TURNING TO SUPPLY-SIDE MANAGEMENT - ESTIMATING INDUSTRIAL COGENERATION POTENTIAL

Increased recognition by electric utilities of the economic opportunit ies for load displacement or purchase of customer cogenerated electric ity has initiated a change in utility supply-side planning that has pa rallels with demand-side management activities. Analytical tools and d etailed research are required to forecast the technical, economic and industry-offered cogeneration potential from various sources. In this study, an end-use technology simulation model (ISTUM-1) is used to est imate the future incremental cogeneration potential from pulp and pape r mills in British Columbia under different scenarios of industry evol ution. The estimated technical potential of 5000 GWh (815 MW) results from determining the total process steam requirements and highest feas ible boiler pressures. The economic potential of about 3500 GWh (570 M W) depends upon the social discount rate, the utility's long run avoid ed costs, boiler cost estimates and the value of burning wood waste th at must otherwise be disposed of. The industry-offered potential of 12 00 GWh (200 MW) results from behavioural parameters in the model that mirror past investment decisions. As with demand-side management, vari ous strategies are available to the utility to bridge the gap between industry-offered and economic potential.