Industry Market Trends
Natural Gas Independent Energy Districts a Bridge to Sustainable Energy
June 26, 2014
While green energy is the way of the future, it isn't yet an option for every business. Companies that aren't in a position to take advantage of renewable energy should consider independent energy districts as a bridge to sustainability. These energy districts use cleaner-burning natural gas. When it comes to energy, we are inexorably moving toward a greener future. With the support of governments across the globe, technology entrepreneurs, and power producers, renewable energy is well on its way to growing into the $2 trillion industry predicted by proponents. While much of the progress toward a sustainable energy future has been driven by governments and the renewable energy industry, individual companies can also play a role promoting sustainability. The benefits extend beyond reducing a business' carbon footprint; renewables can also provide reliable and affordable energy. Going Green There are a number of renewable energy sources to which companies can turn, and solar is probably the best known and most common. Photovoltaic technologies continue to become more efficient and affordable every year. As a result, more companies are turning to solar to meet at least a portion of their power and thermal needs. In fact, solar equipment has become so advanced that some companies are able to produce more energy than they need and are selling surpluses to local utilities. Another green option, particularly for larger companies, is wind power. While wind turbines are most commonly found in commercial "wind farms," they can also be located on a large business campus. However, wind turbines can be costly to install, and companies need to have a long-term energy strategy in place for them to make sense financially. A third renewable option is geothermal energy, through which businesses can use the Earth's subterranean energy to heat and cool their facilities. Geothermal technology utilizes wells that are sunk into underground water sources. Subterranean water is typically between 50° and 60° F and can be used to heat buildings when the outside temperature falls below 40° F and to cool them when the temperature reaches 80° F or higher. Geothermal technologies are among the most sustainable energy sources, but they can only be utilized in areas with sufficient sources of subterranean water. The Bridge to Sustainability While green energy is the way of the future, it isn't yet an option for every business. Companies that aren't in a position to take advantage of renewable energy should consider independent energy districts as a bridge to sustainability. Independent energy districts are small power plants that are sized to meet the specific energy needs of a campus, and they can be configured to operate on most fuel sources, including oil, natural gas, propane, and biofuels. [Editor's note: This system of electricity production is also referred to by several other terms, including distributed generation, decentralized generation, and district energy.] Today, natural gas is a particularly attractive fuel because it combines affordability with availability and sustainability. While natural gas is, admittedly, a fossil fuel, it is much cleaner-burning than oil and coal and has less environmental impact. For businesses that are concerned about sustainability, natural gas can provide a "greener" alternative to oil and coal. Natural gas costs are significantly lower than those for other fuel sources - as little as 1/6th of the cost of oil (on a wholesale pricing basis), for instance. The cost savings offered by natural gas are so significant that independent energy districts that operate on natural gas have potential payback periods as low as a few years. Natural gas also offers flexibility because it is available in several forms. The most common, of course, is pipeline gas. For businesses with direct access to local gas distribution systems, pipeline natural gas can be the perfect fuel choice for an independent energy district. The gas is drawn directly from those pipelines, which are typically provided by local utilities, and used to meet the thermal loads and produce the power that's needed. For businesses that don't have convenient access to pipelines, there are two alternatives, liquefied natural gas (LNG) and compressed natural gas (CNG), which can offer effective "portable pipeline" options. In essence, they permit businesses to create their own pipelines. LNG is natural gas that has been cooled to minus 260° F. This condenses the gas into a liquid and takes up to 600 times less space than in its gaseous state, making it more practical to transport over long distances. Also, when natural gas is liquefied, most of the common impurities - sulfur, carbon dioxide, mercury, and heavier hydrocarbons - are removed, which makes LNG a very clean and reliable fuel for cooling, heating, and power generation. Utilizing LNG as a primary fuel source requires specific infrastructure, including insulated storage tanks, vaporization systems to convert the LNG back to a gas so it can be burned, off-load pumps to transfer the LNG transport contents to storage tanks, and service pipes to convey the vaporized LNG from storage to the end-use equipment. Another potentially useful source of fuel for independent energy districts is CNG. CNG is produced by compressing natural gas to approximately 3,600 psi, which permits it to be stored and transported in container trucks. CNG can be purchased from independent suppliers or gas utilities, which deliver the gas in special tube trailers. Like LNG, CNG facilities require their own infrastructure, including a "mother" station (or compressor station), a decompression - or "daughter"- station with heaters to warm the gas during de-pressurization, and a piping system to connect the daughter station and distribute the natural gas throughout the independent energy district's network. While independent energy districts require up-front capital investment, they typically pay for themselves in just a few years. In addition to being greener, natural gas-powered independent energy districts provide significant cost savings. In addition to providing the opportunity to "do the right thing," renewable energy promises to deliver energy independence and cost savings to American businesses. In fact, many businesses are already taking advantage of renewable energy technologies. However, for businesses that aren't in a position to go completely green, natural gas-powered independent energy districts can serve as the perfect bridge to a renewable future. Top photo credit: Sanborn, Head & Associates Mike Nicoloro is senior vice president and Joan Fontaine is vice president at Sanborn, Head & Associates Inc. Together, they manage Sanborn Head's Energy division. Sanborn Head offers design, permitting, and construction management services to energy producers, transporters, and end-users. It works with clients to employ proven technologies to reduce capital and operational energy-related costs. Mike Nicoloro can be reached at firstname.lastname@example.org and Joan Fontaine can be reached at email@example.com.