serve as a revenue stream for AD plants. These fees are commonly associated with payments made to AD plants for waste collections and are thus considered a potential source of income. However, gate fees are subject to demand and supply which relative within specific geographical markets. Consequently, they can vary considerably across regions and evolve over time.
Carbon Dioxide
One significant benefit of biogas upgrading technology is the CO2 rich off-gas from the upgrading plant. Typically, this off-gas stream is discharged into the atmosphere as waste, leading to environmental harm. However, rather than being released, CO2 can be transformed into a valuable green product through processing. This BioCO2 can then be marketed as an additional commercial product by the biogas producer (Sun et al., 2015).