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IV.3 Commercial sector

The commercial sector consists of quasi non-manufacturing business branches. Included are building/construction trade, financial institutions, publishing houses, retail trade, shopping centres (mall), restaurants, bakeries, laundries, airports, greenhouses, federal, state and local governments as well as health, social and educational institutions etc.

Although the purposes of the energy use vary widely for such a heterogeneous collection, the use of energy carrier for room heating clearly dominates the energy demand (45% of the energy carrier consumption in the commercial sector in Germany). Process-heat preparation (hot water preparation included) is the second most important purpose (26% in Germany), followed by mechanical energy (19% in Germany in 2006). Although lighting is an essential part of energy utilisation in many divisions of the commercial sector, similarly in restaurants, offices, malls or airports, it plays in total only a secondary role, air conditioning is much more energy intensive for example.

Figure IV-4 shows that the demand for gas and electricity in the EU25 rose since 1990, while derived heat remained at a low level. Solid fuels now have only a 3 % portion and oil lost 10 percentage points. One of the reasons for this development is the change from oil fuelled to gas fuelled systems, caused by reasons of convenience, economy and probably also for environmental reasons. The increase of the electricity demand can be explained by more electrical appliances in all ranges,i.e. offices, hospitals and even in bakeries, which use more and more electrical ovens to bake industrially prepared products.

Source: IEF-STE, [Eurostat, 2007b]

Figure IV-4: Development of fuels in the commercial sector, EU25

The capacity range of the energy generation units in the commercial sector varies over a wide range. It starts with some kW as used in restaurants or small hotels and ends at some MW which is needed in a mall or in hospital centres.

The majority of the buildings are equipped with conventional gas and oil boilers. For many years CHP units have been available and are installed when sufficient economic incentives exist. This is mainly influenced by having a continuous and simultaneous demand for heat and electricity and having a heat demand which enables around 5,000 and more yearly operation hours. In general the CHP units supply the base load while an additional boiler is used for the peak demand.

As mentioned before, the capacity range of the units corresponds to the demand of the object and is very wide, starting with a few kWel respectively kWth and ending in the MW-region. The Dachs and the Ecopower reciprocating engines from Table IV-5 are predestined for small objects and their capacity can be multiplied by combining several modules.

The department “Energiereferat” of the municipality of the city Frankfurt in Germany published in 2005 an analysis on European CHP units for commercial application. 20 European manufacturers delivered data for 277 modules which are optimised for the heat supply. The data of 127 gas fuelled CHP modules with a capacity range of 4 – 6,790 kWel were analysed, of 86 bio-/sewage gas modules (14 – 6,790 kWel/ 16 – 800 kWel), of 20 heating oil modules (3 – 5,105 kWel) and of 16 rape oil modules (5.5 – 4,300 kWel).

Source: [ASUE, 2005]

Figure IV-5: Gas fuelled CHP modules, correlation of electrical efficiency and electrical capacity

The efficiency depends directly on the size of the module and as a rule larger units are more efficient. Figure IV-5 shows the range of electrical efficiency of the gas fuelled modules. The white sheet at the right corner is an enlargement of the curve for smaller units. It can be seen that the efficiency of these varies between 25% and 34% and is clearly lower than for units which have a higher capacity. The best value of 46% is reached by the MCFC type of MTU, followed by the 40% efficiency of the Purecell types (PAFC) of UTC.

The ”Energiereferat”-study analysed also the cost structure of the CHP units and found out, that the engine itself normally has a cost-share of nearly 55 to 60%, dropping back to less than 50% for units which are larger than 2 MW. The other costs are attributed to balance of plant, for example the electrical control cabinet (14 to 10%), noise insulation, catalyst, lubricant management, ventilation and installation.

Specific unit prices (€/kWel), calculated from the list prices, are shown in Figure IV-6 . The evaluation demonstrates that the prices for small units are much higher than for larger units. Over the range of 5 to 200 kWel extreme price reductions are evident. They goes down from 2,000 €/kW to 500 €/kW. But the range of 1,500 to 2,000 €/kW is the target value for those two fuel cell types which are far developed and in a market entrance phase.

Source: [ASUE, 2005]

Figure IV-6: Specific prices for gas CHP units, installation included, without remote control

A further result of the evaluation is the expected costs for additional remote control systems, for which the manufacturer calculate around 1,700 Euro. That information will be of interest for future virtual power plant concepts, which make such systems necessary to enable a coordinated operation of many decentralised generation appliances.

The authors of the study collected also data for 86 biogas units. In general there are no technical difficulties to operate the gas engines with biogas. Only minor modification is necessary and the efficiencies are comparable to those of the gas units. The lower heating value of the biogas causes the biogas systems to have a lower electrical output than natural gas fired engines. The prices are marginally higher as fuel clean up must be installed.

Only 20 heating oil CHP units fulfilled the strict emission thresholds, so that the database has a limited validity, see Figure IV-7. As diesel engines give quite good efficiencies, the electrical efficiency of the heating oil CHP units is a little bit better than of the gas units. Because of better thermodynamic conditions of a diesel process, the electrical efficiency is a little bit higher than of a gas engine. But the heat recovery from the water and oil cooling systems is complex and costly so that it is not often used.

Source: [ASUE, 2005]

Figure IV-7: Specific prices for heating oil CHP units, installation included, without remote control

The evaluation of all the data resulted in an average electrical efficiency of 35% (max 46%), in an average thermal efficiency of 49% (max 60%) and in an average overall efficiency of 85% (max 91%). The curve in Figure IV-7 shows the same effect as for gas engines, the specific cost per kWel of small units are clearly higher than those for large heating oil CHP modules.

The micro gas turbine is a new technology which extends the application of CHP technologies especially when a higher temperature level of the heat is required. At a capacity range of 30 kWel to about 500 kWel micro turbines can be applied in the commercial sector.

The basic technology of micro turbines is derived from aircraft auxiliary power systems, diesel engine turbochargers and automotive designs. Micro-turbines are notable for their reliability, small size and low weight. Presently, R&D efforts are dedicated to the construction of micro turbines with a power output of only a few kilowatts.

Micro turbines work in the same way as their large-scale counterparts, but their electrical efficiency is about 15%. However, this poor performance is normally improved by the installation of a recuperator (heat/heat exchanger), which preheats the air used during the combustion process by reusing exhaust gas heat. With that measure an electrical efficiency of 25% - 30% can be achieved, as shown by the examples in Table IV-7. Today’s devices are characterised by lower NOx- and CO-emission levels than internal combustion engines.

Table IV-7: Overview of micro-turbines

Source: [Müller, 2006], companies publication, IEF-STE

Ambitious targets for micro-turbine R&D activities are the enhancement of the electrical efficiency up to 40% and the reduction of the system cost down to ~400 €/kWel.

The phosphoric acid fuel cell, the molten carbonate fuel cell and the solid oxide fuel cell technologies complete the list of fuel cell types which will compete with other technologies in the future commercial market.

Table IV-8 shows data of three phosphoric acid fuel cell units, manufactured in the United States of America and in Japan.

Table IV-8: Examples for Photophoric-Acid Fuel Cell uints suitable for the commercial sector

Source: IEF-STE, [JSME, 2006]

UTC Power, previously operating under the names ONSI and International Fuel Cell, has the best experience in manufacturing and operating PAFC systems. More than 250 units have been sold. UTC has cooperation with Toshiba FC Power System which is using the PC25 unit in Japan.

Fuji Electric is developing its own PAFC system and both companies have tested a few of the units in a variety of applications. Research is currently underway to lower the purchase and maintenance costs, to stimulate new demand.

Table IV-9 shows the molten carbonate fuel cell units of which the first three have reached the pre-commercial respectively the commercial stage without being directly competitive with conventional technologies. The manufacturing cost respectively the purchase prices are still too high, so that the most European projects are realised with governmental funding.

Table IV-9: Examples for molten carbonate fuel cell units

Source: IEF-STE, companies information

FuelCell Energy Inc. has high competence in molten carbonate fuel cell technology, since it has been engaged in that area for more than 30 years. It has cooperation in the main regions of the world, in Europe with CFC Solution (a department of MTU Onsite Energy) and in Japan with Marubeni Corp. for the Asian market. Together with its partners Fuel Cell Energy services more than 50 power plant sites. The units are designed to provide base load power and process heat respectively district heat for a wide range of customers and applications.

With regard to larger SOFC-systems there are still two to three companies which are engaged in that field, whereby the finish company Wärtsilä seems to be most successful. They did install a 20 kWel system (WFC20) in summer 2008 at the Vaasa housing fair which was fuelled by biogas. Wärtsilä’s intention is to develop modules up to 250 kWel, which can be upscaled by doubling and used for a wide range of purposes like in telecom/data centers, hospitals, banks, hotels, malls, offices, industries and even for operation in short route ferries, car carriers or cruisers Table IV-10 shows some data of the Wärtsilä system but also of the Siemens idea and the Rolls-Royce planar SOFC project.

Table IV-10: Examples of larger SOFC CHP-units

Sources: Companies brochures

Although there are a couple of fuel cell systems under successful demonstration or test operation, it is not clear, if all companies will continue their engagement as a long breath is necessary to reach the challenges for further development: ”getting down the capital costs; lengthen the lifetime of FC stack, improving applicability and reliability of the FC systems.” The 2008 report of FuelCellToday on large stationary fuel cells explains, that ”Siemens are purported to be selling off their SOFC business”.