Eight Flags Energy CHP Plant - 20 MW Utility CHP System - Pulp & Paper Facility Partnership - Case Study

Quick Facts

LOCATION: Fernandina Beach, Florida

MARKET SECTOR: Utility / Pulp and Paper

EXPECTED OPERATION DATE: July 2016

FUEL: Natural Gas

GENERATING CAPACITY: 20 MW

THERMAL OUTPUT: up to 200,000 lb/hr steam

EQUIPMENT: Solar Turbines Titan 250
Rentech HRSG
Duct burner
800 ton inlet air chiller

USE OF THERMAL ENERGY: Rayonier’s process steam and hot water

USE OF ELECTRICAL ENERGY: Distribution to Florida Public Utility Customers

ECONOMIC BENEFITS: $28 million in NPV savings to rate payers over 20 years

EMISSIONS REDUCTION: NOx: 165 tons/yr
SO2: 105 tons/yr
CO2: 160,000 tons/yr

CHP PLANT EFFICIENCY: ~ 75%

Project Overview

In 2010, Florida Public Utilities Company (FPU) faced electric rates that were 50% higher than 2007 prices. In order to better serve its customers, FPU derived a solution to stabilize electric rates by establishing a partnership with Rayonier Performance Fiber in Fernandina Beach, Florida to develop a combined heat and power (CHP) system. The new system will augment Rayonier’s existing CHP plant’s steam production. Combined, the two systems will produce the entire thermal load of the mill and more than 100% of its electric demand. Rayonier will sell the excess electric power from their CHP plant to FPU for distribution to the utility’s 16,000 customers on Amelia Island.

FPU’s parent company, Chesapeake Utilities Corporation, formed a new subsidiary, Eight Flags Energy, LLC to build, operate and maintain the CHP plant. The plant, which is scheduled to be completed in 2016, will be built on property adjacent to and owned by Rayonier Performance Fibers.

Reasons for Installing CHP

Florida Public Utility Company provides electric service to approximately 31,000 customers in two distinct areas: 16,006 customers on Amelia Island and 15,155 customers in Marianna, Florida. The company currently does not own any generation facilities and relies on a wholesale power contract with the City of Jacksonville’s utility, JEA, as its main source of electricity. Additional sources of power include two local Qualifying Facilities: Rayonier and RockTenn. The Eight Flags Energy CHP Plant will also be a PURPA Qualifying Facility providing baseload power that will reduce the overall cost and increase the reliability of electricity for FPU’s retail customers on Amelia Island. The CHP system is expected to reduce CO, NOx, VOC, and SO2 emissions compared to the current purchased power as it will be offsetting coal generation resources.