Energy and economic analysis of waste-to-energy plants with government incentives in Colombia

Abstract

Globally, the excessive generation of Municipal Solid Waste (MSW) has become a challenge for mankind, which requires different management models and policies, the objective of this study, is to carry out an energy and economic assessment that values the MSW flows generated by medium-sized cities with less than 1.5 million inhabitants, through incineration technology with electrical production, using an analytical approach, was evaluated at the energy level, a conventional plant configuration, estimating steam parameters at 40 bar and 380°C and the lower heating value (LHV) of MSW at 8,786 kJ/kg, calculated thermodynamic properties in each process stream, plant energy yields were determined, such as energy efficiency at 22.6% and electrical energy delivered to the grid at 87.4 GWh per year, yields used in the economic evaluation, which was conducted in two scenarios, taking into account the state benefits of law 1715 of 2014. The first scenario, which did not include the benefits of the law, yielded economically unfeasible results, with a net present value (NPV) of $ 6,634,332 USD, an internal rate of return (IRR) of 9.18% and a levelized cost of electricity (LCOE) of $189. 33 USD/MWh, however, the scenario that evaluated the state incentives, presents an economic viability with a payback period of 11 years, a NPV of $40,232,650 USD, IRR of 15.78% and a LCOE of $175,197 USD/MWh. Sensitivity analyses were carried out to obtain the NPV and IRR limits for each scenario, showing that the most significant variables to be taken into account in the economic viability of this type of project are: the sale price of electricity, the MSW disposal fee and the percentage of the loan for initial investment.