Biomass

Conversion

Technologies

Peter

Tittmann

Due diligence

defined

Defining terms

Getting there..

Due diligence

Technology

evaluation

Capability

E�cacy

Cost

Information

sources

Vendors

Types

Vendor diligence

Summary

Biomass Conversion TechnologiesDue Diligence for Technology Deployment

Peter Tittmann

Center for Forestry

University of California, Berkeley

Biomass Working Group, February 18 2014

Biomass

Conversion

Technologies

Peter

Tittmann

Due diligence

defined

Defining terms

Getting there..

Due diligence

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Summary

Outline

1 Due diligence definedDefining termsGetting there..Due diligence

2 Technology evaluationCapabilityE�cacyCost

3 Information sources

4 VendorsTypesVendor diligence

5 Summary

Biomass

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Tittmann

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Definitions

Technology The specific unit or package being considered forpurchase from a given vendor. Could include oneor more of:

GasifierBoilerHamermillGas cleaningEngineTurbine

Vendor Entity selling the technology

Conversion Process inclusive of all intermediate steps, ofconverting the raw material (wood chips, debris,pellets) into the final product (electricity, heat,densified fuel)

Biomass

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Definitions continued

Project Set of values, goals, and objectives that leadevaluating conversion technologies

Values Set of principals or ideals that guide and definethe projecteg: profit, environmental stewardship, social

responsibility

Goals General statements aligned with values thatexpress intangible or abstract missioneg: “Provide sustained economic opportunity for

our community”

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Definitions continued

Objectives Specific tangible outcomes

create 10 long-term, living wage local jobstreat 10,000 ac of forest annually,produce 10MWe of renewable electricity,realize 7% return on investment in 15 yearsreduce heating costs by 5%reduce conversion costs by 10% in 5 yearsfor an emerging technology

Team Specific individuals with defined roles.

Biomass

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Before the technology

Define the project Take time to think carefully about theproject articulating at least the following:

ValuesGoalsObjectiveTeam

The known unknowns What you know that you don’t knowyet, and how to know it.

What expertise do you lack on your team(technical, finance, etc.)?Do you have a realistic estimate of feedstocksupply in terms of cost and volume?Do you know what your product market is?How to access it? What price you canexpect to charge?

Biomass

Conversion

Technologies

Peter

Tittmann

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Due diligence

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Vendor diligence

Summary

What is due diligence?

Evaluating capability and e�cacy of a specific technology toachieve your goals and objectives.

Capability Does the technology do what I want it to?

E�cacy How well does it perform

Process e�ciency $/unit outputProduct quality relative to customerspecification

Biomass

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CapabilityCategories

What are the specifications of the technology package?operating conditionsfeedstock requirementsduty cyclemaintenance cycleemissions/residuals

Do the specs meet with your operational conditions?

Biomass

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CapabilityOperating conditions

Temperatures Min, Max

Dust Air filtration requirements?

Biomass

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CapabilityFeedstock specification

Consumption Feedstock consumption (eg: tons/day, greentons ⇡50% MC, oven dry tons 0% MC)

Piece size Dimensions of minimum and maximum piecesize?

Moisture Content What is the maximum and minimummoisture content for feedstock? Dry or wet basis?

Moisture Content measurement

Generally reported on dry basis:

m

g

�m

od

m

od

Where m

g

is green mass and m

od

is oven-dry mass

Biomass

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CapabilityOperation

Mode of operation Batch or continuous?

Duty cycle Does the unit operate continuously betweenmaintenance cycles or is operational down timerequired?

Maintenance cycle How many operational hours betweenmaintenance?

Replacement schedule and cost How often do componentsneed to be replaced? At what cost?

Operation How many people are required to operate thesystem? How automated is feedstock handing?

Biomass

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CapabilityEmissions and residuals

Air emissions Ask for criteria pollutant emissions reported inlbs/ton of feedstock consumed.

Criteria pollutants Ozone (O3

), Nitrogen Dioxide (NO2

),Sulfates,Carbon Monoxide (CO), Sulfur Dioxide(SO

2

), Visibility Reducing Particles (AKA ’dust’),Lead (Pb), Hydrogen Sulfide (H

2

S), VinylChloride

Liquids Does e✏uent need to be treated? Is treatmentsystem included in package?

Residuals Other solid residuals in lbs/ton of feedstock.

CharAsh

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CapabilityTrack record

Its criticaly important to understand the development status ofthe technology.

Development Stage Lab scale? Pilot scale?

Production Ask vendor for a list of installations or clientreferences.

Operating hours?

Guarantee, service Can reflect vendors true feeling aboutreliability.

Evaluate track record against project goals. A technology indevelopment stage may be the best fit if R&D or publicinvestment in novel technologies are important.

Biomass

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Tittmann

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Vendor diligence

Summary

E�cacyMatching project objectives

Does the technology meet your project needs?

Criteria Mfg. A Mfg. B

60 psi steam Xwood pellets Xwood chips X�170� water X10 kWe electricity X� 20,000 GT/year

Table : Example evaluation matrix

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E�cacyProduct Quality

Product specifications Does the product meet known marketspecs?

Densified fuels: Ash content, moisturecontent. Check standards bodies (AmericanPellet Fuels Institute, ASTM International,etc.)Co-firing:

Boiler Type Piece size (in)

Pulverized coal 1/4Stoker 3Cyclone 1/2Fluidized bed 3

Table : Co-firing fuel specification from NREL

Biomass

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E�cacyProduct quality continued

Latency If demand is variable (eg: heat loads inmanufacturing), how quickly can productionramp to meet demand?

Consistency If demand constant and critical (ie baseloadPower Purchase Agreement) can the capacityfactor meet the demand?

Biomass

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CostFit with project finance

Does the technology allow you to meet project revenueexpectations?

Pn

1

R �P

n

1

C � P

Where n is the project planned lifetime in years, R are revenuestreams (heat, electricity, etc) and C are costs (capital, finance,operations, taxes, permit fees,etc.) and P is desired profit.

Biomass

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Peter

Tittmann

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CostEvaluation

Production context Multiple bids will reinforce bid legitimacy

Demonstration context Attempt to quantify expected benefitsfrom demonstration in terms of long term goalsand objectives (eg: SB1122)

public benefitstechnology maturationreducing costs for primary industry (woodproducts, recycling, etc)

Biomass

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Summary

Sources of information

Vendor Ask for data from installed (production) units.Ask for reference to corroborate.

Client Understand relationship to vendor. Ask for rawdata if available. Summary data should beexamined closely.

Biomass

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Technologies

Peter

Tittmann

Due diligence

defined

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Vendor diligence

Summary

Vendor types

Original Equipment Manufacturer (OEM) Company actuallyfabricates unit components (gasifier, engine, dye)

May own intellectual propertyUsually unit sales

Retailer and/or installer Provides comparable unit componentsfrom a multiple OEM mfg. May provide systemengineering services.

Consulting Engineer Combines best fit parts/pieces from OEMto fit system specification. Can provideconstruction-ready plans. Usually bill T&M orlump sum, no equity.

System integrator Energy companies. Procure financing,design, construct, operate.

Biomass

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Peter

Tittmann

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Summary

Who you are doing business with

Company history How long have they been in business?

Product Lines What other product do they produce?

Management Who is the management team?

Other project references Other projects and clients. Be sure tounderstand the relationship between client andvendor for references.

Biomass

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Tittmann

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Vendor diligence

Summary

Due diligence and values

Demands reflection on core values and goals Technology duediligence requires a clear vision of the projectvalues, goals, objectives. This is the measuringstick.

Know just enough about all system components Easy to getlost in the detail. Focus on important things.

inputoutputcosts/benefit alignment with goals andobjectives

Biomass

Conversion

Technologies

Peter

Tittmann

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defined

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Vendor diligence

Summary

Questions?

Contact information

Peter Tittmann, Ph.D.Center for ForestryUC Berkeleypwt@berkeley.eduo. (510) 665-3518c. (707) 849-4135web: http://ucanr.edu/sites/WoodyBiomass/twitter: @UCBWoodProducts

This work is funded in part through a Cooperative Agreement with

the USDA Forest Service.