PROJECT REPORT OF ENGINEERING ECONOMICS
LIFE CYCLE COST ANALYSIS OF FUEL CELL BASED SYSTEM IN MALAYSIA
Reference: Life cycle cost analysis analysis of fuel cell based for residential application in Malaysia; author: T.M.I Mahlia and P.L. Chan
Comparison papers: a) Life cycle cost and energy ana lysis of a Net Zero Energy House with w ith solar combisystem; combisystem; author: Mitchell Leckner and Radu Zmeureanu. b) Life cycle cost of ethanol production from cassava in Thailand; author: Chumnong Chumnong Sorapipatana and Suthamma Yoosin.
SHANDY RADITYA SYAHRON 1206229585 CHEMICAL ENGINEERING INTL Date of submission: October 23rd 2014
1. ABSTRACT Malaysia has developed a new alternative a lternative source for residential electrical needs by using a fuel cell cogeneration system. This alternative is an eco -friendly method that can produce electricity and thermal energy, which the thermal energy can be used to meet the heating loads. In this paper, the comparison co mparison between fuel cell cogeneration system and conventional grid system was shown. The comparison shown is the energy de veloped of these two systems. Also, the comparison of life cycle cost and payback period between these two models is presented. The purpose of comparisons above is to analyze the feasibility of fuel cell cogeneration system to be used in Malaysia. T he results are indicating that the fuel cell cogeneration system can reduce the primary energy use by 30-40%, from the conventional system. 2. BACKGROUND, THEORY, AND EVALUATION A. Background and Introduction Electricity Electricity is one o ne of the main needs in our daily life. Every little thing needs electricity for them to be working, such as; refri re frigerator, gerator, TV, air conditioner, etc. These examples are the goods in our home. In Malaysia, the residential res idential energy use accounts for more than 19% of total electricity in Peninsular Malaysia in 2006, or equals to 14,365 GWh. Most of the residential complex in Malaysia uses the conventional grid energ y system that providing all of the facilities around the nation. But, the t he thermal energy waste of this conventional convent ional system could not be used for other purposes, even if the efficiency of the t hermal energy reached nearly 40%. Therefore, Malaysia government needs to look for an alternative way to solve this problem since the conventional system is not proper enough, since the number of residential development is increasing annually. Ministry of Science, Technology and Innovat ion (MOSTI) has been funding the Malaysia National Fuel Cell Research and Development Program from year 1996 to 2007 with total amount of MYR34 million. The government o f Malaysia has been working hard to change the system from conventional one to the fuel cell coge neration system. Thus, the life cycle cost and payback period of this alternative has to be calculated to look if it is proper or not to be used in the residential complex.
B. Theoretical Approach The design of fuel cell cogeneration system consists of fuel cell system and vapor compression heat pump. As I mentioned before, t he fuel cell cogeneration system producing pro ducing a thermal energy waste that can be stored and used for water heating that uses for bathing, cooking, or every household that uses hot water. Since Malaysia is in the tropical area, to convert normal temperature water in Malaysia (26oC) to the temperature of 60oC for bath only takes 6 seconds for 1 liter of incoming feed. While the electricity produced by the system itself can provide the residential needs for lights lights and common appliances. Also, the vapor compression heat pump can be used for space cooling. Comparing this system with the convent ional system that the waste of thermal energy cannot can not be used, by conclusion, this new alternative system is much better than the old one. Survey data says that 14% of o f the electricity used in Malaysia is for water heater, which is in the 4th rank of the electrici e lectricity ty consumption consumpt ion besides refrigerator (38%), air conditioner (21%), and washing machine (17%). This data means that if the government can replace the conventional conve ntional energy system to the fuel cell cogeneration co generation system for residential use, the thermal waste energy could be so helpful to fulfill the needs of o f the problem. There will be reducing the consumption of electricity itself by using the fuel cell system.
Another advantage of this alternative is that the fuel cell cogeneration system uses oxygen and hydrogen, which this system is converting chemical energy into electrical energy by combining hydrogen fuel and oxygen. Water is the only output of this system that means no pollutants are produced if pure hydrogen is used. This means that the system system is much more efficient than conventional energy sources because it converts chemical energy of o f the fuel directly into electrical energy without combustion step; no pollutants are produced by this system. In conclusion, we can claim that this system will produce electricity better than the current residential electricity rates and significant cost savings especially at co untries untries where electricity is more expensive.
But, this system has some weaknesses also, such as; Malaysia is placed in the tropical area of the Earth that the use of the heat pump for space heating cannot be used, for producing pure hydrogen needs feed of o f natural gas that the supply of natural does not last forever, and also a lso to start or change the conventional system to t his new alternative sys system tem needs an a n expensive initial cost. C. Evaluation -
Scenario A
Typical family in Malaysia use electricity load and thermal load for 10.3 kWh/day and 1.85 kWh/day respectively. For this first case, the fuel cell system is not using battery option to store
the excess of the electricity. Therefore, in this scenario we do not need thermal storage energy because the supply of the thermal energy is enough to meet the demand of the use of the thermal energy for water heating. The new a lternative system must meet the demands and also with the minimum net present cost. The first first potential combination (scenario A) is chosen, which can provide 11 kWh/day for electricity load and 2 kWh/day for thermal load, with a total net present cost of MYR 22,995. This new fuel cell energy system cost which can be used for 20 years. With the annual real interest rate of 5%, the cas h flow diagram for Scenario A is shown below. The fuel cell system has to be replaced for every 5 years, as the lifetime of the fuel cell is only 40,000 h or approximately 5 years. The initial capital cost for the who le project is MYR 3700 with the consideration of annual annua l interest rate and the total cost for the whole project would be MYR 22,995 for 22 years (Net present cost). The salvage cost of the project is MYR 818 at the end of the pro ject lifetime.
Fuel cell production
Primary load
Thermal energy
Thermal load consumption
(kWh/yr)
consumption
production
(kWh/yr)
(kWh/yr)
(kWh/yr)
4015
2812
4364
730
-
Scenario B The difference of this option than before is that the system uses battery option to store the
excessive electricity and this can minimalize the usage hours of the system. But, this scenario also capable to meet the baseline demands which is 11 kWh/day for electricity load and 2 kWh/day for thermal load, just like the first scenario. With the battery pack option, the t he lifespan of fuel cell is two times comparing to scenario A, which required four times throughout the lifespan lifespan of o f the project. This indirectly reduces the replacement cost as battery is only on ly required to be replaced every 10 years. The salvage value for this case is MYR 831. For scenario B with the battery pack backup , fuel cell system only has to operate 4958 495 8 h to meet the requ ired demands. By using this scenario, we could possibly save our net present cost that for this system system needs MYR 18,978 for the net present cost.
Fuel cell production
Primary load
Thermal energy
Thermal load
(kWh/yr)
consumption
production
consumption (kWh/yr)
(kWh/yr)
(kWh/yr)
4015
3118
4840
730
-
Brief Argumentation
By comparing the scenario A with scenario B, we can clearly state that the scenario B is better than the scenario A because the maintenance cost is much less, because of the life life cycle of the system is 10 years rather 5 years (for scenario A). Therefore, for the fuel cell cogeneration system, scenario B is the best However, the fuel cell cogeneration system is not an attractive option to replace the conventional grid system, which we can see from the table above. Also, the fuel cell system needs feed of natural gas for converting pure hydrogen that use for producing electrical energy. Since, we all know the t he source of natural gas in the Earth is slightly decreasing as the time goes by. But, also the fuel cell system has the value of 60% efficiency. Although the conventional grid system has a high total energy cost, it just has a small amount of initial cost. Besides, the maintenance cost for conventional grid system is charged on consumer. Thus, for the company who wants to invest is still being confused in which o ptions they have to choose, whether they stay with the conventional one or the fuel cell cogeneration system.
3. COMPARE AND CONTRAST A. Life cycle cost and energy analysis analys is of a Net Zero Energy House with w ith solar combisystem. The concept of the Net Zero Energy House (NZEH) implies that the systems installed in, on or near the house can convert energy from renewable sources to generate at least as much primary energy as the house uses over the course of the year. At peak demand times, when the home system is not sufficient to satisfy the demand, the electricity is purchased from the utility grid; the electricity is sold back. Also, this do es not affect the environment (does not produce pollution waste). Europe, US, Canada has been started to use this kind of system for for the residential there. Two types of solar collectors are analyzed and resu lts compared: flat plate collectors and evacuated tube t ube collectors, but the flat plate is the better option based of financial cost. Analysis of life cycle cost analysis is shown before to compare and contrast for NZEH with flat plate.
B. Life cycle cost analysis of ethanol production prod uction from cassava in Thailand. This paper is much different from the first two papers, to g ive a contrast between t he productions of energy related with residential residential purpose. Ethanol production usually uses sugar cane, but the Thai T hai law prohibits using the sugar cane directly to produce ethanol. So, the scientists there are estimating an alternative method by using cassa va to produce ethanol. Even though the real calculation for this production is not being given because the plant p lant is still a concept, an approximation for the life cycle cost is being shown below.
Table below is to compare the cost for the three different projects.
Fuel Cell Cogeneration
Net Zero Energy House in
Ethanol Production in
System in Malaysia
Europe, US, and Canada
Thailand
MYR 20,000
USD 89,000 – 97,500
Total of 1,208 million baht
Duration of 20 years
Duration of 40 years
Production of 150,000 l/day
(Scenario B)
4. CONCLUSION AND CRITICS For concluding the comparison of o f three different projects above about life cycle cost, each o f the system has its own advantages and disadvantages. d isadvantages. For the main paper, fuel cell cogeneration system to replace the conventional grid system, I can co nclude that the fuel cell is not an attractive option to replace, although the thermal energy waste from the system can be used for water heating, but in the financial cost for 20 years, the difference of net present cost between this alternative and the old one is not much. The second paper is generating electrical energy without producing waste or pollution, same as the fuel cell system, but t he NZEH does not use natural gas in the system which we a ll know the stock of natural gas in our Earth E arth is slowly decreasing. The last paper about ethanol production from cassava is still a concept project, but this alternative is an attractive option since the government of Thailand pro hibits the use of o f sugar cane to produce ethanol. In financial aspect, the first two papers, fuel cell cogeneration system and Net Zero Energy E nergy House, give a high net present cost, but also for building plant for ethanol production needs a high investment in the first place. The T he data is shown above. In my point of view, fuel cell system and Net Zero Energy House are eco -friendly projects and useful for human beings. While, the et hanol production project is purely a business point of view. So, in financial and economic eco nomic aspects, the first two projects do not give a high profit for the investor since it is for the replacement from the old one. Whilst, the ethanol production project gives a high profit as the initial initial investment that needs high cost, the demands of ethanol is widely open, that the plant p lant just needs to have a good marketing strategy to sell their their products product s while it can cover the maintenance cost for the plant or equipment.
5. REFERENCES
a. http://www.fuelcellenergy.com/why-fuelcell-energy/benefits/combined-heat power-chp/ b. http://sustainability.csusb.edu/Projects/Cogeneration%20Fuel%20Cell.html c. http://www.acgov.org/sustain/documents/fuelcellfactsheet.pdf d. http://www.acronymfinder.com/Net_Zero-Energy-Home-(Canada)-(NZEH).html e. http://link.springer.com/article/10.1007%2FBF00933613#page-1 f.
http://www.businessdictionary.com/definition/net-present-value-NPV.html
