Author Topic: Net metering: Real world numbers  (Read 8542 times)

SCOTT

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Net metering: Real world numbers
« on: December 19, 2006, 06:21:59 PM »
This thread should discuss the economics, leave the technical discussion in the "selling listeroid power back to the grid" thread.

The following is based on my situation in Connecticut, each state has different rates and rules. 


In Connecticut my electric rate is currently .18/kwh inclusive of commodity charge and delivery. As of 1/1/06 the rate will increase to .192/kwh.  My state allows me to net meter up to 100kw/hour various incentives are available including grants. 

 My project is in progress and the intention is to burn veg oil in my 12/1 turning a 10hp induction motor above sync speed pushing back about 7kw/hour back to the grid at full output.  Many months ago I started this process, and it is quite a process, the most challenging part is dealing with the hoops the utility makes you jump through.  But before you lay out any cash it makes sense to run the numbers, below is a review of some of the numbers I considered prior to embarking on this process

The costs add up quickly
Electrical Engineer                    $2000 Strongly suggested by the utility
Protective equipment                $1200 required by the utility
Install                                       $1200 suggested by the utility
Misc materials                          $800
Engine                                      $0*
Gen head/ Motor                      $0*
Total                                        $5200

*I brought a load of gen heads and engines in to the NY area last summer; I resold those with enough margin to pay for my gen head and engine. 

I ran an unscientific test a few months ago to get an idea of how long my 12/1 would run on a gallons of wvo.  The gen was loaded at abput 6800 watts, as this was the max load I could create with the materials/ appliances I had on hand. 

I measured the wattage draw of various heaters and other appliances using a Kill a Watt meter.  The sum of these items came to 6800, I understand there may be some variance after they heat up, it still gives me a good idea of load vs. consumption.  The exhaust was clear to slight white/grey and the engine was loud but seemed to run fine.  I believe I could coax a little more power out of it, so I am using 7kw as an output number.

 I have a 1 gallon auxiliary tank that I filled with 1 gallon of  vo.  The engine was run on diesel and warmed up to 220 deg f as measured at the upper coolant outlet.  I then switched over to the Vo, the engine ran for 88 minuets before I saw air in the clear plastic fuel line from the small 1 gallon tank just prior to the exhaust heat exchanger.  At the point of injection the fuel is at least 230 def f, per the fuel temp sensor just before the injector.  The engine consumed more fuel than I had expected.  It works out to .68 gal/hour consumption, I was expecting under .5/hour.  Perhaps this number will improve as the engine breaks in.  The engine has < 100hrs on it 

The engine runs for 88 min and I produce 10.22kw 
28 min = .46hr     28min/60=.467 
7kw *1.467hrs=10.269kw per hour on WVO
.192(retail rate)*10.269kw= $1.97 worth of avoided retail electricity

So each gallon of free WVO can be converted into $1.97 using the 12/1 Lister type engine
Now I need to make a lot of electricity to cover those costs.  At .192/kw I need to make 27083 kw to break even.  This equates to about 3870 running hours for my 12/1
3870hrs*7kw=27090kw         
That equates to about 11hrs a day 30 days per month.
27090*.192=$5201…. payback in one year.

The above is not reality though, as this assumes I receive the full retail rate for all of my production, sadly this is not the case.  Once I produce in excess of my consumption I am compensated at the avoided or spot rate as determined by ISO New England auction. Over the last 3 years the monthly rate averages .07/kw  This is a far cry from the .192 retail rate I pay as of 1.1.07   

My annual consumption for the last 3 years has been pretty steady, averaging just under 16500kw at the old rate it is about $3000/year.  The rate will be a little higher starting 1/1/07. 
 Any production above 16500kw will be paid out at about .07/kw  (This is not really the case, in high demand months the rate is higher, in June, July, August and Sept the rate is .089.  So if I really want to optimize my electric production I would skew production to the months where the payout is highest.  It may even possible to sign up for “by the hour pricing” where I would be paid based on the actual rate during the actual hours I produce excess electricity.)  I expect that there is a pretty strong correlation between air temp and the spot price during these months, with this in mind it should be relatively simple to “predict” when the rates are highest and adjust gen run time accordingly.
 
……..But for the sake of simplicity I have assumed a flat .07 spot rate.

16500(annual consumption)*.192(retail rate)=   $3168 avoided usage charges
$5200cap cost - $3168=   $2032 this amount needs to be recouped.
$2032/.07=29028kw at a rate of .07 I would need to produce 29028kw which means running the engine another 4146 hours.  This rate schedule makes it impractical to run the engine due to the low amount paid for the incremental output above my domestic usage.  It makes more sense to run it only enough to cover my actual kw consumption.   

If you really want to look at the true value of these numbers you must acknowledge that this production is worth more than production in excess of usage, because the savings flows directly to my household bottom line.  Any production over my domestic usage is paid to me by the utility and as such is taxed at my income tax rate.  A dollar saved is worth more than a dollar earned!

It makes more sense to just run the engine just enough to cover my domestic usage.
16500kw domestic usage /7kw (1hr output) = 2357 hours *7kw * .192 = $3134   
Cap cost                      $5200
Production yr 1    $3134
Shortfall                        $20366

So in year 2 I run the engine  2357 hours and I am at the break even point
2357  hrs *7kw = 16500kw* .192= $3134

Total run time year one: 10 hrs a day 20 days a month =16794 kw
Total run time year two:  6.5 hrs a day 20 days a month =  10916 kw
Run time is variable, run it longer per day for less days per month.

Below is theory not many hard numbers used:

Now I have not mentioned using the coolant or exhaust heat.  Someone  made mention of high and low value heat.  High value heat I define as useable heat that had a much higher temp than the ambient temp where it is to be applied.  This can be from the exhaust and or the coolant.  The low value heat would be the heat radiating from the mass of the engine.  This heat is hard to recover. 
Capture the heat which is easiest to work with first then move on to more difficult sources.  Take the “low hanging fruit”  this would be from the coolant loop, run it through copper finned baseboard heating sections.  Add a circulating pump and the baseboard heat becomes your radiator.  I am sure the HVAC guys in the group could do a heat loss analysis to best size the baseboard sections.  With the right data you would also be able to fine tune the flow to optimize heat gain to the room while leaving enough heat for the return line to keep the coolant in the block hot enough for efficient combustion.  (As for the consumption of electricity of the circulation pump, the Taco model 005-f2 draws .53 amps at 115v so about 61 watts are consumed by the pump. Even at 24hrs run time it only costs 28 cents a day to run.)
This is a balancing act, and with creative use of valves and or variable flow rate pumps it could be done.

Harvesting the exhaust heat will require fabrication or purchase of a gas to liquid heat exchanger.  The principals are pretty straight forward, increase surface area and increase heat transfer.  I am sure there are other factors at play such as dwell time and materials used, but sometimes common sense is enough to get a simple project done.  Have a downward slope to the heat exchanger and put it after your muffler if one is used, this will reduce the acids from a cool exhaust from eating everything.  Plumb it to your house, pool , hot tub or greenhouse. 

Calculate how many BTUs you can take out of the exhaust.  Take that btu content and add it to the BTUs you captured from the coolant loop. The dollar value of those BTUs are determined by the price paid currently for your home heating fuel, as they will displace BTUs you would have purchased normally for your domestic heating requirements.

 I have done the real world math for the electric generation, the numbers work.  Part of the reasons my numbers work is because CT has the 2nd highest electric rates in the country, second only to NY.  I have not done the math for the cogen, but any heat I can use is a bonus.  For my project to make economic sense I don’t need to do cogen.  I can further accelerate the payback time if I use cogen. 

Interesting info I found along the way:

 Each gallon of  free vo is converted to $1.97 in electricity up to my domestic usage. 
Each KW of electricity is equivalent to 3412 BTUs
A BTU of electricity at my retail rate costs me just  $0.0000562    .192/3412btus= .0000562
A cubic foot of nat gas has 1031BTUs
Using last months nat gas bill, my cost per BTU of nat gas is .00158    when converted to BTUs, the cost of nat gas is much higher than electricity.

There are also losses involved with burning nat gas, using a resistance heater there are negligible losses converting each kw to 3412 BTUs.   I would have expected the reverse, It seems it would be cheaper to heat my house with electric vs. nat gas.   The cost per BTU of nat gas vs electricity is so far apart I fear there is a calculation error somewhere.

A gallon of soy oil (my WVO is soy) has about 118000btu per gallon.
1kw = 3412 BTUs
10.269kw*3412=35037 BTUs extracted from a gallon of soy based WVO
35037/118000=29% efficiency which is higher than I expected, and causes me to question the real output I was seeing out of the generator.  I will run the test again once additional ammeter and volt meters are hard wired into the gen panel.

So the economics for my particular situation are:
Cap cost of about $5200
Payback period <2yrs with no cogen

The state offers grants for this type of project, I was awarded a grant of $3300.  I will receive the money when it is operational and deemed in compliance by the utility.  This makes my project pay back in less than one year.  They also offer a separate grant of $250 per kw for backup generators.  If you are called upon by the utility you must take your self off the grid, this can happen if there is a power emergency where rolling brownouts may be required.  I have a ST head, so I also have a backup generator.  Because I am using an induction setup if the grid fails I have a source of power. This grant or grants will make for a very quick payback period of far less than one year.

I have also been looking into using a UL listed off the shelf grid tied inverter, these are common for solar and wind applications.  If this works out, utility approval will be easier and less expensive.   There is still a lot of research to do into this option, I have contacted several manufacturers with limited success so far.  I have 3 years from the date of the grant award to get something installed, so I am in no great hurry.

Bottom line, under the right circumstances and with enough research and hard work it can work, but it is by no means anything close to easy.

Best regards
Scott

net metering with a 6/1 in Connecticut
12/1
6/1

mobile_bob

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Re: Net metering: Real world numbers
« Reply #1 on: December 19, 2006, 07:01:11 PM »
Scott:

shouldnt one factor in the cost of the engine and generators as well as maintenance costs?
i understand you got them free after selling the excess units, but someday they will need replacement.

in either event i like you analysis, and finding that generating to the point of useage offset might make sense in some area's

and above all to me it is the freedom gain, and the contol of the utility company lost, that is the most attractive.

so even if at the end of the day my energy costs were twice what i could buy it for, i would still do it, just to be free, and have one less
controlling force to live with.

to me the removal of all controlling forces is the goal, and then i can pick and choose which i want to invade my life.

that has value :)

good post

bob g
otherpower.com, microcogen.info, practicalmachinist.com
(useful forums), utterpower.com for all sorts of diy info

Jim Mc

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Re: Net metering: Real world numbers
« Reply #2 on: December 20, 2006, 01:48:48 AM »
Each KW of electricity is equivalent to 3412 BTUs
A BTU of electricity at my retail rate costs me just  $0.0000562    .192/3412btus= .0000562
A cubic foot of nat gas has 1031BTUs
Using last months nat gas bill, my cost per BTU of nat gas is .00158    when converted to BTUs, the cost of nat gas is much higher than electricity.

There are also losses involved with burning nat gas, using a resistance heater there are negligible losses converting each kw to 3412 BTUs.   I would have expected the reverse, It seems it would be cheaper to heat my house with electric vs. nat gas.   The cost per BTU of nat gas vs electricity is so far apart I fear there is a calculation error somewhere.


Actual numbers, real math, realistic assumptions.  Nicely done!

Something's amiss with your electric vs. natural gas comparison though.  Here in the midwest, natural gas is sold by the 'therm', and priced at about $1.35/therm (a therm is 100,000 BTUs), so that works out to .0000135/BTU.  Factor in a 80% efficient furnace and we're at .0000169/BTU delivered. With your electricity at .0000562/BTU, electric resistance heat would be over 3 times as costly per BTU delivered.  Not sure what your natural gas prices are, but I'd be surprised if they were >$2.00/therm.

Stan

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Re: Net metering: Real world numbers
« Reply #3 on: December 20, 2006, 02:39:33 AM »
Scott, I'm not sure how you acquired your wvo but you must have had to "go and get it" and then filter it and take the water out of it etc. etc.   How much time will you have to spend on doing that and is it worth the $2.00 /hr you "might" save?  We have the same arguments here over using wood heat.  Sure it's free out in the bush, but you have to have a truck to get it in, then you have to support a chain saw to cut it up, then you have to figure 5 hrs per pickup load to bring it back, then there's at least 5 more hours splitting/stacking/hauling it in time   whew!  No wonder I went to pellets and get them delivered to the door.  I could earn $50/hr  back then at my day job, so wood heat didn't make sense.  (however, I still did it for 10 years, guess I'm crazy)
Stan

SCOTT

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Re: Net metering: Real world numbers
« Reply #4 on: December 20, 2006, 03:21:24 AM »
Jim Mc

I have my gas bill in front of me as I type, unfortunately at last months usage level my cost per BTU is accurate at .00158 per BTU for nat gas.  Notice I said at my current usage level. 

In my area the gas company charges by cubic foot, last month I used 104 cubic feet, my total bill was $169.36 
169.36/ 104cubic feet = $1.628 per cubic foot
a cubic foot of nat gas contains about 1031 BTUs
104cubic feet *1031 BTUs = 107224 total BTUs consumed
$169.36/ 107224 BTUs = $.00158 per BTU

The rate schedule is tiered in my area, the first 30 cubic feet are more than 2x as expensive as all cubic feet above the first 30.  There is also a fixed customer service charge which skews the per BTU cost at low usage levels. 

If it ever gets cold here in CT this winter I will have some $400-$500 bills, where the cost per BTU will be lower.  As it is now the weighted average due to low usage includes a relatively high number of cubic feet at the higher rate vs. the lower rate so that’s why my per BTU is so high.

Thinking out loud here…

The high cost of  BTUs during a low usage periods suggest that using waste heat from a lister type for domestic hot water would have significant cost savings potential. I expect that most of my usage during these periods is due to the dishwasher, washing machine and showers.  It would be possible to schedule the gen to come online a few hours prior to the morning showers etc.

The draw back to this is the effort/money to make/buy the heat exchangers.  A more appealing option is to use an electric hot water heater instead of the gas one currently in use.  Better yet, using an on demand or thankless electric water heater would be more efficient and it is much easier to move electricity than hot water.  The federal government is even offering tax credits for this type of water heater.  To extend the cogen a little further the existing gas water heater could be left in place and used as a pre heater for the tankless system.  Run the cooling loop through the tank as the last “stop” before going back to the engine.

The idea could work.

I did not include maintenance in the original calculations, but I did not use the savings for cogen either, because I don’t have a good way of quantifying those costs.  I think the cogen savings would exceed maintenance costs by a wide margin. 

The .192 electric rate is effective 1/107 not 1/106 as stated in the original post
Stan you are right I did not allocate a value to my time used to collect and prepare the “free” fuel:

I am not paid on an hourly basis, so the time I spend collecting WVO does not have an easily calculated cost.  I stop by 2 restaurants once a week to collect wvo in their original containers.  I have so far spent no money on filters and almost no time on filtering/ dewatering.  I simply let the wvo sit in the back garage in the summer when it is warm,  and if it ever gets cold here I will let it settle in the basement.

Stan by doing all that work to cut, split, stack, and burn your firewood, you improved your cardiovascular health and likely extended your life, that has value! 

I will try to allocate some cost/ value to the time I spend collecting wvo, because there are other things I could be doing  I should be able to come up with a realistic cost per gallon figure…..but I will have to factor in the satisfaction I gain from this little project of mine, it too has value!

Best regards
Scott
net metering with a 6/1 in Connecticut
12/1
6/1

Jim Mc

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Re: Net metering: Real world numbers
« Reply #5 on: December 20, 2006, 03:36:34 AM »


In my area the gas company charges by cubic foot, last month I used 104 cubic feet, my total bill was $169.36 
169.36/ 104cubic feet = $1.628 per cubic foot
a cubic foot of nat gas contains about 1031 BTUs
104cubic feet *1031 BTUs = 107224 total BTUs consumed
$169.36/ 107224 BTUs = $.00158 per BTU

Hard for me to fathom.  In a month's time you used only 107,000 BTUs?  My boiler uses that much during 1 hour of operation.  A gas dryer will burn that in 3 hours.  My pilot lights use more than that in a month.  What gas appliances do you have?  Does the bill say you used 104 "cubic feet" or 104 ccf?  (1 ccf is 100 cubic feet)

Stan

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Re: Net metering: Real world numbers
« Reply #6 on: December 20, 2006, 04:26:37 AM »
You're right Scott, the exercise for the couple of months work (weekends mostly) will probably add 2 years to my life, and the beauty of the woods in the fall made me sit back and drink it all in (the beauty, I saved the beer until I got home and didn't have an axe or chainsaw or truck in my hands) on lots of occasions.  As they say on those dumb bank commercials, the value of that is "priceless".
Stan

Jim Mc

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Re: Net metering: Real world numbers
« Reply #7 on: December 20, 2006, 04:35:14 AM »
A gallon of soy oil (my WVO is soy) has about 118000btu per gallon.
1kw = 3412 BTUs
10.269kw*3412=35037 BTUs extracted from a gallon of soy based WVO
35037/118000=29% efficiency which is higher than I expected, and causes me to question the real output I was seeing out of the generator.  I will run the test again once additional ammeter and volt meters are hard wired into the gen panel.

You might also check into the BTU value of your WVO.  This site lists veg oil as 130,000 btu/gal:

http://www.ag.ndsu.edu/pubs/ageng/machine/ae1240w.htm

SCOTT

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Re: Net metering: Real world numbers
« Reply #8 on: December 20, 2006, 02:05:20 PM »
Jim Mc
You are correct about the nat gas calculation my usage was 104ccf which =10400cubic feet of nat gas.  It took about 15 min on the phone for the gas company to confirm this.  So I really used 10722400 BTUs at a cost of $169.36 for a per BTU cost of  .0000158.  This makes more sense, and makes electric BTUs about 3.5 times the cost of nat gas before conversion losses. 



As for the true content of veg oil, I am not sure what the real BTU content is, if there are 130000 then my effeciency number of 29% would be lower which would make sense.

Thanks for pointing out the miscalculation.
net metering with a 6/1 in Connecticut
12/1
6/1

Flydoctor

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Re: Net metering: Real world numbers
« Reply #9 on: December 20, 2006, 02:48:43 PM »
Scot, and others of course,


Great work.  It realy brings it home to me.

Your calculation and comment:

It makes more sense to just run the engine just enough to cover my domestic usage.
16500kw domestic usage /7kw (1hr output) = 2357 hours *7kw * .192 = $3134   

Can you shed light on my goal of using a bigger gen set making about 17kw with a 20kw head?  We pay $16.8/kwh

I am still thinking the variables are (among many of course)
1.) creating more power
2.) Running less time

We were goingh to install a back up generator anyway, regardless, which has no pay back what-so-ever before we discovered this idea. Houston is ripe for a Hurricane wnd when it comes, my area could be out for a long time as they retore power to a major city before our little lake community.  Having that generator make power with free fuel, that I gather with a electic/free NEV is a fun bonus. 

The bigger generator idea will make more power, but also run my neighbors home (limited) in a storm.  Last year we had to leave during Rita and returned to no power on just our street for 3 days.  It was miserable for my family...I vowed that that would never happen again.

Return?  Like, buying a diesel Excursion, converting it etc. to WVO, while working from home (no commute), makes my payback on that somewhere in 2039, but whos counting.

Sometimes it not about getting a return for your dollar, its about helping out the world a small bit, saving on future expenditures and getting a feeling of satisfaction.  These are unmeasurable in terms of cost/benefit, especially since I have more money than time at this point.

Scott, I would very much enjoy a dialog with you as I progress on email.  Please email me at power@toddhanson.com

Thanks.

Todd from Houston


Dwright

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Re: Net metering: Real world numbers
« Reply #10 on: December 20, 2006, 05:43:40 PM »
I hope you both are planning on keeping us ALL posted, rather than scoffing at all us utility-paying suckers behind our backs on private email ;)

Scott, I think given the right design and situation, most of the heat from the lister can be used, depending on how your net metering works (is the equation zeroed out every month or can credits be brought forward for several months?).

The way I can see this working is to construct an insulated enclosure for the whole unit (which you might want to do for muffling anyway) with a suspended ceiling of water in the form of a flat aluminum faced tank. I've made such a tank with success using composite lumber, silicone sealant, and wide aluminium flashing, or for a bit more cost it could be welded up properly. Use a circulating pump to keep the enclosure at a constant high heat and just about all the waste btu's can be recovered at a very usefull level of heat-- in the winter, anyway. This could also keep the engine at an ideal operating temperature, and keep the engine and wvo somewhat preheated from start to start.

I don't know what temp the genhead would like to stay at. If it likes it cooler than the engine, that would complicate the design a bit. Can anyone comment on that?

rbodell

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Re: Net metering: Real world numbers
« Reply #11 on: May 02, 2007, 09:20:02 PM »
Here in Texas the company I deal with somehow avoid having to buy back power. I think it has to do with no federal assistance or something. It's legal though somehow. Not only that, they won't release the acount to another power company so you are a captive customer. As the local manager says when I complained about service, over charges, not getting a bill and especialy their not buying back, it's us or nobody. WELL, I gues we all know what my answer to that was. I don't care if it costs me more to provide my own power. They won't get my money.

cujet

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Re: Net metering: Real world numbers
« Reply #12 on: May 05, 2007, 02:20:57 PM »
Fantastic work! I followed your numbers and they seem to make good sense.

This got me thinking again about using my listeroid during the hot summer months to run the AC during the day. In fact, for me this achieves the same thing as your plan. How to offset the electric bill. The key is the fuel.

Again,

Thank You!
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Flydoctor

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Re: Net metering: Real world numbers
« Reply #13 on: May 07, 2007, 10:58:16 PM »
I chased this months ago, is a short short summary. 

Texas allows it, but your power company must offer to buy back power, I called 10 and no one did in the lower range of power sost, so I aborted the net merering. 

Yes, it must have an auto shut off if grid power gors off.  Best way; back up batteries and large inverter, the back end of a solar system...my cost was about $8k.  So I decided to simply use a lister 30/2 (just hitting the US today) to run during the hot summer days in Texas, capture heat from exhaust to heat my pool and water and run maybe from 9-7PM.  I have unlimited oil. WVO.

I run my business out of my home, so I can't afford a long power outage if a hurricane comes, thus the back up generator.  But since I have driven over 16,000 miles on WVO in my Excursion, I thought why not run my home in the intense summertime??  My power costs aboout $1000 a months and the pool isn;t finished so I predict $1300.  Cutting that in half or more will be cool.

So, all I seek now is an automatic switch that in case the generator quits while I am golfing, the power with be automatically returned to grid power.  That way my secratary won't have to call me!

Anyone know where I can get a automatic switch??

rmchambers

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Re: Net metering: Real world numbers
« Reply #14 on: May 08, 2007, 03:43:02 AM »
Check on E-bay, their are a lot of LARGE transfer switches offered, ASCO or EASCO is a name I seem to remember.  They aren't cheap but poke around on there and see which one brand offers you the functionality you need.  Then try and source one cheaper elsewhere.  If you have any buddies that are electricians they sometimes pull out stuff like that and install larger etc so you might be able to pick up something like that for a song.

Good luck

Robert