EEN-E3001 Fundamentals of industrial energy engineering, Spring 2023

Learning assignment 6:
Energy pricing

Figure 1 shows an industrial CHP plant that produces back pressure (BP) steam for industrial
processes at a mill. All necessary process values are shown in Figure 1.

Figure 1. An industrial CHP plant

A) Define production costs of BP steam (€/MWh) and electricity using the exergy, energy
and first residual methods (see material of lecture 5). Fuel price is 26 €/MWh and the market
price of electricity is 70 €/MWh. Environmental temperature is 25oC. Allocation factors for
the exergy method are defined as follows:

E 4 - E5
Fthermal = Felectricity = (1 - Fthermal )
E3 - E 2

where E is the exergy content (kJ) of water in the power plant process shown in Figure 1.

B) The plant sells all heat and electricity to the mill. Selling price of electricity to the mill is
the market price (70€/MWh). Calculate how much profit of deficit the plant makes per day
depending on what heat price from Part A) is used in the calculation.

C) What kinds of conclusions you can draw on cost allocation methods on the basis of this
assignment?