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Reports of MOEJ/GEC JCM Project Planning Study: FY2013

Title of StudyJCM Project Planning Study
Power generation by waste heat recovery in cement industry
FYFY 2013
Main Implementing EntityJFE Engineering Corporation
Study PartnersPT Semen Indonesia (Persero) Tbk.
Location of Project/ActivityTuban, Indonesia
Category of Project/ActivityWaste heat utilisation
Study Report

Note: JCM proposed methodology, and calculation sheet are the result of the study. They have neither been officially approved, nor are guaranteed to be officially approved under the JCM.
Description of Project/ActivityThe proposed project is planned to introduce a waste heat recovery (WHR) boiler steam turbine generator system at an existing cement production plant (PT Semen Indonesia, Tuban Plant) located in Tuban, East Java, Indonesia. The WHR system will utilize waste heat currently emitted from the cement factory without utilization. WHR boilers will generate steam using the waste heat exhausted from the cement plant, and the steam will be fed to the steam turbine generator to generate electricity. It can reduce power import of approximately 165,000MWh/year from the grid which will lead to the reduction of fossil fuel combustion at grid-connected power plants.
JCM MethodologyEligibility Criteria1. The project utilizes waste heat from a cement production facility by waste heat recovery (WHR) system to generate electricity
2. WHR system consists of a Suspension Preheater boiler (SP boiler)and/or Air Quenching Cooler boiler (AQC boiler), turbine generator and cooling tower
3. WHR system utilizes only waste heat and does not utilize fossil fuels as a heat source to generate steam for power generation
4. WHR system has not been introduced to a corresponding cement kiln of the project prior to its implementation
5. Cement factory where the project is implemented is connected to a grid system and the theoretical maximum electricity output of the WHR system, which is calculated by multiplying maximum electricity output of the WHR system by the maximum hours per year (24 * 365 = 8,760 hours), is not greater than the annual amount of the electricity imported to the cement factory from the grid system:
- During the previous year before the validation, if the validation of the project is conducted before the operation of the project, or
- During the previous year before the operation of the project, if the validation of the project is conducted after the operation of the project
Default Values・The quantity of electricity consumption by the WHR system
→Calculated by multiplying the total maximum rated capacity of equipments of the WHR system which consumes electricity by maximum operational hours (8760 hours)
・CO2 emission factor for an Indonesian regional grid system
Calculation of Reference EmissionsReference emissions are calculated from net electricity generation by the project which replaces grid electricity import during a given time period.
Quantity of electricity consumption by the WHR system is subtracted from gross electricity generation by the WHR system to calculate net electricity generation.
In order to ensure conservativeness, quantity of electricity consumption by the WHR system is calculated by using the theoretically maximum load for the capacity of equipments in the WHR system.
Monitoring MethodElectricity generation by the WHR system is monitored.
GHG Emission Reductions◆The quantity of net electricity generation by the WHR system which replaced grid electricity import
 ABCDE(A*B*C*D)
Quantity of electricity generation
Generation capacity
(MW)
Operating day/year
(day/yr)
Time
(hrs/day)
Operating Rate
Electricity
(MWh)
 Dry season
28
182.5
24
0.85
104,244
 Rainy season
22
182.5
24
0.85
81,906
Electricity consumption by WHR system
2.4
365
24
1
21,024
Quantity of net electricity replaced grid electricity import
165,126
◆Reference emissions(REy)=EGy * EFgrid
  =165,126 MWh/y*0.741 tCO2e/MWh
  =122,358 tCO2e/y
◆Project emissions(PEy)= 0
◆Emission reductions (ERy)= REy - PEy
  =122,358– 0
  =122,358 tCO2e/y
Environmental ImpactsThere is no requirement for the project to conduct an environmental impact assessment (EIA) as stipulated in ministerial decree No. 11, 2006 which defines that power generation facility of its capacity smaller than 100MW does not need to undergo the EIA process.
Project and its Financial Plan◆Project Plan
The specification of major equipment and auxiliaries is almost confirmed. PT Semen Indonesia and JFE Engineering almost reach an agreement on the layout of major equipment and will proceed to a detail design and procurement as a next step.
◆Financial Plan
The initial investment for the project will be all covered by PT Semen Indonesia with a condition of JCM subsidy.
Promotion of Japanese TechnologiesAlthough initial investment for WHR system with Japanese technology is higher than the one with similar technologies by India or China, WHR system with Japanese technology can be stably operated much longer therefore it can be considered as economical in a long-term view and CO2 emission reduction in a life cycle will be greater. If higher initial investment can be overcome, Japanese technology can hedge a risk of rising industrial electricity cost and contribute to the reduction of production cost in a long-term view.
Sustainable Development in Host CountryThe project can reduce the cement production cost as well as CO2 emission. In Indonesia where a cement market is strong, investment in cement production facility has higher priority than the one in WHR system. However WHR system has benefit of deducting unit cost for cement production, which results in tolerance for fluctuation such as slowdown in economic growth in the future. By showing successful completion of the project and proving return on initial investment, WHR system is expected to spread out in Indonesian cement industry and it will contribute sustainable development not only in environmental aspect but also economical aspect.

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