The use of alternative fuels by the cement industry continues to grow. The respondents to this Oil Business Council Survey, which represents around two thirds of cement production outside of China shows the usage of alternative fuels has reached 40 million tons annually in 2012, and this is equates to an overall substitution rate of around 12%.
Now, if we drill down through those numbers and examine the performance of one the major cement producers responding to that survey, we can see that the specific kilns in the group is an extremely wide distribution in the take up of alternative fuels. So why are some counTyres achieving such a high substitution, right?
And others, nothing at all. Well, the answer lies in the range of challenges that must be dealt with to develop a project. Access to an economically viable fuel service is the first challenge, and there are hurdles that must be overcome relating to the energy market. Community acceptance and regulatory approval, each kiln will have its own unique characteristics relating to raw material chemistry, kiln design and layout. So, there is a multiplicity of issues that we need to deal with.
So, well there are many challenges that will be common to any life to energy project. In South East Asia, the sourcing of feedstock stands out as a major challenge that has to be dealt with. To make the project work, it's necessary to have feedstock that has the right setting in terms of quantity, quality, and price, and this can be difficult in South East Asia for a number of reasons.
The cost of landfill is low due to engineering design standards is no or low government impose landfill rubbish, poor quality of waste in terms of recoverable calorific value. Landfill costs are not fully pashed on to the waste generator. There's a lack of a regulatory framework to drive higher induce options and vested interests, may be more interested in maintaining the status quo. The resource qua responds to this challenge is been to initially source material from the mature waste market, in this case Australia to provide the underlying security supply, price and fuel quality.
The establishment of a local processing facility then allows the development of a local sourcing network to capture the feedstock at source before it enters the waste stream, then it facilitates a transition from external to local sourcing. The transboundary movement of solid recovered fuel is accepted international practice, and is expanding rapidly.
For example, a movement of this material out of the UK has grown from nothing in 2010 to over 2 million tons in 2014. The trade is driven by a will developed SRF market in Europe, that includes cement counts. The situation in many ways reflects the regional SRF situation in the Australian South East Asian region.
There're a few additional opportuniTyres for SRF use in the Australian context due to the steady decline of cement manufacturing operations in that country. However, the South East Asian market is growing with the push of both lower energy cost and improve business sustainability. Now, just to give you a picture of the results called Malaysian operation at Ipoh.
This plant produces an IDF SRF material, uses to descriptive pressure [xx] fueled in PEF. The facility utilizes material from which the over size non-combustibles have already been removed, which leaves the material containing a mixture a plastic, timber, textile, and paper. This material is blended and reduced in piece size to around 35 millimeter.
To do this, the material must go through a primary shredding step followed by metal separation, and [xx] separation to remove any heavy non combustibles, followed by secondary shredding and a final metal removal step. The plant's been operating since December 2013. It has a capacity of 75,000 tons per annum and the ability to double its output with an additional secondary shredder. The offtake of this product is to Lafarge Malaysia that is Kanthan Plant.
So, if we move to the energy price challenge, the energy market has seen a significant downturn in price in recent times, and this puts pressure on the viability of new alternative fuel projects. However, what must be born in mind is the cyclical nature of the energy market. For example, this chart shows the 100 year move in coal prices adjusted for inflation. In the longer term, process will return to trend, it is matter of managing through the picks and trots.
The real scale approach to making this challenge just to share the upside as well as the downside, by linking the SRF fuel price to coal price, and working with clients to develop low cost entry level feed systems to lower the capital hurdle. The environmental challenge, and this is very much an issue of managing perception.
Any new project must gain regulatory approval and community acceptance. In many ways, these issues are two sides of the same coin. What is the interest to both this stakeholders is the impact of the project upon environment. The evidence or the impact of the use of IAF is clear, there is none. The conclusion is not only demonstrated by the mission data, but by examining the fundamental physics and chemistry of the cement process.
If we look at the kiln missions, they can be broadly grouped into dust, nitrous oxide, acid gases, organics, and metals. And we have a look at H1 in turns starting with dust. The fuel you burn is clearly not going to influence dust emissions. Dust emissions are a function, the type, and size of dust collected that you use and how well it's operated and maintained.
Nitrous oxides are formed from atmospheric nitrogen in the main burner and from the fuel in nitrogen in the main burner in Celsana[sp?]. An important point is that Nitrous Oxide can also be destroyed in the back end of the kiln of the calciner. The evidence is that nitrous oxide emissions can reduce with IAF through this distraction mechanism that will not increase with the fuel change. Toxins and fumes. There's always concern about toxins and fumes, especially if there is more chlorine entering the kiln with a plastic bags fuel, but the concerns are unfounded. Cement kilns have exceptionally low levels of darks and emissions and it is largely because of the rapid cooling of the gashes after the pre-heater in the room that will prevent its formation. Fuel plays no role. The VOCs or Volatile Organic Compounds derrive from the organics in the raw material, and you would have to have a very poorly operating calciner to be producing VOCs from fuel.
Acid gashes, Chloride, Fluorides and Sulphur can be the best friend or the worst enemy of the prices. But they are not going to report to the emissions in any significant way. It all comes down to what I call the chemical suit, that's the presumingprocess. Chloride has a higher affinity for the Alkalies, Sodium and Potashium as does Sulphur. Any access Sulphur reacts with Calcium as does the Fluorone. All of these components blend up in the clinker of the emissions. Metal emissions, the overwhelming majority of the metal emissions from the cement kiln derive from the raw materials. And as a consequence, the metal emissions have the direct correlation with the amount of dust emitted.
The estimates of the contribution to metal emissions from the fuel have been made by the Germans [xx]. Apart from mercury [xx] the contribution is immaterial. So, Mercury [xx] must be kept at low levels whatever the fuel used. Carbondioxide, it's not an emissions regulated, but carbondioxide emissions can be reduced through the use of alternative fuel containing biomass. In addition to these direct savings, there are significant indirect Green House savings from the avoidance of land filling and the production of methane. Turning now to the technical challenge at the cement calciner, major impact on the process is the characteristics of the alternative fuel. And here we're talking about the non combustible component, the metrics, the ash, the moisture, issues around variability of the calorific value, the ash, the fit grate, the particle size of the fuel and the circulating elements.
If the technical issue is ashociated with change in few characteristics are not properly managed, much of the national fuel savings can evaporate through increased production cost, reduced overall equipment, effectiveness and product quality issues. So, you can end up with quite a list of technical risks, not just related to the fuel characteristics, but the choice of fuel firing location, the quantity of fuel, and the fitting equipment.
So to make this challenge, you need to identify all those risks, analyze them, rank them, develop mitigation strategies until you get down to an acceptable risk profile. So, to illustrate this process for an SRF field, the major variables that needs to be controlled in SRF are calorific value, moisture ash and chlorine, and you need a strategy to manage fuel variability which is based on contractual arrangement with the supplier.
You didn't need to ashist the kiln's tolerance for additional Chlorine, which is determined by the tendency to cutting formation from the presence of Sulphur and Chlorine in the kiln. An expected guidance here is to avoid any adverse impact to keep the total Chlorine input of the kiln source system from all sources, below a value of 200 milligrams of Chlorine and a Kilogram of Clinker.
Another tool that can be used to ashess existing kiln performance is this graph complied by [xx] Smith. It's based upon a periodical data relating to levels of Chlorine and Sulphur in hot mill, and tendency to cutting across the range of operating kilns. This type of ashessment might suggest there are no issues or that additional blast is inclining, maybe required, or in the extreme, the installation of a kiln bypash. If the fuel is changed, the composition of the ash will change which may require raw mix adjustment to maintain the target clinker chemistry.
[xx] substitution ranks, this is not generally a problem. It may become significant at higher substitution rates as the ash contribution to the clinker becomes greater. The effect of moisture and changing Carbon Hydrogen ratio in the fuel should be examined as it is consequences for pre[xx] fine capacity and potentially kiln output.
As the fuel moisture goes up and the Carbon-hydrogen ratio goes down, the process gas volumes will increase. These figures shows approximate specific gas volumes, for different fields it illustrates the indicative changes in gas volume to be expected for a 100% fuel replacement. For something less than that, the impact will be proportionately less.
The fuel has to burn. There must be sufficient oxygen temperature residence time and fuel air mixing to ensure this happens. Here we have the representation of the oxygen profile for a particular calciner which you can see is far from uniform. It underscores the made for good understanding if the optimal location to eject the SRF, and this knowledge in turn informs the amount of fuel that can be substituted, and this is one of the most important inputs in to the project business case. And to here from Cena we'll discuss the insights provided by CFD modeling in his presentation tomorrow. So, in summary, the challenges that must be addressed to deliver the viable IAF project, stable long-term fuel source, consistent and reliable volume of fuel and quality of fuel,
a commercial partnership between the fuel supplier and end user, engagement with the community, regulator, and employees, understanding the process quality in environmental impact of the changing fuel type, a reliable feed system that's fit for purpose, and learning from your own experience to optimize your fuel benefits. And so to conclude, something about ResourceCo. ResourceCo is a privately owned company with head office of Australian operations in Adelaide and its Asian head office in Singapore. ResourceCo produces around 100,000 ton per annum of Tyre Derived Fuel or TDF and 150,000 tons per annum of solid recovered fuel also known as Process Engineered Fuel or PEF.
ResouceCo sources its feedstok from Australia and Malaysia. It has Tyre collection systems in each major Australian capital city, higher processing operations in Melbourne, Sydney in Brisbane, and SRF processing operations in Adelaide, and Sydney in Australia, and Ipoh in Malaysia. The principle markets for the TEF is the pulp and paper industry in Japan, and the chemical, and cement industries in South Korea.
SRF is used in cement kilns, both in Australia and in Malaysia. So, it brings me to the end of my presentation, but if you would like to discuss any of the issues raised in this presentation in more detail, ResourceCo does have a stand in the exhibition area, so thank you.