$1.5 Billion Partnership Will Recycle Industrial Waste Energy

November 26, 2007

Recycled Energy Development (RED), headquartered in Chicago, Ill., has formed a strategic partnership with private equity firm Denham Capital Management to develop a $1.5 billion portfolio of waste energy recycling projects. The partnership will serve as an investment platform to fund projects developed and managed by RED that will profitably reduce energy costs and greenhouse gas pollution. “These projects will range in cost from $15 to $50 million,” says Sean Casten, RED’s President and CEO, “and take from 12 to 18 months to complete.”
 
More than two-thirds of U.S. greenhouse gases are generated by the production of power and heat. Meanwhile, industrial production and electricity generation plants waste vast amounts of energy that could be recycled into clean power. According to studies done for EPA and DOE, recycling presently wasted energy could generate nearly 200,000 MW of clean power, equivalent to about 20% of U.S. electricity generating capacity. These facilities run on a near continuous basis, and could slash total U.S. fossil fuel use and greenhouse emissions by 20%. Casten estimates that the 200,000 MW represents a total of $350 billion in capital equipment.
 
Recycling this wasted energy takes two forms: industrial waste energy recovery, which requires no new fossil fuels and produces no greenhouse gas emissions; and combined heat and power, where more gains could be realized by local power generation near manufacturers using byproduct heat to displace boiler fuel in lieu of electricity from distant, central generation. Conventional power plants typically waste two-thirds of their energy in the production process, but on-site generation—often referred to as cogeneration or combined heat and power (CHP)—typically is more than twice as efficient and less expensive than conventional generation because it recycles the byproduct heat from power generation and avoids long-distance transmission costs and line losses.
 
One industry that will benefit from this approach is the float glass industry, where about 12% of total operating costs represents energy, with 4% of that electricity. By recycling wasted energy, a 5% reduction in total operating costs is possible. “We estimate that there are around 36 float glass manufacturing plants in the U.S.,” says Casten, “that require 6-7 MW of electricity per plant. With recycling waste energy, 8-10 MW of power could be generated, thereby providing excess energy that could be sold to the grid, generating an additional revenue stream for the company.”
 
RED will work closely with its North American industrial partners to develop recycled energy projects that supply electricity and useful thermal energy to host manufacturing facilities, with RED providing the necessary capital for the projects. RED and its partners will then share the resulting energy cost reductions, along with profits from the sale of excess energy and emission credits.

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©2007 The American Ceramic Society

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