Economic analysis of heat production in existing medium size combined heat and power plant, with respect to the CO2 allowances purchasing cost

The developed mathematical model for simulating CHP performance gives the possibility to select the boiler type, and assess the probability and efficiency of each configuration. The dedicated tool calculates the selected operation mode, heating power demand, and enables models comparison. The algorithm includes real equipment operational parameters, technical limitations, actual energy prices and costs regarding energy law acts. The performed analysis is up-to-date, due to a few aspects: permanently increased fossil fuels costs, low electric energy prices, growing costs of CO2 emission allowances, and high electricity production cost on turbine's condensing section at steam parameters of T = 435 °C and p = 34 bar. A detailed cost analysis is performed on each product separately: thermal energy, electric energy from cogeneration and electric energy from condensation, during every hour, frequently. The calculation is carried every an hour for a period of 24 h, the energy balance is ensured during the calculation. The most important result of this study is a comparison of CHP to water boiler operation profitability, also including the net profit comparison. Furthermore, the cost of the CO2 emission is studied, for the production profitability in two scenarios, as the price increases from 7 EUR/tone to 15 EUR/tone and 30 EUR/tone.