How FMCG factories can generate their own energy and save ... · Actual case study • Blue-chip...
Transcript of How FMCG factories can generate their own energy and save ... · Actual case study • Blue-chip...
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How FMCG factories can generate their
own energy and save water from their
waste
Mike Smith
Economist, Talbot & Talbot, South Africa
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• Fast-Moving Consumer Goods (FMCG) are high turn-over
consumable products
• Packaged foods, beverages, toiletries, over-the-counter drugs…
Introduction to FMCG
Image references: FMCG Futures
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Energy
• Water and Energy are a major component in manufacturing
Raw
material
Packaging Raw Water
CO2
Effluent
Image references: HuffPost & Beverage Daily
Manufacturing: Resource use
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• Water and Energy are a major component in manufacturing
Beer
Soda Drink
+/- 3.5 litres to make 1 litre beer
Slaughtered
Chicken11 to 17 litres per bird
+/- 3.1 litres to make 1 litre soda drink
Water & Energy Consumption
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Energy & Water: Risk / Cost
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• Continuity of supply
• Loss of production
• Shut-down, standing costs
• Process damage
Energy & Water: Risk / Cost
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-
100
200
300
400
500
600
700
800
900
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Electricity price increase (average) CPI
2008 - 2011
27.4% year-on-year
increase
Electricity in South Africa2000 as base year = 100
694%
increase
since 2000
Energy & Water: Risk / Cost
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• Water price
escalation, similar to
electricity price?
• Real cost of water to
be recovered
• Shortages…
Vaal River System
Reconciliation
Strategy already off
schedule
Energy & Water: Risk / Cost
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The Solution or Opportunity
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The solution: Technology
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The solution: Technology
AD MBR RO
Gas
GeneratorBoiler
Effluent
Biogas
Recovered
WaterRecovered
Energy
Brine
Buffered water
storage
65%+
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The solution: Technology
AD
Anaerobic Digestion
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The solution: Technology
MBR
Membrane Bioreactor
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The solution: Technology
RO
Reverse Osmosis
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The solution: Technology
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The opportunity: Financial
Energy
Water
Effluent
Electricity and/or Fuel Saving
Reduced CO2 Tax
60 – 90% Water Recovery
Reduced volume
Improved quality
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The opportunity: Financial
Revenue value breakdown
dependent on:
• Status quo / sources
• Tariff pricing
• Tariff escalation
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8.0 years R358 783 382 R74 517 496 17%
Simple Payback Net Saving NPV IRR
-
5000 000
10000 000
15000 000
20000 000
25000 000
30000 000
35000 000
40000 000
45000 000
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Savings by type
(100000 000)
(50000 000)
-
50000 000
100000 000
150000 000
200000 000
250000 000
Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10 Y11 Y12 Y13 Y14 Y15
Ra
nd
CFADS vs Debt Balance / Retained Savings
Debtbalance /
retained
savings
The opportunity: Financial
Saving opportunities
employed
Water recovery___
Energy recovery___
Effluent discharge___
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7.1 years R423 529 871 R109 145 148 21%
Simple Payback Net Saving NPV IRR
-
10000 000
20000 000
30000 000
40000 000
50000 000
60000 000
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Savings by type
(100000 000)
(50000 000)
-
50000 000
100000 000
150000 000
200000 000
250000 000
300000 000
350000 000
Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10 Y11 Y12 Y13 Y14 Y15
Ra
nd
CFADS vs Debt Balance / Retained Savings
Debtbalance /
retained
savings
Saving opportunities
employed
Water recovery___
Energy recovery___
Effluent discharge___
The opportunity: Financial
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Saving opportunities
employed
Water recovery___
Energy recovery___
Effluent discharge___
4.6 years R699 377 302 R259 461 584 36%
Simple Payback Net Saving NPV IRR
-
20000 000
40000 000
60000 000
80000 000
100000 000
120000 000
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Savings by type
(200000 000)
(100000 000)
-
100000 000
200000 000
300000 000
400000 000
500000 000
600000 000
700000 000
Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10 Y11 Y12 Y13 Y14 Y15
Ra
nd
CFADS vs Debt Balance / Retained Savings
Debtbalance /
retained
savings
The opportunity: Financial
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Case study
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Actual case study
• Blue-chip FMCG producer in South Africa
• Project development funded by EEP Africa (managed by Nordic
Development Fund [NDF])
Case study: Financial
Water recovery___
Energy recovery___
Effluent discharge___
Project being developed within an SPV as a BOOT (Build, Own, Operate, Transfer)
15-Y operational & product purchase agreement
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Client side savings
• Determined by tariff
escalations
• Scenario analysis
indicates 15-Y
savings of:
R 0
R 50 000 000
R 100 000 000
R 150 000 000
R 200 000 000
R 250 000 000
R 300 000 000
R 350 000 000
R 400 000 000
R 0,00
R 50,00
R 100,00
R 150,00
R 200,00
R 250,00
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032
R /
m3
9.5% 10% 12% 14%
Case study: Financial
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R 0
R 50 000 000
R 100 000 000
R 150 000 000
R 200 000 000
R 250 000 000
R 300 000 000
R 350 000 000
R 400 000 000
R 0,00
R 50,00
R 100,00
R 150,00
R 200,00
R 250,00
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032
R /
m3
9.5% 10% 12% 14%
Client side savings
• Determined by tariff
escalations
• Scenario analysis
indicates 15-Y
savings of:
@ 10% - R102 million
Case study: Financial
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R 0
R 50 000 000
R 100 000 000
R 150 000 000
R 200 000 000
R 250 000 000
R 300 000 000
R 350 000 000
R 400 000 000
R 0,00
R 50,00
R 100,00
R 150,00
R 200,00
R 250,00
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032
R /
m3
9.5% 10% 12% 14%
Client side savings
• Determined by tariff
escalations
• Scenario analysis
indicates 15-Y
savings of:
@ 10% - R102 million
@ 12% - R576 million
Case study: Financial
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R 0
R 50 000 000
R 100 000 000
R 150 000 000
R 200 000 000
R 250 000 000
R 300 000 000
R 350 000 000
R 400 000 000
R 0,00
R 50,00
R 100,00
R 150,00
R 200,00
R 250,00
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032
R /
m3
9.5% 10% 12% 14%
Client side savings
• Determined by tariff
escalations
• Scenario analysis
indicates 15-Y
savings of:
@ 10% - R102 million
@ 12% - R576 million
@ 14% - R1.2 billion
Case study: Financial
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Environmental & development impact
• 3.4 MWp energy capacity
• 28 000 MWh per year
• 10 thousand tCO2e avoided per year
• 876 million litres of water recovered per year
• 197 temporary jobs
• 17 permanent employees
Case study: Impact
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Extrapolation
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Extrapolated Impact
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Extrapolated Impact
25examples
80 MW
700
GWh/year
22 billion litres of water
saved
425 new
jobs
5 000 jobs
supported