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In the paper we have analysed whether and to what extent co-incineration of secondary fuels in cement manufacturing is cost-effective. Techno-economic assessment shows that combined combustion of solid recovered fuel and traditional fossil fuel (petroleum coke) is economically viable to the extent of 20:80 per cent. The paper also concluded that the impact of the plants on the quality of air would be negligible.
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Paper number: 13(2015)4, 345, 307 - 315 doi:10.5937/jaes13-9574
USE OF SOLID RECOVERED FUEL (SRF)
IN CEMENT INDUSTRY – ECONOMIC
AND ENVIRONMENTAL IMPLICATIONS
Original Scientific Paper
Nikola Dondur*
University of Belgrade, Faculty of Mechanical Engineering, Belgrade, Serbia
Aleksandar Jovović
University of Belgrade, Faculty of Mechanical Engineering, Belgrade, Serbia
Vesna Spasojević-Brkić
University of Belgrade, Faculty of Mechanical Engineering, Belgrade, Serbia
Dejan Radić
University of Belgrade, Faculty of Mechanical Engineering, Belgrade, Serbia
Marko Obradović
University of Belgrade, Faculty of Mechanical Engineering, Belgrade, Serbia
Dušan Todorović
University of Belgrade, Faculty of Mechanical Engineering, Belgrade, Serbia
Sonja Josipović
University of Belgrade, Faculty of Mechanical Engineering, Belgrade, Serbia
Miroslav Stanojević
University of Belgrade, Faculty of Mechanical Engineering, Belgrade, Serbia
*University of Belgrade, Faculty of Transport and Traffic engineering, Vojvode Stepe 305, Belgrade, Serbia;
ndondur@mas.bg.ac.rs
In the paper we have analysed whether and to what extent co-incineration of secondary fuels in ce-
ment manufacturing is cost-effective. Techno-economic assessment shows that combined combus-
tion of solid recovered fuel and traditional fossil fuel (petroleum coke) is economically viable to the
extent of 20:80 per cent. The paper also concluded that the impact of the plants on the quality of air
would be negligible.
INTRODUCTION
In order to reduce energy dependence on con-
ventional fossil fuels and negative effects on the
environment, cement industry is increasingly
turning toward alternative fuels. Cement manu-
facturing is highly energy-intensive, with energy
resources typically accounting for 30-40% of the
product price. Traditionally, the primary fuel is
coal, though other fuels such as petroleum coke,
natural gas and oil are also used. Besides these
fuels, various types of wastes can also be used
as fuels. Solid Recovered Fuel (SRF) is mechan-
ically fragmented solid secondary raw materials,
i.e. waste having the use value for energy gen-
eration (not eligible for recycling) and is quali-
fied, by its nature, as non-hazardous waste. Use
of waste materials as alternative fuels in cement
industry started in the 1970s and since then the
number of cement plants worldwide using alter-
native fuels and raw materials has steadily in-
creased. In order to lower the costs of energy
resources, cement plants in the European Union
follow a long-established practice that the pri-
mary fuel (commonly coal) is replaced by sec-
ondary fuels. The most frequent secondary fuels
include waste or recycled materials which have
high heating value and which are convenient
for burning in cement kilns. High temperatures
in a cement kiln destroy these materials in the
environment-friendly and energy-efficient man-
ner. A large number of countries are replacing
the primary fuels with secondary fuels even up
to 50% of the specific heat needed for the clinker
making process. Use of secondary fuels primar-
ily depends on the availability of that type of fuel.
Therefore, it is necessary to conduct a techno-
economic analysis that will show whether and to
what extent co-incineration of secondary fuels in
cement manufacturing is cost-effective [05].
Key words: Solid recovered fuel, Environment, Economic, Risk
Journal of Applied Engineering Science 13(2015)4
308
Nikola Dondur - Use of solid recovered fuel (srf) in cement
industry - economic and environmental implications
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TECHNOLOGICAL PROCESS
The cement manufacturing process includes the
following technological steps: exploitation and
preparation of raw materials (limestone, marl
and clay); grinding, transportation and storage
of raw materials; production and storage of raw
meal; fuel storage, transportation and prepara-
tion; clinker production, transportation and stor-
age; cement production, transportation and stor-
age; cement packing and palletising, shipping.
Raw meal is produced by grinding raw materials
in the raw material grinding mill. The components
include: a mix of marl and limestone, pure lime-
stone, clay, pyrite burning and bauxite. The core
and dominant component is a mix of limestone
and marl. Other components are used for correct-
ing the contents of the necessary oxides in the
raw meal. Function of the raw mill is to dry and
grind the raw mix. The raw materials are dried
in the mill drying chamber where these materi-
als are also partly crushed by rotation movement
causing friction. Drying is done by bringing hot
gases from the rotary kiln or from the rotary kiln
which is used when the rotary kiln is not working
or not producing sufficient quantity of hot gases.
In the mill raw materials are crushed by means
of the diameter 20-90mm grinding balls until the
desired fineness is achieved. The ground raw
materials are sent by air flow through the pipeline
into the separator – grit separator. In the separa-
tor itself bigger particles of the raw meal are sep-
arated. Thus separated bigger particles go, by
free fall, to the air slide which returns them to the
mill for regrinding. Fine particles of the raw meal
go through the pipeline to two cyclones. From
the cyclone the ground materials are pneumati-
cally transported to the silos for homogenization
while one part of the air flow is injected through
an appropriate pipe into the cooling tower and
further to the electrostatic precipitator and the
other part of the air flow is reversed, through a
pipeline, to recirculate through the mill, pipeline,
separator and cyclones. Since the temperature
of gases entering the electrostatic precipitator is
high, the plant for cooling of gases is used – cool-
ing tower. The cooling tower also operates as a
cyclone and therefore part of raw meal falls on
the transport system through which it is brought
back into the process. Smaller particles of the
raw meal are drawn from the cooling tower, by
ventilator, into the electrostatic precipitator. After
separation of the raw meal particles, these par-
ticles are taken from the electrodes (by means of
the shakers) through the screw conveyor to the
T-section and further to the airlift. The raw meal
is then transported pneumatically from the airlift
through the pipeline to the homogenization silos.
In the homogenization silos raw meal is finally
mixed by compressed air and chemical compo-
nents are blended. Homogenized raw meal is
brought through the silos discharge device into
the raw meal silos into which the air is injected
so that the raw meal stays loose. From these si-
los, through the silos discharge devices, the raw
meal is transported further into the rotary kiln.
Technological basis of the cement clinker man-
ufacturing process is the rotary kiln with four-
stage cyclone heat exchanger (pre-heater) with
satellite cooler and burner, using the dry process
technology. (Figure 1.)
Fuel oil, petroleum coke or coal is used as fuel
for the rotary kiln. However, to be used as fuels
for the rotary kiln, these fuels need to be pre-
pared before use and therefore the new solid
fuel drying and grinding plant was designed.
Clinker, as a main semi-manufactured product
in the cement manufacturing process, is made
by burning raw meal in the rotary kiln. The main
process conditions in the rotary kiln are as fol-
lows: raw mix is kept for long time, oxygen-rich
environment (O2), temperature of the raw mix is
up to 1500 ºC and temperature of the gases up
to 2000 ºC, temperature of the flame at the top of
the burner is over 2000 ºC, which causes inten-
sive degradation of lime (CaCO3) to calcium ox-
ide, known as quicklime or burnt lime (CaO) and
carbon dioxide CO2 at temperatures below 800
ºC. The main component in the cement making
process is clinker, with the use of the following
additives: gypsum (necessary to control the set-
ting time of the cement), slag, fly ash and lime.
However, as the clinker is the basis for manu-
Journal of Applied Engineering Science 13(2015)4 309
Nikola Dondur - Use of solid recovered fuel (srf) in cement
industry - economic and environmental implications
, 345
facturing cement, cement quality depends on
the clinker quality, percentage and fineness of
grind.
Used energy and possibility of using SRF
In the cement plant in which economic justification
of the use of the solid recovered fuel produced
from waste (SRF), petroleum coke, coal and fuel
oil are used as main fuels for the rotary kiln. In
2010 the share of coal was 2.5% and of petro-
leum coke 95.7%, whereas in 2011 the share of
coal was 68.6% and petroleum coke 29.5% re-
spectively. In the 2009-2011 period consumption
of petroleum coke ranged from 41389 to 11065
tons. Consumption of coal in 2011 was 34725
tons. According to the Project, it is planned to
use solid recovered fuel which can be found on
the market and which meets appropriate quality
standards [01] The planned maximum volume of
the use of solid recovered fuel is 25,000 tons per
year (capacity of 48 tons per day, that is, 2 tons
per hour, with the maximum level of substitution
of the main fossil fuels of 24 %).
SRF is most frequently produced in the plants (in
the vicinity of municipal waste landfills) where af-
ter separating the recyclable fractions of waste,
the remaining residue is fragmented, dried, sta-
bilised and packed [06]. SRF consists of fuel
segments of waste: paper, fabric, light fractions
of artificial materials, wood, rope, yarns, etc.
IMPACT ON THE ENVIRONMENT
BY USING SRF
In the observed Cement Plant, pollutants dis-
charged into the air, primarily solid particles
generated in the course of the manufacturing
process (crushing and grinding of the raw mix,
technological process in the rotary kiln, trans-
port, storage and grinding of the cement clinker,
cement packaging and transport, storage and
grinding of the solid fuels, etc.) as well as gas
components (from fuel burned and technological
gases) are generated.
Experiences from other (similar) cement plants
where solid recovered fuel is already used as al-
ternative fuel show no increase in the gas and
solid particle emissions above Emission Limit
Value (ELV) nor threat that transport and/or burn-
ing of this material will deteriorate the quality of
air in the immediate environment and beyond.
Manipulating the SRF in the warehouse, dosage
and transport will not cause any deterioration of
the air quality in the wider area of the cement
plant complex. As the fuel combustion gas prod-
ucts which are dosed on the side of the main
burner spend considerable time in the rotary
kiln, there is no possibility that some component
(particularly not an organic component) or fuel
combustion product is not fully decomposed and
converted into the simplest oxides. To that end,
the calculation of the SRF co-combustion in the
cement kiln was made, as follows:
The SRF flow of 3,000 kg/h is adopted,
Operation of the kiln with fossil fuel as well
as with the mix fossil fuel +SRF (co-combus-
tion)
For the SRF which meets requirements of
the technical standards, as well as for the op-
eration of the kiln with and without SRF, the
emission factors are adopted, based on the
EU, EPA, Solid Recovered Fuels, Contribu-
tion to BREF “Waste Treatment“, European
Recovered Fuel Organisation, Thomas Glo-
rius, Joop van Tubergen, Institute and Chair
of Processing and Recycling of Solid Waste,
RWTH Aachen, EUROPEAN COMMISSION
- DIRECTORATE GENERAL ENVIRON-
MENT REFUSE DERIVED FUEL, CUR-
RENT PRACTICE AND PERSPECTIVES
(B4-3040/2000/306517/MAR/E3) FINAL RE-
PORT.
Flue gas flows from the process of co-incinera-
tion of SRF in the cement kiln, obtained in the
calculation, are shown in Table 1, whereas Table
2 shows data on the rotary kiln processes.
-
-
-
Flue gases Values Units
Flows on 10% O2145000 Nm3/h
Total flows 145000 Nm3/h
SRF flue gases flows 25500 Nm3/h
Flue gases flows from
other fuels 119500 Nm3/h
Table 1: Flue gases flows in cement kiln
Table 2: Flue gases flows in rotary kiln
Flows Values Units
SRF 3000 kg/h
Clinker 66660 kg/h
SRF/Clinker 0,05 kg SRF/kg klink.
Petroleum
coke (wet) 7044 kg/h
Petroleum
coke (dry) 6725 kg/h
Journal of Applied Engineering Science 13(2015)4
310 , 345
Table 3: Shows values of flue gases flows components obtained by calculation
Components
Concentration of
SRF in 10% O2,
calculated
[mg/Nm3]
Concentration
without SRF in
10% O2,
measured
[mg/Nm3]1
Total concentration,
[mg/Nm3]
Flow
[kg/h]
GVE
[mg/Nm3]
PM 14 1,23 3,476 0,5039 30
NOx 262 744,66 659,78 95,668 800
SOx 4 0 0,7034 0,102 50
CO 53 75,33 71,403 10,353 500
TOC 10 6 6,703 0,972 10
PCDD 0,000000068 3,5•10-9 1,484•10-8 2,152•10-9 0,0000001
In order to assess the impact of the use of SRF
on the air quality, a model of dispersion of pollut-
ants (NO2, SO2, dust, CO) from the main emit-
ters (stack of the kiln, raw mill, cement mill and
solid fuel mill).Within the assessment of the im-
pact of the cement plant on the environment (En-
vironmental Impact Assessment), the standard
model EPA (U.S. Environmental Protection
Agency) AERMOD was used. Models for the
needs of this study covered a modelling domain
of 20×20 km with the cement plant in the centre.
By applying the AERMOD, a 3D model of the ce-
ment plant was made (Figure 2.), covering only
those facilities which are relevant for dispersion
modelling..
Figure 3. shows the results of dispersion model-
ling of total dust from three main cement plant
emitters with the use of SRF. The maximum
obtained value for the averaging over one-year
period is 0.13403 µg/m3, and this value is re-
corded on the slopes of the hill, located approx.
1 km south of the Cement Plant. Considering the
maximum allowable value for this pollutant com-
ponent of 70 µg/m3. [02], it can be concluded
that, considering this pollutant, the impact of the
plants on the quality of air would be negligible.
1 – existing emissions
Figure 2: 3D model of cement plant
Taking into account all the results obtained
through the dispersion modelling of the pollut-
ants from the SRF co-incineration process in the
cement plant, a conclusion can be drawn that
the impact on the overall quality of air will be
negligible. Results of the air pollution dispersion
model show that the concentration of particles in
the air in the broader area surrounding the ce-
ment plant will remain below the defined maxi-
mum allowable values.
Therefore, no cumulative impact of the emission
of pollutants on the existing quality of air should
be expected. The impact of the Cement Plant
from the aspect of emissions into the air will re-
main at the present level. Health hazards to the
exposed population due to this process can be
considered negligible. Partial substitution of the
main fuel with alternative SRF will not cause the
appearance of new types of wastewaters and
waste or increase in the quantities of the exist-
ing ones. An increase in noise levels due to the
transport and delivery of SRF to the location of
the Cement Plant will be negligible. The use of
alternative fuels will not cause any new effects
that could produce, together with the existing im-
pacts of the Cement Plant, any new cumulative
effects on the environment.
Althouth it is assessed that additional emissions
due to the use of SRF will be extremely limited
and will not cause an increase of the present ef-
fects on the quality of air in the surrounding of
the cemenet plant, the manufacturing process
and emissions from the plants will be monitored
in the same manner as so far. Given the fact
that the use of SRF will not lead to a change in
quantities and quality of wastewaters or cause
generation of additional quantities of waste,
monitoring of the environmental impact defined
Nikola Dondur - Use of solid recovered fuel (srf) in cement
industry - economic and environmental implications
Journal of Applied Engineering Science 13(2015)4 311
, 345
by environmental impacta assessment study
includes primarily monitoring of the air quality
impact and refers to the emissions of pollutants
from the raw mill and rotary kiln emitters and air
quality at the measuring points in the wider zone
of the cement plant.
Figure 3: Results of the dispersion modelling of total dust from three main cement plant emitters with the
use of SRF
ECONOMIC ASSESSMENT
Methodology
In order to identify the net economic effects of the
substitution of the portion of fossil fuels by solid
fuel generated from municipal waste, the authors
applied the standard approach of comparing the
situation “With” Project, that is, if the substitution
is made and the situation “Without” Project, that
is, if the cement plant continues to use exclu-
sively fossil fuel as a heat energy source in the
rotary kiln. The situation “With” Project means
that investment (for technical adaptations) is
made without production losses and that after
project implementation the volume of production
will not change in the further exploitation life of
the cement plant. “With” Project situation implies
an increase of the operating costs (maintenance
and insurance of newly-installed equipment and
additional consumption of electricity), but also
reduction of the heating energy costs due to
the substitution of part of more expensive fossil
fuel (petroleum coke). “Without” Project situation
means unchanged revenues and costs in the
planned exploitation life of the cement plant. The
criteria for the evaluation of the repair justification
are defined according to the standard approach
of comparing financial and economic costs and
benefits. [04]. For evaluation of the financial
cost-effectiveness of the Project the authors
used the dynamic approach of the Discounted
Cash Flows for “With” and “Without” Project situ-
ations. This analysis is meant to show whether
the project on partial substitution of main fossil
fuels with solid fuels generated from municipal
waste increases or reduces the cement plan re-
sources over the entire exploitation period. In
order to assess project cost-effectiveness in the
overall exploitation period the authors developed
a table of “With” and
Nikola Dondur - Use of solid recovered fuel (srf) in cement
industry - economic and environmental implications
Journal of Applied Engineering Science 13(2015)4
312 , 345
“Without” Project financial flows. The “With” Proj-
ect financial flow gives a dynamic overview of an-
nual revenues from cement sale and transport,
on the one side, and the overview of all financial
outflows, including investment and operating ex-
penses without depreciation and corporate profit
tax, on the other side. The “Without” Project fi-
nancial flow gives a dynamic overview of annual
revenues from cement sale and transport, on the
one side, and a dynamic overview of financial
outflows excluding depreciation and corporate
profit tax. To define the net financial effect of the
combined combustion project over the entire
economic life it is necessary to establish the dif-
ference between the “With” and “Without” Proj-
ect cash flows. The net difference between these
flows represents an annual financial effect of the
project on combined combustion of SRF and of
the main fossil fuels. The net present value of
the Project is a discounted sum of these differ-
ences, whereas the internal rate of return (IRR)
is an average rate of profitability of the invested
funds. The Project’s net present value is positive
and multiply exceeds the initial investment costs.
Discounted value of the net profit at the rate of
5% is EUR 1,574,296, which is twice as much
as the initial investment. According to this crite-
rion for evaluation of investment justification, the
Project is acceptable. Apart from the positive
net present value, the Project also achieves a
positive internal rate of return of 27.5%. Payback
period is 4.5 years, which is acceptable for proj-
ects in the cement manufacturing industry. In-
vestment in the project of co-combustion of fossil
fuels and municipal waste includes the effects
and costs beyond the company which are rel-
evant for the overall social and economic devel-
opment. As given in the preliminary design, the
project of construction of the plants for combined
combustion should also have, besides saving of
fossil fuels, positive environmental implications.
Namely, treatment of portion of municipal waste
as a potential heating fuel in the cement industry
brings useful environmental effect for the over-
all economy. Burning plastic, fabrics, cardboard,
paper or rubber in the rotary kiln at extremely
high temperatures is a preferred option of non-
recyclable municipal waste management. Al-
though purchase or manufacturing of the solid
recovered fuel is an economic cost for the inves-
tor from the aspect of the overall economy, por-
tion of the municipal waste generated into solid
recovered fuel represents an indirect economic
benefit. These positive environmental effects
are included into the cost-benefit methodological
framework and monetarily valued in an indirect
way. Based on the assessed local cost of the
solid municipal waste treatment at landfills (5-10
euros per ton), costs of the manufacturing SRF
from non-recyclable portion of the solid munici-
pal waste (15–20 euros per ton), required quan-
tities of the non-systematised solid municipal
waste for manufacturing a ton of SRF (3 tons)
and annual consumption of SRF (12,750 tons
per year), the authors calculated the monetary
equivalent of positive environmental effect of the
project on introducing co-combustion in the ce-
ment plant in the amount of EUR 51,000 p.a.
(7. 5•3-17.5)•12750. Within the assessment of
the economic justification of the project for con-
struction of the co-combustion plant, the authors
developed an economic flow, showing all flows
of real resources, including investment, operat-
ing costs without transfer payments, real savings
in the consumption of heating energy, but also
positive environmental effect achieved through
solid municipal waste management. The eco-
nomic net present value of the Project is EUR
2,054,443 and the economic internal rate of re-
turn is 33%.
Sensitivity and risk analysis
Sensitivity analysis is the first phase in the as-
sessment of the investment project risks. Calcu-
lating the values of parameters for the project as-
sessment starts with the most likely input values.
[3]. Price and quantity of the used SRF, price and
quantity of the used petroleum coke, the rate of
substitution of petroleum coke with solid recov-
ered fuel produced from waste, price and quan-
tity of electricity, prices of other solid and liquid
fuels, value of investment are the parameters
that can be changed over the co-combustion
implementation and exploitation. Change in the
values of these parameters certainly affects the
values of relevant parameters for the evaluation
of the project justification. Sensitivity analysis
is performed by changing one input parameter
by certain percentage while keeping other input
parameters constant. Therefore, this is a statisti-
cal approach that does not include simultaneous
changes of input parameters. Selection of criti-
cal variables is performed based on the try and
error approach. Namely, after an input value is
changed by certain percentage, change in the
level of evaluation parameters is observed (NPV,
Nikola Dondur - Use of solid recovered fuel (srf) in cement
industry - economic and environmental implications
Journal of Applied Engineering Science 13(2015)4 313
, 345
IRR and payback period of a given investment).
The aim of the uncertainty analysis and identi-
fying the most critical items of the project is to
find out at which items and by which percent-
age change of the value of that item the critical
(last acceptable) values of outputs can be most
rapidly achieved and/or by which percentage
certain item should be increased or decreased
so that the NPV is zero or IRR is equal to the
discount rate. In the sensitivity analysis the per-
centage change of the value of an input param-
eter of the Project which equalizes the net pres-
ent value to zero and IRR to the discount rate is
called the switching value. Table 4. shows vary-
ing of the prices of solid recovered fuels, price of
petroleum coke, volume of investment and rate
of substitution of petroleum coke with solid re-
covered fuels. Prices and investment vary in the
range ±10%, whereas the rate of substitution of
petroleum coke with SRF, except the base case
20:80 is also tested for the case 10:90.
Variable Changes in ( %) NPV (€) IRR (%) Payback
(Years)
SRF price
0% 1574296 27,5 4,36
-10% 1934406 31,9% 4,02
10% 1214185 23,0% 5,69
Switching values (%) 43,7% 05% /
Changes in ( %) NPV (€) IRR (%) Payback
(Years)
Fossil fuels price
0% 1574296 27,5 4,36
-10% 4095070 56,6% 2,51
10% -946479 -5,9% /
Switching values (%) 6,5% 05% /
Changes in ( %) NPV (€) IRR (%) Payback
(Years)
Investment costs
0% 1574296 27,5 4,36
-10% 1652942 30,7% 4,01
10% 1495649 24,8% 5,21
Switching values (%) 290% 05% /
Rate of technical sub-
stitution (SRF:fossil
fuels)
SFR:FF
20:80
10:90
NPV (€)
1574296
223387
IRR (%)
27,5
8,9%
Payback
(Years)
4,36
9,81
Table 4: Sensitivity Analysis
Sensitivity analysis shows that the Project’s most
critical input parameter is the price of petroleum
coke. If the price of petroleum coke is increased
by 6.5% (from 105 to 112 euros per ton), the proj-
ect will not earn profit and the payback period of
the investment funds exceeds the projected ex-
ploitation period of the Project. Co-combustion
Project is not particularly sensitive to the change
of SRF price. The net present value is zero and
the internal rate of return is the discount rate
(5%) only if the price of solid recovered fuel is in-
creased from EUR 30 to EUR 43 per ton (44%).
Change of the investment costs does not have
notable influence over the Project performance.
The Project is commercially unjustified only if the
investment costs are tripled. Change of the rate
of technical substitution of petroleum coke with
SRF significantly influences the Project perfor-
mance. Namely, if the rate of substitution is re-
duced from 20:80 to 10:90, the discounted net
profit of the Project (NPV) falls by 86% and the
average annual profitability (IRR) by 67%. To as-
sess risk of a specific component of the Project,
that component must be not only sensitive, but
also highly uncertain. Risk assessment is mea-
surement (quantification) of uncertainty. There-
fore, for the assessment of the Project’s risks,
critical components of the Project must be de-
fined. For each critical component of the Project
probability of event must be calculated because
Nikola Dondur - Use of solid recovered fuel (srf) in cement
industry - economic and environmental implications
Journal of Applied Engineering Science 13(2015)4
314 , 345
such probabilities also define probability of out-
puts of the project model analysis. Risk analysis
or quantitative assessment of uncertainty thus
goes one step beyond the sensitivity analysis by
defining weights to the critical variables of the
model (price of petroleum coke and SRF), that
is, probability at which given value of those vari-
ables will occur. Once the distribution of these
weights and/or probability for the selected criti-
cal variables (based on the sample or other-
wise) is determined, it is necessary to define the
technique that will reliably transfer the impact of
these variables thus (stochastically) determined
to the model results. In this case, the term “reli-
ably” means that the occurrence of the critical
variable by the selected (determined) distribution
of probability is transferred to the result of the
model (NPV or IRR). In the risk analysis for the
Project on Co-Combustion of SRF and Petroleum
Coke in the cement plant the price of solid recov-
ered fuel was modelled by triangular probability
distribution and the price of petroleum coke by
log-normal distribution. Figures 4. and 5. give the
overview of the obtained results of the NPV and
IRR simulation (Latin Hypercube Sampling meth-
od).Results of the risk assessment show that the
expected value of the internal rate of return (IRR)
is 25.49% with probability of about 25%. Simula-
tion results show that with 90% probability the in-
ternal rate of return of the Co-Combustion Project
will range from 1.0% to 46%. Probability of the
negative internal rate is about 10%. With adopted
probabilities (by appropriate statistical reliability
tests) for the prices of SRF and petroleum coke,
the profitability of the Project is significantly above
the relevant cost of capital (interest rate).
Figure 4. Probability distribution for IRR (%)
Figure 5: Probability distribution for NPV
Nikola Dondur - Use of solid recovered fuel (srf) in cement
industry - economic and environmental implications
Journal of Applied Engineering Science 13(2015)4 315
CONCLUSION
Sensitivity and risk analyses have identified criti-
cal input economic parameters and quantified
their importance on the performance (results) of
the Co-Combustion Project in the Cement Plant.
Sensitivity analysis has identified, through a try
and error method, the most critical input eco-
nomic and technical parameters. Minor chang-
es of the price of petroleum coke, price of SRF,
volume of investment and the rate of technical
substitution of petroleum coke with SRF cause
dramatic changes of the Project performance.
Given the Terms of Reference, special attention
is given to the energy sources. Petroleum coke,
that is, the prices of petroleum coke and its com-
bination with SRF, remains the most critical eco-
nomic parameter. A slight increase in the price of
petroleum coke (6.5%) brings the Project to the
verge of acceptability (total net profit is equal to
zero). Given the relatively lower importance of
SRF in the overall energy consumption, an in-
crease of the SRF price is not so dramatic from
the aspect of the total performance of the Project.
In the basic combination of the combined com-
bustion (20:80), the price of SRF needs to go up
by 43.7% for the Project to be at the verge of ac-
ceptability. The rate of technical substitution, that
is, its change is of crucial importance for the Proj-
ect performance. If it is assumed that the prices
of petroleum coke and SRF are not changed,
which is the basic assumption in the sensitiv-
ity analysis, a decrease of the substitution rate
from 0.25 to 0.11 leads to a dramatic reduction in
the net present value and internal rate of return.
Namely, if SRF and petroleum coke are techni-
cally (energy-based) combined at the rate 10:90,
the net present value is still positive, internal rate
of return is slightly above the discount rate and
the payback period is about 10 years. Given the
positive effect size, the volume of investment is a
less critical variable. Of course, it does not mean
that it is irrelevant how much and when will be
spent for the Project implementation, but it gives
a possibility for building and purchasing more
comfortably and at higher prices the necessary
mechanical and electrical equipment. The total
price of the Project may even be increased by
three times and the investment would be at the
verge of justification.
In the probabilistic risk assessment two input pa-
rameters were assessed: price of petroleum coke
and price of SRF. These are the two variables
whose variances affect the Project performance.
Although important, the volume of investment
and rate of technical substitution of petroleum
coke with SRF were not tested through the prob-
ability assessment because the investor may
directly influence these parameters. Namely,
though the volume of investment can also be af-
fected by external factors (change of purchase
prices in the course of the construction), it is still
a foreseeable parameter and potential uncer-
tainty lasts only in the first two years, until the
completion of the construction works and pur-
chase of mechanical and electrical equipment.
The risk of the Project was assessed through
the probability assessment of the SRF and
petroleum coke price variances. With probability
of loss (negative net present value) of 20% and
negative internal rate of return of 10% the Proj-
ect on the construction of the plants for the use
of solid recovered fuel (SRF) for combined com-
bustion with the main fossil fuel can be classified
into the group of projects with acceptable (low)
level or investment risk.
REFERENCES
Decree on Monitoring Terms and Air Quality
Requirements, Official Gazette of the Repub-
lic of Serbia, No. 11/2010 and 75/2010)
Dondur N. Economic analysis of projects,
Faculty of Mechanical Engineering, Bel-
grade, 2002.
EU Guide to cost-benefit analysis of invest-
ment projects European Commission, Di-
rectorate General Regional Policy, 2008.
Faculty of Mechanical Engineering, Universi-
ty of Belgrade: Use of Solid Recovered Fuel
(SRF) in Cement Industry, Project Report,
no.502/707/2013. Belgrade, 2013.
Fyffe J. R., Breckel A. C., Townsend A. K.
and Webber M. E.: Residue-Derived Solid
Recovered Fuel for Use in Cement Kilns,
July 2012, University of Texas at Austin.
Ibbetson C., UK Market Development of Sol-
id Recovered Fuel from MBT Plants, Regen
Fuels Ltd, London. UK, 2006.
1)
2)
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4)
5)
6)
Paper sent to revision: 21.11.2015.
Paper ready for publication: 15.12.2015.
Nikola Dondur - Use of solid recovered fuel (srf) in cement
industry - economic and environmental implications
, 345
... These changes introduce a whole new range of products into the forestry sector existing beside traditional wood products, such as plywood, pulp, paper, board and tissue [15,16]. New technologies have already enabled production of novel materials such as nanocellulose, man-made cellulose fibres and importantly fibre reconstruction from cellulose waste [17,18], The method used by the actors in the field for conducting the relevant analyses mainly follows the Delphi approach for data collection as an appropriate means of long-range (20-30 years) academic research, together with expert opinions conducted in respect to development of bioeconomy and bio-based materials within the EU [20]. A change from fossil-based industrial activity to bioeconomy has been defined in many EU bioeconomy policies, which have followed the developing decline in the forestry sector and recognition of the social acceptance of appreciating long term environmental consequences [6,15]. ...
... Next to come was the 2002 EU bioeconomy strategy with the title "Lifesciences and Biotechnology: a strategy for Europe", prioritising life science and biotechnology as probably the most promising of the frontier technologies, with a capacity to contribute to the achievement of the Lisbon Agenda objectives and in 2005 the 'knowledge-based bioeconomy' (KBBE) was finally established [23,25]. In February 2012, the Euro-pean Commission published an action plan of bioeco-nomic development entitled, "Innovating for Sustainable Growth: a bioeconomy for Europe" [17], in which bioeconomy was portrayed as an environmentally acceptable solution to a variety of European and global problems, and in that way 'bioeconomy' became a central element of the EU's political agenda, following the same trend at that time in the United States [16], [26]. ...
... Over the last years, several strategies have been set forth for establishing more sustainable production patterns, and reduction of solid waste and appropriate use and reuse of natural resources using the circular economy strategy, e.g. European Commission, 2015 [17,51]. For example, the Cascade circular economy is based on implementation of closed material loops in utilisation of available resources within larger loops, thus making continuous use of materials and then the wastes so long as products can be created [14,54]. ...
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Greenhouse gas emission reduction is strongly advocated within the European Union (EU). Biomass has emerged as a renewable energy source and as manufacturing raw material with ecological credentials to mitigate carbon imbalance. The EU has defined the bioeconomy encompassing these material sources as a basis for technological and economic development. Biocenology, describing the study of natural communities, however, additionally demands inclusion of a circular economy, in which it needs to be assumed that endless renewable products are kept in continuous circulation of use and reuse. Thus, there arises the question whether the bioeconomy route alone, promoted by the EU, is sustainable. Using research literature, based on the Delphi method, and EU documents, we discuss the importance of sustainable management of bioresources. Short term solutions may remain necessary to ensure economic stability but, without embracing the circular economy, only limited mitigation of greenhouse gas emissions can be expected
... These changes introduce a whole new range of products into the forestry sector existing beside traditional wood products, such as plywood, pulp, paper, board and tissue [15,16]. New technologies have already enabled production of novel materials such as nanocellulose, man-made cellulose fibres and importantly fibre reconstruction from cellulose waste [17,18], The method used by the actors in the field for conducting the relevant analyses mainly follows the Delphi approach for data collection as an appropriate means of long-range (20-30 years) academic research, together with expert opinions conducted in respect to development of bioeconomy and bio-based materials within the EU [20]. A change from fossil-based industrial activity to bioeconomy has been defined in many EU bioeconomy policies, which have followed the developing decline in the forestry sector and recognition of the social acceptance of appreciating long term environmental consequences [6,15]. ...
... Next to come was the 2002 EU bioeconomy strategy with the title "Lifesciences and Biotechnology: a strategy for Europe", prioritising life science and biotechnology as probably the most promising of the frontier technologies, with a capacity to contribute to the achievement of the Lisbon Agenda objectives and in 2005 the 'knowledge-based bioeconomy' (KBBE) was finally established [23,25]. In February 2012, the Euro-pean Commission published an action plan of bioeco-nomic development entitled, "Innovating for Sustainable Growth: a bioeconomy for Europe" [17], in which bioeconomy was portrayed as an environmentally acceptable solution to a variety of European and global problems, and in that way 'bioeconomy' became a central element of the EU's political agenda, following the same trend at that time in the United States [16], [26]. ...
... Over the last years, several strategies have been set forth for establishing more sustainable production patterns, and reduction of solid waste and appropriate use and reuse of natural resources using the circular economy strategy, e.g. European Commission, 2015 [17,51]. For example, the Cascade circular economy is based on implementation of closed material loops in utilisation of available resources within larger loops, thus making continuous use of materials and then the wastes so long as products can be created [14,54]. ...
... This mode shows several economic and environmental advantages (Scarlat et al., 2015& Istrate et al., 2020. In particular, the refuse-derived fuel(RDF) process reduces the volume of waste, saves fossil fuels, incorporates residues into the composition of clinker and reduces CO 2 emissions from fossil fuels (El-Salmouny et al., 2020;Hemidat et al., 2019, Dondur et al., 2015Scarlat, 2015;Ramachandra et al., 2018, Zhao et al., 2016, & Reza et al., 2013. The cement sector is a large consumer of fossil fuels (Schneider, 2015). ...
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Energy recovery is a sustainable method of municipal solid waste (MSW) management. The co-incineration of refuse derived fuel (RDF) has shown several economic and environmental advantages. The objective of this research is to assess the impact of RDF recovery on leachate quality using leachate tests and calculation of greenhouse gases (GHG) reduction in the kilns of a cement plant. The qualitative results of the eluate show that there is an impact on leachate quality depending on the type of waste. The values of the chemical oxygen demand (COD), biological oxygen demand (BOD5), electrical conductivity and pH of the leachate from the raw waste after 120 hours of leaching are 29.33 gO 2 /kg DM, 14.00 g O 2 /kg DM, 4.27 ms/cm and 7.57. On the other hand, the values of the same quality parameters of the eluate generated by the waste without RDF are 19.33 g O 2 /kg DM, 20.67 g O 2 /kg DM, 2.77 ms/cm and 7.13; respectively. The calculation of GHG reduction shows that the substitution of 83,000 tonnes per year of petroleum coke by 15% of RDF (25,493 tonnes per year) can reduces 28,970 tCO 2 eq.
... Cellulose, from wood, agricultural residues, waste sulphite liquor from pulp and paper mills, must likewise be converted into sugars, generally by the action of acids or cellulolytic enzymes [11]. Lignocellulose biomass has long been advocated as a feedstock for cost-effective bioethanol production in an environment-friendly and sustainable manner, and agricultural wastes/residues are advocated as abundant and renewable resources for secondgeneration bioethanol production [9,11]. Therefore, to make full use of these resources for sustainable and economically feasible bioethanol production, the following difficulties still need to be overcome: (i) collection, supply and handling of bio-waste; (ii) economically feasible pre-treatment of waste; (iii) production of different economically feasible enzymes and yeast strains that will enable more efficient fermentation of cellulose in working conditions [15]. ...
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Greenhouse emission reduction is strongly advocated within the European Union. The study of natural communities (biocenology), additionally demands inclusion of a circular economy, in which renewable products are kept in continuous circulation of use and reuse. In light of this, there arises the question whether the bioeconomy route alone, promoted by the EU, is sustainable. Using literature, based on the Delphi method, from EU documents and related scientific literature , we highlight the importance of sustainable management of bioresources. It seems that only limited mitigation of greenhouse gas emissions can be expected. Keywords: bioeconomy, circular economy, forest resource, biofuels, European sustainability, sustainability
Residue-Derived Solid Recovered Fuel for Use in Cement Kilns
  • J R Fyffe
  • A C Breckel
  • A K Townsend
  • M E Webber
Fyffe J. R., Breckel A. C., Townsend A. K. and Webber M. E.: Residue-Derived Solid Recovered Fuel for Use in Cement Kilns, July 2012, University of Texas at Austin.
EU Guide to cost-benefit analysis of investment projects -European Commission, Directorate General Regional Policy
  • N Dondur
Dondur N. Economic analysis of projects, Faculty of Mechanical Engineering, Belgrade, 2002. EU Guide to cost-benefit analysis of investment projects -European Commission, Directorate General Regional Policy, 2008. Faculty of Mechanical Engineering, University of Belgrade: Use of Solid Recovered Fuel (SRF) in Cement Industry, Project Report, no.502/707/2013. Belgrade, 2013.
UK Market Development of Solid Recovered Fuel from MBT Plants, Regen Fuels Ltd
  • C Ibbetson
Ibbetson C., UK Market Development of Solid Recovered Fuel from MBT Plants, Regen Fuels Ltd, London. UK, 2006.