Application of renewable energy sources in the municipality of Hostetin
Ir. R. Ellenbroek*, Dr. M. Cmiral**, Ir. R. Venendaal***, Dr. Y. Gaillyova****
*BTG Biomass Technology Group, PO Box 217, 7500 AE Enschede, The Netherlands
Ph.: +31 53 489 2897; Fax: +31 53 489 3116; e-mail: office@btgworld.com
**BTG Czech Republic S.R.O., Balbínova 8, Praha 2, 12000, Czech Republic
Ph: +420 2 22826421, Fax: +420 2 22826422, e-mail: btg@volny.cz
*** TEI Twente Energy Institute, P.O. Box 545, 7500 AM Enschede, The Netherlands
Phone: +31 53 4836660, Fax: +31 53 4337415, e-mail: tei@tei.nl
****Ecological Institute Veronica, PO Box 91, 601 91 Brno, Czech Republic
Ph.: +420 5 4221 8351 2; Fax: +420 5 4221 0561; e-mail: veronica@ecn.cz
In Hostetin, a small village lying in the White Carpathians, the Twente Energy Institute co-ordinates a project where the use of biomass and solar energy as clean and renewable resources is demonstrated. The project, executed under the Dutch PSO programme, aims at the demonstration of cost-effective fossil fuel energy substitution. It leads to a significant reduction of both fuel costs and CO2-emissions and could therefore be considered as a perfect demonstration of the 'Joint Implementation' concept. Furthermore, Hostetin sets an example for the sustainable development of other rural communities in the White Carpathians region.
Being on the shortlist for accession to the European Union, the Czech Republic will increasingly have to aim at environmentally sound energy generation and utilisation. As part of this, the demand for energy saving measures and alternative energy sources is growing. With abundant biomass resources available, especially the market for energy from biomass looks very promising. Biomass energy has the potential to combine economic, environmental and social benefits.
Hostetin is a village of 230 inhabitants, situated in the White Carpathians. Like in many municipalities, the majority of the population is currently using electric heaters and/or household scale brown coal systems for basic heating. Hostetin is not connected to a district heating network and will not be connected to a natural gas network. Main drawbacks of the current situation are:
from a primary energy point of view, it is very inefficient to use electricity for heating purposes.
combustion of brown coal, being a fossil fuel, significantly contributes to the greenhouse effect (CO2-emissions);
in addition it leads to strong environmental pollution in the form of dust, CO and SOx.
The District Office in Uhersky Hradiste and Ecological Institute Veronica, together with Twente Energy Institute and BTG Biomass Technology Group, The Netherlands, selected Hostetin as a potential site for demonstration of alternative energy supply system: a centralised biomass based heating plant [1]. A key factor in the identification phase was the strong support by the inhabitants: 100% of the population confirmed commitment for a bio-energy system.
Implementation of renewable energy system
The demonstration project embraces the installation of a 732 kWth wood chips boiler system, together with the establishment of a district heating network. A schematic overview is given in Figure 1 [2].
Figure 1: Schematic overview of biomass heating system
In the summer of 1999, implementation works started with the construction of the district heating pipeline system. After completion of the new boiler house in the winter of 1999, the boiler, manufactured by KARA Energy Systems, The Netherlands, was installed. In spring 2000, every house in Hostetin was provided with a heat exchanger, connected to the district heating system. The biomass heating plant was commissioned in May 2000. Actual operation will start as from the beginning of the heating season September/October 2000).
To cover the required wood amount of 500-600 tons/yr, a long term agreement was signed with a local wood processing company and forest owners in the surrounding municipalities. Back-up supply is partly secured by local villagers, which are in possession of forests.
In addition to the biomass boiler system, nine houses in Hostetin are, at the moment, equipped with solar hot water systems and the solar programme co-ordinated by Ecological Institute Veronica will further develop. Especially in the summer period, when the wood boiler is switched off, the solar boilers will be used for the production of hot tap water (e.g. for showering). Without solar boilers, households are forced to use fossil or electrical heating systems. The combination of solar and biomass energy is meant to demonstrate the concept of integral green heat supply, thereby maximizing CO2-emission reductions in a cost-effective way.
During the last years, Hostetin started to develop as a model village for sustainable technologies: in 1997 a reed bed waste water treatment facility was put into operation and in 1999 the project supporting traditional extensive fruit-growing and its local processing and marketing was started. The recently implemented renewable wood and solar based heating systems significantly contribute to the further development of this model concept. However, the benefits of implementing sustainable projects lie not only in the environmental protection but also in the regional development that involves the use of local natural and human resources. In line with this idea, Veronica and TEI will establish a Centre for Regional Development and Support of Sustainable Rural Technologies in Hostetin [3]. The Centre, financed a.o by the Dutch government (Matra-programme) aims at initiating sustainable rural development projects in rural communities in the White Carpathians, in close co-operation with local authorities, NGO's and SME's. The projects implemented in Hostetin, demonstrating that both social, economic and environmental benefits can be achieved, should trigger the multiple development of similar projects in the region.
Joint Implementation (JI) is a mechanism for reducing GHG emissions via a co-operation between two countries with the aim of achieving mutual benefits. In principle an investor country contributes to the implementation of a project in a host country where the marginal costs of GHG emissions reduction are relatively low [4]. The JI mechanisms are based on the so-called Emission Reduction Unit (ERU) that represents an emission credit equal to a metric ton of CO2 equivalents. The JI project performance is compared with a reference level - project baseline (i.e. GHG emissions if the project was not implemented) and the difference is expressed in the number of ERU's [4]. The price of ERU is not yet established, however, it is anticipated that in future it will become fully tradable.
Over the last few years, Twente Energy Institute and BTG Biomass Technology Group have been gaining experience from the pilot JI projects (also called Activities Implemented Jointly, AIJ) implementing biomass projects in several countries of CEE, among which the project in Hostetin. According to the baseline calculations, the Hostetin plant will achieve an emission reduction of 3,350 tons of CO2 equivalents per year [5]. This corresponds to 16,750 ERUs to be generated in the 2008-2012 'commitment period', defined by the Kyoto protocol as the time interval to which the currently developed JI projects should be bound [6]. Based on analyses of a number of project situations in CEE, the price for 1 ERU is suggested by BTG to be up to around EUR 8, which is in agreement with the currently predicted price of EUR 5 to 10 [7].
The Dutch approach: ERU-PT
With the exact rules for ERU's calculation still to be finalised, the government of the Netherlands made a step ahead and recently launched the first round of the so-called Emission Reduction Procurement Tender. Under the ERU-PT programme, a private party (contractant) receives a contract from the Dutch government for the implementation of a JI-project in the host country, after approval of the host country government. In return, the Dutch government can exercise claims on ERU's at the host government [7]. It is expected that funds available from ERU-PT may cover between 10 to 40% of project investment costs. Projects under ERU-PT are not bound to any technology or know-how import, which brings opportunities to local manufacturers. This funding may be combined with the local governmental funds and development programs or with other foreign investments involving national and international funds, banks or private companies. An ERU-PT prequalification proposal was submitted by BTG, covering the development and implementation of a portfolio of 19 biomass energy projects in Czech Republic [8]. With a few exceptions, these projects represent municipal heating systems where old fossil fuel boilers will be replaced with biomass boilers. The Czech government positively acknowledged the project concept and will further investigate the details.
Commenting on general experience from pilot-phase projects, eliminating risks on any possible front is of essence when dealing with 'early' JI projects as any project failure may devaluate the idea of JI and disturb its long-term prospects. Some of the most important factors are the strong commitment of all project partners and their proper communication, paying extra attention to overcoming the language and cultural differences. Preferably commercially proven technologies should be implemented to avoid unnecessary difficulties and delays. Ensuring cost-effectiveness and adequate capacity is an obvious first principle.
There are indications of Dutch banks that they would like to become involved specifically in projects under ERU-PT offering them further financial assistance. In principle, based on the experience in other countries, it is estimated that the direct financial commitment of the project owner implementing a renewable energy technology, such as a biomass boiler, may be as low as 10% of the total investment cost.
Conclusions
In the last two years, Dutch and Czech partners have been co-operating in a successful way on the implementation of a biomass heating plant and solar systems in the village of Hostetin. The experiences from this project, demonstrating the applicability and feasibility of renewable sources for heating purposes in Czech Republic, will be used to initiate similar projects in other (rural) municipalities. Attention should be paid not only to the energy and environmental benefits of bio-energy systems, but also to the positive impact on regional economic and social development.
A wide-scale introduction of bio-energy projects could significantly contribute to the reduction of CO2-emissions in Czech Republic, given the large biomass resource potential in Czech Republic. Mechanisms like 'Joint Implementation' offer attractive opportunities to facilitate and finance future projects.
References
Hostetin Biomass Heating Project, Project proposal for Senter PSO Programme, 1998
Hostetin Biomass Heating Project, project brochures and leaflets, 1999
Centre for Regional Development and Support of Sustainable Rural Technologies; project proposal for Matra Projects Programme, TEI, BTG, Veronica, Nadace Partnerství, 2000
Operational Guidelines for Baseline Studies, Validation, Monitoring and Verification of Joint Implementation Projects, Ministry of Economic Affairs of the Netherlands, 2000
Hostetin Biomass Heating Project, Registration Joint Implementation test project, Annexes to registration form, TEI/Senter 1999
Kyoto Protocol to the United Nations Framework Convention on Climate Change, Conference of the parties to the Convention. UKY.97-FCCC/CP/1997/L.7 Add.1
ERU-PT, Emission Reduction Procurement Tender, Terms of Reference, Senter Internationaal, 2000
Biomass Energy Portfolio for Czech Republic; Expression of Interest for ERU-pt Programme, 2000