Algae Production in Wastewater Treatment:

Prospects for Ballen

Michael Cunningham Calvin HeimVerena Rauchenwald

LoCal-RE Summer Research Program

August 26, 2010

Abstract

This report investigates the technical and economic viability for algae pro-duction at the Ballen Wastewater treatent plant (WWTP) on Samso Island,Jutland, DK. In the proposed system wastewater is utilized as a feed stock andflu gas from a biomass plant provides carbon dioxide. A published economicmodel predicts an annual average biomass selling price from oil prices, lipidcontent, and predicted annual algae yield.

This group constructed a model that predicts an internal rate of return(IRR)of 10.47% based on an approximation of the theoretical biomass yield (15.3grams algae (dry weight) per square meter per day over the summer season) andcosts from similar algae production systems. The baseline predictions assumethat oil and electricity are at current market price, and the open market price ofCO2 is $7 per ton. This study concluded that economic viability of the projectdepends greatly on the CO2 and oil market prices. If the market price of carbondioxide increases to $19-20 per ton, the sequestration of carbon dioxide is thehighest source of profit. In addition, algae production process helps meet EUdirective water discharge regulations by decreasing the concentrations of TotalNitrogen (TN) and Total Phosphorous (TP). Policy issues, regulations, andsocial implications of this project for the people of Samso are discussed.

Contents

1 Introduction 21.1 Incentives for biomass production . . . . . . . . . . . . . . . . . . 21.2 Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31.3 WWTP operational regulations . . . . . . . . . . . . . . . . . . . 41.4 Physical constraints to algae growth . . . . . . . . . . . . . . . . 5

1.4.1 Light . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51.4.2 Temperature . . . . . . . . . . . . . . . . . . . . . . . . . 61.4.3 Nutrients . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

2 Methodology 82.1 Plant setup . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82.2 Determination of revenue . . . . . . . . . . . . . . . . . . . . . . 102.3 Production Cost assumptions . . . . . . . . . . . . . . . . . . . . 11

2.3.1 Cash Flow assumptions . . . . . . . . . . . . . . . . . . . 112.3.2 Electricity Demand in Power Plant . . . . . . . . . . . . . 112.3.3 Reduction in Electricity Demand Approximation . . . . . 112.3.4 Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122.3.5 Carbon Dioxide . . . . . . . . . . . . . . . . . . . . . . . . 122.3.6 Price of Carbon Dioxide . . . . . . . . . . . . . . . . . . . 12

3 Results 123.1 Biomass Yields . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123.2 Centrifuge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

3.2.1 Centrifuge Models . . . . . . . . . . . . . . . . . . . . . . 133.2.2 Determining Maximum for Centrifuge System . . . . . . . 14

3.3 Oil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153.4 Carbon Dioxide . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153.5 Algae Lipid Content . . . . . . . . . . . . . . . . . . . . . . . . . 163.6 Expected Water Quality Improvements . . . . . . . . . . . . . . . 17

3.6.1 Biological Oxygen Demand . . . . . . . . . . . . . . . . . 173.6.2 Chemical Oxygen Demand . . . . . . . . . . . . . . . . . 183.6.3 Total Nitrogen . . . . . . . . . . . . . . . . . . . . . . . . 193.6.4 Total Phosphorous . . . . . . . . . . . . . . . . . . . . . . 203.6.5 Total Suspended Solids and Volatile Suspended Solids . . 203.6.6 Predicted Results . . . . . . . . . . . . . . . . . . . . . . . 203.6.7 Other Areas of Reduction . . . . . . . . . . . . . . . . . . 21

4 Discussion 214.1 Economic Harvesting System . . . . . . . . . . . . . . . . . . . . 214.2 Photobioreactors . . . . . . . . . . . . . . . . . . . . . . . . . . . 224.3 Carbon Dioxide . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

4.3.1 Technical . . . . . . . . . . . . . . . . . . . . . . . . . . . 224.3.2 Economic . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

4.4 Oil Prices and Inflation Rate . . . . . . . . . . . . . . . . . . . . 23

1

4.5 Water Quality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 244.6 Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 244.7 Accuracy of Predictions and Assumptions . . . . . . . . . . . . . 254.8 Society and Policy . . . . . . . . . . . . . . . . . . . . . . . . . . 25

4.8.1 Policy Challenge: Local Support . . . . . . . . . . . . . . 254.8.2 Social Challenge: Raising Capital . . . . . . . . . . . . . . 264.8.3 Setting New Goals for the Biores Project . . . . . . . . . 26

5 Conclusion 27

A Biomass yields 29

B Cash Flow and Inputs 30

1 Introduction

1.1 Incentives for biomass production

The utilization of biomass as a renewable energy source for transportation andelectricity production has increased over the past decade because of the interestin energy security, and GHG mitigation. A focus on Climate Change in Europeled to the 20-20-20 targets. These targets require countries to decrease GHGemissions, increase electricity generation, and decrease consumption by 20%.All EU-15 countries intend to include biomass in their portfolios to meet thesetargets by the year 2020. However the use of biomass could increase GHGemissions depending on combustion efficiency, planting and harvesting practices,and other footprints of the biomass life cycle.

Traditional biomass sources include first generation crops such as corn,canola, and switchgrass. Recent studies show that algae is more favorable thanthese crops in terms of land and water consumption and eutrophication poten-tial. Current algae production methods emit carbon dioxide while the growingof corn, switchgrass, and canola for fuel purposes sequesters carbon dioxide.

Fertilizer and carbon dioxide produced specifically for traditional algae pro-duction lead to the majority of GHG and energy consumption. Forty percent ofenergy demand and 30% of GHG emissions can be attributed to process-specific-manufactured CO2. Fertilizer accounts for approximately 50% of energy use andGHG emissions [12].

The handling of bioenergy requests a responsible and sustainable way ofproduction. Biomass is considered as CO2-neutral and thus very efficient inreducing emissions, but if forests are exploited the exact opposite would takeplace. Deforestation is one of the major issues for global warming. Furthermorethe competition for land between energy crops and food crops has to be avoided.It has to be ensured that fertile land is available for the worlds expandingpopulation. Instead of using arable land for biofuel production this projectfocuses on using wastewater as a resource. nutrient for a new product, the algae.However, our project declares wastewater as a resource for future products.

2

Figure 1: The dike ponds in Lolland integrate wastewater treatment, floodprevention, and potential for algae production.

Instead of growing and incinerating food crops we take the algae and put itinto the wastewater pond. Therefore water and land is saved, fertilizers arenot needed because the wastewater pond is an enormous area of nutrients andchemicals for further treatment of the wastewater are minimized [28].

1.2 Objectives

The utilization of wastewater as a feedstock and flu gas as a CO2 source elimi-nates the requirement the fertilizer and process-specific-manufactured CO2 fromthe algae production process. The results should be a major reduction in life-cycle energy requirement and GHG emissions. The goal of this project is toanalyze the social, economic and technical benefits of algae production utiliz-ing wastewater as a feedstock and flu gas as a CO2 source. Our technical andeconomic objectives are to approximate the annual growth rate of algae, to de-termine the rate of return on investment in a wastewater-based algae productionprocess on Samsø, and to identify the most sensitive input variables to this rateof return; our social objectives are to examine regulatory and social incentivesto implement this algae process.

3

1.3 WWTP operational regulations

A wastewater treatment plant has to follow certain regulations to be estab-lished. In the case of Samsø the Council Directive of 21 May 1991 concerningurban waste water treatment constitutes the framework for the procession ofdomestic and industrial wastewater as well as run-off rain water. Its main focusis to protect the waters in the EU member states through appropriate collec-tion, treatment and discharge of urban waste water. Moreover it is one of thethree directives of the European Union on water policy. Based on the CouncilDirective EU member states have enacted national laws.

Samsø is an island with a capacity population equivalent (p.e.) of 6.700;it runs an MBNDK process, which means that the plant performs mechanical,biological, nitrification, and denitrification processes on the wastewater; finally,the water passes through a clarifying tank before disposal [8]. The biologicalprocess is an activated sludge process, and the sludge is treated in an approx-imately 40m by 75m reed-bed system, where the sludge degrades for ten yearsbefore agricultural application as a fertilizer, use as construction material, ortransport to a landfill[30].

Article 10 of the Directive points out local climate conditions and loads sea-sonal variations shall be considered when designing, constructing, operating andmaintaining a WWTP. This article is of importance because the main factorsfor the algae production on Samsø are sunlight and temperature. These factorsare very sensitive; thus algae production in open ponds is only feasible fromApril to October. The seasonal variations of load are of importance as in thesummer Samsø is hosting a festival with many visitors. Therefore the WWTPsp.e capacity is 6.700 although the p.e load during the year is only 1.409 [6].Flexibility in capacity is needed to handle the load of visitors.

Annex I of the Directive elaborates precisely the requirements for urbanWWTP concerning

• the collecting systems,

• the discharge from urban WWTPs to receiving waters, and

• reference methods for monitoring and evaluation of results.

Collecting systems have to be designed with the best technical knowledge byhaving the characteristics and volume on urban waste water on the mind. More-over leaks shall be prevented and storm and over flood-based pollution of re-ceiving waters shall be limited.

The design of the WWTP has to guarantee representative samples to betaken of incoming and effluent water before being transferred to receiving waters.Moreover the effect on the receiving waters shall be limited by elaborating thebest point of discharging the water.

Further it is required in Annex I, D, 2 “reference methods for monitoring andevaluation of results” to decrease degradation of samples between collection andanalysis by applying international laboratory practices. Moreover it prescribeshow many samples shall be obtained due to the size of the treatment plant.

4

Samsøs WWTP at Ballen has a population equivalent capacity of 6.700 thus foursamples are required after the first year has shown that the water is coherentwith the requirements of the Directive. If the p.e. is over 50.000 then 24 sampleshave to be obtained.

In addition Annex I provides a table with percentage of reduction and con-centration values of discharged waters.

The required BOD (biochemical oxygen demand) in the WWTP has a con-centration of not more than 25 mg/l O2. Another parameter described in thetable is COD (Chemical oxygen demand). The concentration limit of COD liesat 125 mg/l O2, while requiring a reduction of 75% from incoming water.

TSS (Total suspended solid) demonstrates the third parameter concerningthe approval of discharged water. The Directive sets the limit for TSS con-centration at 35 mg/l if a p.e. of 10.000 is existing. In this case the minimumpercentage of reduction is defined by 90%. Incoming water with 2000-10.000 p.e.is allowed to reveal a concentration of 60 mg/l TSS. Under these circumstances70% of TSS have to be reduced at minimum [5].

1.4 Physical constraints to algae growth

1.4.1 Light

Photosynthetically active radiation (PAR), radiation that falls between thewavelengths of 400 and 700 nm (roughly 43%-45% of the total incoming radiation)[27,p. 377], supplies the energy for photosynthetic conversion of carbon dioxide tocarbohydrates. In his review, Shen [33, p. 1282] shows that the maximum theo-retical conversion of PAR to carbohydrate is 27%.To completely determine theamount of available light, one would have to consider the geometry of the algalgrowth area: for ponds, the amount of sunlight available to algae is limited bythe available solar flux, which rises and falls with the seasons. Table 1 listssome average solar fluxes for Samsø by month. As the light passes throughthe surface of the algae tank, microalgae absorb or scatter the light. The lightcontinues to dim and scatter as the optical path length (e.g., the depth of thepond) increases. Furthermore, as the density of algae increases, the effects ofshading come into play and decrease the amount of PAR [23, p. 24]; it has beensuggested that the combined effects of photon absorption limitations, opticaltransfer losses, and use of energy for life-support functions of the algae decreasemaximum conversion efficiency of PAR in photosynthesis to 10%, and it hasbeen suggested tha the PAR conversion efficiency is 3.7% for open ponds[33, p.1282]. Too much lighting can cause photoinhibition [23, p.24], which is morerelevant for the entire algal population at low algae concentrations ( less than10 g/L). This effect of photoinhibition (for algae) generally begins at about 10%of the full solar flux at midday [13, p.8], but varies from species to species.

A rough approximation for the biomass yield of an algae farm, BY ( gm2∗month ),

may be given by

BY =QTη

Ec(1 − L) + ElL( adopted from [33, p. 12, Equation 2])

5

Table 1: Radiation and temperature data for Samsø, from [7]

where Q is the month-average PAR energy per day (kWh/m2 ∗ day), T is time(number of days in the month) , η is the theoretical final PAR conversion effi-ciency (10%), Ec is the energy necessary for building one gram of carbohydrate(17KJ ∗ g−1), El is the energy necessary for synthesizing one gram of lipid(38KJ ∗ g−1), and L is the lipid content ( g lipids

g algae ) of the algae by dry weight.

Note that the 3.7% mark for open ponds was not used. We factor in theeffect of environmental temperature changes to account for lower yields.

1.4.2 Temperature

The maximum rate of primary production may also be approximated by theArrhenius expression in regards to temperature.

µ = Ae−EaR

1T

where

µ ≡ first order growth rate, day−1

Ea ≡ “approximate” activation energy for photosynthesis,kJ

mol

R ≡ universal gas constant,kJ

mol ∗KT ≡ temperature, K

A = maximum growth rate, day−1

6

This approximation requires empirical data for a range of temperatures to ap-proximate the constants A and Ea; in [18, p. 761], a collection of data forfreshwater and marine algae suggest that this relation takes the form of

µ = Ae−6842 1T

Assuming that we remove algae from an open pond at a very slow rate (so thatthe concentration of algae in the entire pond remains relatively constant), wecan view the growth (for the purposes of this model) as a zero-order expression,a function of temperature. Then, the fraction of the full biomass yield rateavailable at lower temperatures than the standard (let us assume 25◦C ), f(T )is

f(T ) =µ(T )

µ(25◦C)=e

−6842T

e−6842298K

This model makes three major assumptions:

• Optimal growth occurs near 25◦C.

• Photosynthesis can be modeled as one “master reaction” with activationenergy Ea.

• The slow harvesting method does not significantly alter the overall con-centration of algae.

As temperatures drop close to the freezing point, algal primary productivitydecreases to an unprofitable amount; modeling for cold climates such as those inSamsø(Table 1) must take in to account that slow-flowing, shallow open pondswill freeze in the winter months.

However, experimental data reveals relations between temperature, light in-tensity, activation energy, and the half-saturation constant and implies the needfor a more involved expression for the growth rate. Eilers and Peeters (1993)responded with a more extensive model for primary productivity based on statesof the photosynthetic factories, assuming that temperature only affects the peakprimary productivity and optimal light intensity[15]. Duarte (1995) goes fromtheir model to consider the correlations between temperature over the entirelight intensity and temperature range (specifically, the initial slope of the P- Icurve) by constructing a model based on 5 reaction rates of photosynthesis andfitting a temperature-intensity-productivity surface to experimental data usinga least-squares method [14]. We applaud their efforts, but choose the simplerArrhenius model for this paper.

1.4.3 Nutrients

CO2 Microalgae, like other plants, need carbon dioxide for photosynthesis. Itmay come from the atmosphere, industrial exhaust gases, or from dis-solved carbonate and bicarbonate ions in ambient waters. High microal-gal growth rates require more carbon dioxide than atmospheric CO2 (at0.0387% CO2, by volume) can offer; flue gases from power plants (at 15%

7

Figure 2: Schematic of the integrated system: power plant, wastewater plant,and biorefinery.

Sunlight

''Ballen Power Plant

Flue gas //Algae Pond

Purified Water

&&

algae //

Lost CO2

OO

Biorefinery

W

Pretreated water

55kkkkkkkkkkkkkkkkkW T P

CO2, by volume) provide a viable alternative for the algae and carbonmitigation for the power plants [27, p.373].

N Algae use nitrogen to build nucleic acids and proteins. Unlike carbon dioxide,atmospheric nitrogen N2 is not readily available for use by the algae;nitrate (NO –

3 ) and ammonium (NH+4 ) are the more readily available. By

depriving microalgae of nitrogen, lipid production significantly increasesat the cost of a lower overall growth rate [27, p.373].

P Phosphorous plays several roles in microalgae as a constituent of phospho-lipids (for cell membranes) and adenosine triphosphate (to carry energyfor cell functions), among other functions. The phosphate ion, PO – 3

4 , isperhaps the most bioavailable form of phosphorous, as phosphorous boundto metal ions are not as easily accessed [27, p.373].

2 Methodology

To evaluate the economic feasibility of adding an algae process to the exist-ing wastewater treatment plant (WWTP) at Ballen, we conduct a sensitivityanalysis to determine the internal rate of return and net present value for thisprocess in various scenarios. We also consider the legal and social ramificationsof adding an algae process at Ballen.

2.1 Plant setup

Our algae production system (Figure 2) modifies the Ballen wastewater treat-ment plant to include a seasonal biological treatment via raceway ponds andto receive flue gas from the biomass power plant in Ballen. We choose to growthe algae in a raceway pond, which we hope the low initial costs relative tophotobioreactors and enclosed systems (figure 3).

8

Figure 3: Raceway pond, from [33]

The area of the production facility is 10839 m2. This is approximately 1.08hectares. The volume of the production pond is 2709 m3, and the depth of thepond is 25 cm. Paddle wheels mix the pond for optimal light exposure and gasexchange; the pond has a retention time of 6 days for adequate nitrogen andphosphorous removal. The cost for a paddle wheel is predicted to be about$5,000 per hectare of algae production, based on a survey of different existingalgae production systems [27]. The aeration system utilizes disk aerators todiffuse air into the ponds. The carbon dioxide aeration equipment costs varygreatly, but we assume the cost of $10,000 per hectare of algae pond givenby current literature [27]. The harvesting system, which harvests algae at arate equal to their biomass yield rate, combines flocculation with subsequentcentrifuging. The flocculation process makes the negatively charged microalgaelose their charge and cluster together [10]. We perform minimal centrifugationafterwards to increase the solid contents in the final product. The estimated costfor this process is $10-$20 per ton [27]. A sensitivity analysis on the differentcosts associated with a pure centrifuging system are analyzed in section 3.2.

The wastewater treatment plant provides the algae ponds with partiallytreated wastewater. The algae extract nutrients from the wastewater (see sec-tion 1.4.3); we assume that the wastewater provides a bounty of nutrients, does

9

not chemically inhibit the growth of microalgae with heavy metals or syntheticcontaminants, and does not introduce predatory species that might reduce ourbiomass yields. The biomass power plant in Samso provides the algae produc-tion plant with flue gas via an underground pipeline to mitigate CO2 emissionsand sponsor microalgae growth; we assume that gases besides CO2 (such asNOx) do not hinder microalgae growth. After harvest, the WWTP sells thealgae to the planned biorefinery on Samso. We also assume that our plant oper-ates in the months from April to October following the example of the ALPHAmodel [20, p.159] to avoid freezing of the ponds.

2.2 Determination of revenue

We determine an acceptable algae sales price (Z, in dollars per metric ton) byassuming an equal market value for crude oil, biogas, and biodiesel (from [33,p. 9]):

Z =X [q (1 − w)Ebiogas + ywEbiodiesel]

Epetroleum

where

X ≡ price per barrel of crude petroleum$

bbl

Epetroleum ≡ energy per barrel of petroleum,MJ

bbl

q ≡ biogas volume produced by anaerobic digestion of residual biomass,400m3

Mg

w ≡ lipid content of biomass in percentage dry weight,Mg lipid dry matter

Mg Algal dry matter

Ebiogas ≡ average energy content of biogas, 23.4MJ

m3[11, p. 127]

y ≡ yield of biodiesel from algal oil, 80% by dry weight

(Mg biodiesel

Mg lipids

)Ebiodiesel ≡ average energy content of biodiesel, 37800

MJ

Mg biodiesel

With the temperature and radiation data from Table 1, we can approximatethe total theoretical biomass yield from available PAR (as discussed in section1.4.1) and the appropriate temperature correction factor (as discussed in section1.4.2). We approximate the amount of biomass generated by multiplying thetwo results together, by month. Before the sensitivity analysis, we assume thatthe lipid content is %20 by dry weight. The results are shown in section 3.1

10

2.3 Production Cost assumptions

2.3.1 Cash Flow assumptions

• General Inflation Rate provided by Danmarks Nationalbank: 2.3% [1]

• Interest Rate on 10-year business Loan provided by Danmarks National-bank: 4% [1]

• MARR’ is standard for a SP 500 company at 12% [31]

• Corporate Tax Rate: 30% [3]

• Annual Matienance Costs: 10% of intial cost of equipment

• Replacement of damaged parts: 5% of intial cost of equipment

• Working Capital: 4% of intial cost of equipment

• Oil Inflation Rate: 1.5% higher than general inflation rate

• Electrical Inflation Rate: same as general inflation rate

• Carbon Dioxide Inflation Rate: 1% higher than general inflation rate

• Electricity Price: $0.16 per kWh Industrial Electricity Price for Denmark[2]

2.3.2 Electricity Demand in Power Plant

The electricity demand in the power plant is based on data about small powerplants from a survery of United States plants [19]. The study predicts a powerconsumption of 0.591 kWh per cubic meter of water treated.

2.3.3 Reduction in Electricity Demand Approximation

The improvement in water quality, explained in section 3.6, will decrease thecosts related to biological treatment. Biological treatment consumes up to 40%of electricity in a standard sludge activated wastewater treatment plant [12].Our model assumes that the improvements in water quality will reduce theelectiricty demand of the biological treatment process by thirty percent. Thisis a rough assumption because the electrical savings will differ from process toprocess. Savings could also come from designing the systems to treat cleanerwater from the algae production system. Further study is necessary to quantifythe actual savings from water quality improvements over the eight month periodof algae growth.

11

2.3.4 Land

The cost for land, according to Professor Morton Blarke, in Denmark is approx-imatley 150,000 kr. per hectare. Our model assumes that the algae productionprocess will utilize the land at the Ballen Wastewater Treatment Plant. Wewill not take into account any additional land needed to implement the algaeproduction system in our economic model.

2.3.5 Carbon Dioxide

Our model assumes that the Ballen Wastewater treatment plant will be paid toutilize carbon dioxide from the biomass plant on Samsø. This assumes that thecost for collecting and storing the carbon dioxide is not included in the economicanalysis. The equipment necessary to deliver the carbon dioxide into the systemis purchased as part of the intial investments. Details about the carbon dioxidedelivery system are outlined in section 2.1.

2.3.6 Price of Carbon Dioxide

There will be a sensitivity analysis on the price of CO2 in section 3.4. The priceof carbon dioxide in the initial model is assumed to be $7 per ton. This is theresidential household tax per ton of carbon dioxide in Denmark [29].

3 Results

Initial model results yield a net present value (NPV) of $6,389. The internal rateof return (IRR) based on cash flows before taxes for investors is 10.47%. Thisindicates that investment into the algae system is favorable. Information on theinputs of the model, as well as annual cash flows, can be found in Appendix ??.

3.1 Biomass Yields

Figure 4 shows the estimated monthly biomass yield rates. The yearly averageis 9.5 grams per square meter per day, whereas the seasonal average (from Aprilto October, inclusive) is 15.3 grams per square meter per day. This sums up toa yearly production of

3.2 Centrifuge

The cost of harvesting equipment is the first variable that will be analyzed. Thecurrent system set up is detailed in section 2.1. Four alternatives are presentedin this section regarding the price of centrifuging. The second section of thisanalysis will determine the maximum price per ton of algae that this systemcan pay for a centrifuge and still make a profit.

12

Figure 4: Monthly biomass yields. Note the reducing effect of temperature onthe biomass yield rate, especially in the winter months.

0

5

10

15

20

25

30

35

40

45

Janu

ary

Febr

uary

March

April

MayJu

ne July

Augu

st

Sept

embe

r

Octob

er

Novem

ber

Decem

ber

Month

Bio

mass

Yie

ld (

g/

m^

2*

d)

Allowable by given sunlight and groundtemperaturesBy available sunlight (PAR)

3.2.1 Centrifuge Models

The first alternative is the utilization of the centrifuge system outlined in [16].The system used to collect high-value algae for the production of 96% pureEPA. EPA is one of the oils in omega-3, so the chemical composition of algaemust not be modified greatly during production or harvesting [21]. The costsof installing the harvesting and centerfuge system at this plant costs $9461.75per ton of algae [16]. The second alternative involves installing the WestfaliaDA200 Clarifier Centrifuge with Nozzle Discharge. The quoted price of a usedmodel from Perry Process Equipment Ltd. is $215,648.10 (171,000 euros). Thispiece of equipment is one of the top products on the market. The third andfourth alternatives use the approximations from [27] for the cost of a collectionsystem that relies on just centrifuging to collect algae. The range of costs forthis system is between $1500-$1000 per ton of algae production. Table 2 showsthe NPV from all of the alternatives. Since all alternatives resulted in negativeNPV, the IRR does not exist.

The results from Table 2 indicate that a collection system that uses justcentrifuging will result in a loss for investors. The “Westfalia DA200 Centrifugewithout electricity costs” alternative shows collecting the algae and then only

13

Table 2: Centrifuge systems and Net Present ValueSystem NPVHigh value EPA oil recovery $-406833Westfalia DA200 Centrifuge $-222,556Westfalia DA200 Centrifuge without electricity Costs $-212,269$1500 per ton Algae System $-43,228$1000 per ton Algae Harvesting $-20,463

centrifuging when the electricity is cheapest did not offset the high initial costsof purchasing the centrifuge system.

3.2.2 Determining Maximum for Centrifuge System

This section will determine the maximum price per ton that investors can payfor a centrifuge-only system. Figure 5 belows shows the relationship betweenthe IRR and the cost of centrifuge systems.

Figure 5: Internal rate of return for various centrifuging costs.

The maximum initial investment into a centrifuge system for investors is$27,720. The cost per ton of algae for centrifuging at that total price is $645.

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3.3 Oil

The predicted price of algae for biodiesel for this model is based on three vari-ables, algae yield, price of oil per barrel, and lipid content. This section willillustrate the changes in IRR and NPV of the system if oil prices change overtime. It is difficult to predict the inflation rate of oil. Figure 6 shows the averagespot market price of oil per year over a twenty-four year period.

Figure 6: Spot oil prices.[4]

The model predicts that oil prices per barrel will increase at a rate higherthan inflation. In Figure 7 the 0% value assumes that oil prices will increaseonly at the general inflation rate (2.3%) of Denmark. Figure 8 compares theinternal rate of return with the price of oil.

3.4 Carbon Dioxide

One major assumption for the model is that the government credit for carbondioxide is $7 per ton sequestered. Another assumption is that the price of carbondioxide will increase at a rate 1% higher than inflation. Table 3 displays theNPV and IRR of the algae production system at different credits given by thegovernment per ton of sequestered carbon dioxide. The values in column 1 of

Table 3: Value of Carbon Credits and the Resulting Net Present Value andInternal Rate of Return

Credit ($ per ton CO2) NPV IRR7 $16,190 18.34%0 $-4,656 -18 $49,434 39.83%5.07 (4 euros) $10,929 14.27%38.04 (30 euros) $109,114 72.77%

Table 3 were selected carefully to corellate with real world carbon tax codes andpropositions. The price of $7 is approximatley the current carbon tax on Danish

15

Figure 7: The change of rate of return with oil inflation.

businesses set up in 1992. The price of $18 is the carbon tax on residences perton of CO2 emitted. (Morris, 1994) On June 22, 2010 the European Commissiondebated the subject of a carbon tax. The price range was between 4-30 euros[26]. Rows six and seven analyze the effects that the highest and lowest carbontax discussed by the EU [26].

3.5 Algae Lipid Content

The lipid content is one of the main factors that determines the price of thealgae. The effect of changing the lipid content on the price of algae, the IRR,and the NPV are shown in table 4. The data in table 4 shows that the IRR and

Table 4: % Lipid Content (dry weight) and its effect on NPV and IRR. Comparethe changes in IRR with those in Table 3.

Lipid Content (percentage) ”Price of Algae ($ per ton)” IRR (%) NPV ($)20 161.46 10.47 6389.0710 136.55 6.53 2102.3625 173.91 12.31 8532.436 126.59 4.82 126.59

NPV are affected by a five to ten percent increase in algae lipid content.

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Figure 8: Rates of return for several constant oil prices.

3.6 Expected Water Quality Improvements

This section of the paper will attempt to predict the improvements in the waterquality at the Ballen WWTP based on multiple studies. It is not possible tomake accurate predictions about the improvements in the water quality withouttesting them in a specific reactor set up. However, data suggests that certainimportant indicators of overall water quality improve during the production ofalgae for biomass.

3.6.1 Biological Oxygen Demand

The Biological Oxygen Demand (BOD) is the amount of oxgen required tostabalize the organic matter in the water. The BOD is commonly used to deter-mine the efficency of treatment processes, and the size of wastewater treatmentfacilities [34]. It is important that treatment processes decrease the BOD forenviromental reasons. If water with a high BOD is discharged into a river, itcould consume all oxgen in the water killing living organisms including fish.The incorporation of algae production into the wastewater treatment processdecreases the BOD in the wastewater [32] [22] [17]. Table 5 below displays theimprovements in the BOD of the wastewater from Park and Cragg’s experiment[32]. Their experiment used raceway ponds similar to the one outlined in section2.1.

The effects of algae production on the wastewater at Ballen should be withina similar range as [32]. The data in table (predicted results) shows the average

17

Table 5: Improvements in BOD from [32]BOD Initial (mg/L) BOD Final (mg/L) Removal (%)257.7 14.4 94.4

reduction in BOD that could occur during month algae production.

3.6.2 Chemical Oxygen Demand

The Chemical Oxygen Demand (COD) determines the organic content of wastew-ater. [34]. Research indicates that algae production is not an effective way toremove the COD of wastewater. Figure 9 shows the COD of wastewater in analgae pond remains constant over 72 hours [22].

Figure 9: COD, from [32]

The COD of water in an algae production system can decrease if heterobac-teria and nitrifying bacteria grow next to the algae. The data in [22] shows thatthe COD in the wastewater decreased by 32% after 13 days.

The algae production process at the Ballen wastewater treatment is notexpected to result in reduction in COD of the wastewater.

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3.6.3 Total Nitrogen

The Total Nitrogen (TN) is the sum of organic, ammonia and nitrate concen-tration in wastewater. The TN removal in wastewater is important because itprevents enviromental damage, especially eutrification. As detailed in section1.4.3, nitrogen is one of the most important nutrients necessary for algae growth.

The algae production process is an effective way to decrease the TN inwastewater [22] [17]. Figure 10 shows the TN concentration in wastewater overa 72 hour period during algae production. There is a linear decrease in the Total

Figure 10: Reduction in total N, from [32]

Nitrogen concentration from 11.7 to 6.1 mg per Liter. The algae only consumeNitrogen during photosynthesis. The reduction of 5.4 mg per Liter of the TNconcentration corresponds to the redution of Ammonia Nitrate. The overallresults of He, S, & Xue, G., state that over the average TN removal of the algaeproduction system is 36% [22]. The final TN concentration of the effluent wasalways below 15 mg per Liter.

One main factor that could determine the removal rate of TN is the rela-tively constant pH maintained throughout the algae production process. Theconditions given by Martinez et al. removed the TN by 76% at a water temper-

19

ature of 25◦C [17]. However, the pH of the system was not constant throughoutthe process. The utilization of ammonia decreased the pH of the system. At thesame time, the utilization of hydro-carbonic acid by algae as a source of carbondioxide increased the pH.

3.6.4 Total Phosphorous

Total Phosphorous (TP) is the concentration of the Total Phosphorus in wastew-ater. Section 1.4.3 states that phosphate is an important nutrient for algaeproduction. Algae production effectivley removes phosphorous from wastewa-ter [17] [22]. Figure 9 shows the removal of TP from wastewater through algaeproduction over a 72 hour period. The results from He, S, & Xue, G., statethat the discharge water from the algae production system always had a TPconcentration less than 0.5 mg/L [22]. Multiple studies suggest that the max-imum removal of phosphorous from wastewater is about 51% [9]. The resultsfrom He, S, & Xue, G., and Martinez et. al suggest that complete removal ofphosphorous over a retention time period between 72-118 hours [22] [17].

For the purposes of this study, the reduction of TP in the wastewater willfollow the accepted value of 51% [9]. However, algae production could result ina much higher reduction in TP.

3.6.5 Total Suspended Solids and Volatile Suspended Solids

Total suspended solids (TSS) are dissolved solids in wastewater. The TSS willnot be removed using conventional gravity settling processes. The volatile sus-pended solids (VSS) will burn away at 550◦C. Therefore, they are considered tobe mostly organic material. TSS and VSS can be removed through filtration[34].

The production of algae increases the amount of TSS and VSS present inwastewater. Table 6 displays results from Park & Craggs [32].

Table 6: Reactor 4-day Retention Time with CO2 addition [32]Influent (mg/L) Effluent (mg/L) Reduction (%)

Total Suspended Solids (TSS) 79 175.2 -121.8Volatile Suspended Solids (VSS) 76 156.1 -105.4Percentage of VSS 96 89 7

The percentage of VSS in the influent and effluent water is important. Thesimilar percentages of VSS in the influent and effluent water show that themajority of the new solids in the effluent water are organic.

3.6.6 Predicted Results

Table 7 below shows the predicted removal of BOD, TN, and TP by the algaeproduction system. Table 7 also predicts the increase in the TSS as a resultof algae production. The time period needed to remove achieve the predicted

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Table 7: Predicted removal of BOD, TN, and TP by the algae production systemIntial Concentration (mg/L) Concentration after algae (mg/L) Reduction (%)

BOD - - 90-95COD 75 75 0TN 8 5.12-1.92 36-76TP 1.5 0.74 51TSS - - -121.8VSS - - -105.4

removal rates is between 72-118 hours (which is less than the 6 day retentiontime of the pond of this analysis).

3.6.7 Other Areas of Reduction

There are many other areas of water quality which algae affect. The potentialof algae to remove heavy metals in both industrial and municipal waste is welldocumented. As detailed in section 2.1, one of the main assumptions about theinfluent into the Ballen Treatment plant is that there is a low concentrationof heavy metals. Therefore, the removal of heavy metals is not discussed indetail. Algae production also has the potential to remove pathogens. Predictingthe rate of pathogen removal would require actual samples from the BallenWastewater Treatment plant.

4 Discussion

This section of the paper discusses the technical, economical, and social benefitsand challenges associated with algae production using wastewater. It reviewsand analyzes data presented in other sections and makes policy recommenda-tions.

4.1 Economic Harvesting System

The price of harvesting equipment, CO2 equipment, and mixing equipment mustdecrease to implement projects for low-cost algae production. The electrical ef-ficiency of equipment must also increase if algae production will compete withoil and agricultural crops as a fuel source. The results of the model and thesensitivity analysis conducted in section 3.2 show that equipment costs greatlyimpact the feasibility of producing algae. The centrifuge sensitivity analysisshows that it is impossible to implement such technology on a small scale. In-dustrial centrifuges, such as the Westfalia DA200 Centrifuge, harvest algae atefficiencies greater than 95%. However, the cost of these systems, as seen intable 2, make the implementation of technology for the production of fuels tooexpensive. The Westfalia DA200 Centrifuge system analyzed in this paper wasalso refurbished. The alternative scenario, Westfalia DA200 Centrifuge without

21

electricity Costs, did not result in a positive NPV. This alternative assumed thatthe centrifuge would operate only during times when wind power was abundantin the market. Therefore, the cost of electricity would be almost free. De-spite the high consumption of electricity required by the centrifuge process, thealternative resulted in a negative NPV.

4.2 Photobioreactors

Photobioreactor technology has the potential to make algae production moreeconomically competitive in a country such as Denmark. The photobioreactorscan produce algae at a much faster rate than open ponds because the algaeis grown in enclosed, well-monitored tubes (or other kinds of pipe). Photo-bioreactors maintain a constant temperature and operate year around in anyclimate condition. The reactors can use the sunlight as a source of free energyto grow the algae during the day. The high initial costs and energy demandsof current reactor technology make algae production from wastewater a riskyinvestment today. The following set of conditions would make photo-bioreactorsa viable option for algae production with wastewater treatment.

• Utilize the wastewater from the treatment plant at a high flow rate whilelimiting the amount of TSS from algae production

• Use an external heat source to maintain a constant temperature

• Maximize the use of inexpensive electricity from the grid during peak windpower production

The development of bioreactors that meet these conditions could make the pro-duction of algae at the Ballen WWTP. These types of bioreactors utilize therenewable energy available in the Danish grid to compensate for environmentalconditions.

4.3 Carbon Dioxide

4.3.1 Technical

The main technical benefit from the use of flue gas in algae production is in-creased algae yield. However, there are many problems pertaining to the use offlu gas. It is necessary to analyze the effects of various types of flu gas on differ-ent algae species. One of the main assumptions in this model is that flu gas willincrease the yield of algae and never inhibit growth, one worth reconsidering.

Carbon dioxide is a much more difficult gas to diffuse through water thanoxygen. However, current techniques for transferring carbon dioxide into waterare similar to the way oxygen is transferred into tanks during activated sludgewastewater treatment. Improvement in the technology to transfer carbon diox-ide to algae is necessary to improve algae absorption.

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4.3.2 Economic

The sensitivity analysis on the price of carbon dioxide in section 3.4 showsthat carbon dioxide market prices heavily dictate the IRR and NPV of thesystem. Potential profits increase and decrease greatly depending on the priceof CO2 (table 3). It is important to capitalize on the emerging market forcarbon dioxide because this production process has the potential to sequestersignificant amounts.

Studies have shown that the mass of carbon dioxide sequestered by ChlorellaSp., a representative species for our plant with a 20 % lipid content in ideal con-ditions, is between 10-50% of the CO2 per ton of algae bubbled into the water.Thus, we quickly obtain a return for every ton of algae produced from carbonmitigation. According to Peter Kinch, the head of Climate Centre at NordjyskElhandel, the algae production system would be eligible to receive a carboncredit for each ton of carbon dioxide sequestered by algae. The wastewatertreatment plant would only receive credits for carbon dioxide sequestered byalgae. It would not be penalized for carbon dioxide that escaped in the air.

The sequestration of carbon dioxide is more profitable than the productionof algae when the price of carbon dioxide per ton is between $19-20. If theabsorption rate of algae increases from 50% to 60%, the IRR increases fromthe baseline prediction of 10.4% to 12.2%. These predictions indicate there is alot of economic motivation to optimize the carbon dioxide delivery system andincrease absorption of carbon dioxide for algae.

The production of large amounts of low-cost algae to obtain carbon dioxidecredits is possible. Harvesting before algae reach full growth would result inmore mass per year, but algae with a lower average lipid content. This wouldmaximize the amount of carbon dioxide sequestered during the production pro-cess.

The Ballen wastewater treatment plant would need to identify a producerof biodiesel that can accept different amounts and qualities of algae during theeight month harvesting period. The producer would need to facilitate algae withdifferent lipid contents. One positive aspect about the production of biodieselis that it utilizes a blend of different raw materials.

4.4 Oil Prices and Inflation Rate

The sensitivity analysis in section 3.3 show the IRR and NPV of the algaeproduction system relies on crude oil prices (as the foundation of our revenuemodel). The data in figure 8 show the relationship between oil prices and IRR.Figure 7 show the relationship between the oil inflation rate and the IRR.

Higher oil prices and algae with higher lipid content results in much higherprofits. If oil prices decrease significantly over the next ten years, high qualitybiomass could be utilized for other purposes, such as plastics or pharmaceuticals.One problem with trying to produce high quality algae from this system is thatthe input of nutrients and carbon dioxide are unpredictable.

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4.5 Water Quality

The predictions displayed in Table 7 are very rough estimates meant to em-phasize the potential of algae production to improve the quality of wastewater.The high removal rates of TN and TP decrease the possibility of eutrophicationin the discharge water. The increase in the water quality due to algae produc-tion helps meet regulation outlined in section at a cheaper price. The watercan be reused in non-potable ways. If the groundwater supply in Samsø is atrisk, the water can be pumped into the ground, where it would slowly mix withgroundwater.

4.6 Regulations

The Council Directive of 21 May 1991 concerning urban waste water treatmentconstitutes the framework for the procession of domestic and industrial wastew-ater as well as run-off rain water. Its main focus is to protect the waters inthe EU member states through appropriate collection, treatment and dischargeof urban waste water. Based on the Council Directive EU member states haveenacted national laws.

The design of the WWTP has to guarantee representative samples to betaken of incoming and effluent water before being transferred to receiving waters.Moreover the effect on the receiving waters shall be limited by elaborating thebest point of discharging the water. Annex 1 prescribes the number of annualsamples based on the treatment plant size.

The Directive sets the limit for TSS concentration in the samples at 35 mg/lfor a p.e. of 10.000. The minimum percentage of reduction is 90%. Systemswith a load equivalent to 2000-10000 p.e. are allowed to have a concentration of60 mg/l TSS. Under these circumstances, the minimum reduction is 70%. Thealgae production system at Ballen does not help the treatment process meetthese regulations because it increases the TSS.

The required BOD in discharge water cannot exceed 25 mg/l. The reductionof BOD by the treatment process must be at least 70 to 90%. The predictionin table 7 states a BOD reduction of 90-95% is possible. The algae productionsystem helps meet the BOD reduction requirement mandated by the Councildirective. The concentration limit of COD is at 125 mg/l and the minimumreduction is 75%. Based on the results in table 7, the implementation of algaein the WWTP in Ballen will not significantly change the COD. The initialconcentration of phosphorous in Ballen is 1.5 mg/l. With algae production, theTP concentration could improve by 51% to 0.74 mg/l. This reduction fulfillsthe 2mg/l concentration required by the law. The directive requires an 80%reduction in initial TP concentration. Therefore it is inconclusive whether algaeproduction fully meets regulations. A TN change from 8 mg/l to 5.12-1.92mg/lis predicted through implementation of algae production. The maximum TNallowed by law is 15 mg/l. The required reduction of TN concentration inincoming water is 70-80%. The predicted TN concentration reduction throughalgae production is 36-76%.

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4.7 Accuracy of Predictions and Assumptions

The generous assumptions made to calculate the biomass yield rate (per season)should be challenged by comparing the results with actual biomass yields in theregion of Samsø. Because they do not consider predation, invasive species,impacts of flue gas, daily fluctuations in temperature and light, and wastewatercomposition, we wish to include these factors in future work.

Actual experiments must be carried out utilizing the Ballen WastewaterTreatment influent over the period of many months to obtain meaningful results.The composition of the wastewater, amount of sunlight, temperature (bothwater and general), and hydraulic retention time are some of the factors thatwould greatly affect the results at Ballen.

The actual removal of BOD depends on multiple factors including the initialBOD and growth rate of algae. The removal rate of TP and TN only occurs dur-ing photosynthesis. Therefore, weather patterns over the eight month growingperiod in Denmark would affect the results displayed in table 7 greatly.

One of the main assumptions in this paper is that the wastewater wouldprovide the algae with high amounts of nutrients, while never inhibiting pro-duction. A constant pH can be maintained in the wastewater using carbondioxide. Although certain studies have shown that treating raw wastewater ispossible with algae, these studies have not tried to grow algae as a product.

This project did not investigate the effects pathogens, pharmaceuticals, anti-microbial resistant bacteria, hospital effluent, and industrial wastewater couldhave on algae production. Furthermore, we did not investigate the possibilitythat storm run-off during the Denmark spring months could contain pesticidesfrom fields or oil from automobiles.

4.8 Society and Policy

This section deals with challenges as gaining local support to bring the wastew-ater treatment project forward. Further the potential ways of raising capital isgoing to be described and a proposal for future actions concerning the integra-tion of algae for biodiesel is given.

4.8.1 Policy Challenge: Local Support

In 1998 Samsø started to orientate its citizens about the concept of a 100%renewable island. It was very important to win sympathy of the local peoplefor this project. To give them a sense of community local contractors andelectricians were hired for foundation and installation work and umpteen publicmeeting were held. The intense effort obviously was worth it because manyrenewable energy units are nowadays directly financed by Samsøs inhabitants.They sensed it as a way to boost the business and wanted so support it actively.The eleven 1 MW installed wind turbines are today owned by individual personsand a windmill cooperative.

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4.8.2 Social Challenge: Raising Capital

If people shall invest in the WWTP they have to be well-informed about theongoing processes. Providing participation options might pave the way for thedevelopment of a cooperative. In Ballen-Brundby for example the district heat-ing plant is owned and controlled by the consumers connected to the network.In this case Special Purpose companies distribute the annual income withouttaxes and minus the operating costs to the stakeholders [24]. Previous projectson the construction of wind turbines raised money from feed-in tariffs, subsidiesand municipal ownership. A feed-in tariff would charge the citizens of Samso anextra price on their water bill and would use these funds to develop the algaeproject at the WTTP. This option for raising capital is the least popular optionin terms of public support. The chance to receive a subsidy from the govern-ment is high due to its previous support in wind turbine and the willingness tosubsidize the planned new biogas plant. Another finance scheme is municipalownership. It is the best way to secure steady funding and promote the prod-uct. Shares of the production system for algae and biodiesel could be auctionedoff publically. The municipality already bought five offshore wind turbines byborrowing 125 million DKK (17 mill EUR). A share of the turbine is owned byeach citizen. In case profit can be generated the money has to be paid backinto projects concerning energy instead of being used for operational tasks ofthe municipality [24].

4.8.3 Setting New Goals for the Biores Project

The biores project, which was written in cooperation of six European islands,focuses on the production of biogas from municipal waste. The goal is to reducelandfill waste, while simultaneously create energy for district heating.

According to the Samsø Report, Samsø has the capacity to produce enoughbiodiesel for the islands energy demand of 500 TJ per year. Denmark hasthe ideal climate conditions and highly skilled farmers to produce high yields ofrapeseed oil. In 2003 the local production of rapeseed started as a demonstrationproject. Its purpose was to submit tractors with oil and provide rapeseed feedfor animals. Today rapeseed is used in the tractor and car of only two farmers.The project failed partially because biodiesel was not considered a renewablefuel. Therefore, the high national tax on gasoline applied to the biodiesel [25].

The new goals for the Biores project should be to expanded and incorpo-rated production of biodiesel from the islands raw materials including algae andrapeseed oil. The government must grant the island of Samso an exemption onthe fuel price tax for biodiesel. The production of biodiesel is a sustainable pro-cess that improves wastewater quality, and sequesters carbon dioxide. Furtherbiodiesel does not contain sulphur, which creates S02 and leads to acid rain. Incomparison with conventional diesel biodiesel sets fewer solid particles free [28].

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5 Conclusion

In conclusion, our predicted algae production process, coupled with a WWTPand a power plant supplying flue gas, could cover its costs with a 10.47% rateof return. We emphasize the sustainability of the production process over itspotential to produce biodiesel: carbon mitigation from flue gas and the functionof wastewater treatment may far outweigh revenues from biodiesel and biogasproduction.

However, the assumptions made to determine the theoretical biomass yields(15grams per square meter per day, over the summer season) should be com-pared to existing data in the region of Denmark and modified to account forchemical and environmental factors beyond light and temperature. The eco-nomic model should also be updated to actual algae sales prices, not theoreticalprices based on a break-even price with crude oil.

To make this open pond system truly feasible, reductions in equipment costs,particularly those of harvesting equipment, must be realized. Increases in theprice of oil and carbon taxes will help the development of this technology, asthe limited (though locally benficial) biodiesel production for the community ofSamsø will not cover the costs of production over an extended period of time,factoring in problems such as land costs and equipment failures. Hopefullyinteraction with the proposed biorefinery will make this plan feasible in thenear future.

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[22] Shengbing He and Gang Xue. Algal-based immobilization process to treatthe effluent from a secondary wastewater treatment plant (wwtp). Journalof Hazardous Materials, 178:895–899, 2010.

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A Biomass yields

The biomass yield calculations produce the following monthly table.

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Table 8: Biomass yields, calculated by the Arrhenius equation and potentialfrom solar radiation at Samsø

Month Biomass yield(grams per square meter per day)January 0.604344974February 1.391343399

March 3.252745308April 7.601075626May 16.16408718June 21.87170088July 26.26835674

August 21.66856419September 9.721507286October 3.485161852

November 1.095138788December 0.53622655

Yearly average 9.471687732Seasonal average 15.25435054

B Cash Flow and Inputs

The cash flows are saved in an Excel file. Snippets have been presented here.The following tables show the inputs to the cash flow as well.

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Table 9: Cash flow spreadsheet used in the economic analysis, page 1

PondsAlternative 1 Utiliziation of Existing Ponds

0 1 2 3 4 5 6Income StatementIncomeAlgae Sale $5,440 $5,620 $5,805 $5,997 $6,195 $6,399Electricity Saving $1,247 $1,276 $1,305 $1,335 $1,366 $1,397

Annual ExpensesMaintenance ($3,284) ($3,359) ($3,436) ($3,515) ($3,596) ($3,679)Replacement of Damaged Parts ($1,642) ($1,680) ($1,718) ($1,758) ($1,798) ($1,839)Electricity Carbon dioxide ($141) ($144) ($148) ($151) ($155) ($158)Electricity Harvesting ($289) ($295) ($302) ($309) ($316) ($323)Electricity Mixing ($86) ($88) ($90) ($92) ($95) ($97)

Carbon EmissionsCarbon Dioxide Sequestration $2,569 $2,653 $2,741 $2,832 $2,925 $3,021Carbon Dioxide Saving Electricity $68 $70 $72 $75 $77 $80

Depreciation ValuesCarbon Dioxide Pump ($2,710) ($2,710) ($2,710) ($2,710)Mixing Equipment ($1,355) ($1,355) ($1,355) ($1,355)Harvesting Equipment ($4,144) ($4,144) ($4,144) ($4,144)

Taxable Income ($4,326) ($4,156) ($3,980) ($3,796) $4,603 $4,801Income Tax $1,298 $1,247 $1,194 $1,139 ($1,381) ($1,440)

Net Income ($3,029) ($2,909) ($2,786) ($2,657) $3,222 $3,361

Cash Flow StatementOperating ActivitiesNet Income ($3,029) ($2,909) ($2,786) ($2,657) $3,222 $3,361Depreciation Values $8,209 $8,209 $8,209 $8,209

investing ActivitiesCarbon Dioxide Pump ($10,839)Mixing Equipment ($5,420)Harvesting Equipment ($16,576)Working Capital ($1,313) ($1,313) ($1,344) ($1,375) ($1,406) ($1,438) ($1,472)

$1,313 $1,344 $1,375 $1,406 $1,438Financing ActivitiesBorrowed Funds $32,835Repayment on Principal ($2,735) ($2,844) ($2,958) ($3,076) ($3,199) ($3,327)Payment for Intrest ($1,313) ($1,204) ($1,090) ($972) ($849) ($721)

ATCF ($1,313) ($181) $1,221 $1,344 $1,471 ($859) ($721)

Net Present Value $388

Page 1

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Table 10: Cash flow spreadsheet used in the economic analysis, page 2

Ponds

7 8 9 10

$6,611 $6,829 $7,054 $7,287$1,429 $1,462 $1,496 $1,530

($3,764) ($3,850) ($3,939) ($4,029)($1,882) ($1,925) ($1,969) ($2,015)

($162) ($166) ($169) ($173)($331) ($338) ($346) ($354)

($99) ($101) ($104) ($106)

$3,121 $3,224 $3,331 $3,440$82 $85 $88 $91

$5,006 $5,220 $5,441 $5,671($1,502) ($1,566) ($1,632) ($1,701)

$3,504 $3,654 $3,809 $3,970

$3,504 $3,654 $3,809 $3,970

($1,505) ($1,540) ($1,575)$1,472 $1,505 $1,540 $1,575

($3,460) ($3,599) ($3,743) ($3,893)($588) ($449) ($305) ($156)

($578) ($429) ($275) $1,497

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Table 11: Inputs to the cash flow analysis, page 1

Pond_inputs

InputsMarginal Tax Rate 30%Inflation rate 2.30%MARR 15%Interest Rate 4.00%MARR' 12%Electrical Inflation Rate 0.00%Oil Inflation Rate 1.00%Algae Inflation Rate 3.30%C02 Inflation Rate 1.00%

Wastewater Treatment PlantFlow Rate (Q) annual 164846 m^3/yearDays per year 365Flow Rate daiy 451.6328767 m^3/dayResidence time in Algae System 6 daysActivated Sludge Treatment Elec Demand 0.591 KwH/m^3Total Electriity Demand 97423.986 KwH

Biological Treatment ProcessElectricity Through Biological Treatment 38969.5944 KwHPerecetage of Electricity avoidied 0.3in Biological TreatmentElectricity Saved 7793.91888Cost electricity saved $1,247.03

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Table 12: Inputs to the cash flow analysis, page 2

Pond_inputs

ValueAlgae Pond Capacitypond Volume 2709.79726 m^3pond Area 10839.18904 m^2Hectres conversion 10000 m^2Hectres of algae growth 1.083918904 hectres

Algae Generation ratePetroleum Price per Barrel $72.76Energy Petroleum 6100Lipid content $0.06Biogas generation volume 400Energy Biogas 23.4Yield biodiesal from Algal Oil 0.8Energy Biodiesal 37800 mg/(L*day)

Price per ton Algae $126.59kg/m^3*day

Yield of AlgaeGrowth Rate 15.25 g/m^3

Algae Production without Carbon DioxideBiomass production 165.2976329 kg/day

Algae Production with Carbon DioxideAlgae Production with Carbon Dioxide 198.3571595 kg/dayIncreased productivity 0.2

Algae Generation Days per year 260 days

Algae Produced annual 42.97738455 tons

Annual Income Algae $5,440.42

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Table 13: Inputs to the cash flow analysis, page 3

Pond_inputs

Electricity Average

Electricity PricesAverage Price of Energy Denmark $0.16 cents per KwhPrice Non-peak demand 0 cents per Kwh

DemandsPaddle Wheel System per 1000 m3 1.23 KWH/m^3Harvesting per 1000 m^3 4.11E+000 KWH/m^3Carbon Dioxide demand per 1000 m^3 2.01 KWH/m^3Carbon Dioxide System 1323.546276 kwhPaddle Wheel System 809.9313031 kwhHarvesting per liter 2706.355818 kwh

Costs (annual)Paddle Wheel System (annual) $129.59Harvesting (annual) $433.02Carbon Dioxide System (annual) $211.77

Costs (8months of year)Paddle Wheel System (8months) $86.39Harvesting (8months) $288.68Carbon Dioxide System (8)mnths $141.18ration months collection per year 0.666666667Days operating per year 243

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Table 14: Inputs to the cash flow analysis, page 4

Pond_inputs

Equipment Costs (Installation)

Harvesting (combined Floculation and Centrefuging)Cost per hectre algae $14,500.00Additional Centrefuging Costs $20.00 per tonCost Installation $16,576.37

Carbon Dioxide PumpingCost System per hectre pond $10,000.00Cost of System $10,839.19

Mixing CostCosts of Paddle Wheel per hectre algae pond $5,000.00Cost of Paddle Wheel $5,419.59

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Table 15: Inputs to the cash flow analysis, page 5

Pond_inputs

Annual Costs Costs

Maintenance $3,283.52

Carbon Dioxide CreditsCost of Carbon Dioxide to Society Externalities $7.00 per ton

Carbon Dioxide emissions 0.00124 tons per KwHCarbon Dioxide Saved Costs $67.65

Carbon Dioxide Sequestered per ton algae 3.7 tonsCarbon Dioxide Sequestered 733.92149 tonsCarbon Dioxide Absorption Rate 50.00%Carbon Dioxide Sequestration Benefits $2,568.73

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