Below are answers to frequently asked questions we receive about waste pressure and Pressure Corp. If your questions are not answered by our FAQ, please do not hesitate to contact us.
How do I know if the gas flow through my pressure letdown station creates a viable waste pressure project?
Pressure Corp offers a no commitment Waste Pressure Analysis for any organization interested in exploring the viability of their waste pressure resources. To complete a Waste Pressure Analysis, we only require high-level gas flow data that includes volume of gas flow, pressure reduction ratio and hours of gas flow per year. Our specialized technoeconomic model will provide your organization comprehensive answers of the viability of your waste pressure resources.
How much power can Pressure Corp's waste pressure power systems produce?
Our waste pressure power system is ideally suited for sites with potential to output power between 1MW to 10MW. We can develop waste pressure power systems with a capacity less than 1MW but the economics of these sites may not be ideal. Higher power prices, grants, and the brokerage of carbon credits can be used to improve the economics of smaller projects.
Can hydrogen waste pressure be harnessed?
Yes! The principles of waste pressure apply to hydrogen for power generation.
What happens to the existing pressure letdown station?
To ensure safe and constant operation we install out waste pressure power system in parallel to the existing pressure letdown station. This creates failsafe to ensure gas will still flow should there be an issue with our system.
How do you pre-heat gas?
Pressure Corp uses waste heat resources, if available, or a line heater to pre-heat gas. We design our line heater to ensure we are delivering gas at the temperatures required by customers. If waste heat is available, Pressure Corp can create a zero emissions resource. Should a line heater be required our waste pressure power system is 37% more efficient than a the most efficient combined cycle power plant. Waste pressure is a highly efficient source of energy that increases the efficiency of pipeline systems by leveraging the energy produced during compression processes.
How are waste pressure projects funded?
Pressure Corp secures long-term power purchase agreements (PPA) to ensure enough revenue from electricity sales to meet the return thresholds required from investors. PPAs can be secured directly with our host customers, distributed on-site load from data centers or growing facilities, local utilities, or wholesale power markets.
Why use third-party capital?
Third-party capital enables our host customers to reduce their emission footprint without having to pay the costs to do so. By leveraging third-party capital, our host customers can use their balance sheets for their core business activities that provide higher returns. Our project investors can provide lower cost capital to absorb the costs necessary to develop waste pressure power projects.
Do we have to use third-party capital to complete a project with Pressure Corp?
No, your waste pressure project can be funded using your own capital. Pressure Corp will find the best project funding solution that works for your organization. Our aim is to provide a complete technical and financial solution that best meets your needs.
How reliable is Pressure Corp's waste pressure power system?
Pressure Corp partners with reputable manufacturers who supply the components for our waste pressure power system. The core component, turboexpanders, are supplied by well-known manufacturers who have field-tested their technology for decades. Our systems are expected to have an operational life of 20+ years.
Why is it worth reevaluating the potential opportunity for waste pressure if my organization has studied the resource in the past?
Many organizations have evaluated waste pressure opportunities in the past. The variable in consideration was the timing of their evaluation. Very few organizations have conducted an evaluation within the last five years. There have been significant economic drivers that make those evaluations outdated. In addition, new regulations on methane emissions, new funding mechanisms/grants, and the increase of low-cost capital for these projects have also helped increase the viability of waste pressure projects.
What are the factors that go into Pressure Corp's evaluation of waste pressure projects? How might it differ from my organization's prior evaluations of these projects?
There are four (4) primary factors to consider when evaluating the feasibility of waste pressure projects:
The opportunity cost of a project. The returns of waste pressure projects are often below internal hurdle rates for many organizations. Considering the relatively small returns, engineering teams are often prioritized on projects with higher returns and revenue potential.
The risk of a project on facility operations. The risk of a waste pressure project interrupting facility operations for even a day or two is asymmetric to the return of such projects. Lost revenue from unscheduled facility downtime from even one or two days can completely negate the return of such a project. We evaluate all the facility interruption risks to mitigate them with failsafes like installing our systems in parallel to existing pressure letdown stations, conducting the installation during scheduled downtime, and securing insurance products.
The power generation potential, which is determined by the thermodynamic characteristics of a given site (primary inputs are gas flow, shape of the gas flow across the year, pressure ratio between inlet and outlet of the valve, and viable waste heat sources at the site). If a site has viable power generation (i.e., ideally greater than 1MW), we evaluate the economics of the project.
The economics of the project. The viability of this factor is subject to the hurdle rate of the capital provider and the levers that were available at the time of evaluation for cost engineering.
Pressure Corp has found that when waste pressure projects failed feasibility evaluations in the past, it was often because of the second and third factors rather than the first. And often the communication that these projects were not viable conflated all three factors.
What has changed in the market since our organizations prior evaluations of these projects to make a re-evaluation worth our time?
For the risk and opportunity cost of a project, market maturity has provided benefits:
There are now a number of insurers that offer facility interruption risk for energy projects like waste pressure. This alleviates the asymmetric risk faced by facility managers.
ESG mandates from investors has pushed organizations to look for tangible solutions like waste pressure projects to satisfy investor demand and maintain share price.
For power generation, there have been developments that affect the thermodynamic-viability of potential projects:
Efficiencies of turboexpander generators have increased and can accommodate better optimization of gas flow variability. Advancements in small-scale turboexpander generators for industrial gas and LNG applications have increased turboexpander efficiencies. The increasing sales volume and modularization of those more efficient turboexpanders has helped drive down unit costs of the component.
Gas flows can be optimized without impacting the system as a whole to increase the flow at a given site and decrease the variability of that flow. When analyzing waste pressure sites in isolation of the system's flexibility can often underestimate the potential opportunity.
For the economics of a project, a lot has changed:
The availability of low-cost capital from infrastructure investors has removed the opportunity cost of using your company's capital which is better served to fund core business activities.
Capital from ESG-focused investment funds, in particular, is earmarked for these types of projects but there is a shortage of shovel-ready projects that capital can be deployed for. This over supply of capital helps reduce the cost of capital for waste pressure.
The market for carbon credits and clean energy credits is more robust, offering a new revenue stream for waste pressure. These credits are also increasing in value as regulations tighten.
The availability of the ITC in the United States was extended for waste energy recovery projects in Dec 2020. Waste pressure projects fall under this criteria. This shaves 26% percent off of capital costs for projects that begin construction before January 1, 2023 and 22% off capital costs for projects beginning construction before January 1, 2024.
There are billions of dollars in additional grants that are available for waste pressure projects. These grant programs reduce the cost of capital or even subsidize the cost of project development to make waste pressure even more economical.