Xylem Study Pinpoints Big Energy Savings for Treatment Plants

A new study demonstrates potential for $40B in annual energy savings through efficiency improvements at wastewater treatment plants in the US, Europe and China.
Xylem Study Pinpoints Big Energy Savings for Treatment Plants
This graphic shows how the wastewater industry could cut its electricity-related emissions by half. (For more information on this report, visit Powering Wastewater.xyleminc.com or email powering.wastewater@xyleminc.com.)

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Energy efficiency is big on the agenda of clean-water plant teams. Pursuing the ideal of resource recovery, they’re making changes that save electricity and fuel, and in some cases striving for energy self-sufficiency.

But in the grand scheme, exactly how big is the energy savings opportunity? A 2015 study conducted by Xylem lends perspective. The company’s Powering the Wastewater Renaissance report estimates that plants in the United States, Europe and China could save $40 billion per year through the adoption of high-efficiency technologies. This would eliminate nearly half of those plants’ electricity-related emissions, preventing an amount of greenhouse gas emissions equivalent to those released from the burning of 9.7 billion gallons of gasoline.

The report says 95 percent of the savings could be achieved through measures that have zero or negative cost, meaning they pay for themselves over time through savings on fuel or electricity. The technologies in question are not futuristic — they exist and can be readily deployed today. Al Cho, vice president for strategy and business development with Xylem, talked about the study in an interview with Treatment Plant Operator.

TPO: Why did Xylem undertake this study and report?

Cho: At the global and local levels, we hear a lot about the relationship between water, energy and climate. We saw an opportunity to address those issues together. There is a lot of inefficiency in today’s water infrastructure. We took a data-driven approach to understand the size of the opportunity to reduce energy consumption and emissions in the wastewater sector.

TPO: What methodology was used in conducting the study?

Cho: We worked with a consulting firm as well as our own engineering experts. We also drew on published data and had the study peer-reviewed by external experts. We used a framework called the marginal abatement cost curve to compare the costs of different options for reducing greenhouse gas emissions. If you’re trying to cut greenhouse gases by a huge amount, there are ways to do it that are very expensive and don’t make economic sense unless you include a price for carbon. There are other opportunities that make economic sense on their own. A lot of those involve energy efficiency.

TPO: Can you give examples of measures that are overly expensive?

Cho: One example in the energy industry is carbon capture and storage, an emerging technology where utility companies would capture carbon dioxide from electric power generation and store and seal it deep underground. It’s an expensive technology that would only be economical if the cost of carbon were high enough so that by capturing it companies would earn money for carbon emission reductions. On the other hand, there are negative-cost interventions like energy efficiency, where you save money by implementing them.

TPO: What are some of those negative-cost opportunities in the wastewater sector?

Cho: We looked at 18 specific interventions, from wastewater collection and transport through primary, secondary and tertiary treatment. We examined the current baseline in terms of the energy consumption and energy efficiency of existing infrastructure, relative to the best-in-class energy-efficient technologies that are readily available today.

We looked at it from two perspectives. First, in terms of a price on carbon: What is the cost associated with each ton of greenhouse gas abatement? That’s what is relevant for global policymakers thinking about climate change. Then we looked at it in terms of the internal rate of return on investment. We found that by upgrading efficiency in areas such as pumping, aeration and process control, energy consumption can be reduced significantly, and mostly at a negative cost of abatement, at rates of return in excess of what most investors would normally require.

TPO: More specifically, what do these efficiency improvements include?

Cho: They include variable-speed pumping, high-efficiency pumping hydraulics, variable-speed blowers, optimized aeration systems and aeration control, improvements in biogas production, enhanced filtration control, and improved filter air scour efficiency. Another area that our analysis shows to be highly profitable is the use of sensors and data analytics to optimize energy-intensive processes.

TPO: What measures are involved in optimizing biogas production?

Cho: We evaluated technologies for optimizing the mixing of biosolids and other materials in digesters. Some digester processes aren’t as efficient as they could be, because the mixing is too energy intensive or is not effective. In many cases, mixers don’t operate at optimal speed, or they draw excessive energy in order to mix the biosolids and expose materials to the decomposition processes.

TPO: Where does biogas-fueled combined heat and power fit into this equation?

Cho: That is certainly an opportunity, but we did not include CHP in the scope of our study. It is certainly something we could evaluate in the future.

TPO: How would you rate the energy-saving opportunities at existing plants versus new facilities being built?

Cho: There are efficiencies to be gained both in retrofitting facilities and in making different choices when building new plants. Consider China, which is committed to building many wastewater treatment plants to address environmental problems. If you make the investment to build out the new plants with higher-efficiency technology, you get an even better return because there is no extra cost for retrofitting and you lock in the full lifetime of the more efficient technology. Some of the most attractive economics are in emerging markets that are still building their infrastructure.

But a key finding of the report is that when you look at the energy savings available even in the United States and Europe, the cash flow from increased energy efficiency is big enough to make even the retrofit of many technologies highly attractive.

TPO: Efficiency retrofits require an up-front investment, and limited capital is often a barrier. How can that barrier be overcome?

Cho: When we see a big negative-cost opportunity like this persist for a long time, it’s a signal that there is some type of market imperfection. In the United States, we have a nexus of market barriers that include limited capital and a strong focus on maintaining existing systems that work from an effluent-quality perspective. There is also most likely insufficient awareness of the full economic potential of upgrades.

I believe the future model will involve some mix of enhanced financial service offerings that help municipalities make up-front capital investments by leveraging the cash flow from energy efficiency. We see some examples of this in building retrofits for schools and municipal buildings through energy savings performance contracting. I see that same model as potentially viable in the wastewater world.

TPO: How important are government and utility incentives as part of the answer?

Cho: They can and should be part of the picture. Almost every city in the country is looking at how to reduce energy consumption and greenhouse gas emissions. One of the first places they should look at is the wastewater infrastructure. Savings can be encouraged by a number of means, including government programs such as the green project set-asides in state revolving loan funds and state and local energy efficiency funding programs. Realizing the savings will require a lot of flexibility and creativity on the part of operators and municipal officials. The good news is that if people collaborate to make the financing and the technology come together, there are real benefits for ratepayers and for communities.

TPO: All things considered, how would you say this study adds value to the wastewater treatment sector?

Cho: What this study really does is put numbers to something many people intuitively already know — there are opportunities to make our wastewater systems more productive and efficient while improving quality and reliability. As more and more municipalities focus attention on their energy consumption and environmental performance, we will also see innovation in the market in the form of financing and business models that enable more treatment plants to take advantage of energy-efficient technologies.


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