Emerging Solution For Rural Energy Sufficiency

Emerging Solution for Rural Energy Sufficiency: The Potential of Husk for Rural Rice Regions By

Agus Pakpahan Deputy Minister for Agroindustry, Forestry, Paper, Printing and Publication Ministry of State Owned Enterprise September 2006

Why do We Have Severe Energy Problem? • Too much dependency on Oil & Gas as our main sources of energy • Lack of appreciation on what we have-actually what have been bequeathed to us • Lack of focus on what should we do • Lack of synergy on what we have to organize • Lack of programs based upon people’s capability to support

Why Rice Husk Is Our Strategic Instrument? Its Availability!

How Much Energy Can Husk Supply?

How Much Energy Can Be Generated from Husk? (Now is more than 10,000 GWh/Year)

Employment Energy Elasticities?

Labor-Energy Elasticity

Continued.

Cont.

Energy Taxation

Energy Tax-Sector

Conclusion: Energy TaxEmployment

Carbon saving potentials in food & drink

Carbon savings in textile

Cogen ?

Embedded Generation

Efficiency ?

Cogen System

Mountains of Husk We Will Have

What are inside husk? (Heru Harsono)

Integration of Rice Milling and Cogen • • • • • • • • •

Benefits of the Rice-Husk Cogeneration Power Plant Environmental Benefits Less pollution Uses rice husk, which is considered an agricultural waste Economic Benefits Savings (electricity production) Income generating (selling excess electricity, ash sales) Generates job Saves on fuel, no foreign currency needed

What Projects Have Been Developed?

Chia Meng Rice Mill: Thailand

Chia Meng Rice Mill Design

Malaysia

Thailand

Thailand

Cambodia • Angkor Rice Mill • More than 25,000 families are Angkor Rice’s members and growing Neang Malis rice. There are no middlemen. Angkor Rice sets a high standard. The Agriculture Division distributes high quality seeds and instructs the farmers in planting rice.

Making Farmers Enthusiasm

Model & Scenarios • Steam turbine system with 1 MW electric capacity • Present capacity of the mill is 10 tons/hour. Proposed expansion of another 10 tons/hour • Rice husk will be used as fuel • Two scenarios: • steam has no value • steam has value equal to 50% of the cost for steam generation in a boiler using fuel oil • Excess Electricity exported to other customers • Utilization of heat for drying

Scenario I • Scenario I: Steam has no value • Total Investment Cost including contingency: 1.5 million euro • Net Present Value: 3.1257 million euro • IRR: 49.7% • Discounted Payback Time: 2.3 years • Cogeneration Project Lifetime: 20 years

Scenario II • Scenario II: Steam has value equal to 50% of fuel oil cost • Total Investment Cost including contingency: 1.5 million euro • Net Present Value: 4.659 million euro • IRR: 64.4% • Discounted Payback Time: 1.6 years • Cogeneration Project Lifetime: 20 years

A Study on Benefit/Cost of Utilization of Rice Husk by C. Sookkumnerd, N.Ito, K.Kito Mill size t/day

IRR%

Pay Back Period Years

35

3.63

12.98

45

14.4

7.88

60

20.49

5.67

95

26.60

4.30

120

21.15

5.23

Factors Affecting Efficiency 400 350

Husk price, THB t-1

300 250 200 150 100 50 0 0

10

20

30

40

50

60

70

80

Mill use factor, % 35 ton per day Mill 60 ton per day Mill 120 ton per day Mill

45 ton per day Mill 95 ton per day Mill

90

100

Conclusion made by Sookkumnerd, N.Ito, & K.Kito Conclusion • From the investigation of utilization of rice husk as energy source in Thai rice mill, the following conclusion can be drawn. • 1. The use of steam engine rice mill as energy saving technology is financial feasible for rice mill. • 2. Using steam engine to drive grid-connected generator for electricity generation improve the economic performance of applying steam engine as energy saving technology for rice mill. • 3. The role of engineering consultant firms, who understand the natures of small and medium scale enterprise as partnership enhances the development of the renewable energy project in rice mills. • 4. Instead of working for all equipment in steam engine system, steam engine manufacturers should concentrate their production on only steam engine manufacture and collaborate with other different discipline partner, for example, boiler companies and control and instrumentation companies in developing the steam engine system.

Gemina Rice & Flour Mill (Nicaragua) Basic Operational Characteristics •

•

•

The Gemina rice mill is normally operated for 24 hours per day, 5.5 days per week throughout the year (6,864 hours per year). The mill is currently designed to mill up to 9 tonne paddy/hour. Recently Gemina decided to expand milling capacity at the Chinandega site by relocating the Molinos El Pacifico mill to that site.[1] When these changes are complete in 2002, the Chinandega complex will have a capacity to mill 18 tonne paddy per hour. In 2001, the Chinandega mill processed 44,000 tonne of paddy and produced approximately 8,000 tonne of husk. After 2002, when Molinos del Pacifico Rice Mill has been transferred to Chinandega the husk production is expected to approach 25,000 tonne/year. The flour mill normally operates for 24 hours per day and 26 days per month. The mill is currently designed to mill 5.2 tonnes of wheat per hour. The flour mill has a current demand of 660kW and a consumption of 305,000 kWh per month. Hence if operated normally throughout the year the annual consumption will be 3,660,000 kWh. Gemina plans to expand the capacity of the flour mill. The new equipment will use an additional 246 kW. Electrical demand will therefore increase by 197kW and by 1,249,116 KWh/year.

Gemina (cont.) • •

Electrical Consumption and Cost For the period July 1999 through April 2000, the average hourly consumption of electricity (month total divided by number of hours in the month) at the Chinandega mill complex varied from 264 kW to 419 kW (average 354kW). The annual electrical consumption, at that time, is estimated as 1,000,000 kWh and the paddy milled about 18,000 tonne/year.. More recently, the rice mill consumption has increased to 1,600,000 kWh/year. The current consumption at the Molindos Pacifico Rice Mill is 1,200,000 kWh. After the Molindos Pacifico plant is moved to the Chinandega site, the combined consumption is estimated to be 2,800,000 kWh. • After the currently planned expansions at the Chinadega site, the maximum demand of the rice mill and flour mills is expected to increase to 1450kW and the electrical use to about 8,000,000 kWh/year (2,800,000kWh from the rice mill and 4,909,116 kWh at the flour mill).

Gemina (cont.) • In 2000, Gemina paid an average of US 11 cent/kWh including IGV (similar to VAT in Europe) for electricity purchased from the local distribution company. Discounting and deducting the IGV, which Gemina can eventually recover, the net price was 9.65 cent/kWh. The supply of power is somewhat unreliable and the price is highly dependent on the world price of oil. As this report is being prepared the privately owned Nicaragua distribution companies are seeking price increases to compensate for the increased oil price, which has caused the cost of wholesale electricity to rise.

Gemina (cont.) •

After the heat recovery boiler, the hot gases pass through a mechanical dust collector before being exhausted to atmosphere by a stack. The main design data is: • Fuel Input – 2,750kg/hr – Fuel Moisture Content 10 %

•

Fuel HHV – 14,235 kJ/kg

• • • • •

Generator Output (gross) 1,750 kWe Generator Output (net 1,575 kWe Operating Hours – 7,884 hr/yr (90% capacity factor)

ASEAN Countries

Background from EUROPE

Steam & Heat Quality Req.

Emissions

Conversion Technologies

How To Make It Real? • Create strong & realistic energy & agricultural development policy • Investing in socio-economic organization such as Farmers Owned Enterprise (FOE) as a basic institution for making strategic change • Building synergy across stakeholders • Create appropriate funding systems

Who Are the Stakeholders?

Model I: Facility Owner-Operated and Financed

Model II: BOO/BOT

Model III: Financing Directly to Project

Creating Farmers Owned Enterprise (FOE) Is a Key • Making collective action to ensure husk supply sustainable • Increasing farmers income and employment opportunities • Breaking the barriers to change for better future • Creating growth from within principle

Here We Go! • We have to change before inexorable change force us to change • Thank you.