All paper mills need access to natural gas. If your mill is located in a very rural part of the country or is located on geographically challenging terrane, you might still be burning heavy fuel oils, coal or even tires.
You are responsible for the mill and the surrounding community. Your facility must remain competitive, comply with ever stricter EPA air emissions regulations, and do its part to meet corporate’s “green goals.” We talked to one potential customer who said that she could fine tune her boiler to pass a CO2 test or fine tune it to pass a NOx or particulate test…..but not all at the same time. This situation causes a great deal of pressure on your staff. It is sort of like the Volkswagen dilemma. It will eventually need to be fixed.
If your mill is not yet on a gas pipeline, you may think that your only “fix” is paying millions of dollars per mile for a pipeline extension. The money is one thing but the environmental requirements, environmental activists, delays, and bad press caused by right-a-way purchases or eminent domain threats are just as bad.
How do you find the particular solution for your mill? There is a new option called the virtual pipeline. At least ten mills in the US are currently receiving trucked natural gas from a virtual pipeline.
A virtual pipeline is a fleet of tractor-trailers that delivers the same gas that traditionally comes from a pipeline. Virtual pipeline providers keep their trucks rolling so that the mill is provided with gas 24/7. The service does not require the mill to build storage as the gas is drawn out of the trailers directly into the power house at whatever temperature and pressure that is required. With between two and twenty 40 foot trailers unloading CNG all day long, the experience is like being on an old fashioned gas pipeline. Customers love it! Some find the added benefit of having the wood products that they also burn actually burn more efficiently with gas in the mix.
You do not need to convince corporate to fund a pipeline extension when no one knows how long your mill will be producing its current product lines or how long it will even stay operational. And your mill may do so well on natural gas that you will be a hero and get new equipment, put in a CHP system, or expand. A virtual pipeline can expand with you at no cost. The virtual pipeline service provider who had been delivering six loads a day for your process heat just brings ten loads a day after the expansion. No new capital requirement.
How exactly does this work? You work with your engineering team to convert the boilers, kilns, etc. to being dual-fuel. You can do it in stages if you like. The primary fuel source will be CNG and the backup may be fuel oil. The backup is needed when the virtual pipeline provider is curtailed at the transmission line, but the need for backup fuel would also exist if you were physically connected via a distribution line to the same transmission line that curtailed the virtual pipeline provider. Back up fuel is not bad, however, as it represents a good insurance policy in today’s erratic energy pricing world. Who knows when gas will be cheaper than fuel oil or vice versa? The service provider may occasionally have a problem with your delivery because of inclement weather or perhaps an automobile accident causing a delay. In this very infrequent scenario, the provider’s Operations Team will contact your operations people to discuss slowing down the mill, or switching briefly to your backup fuel. This does not happen often and in fact, it is usually the mill asking the virtual pipeline provider to slow down fuel deliveries due to equipment maintenance or malfunction.
While you are converting the equipment inside your mill, the virtual pipeline company is building a compressor station on the closest interstate transmission gas line, building decompression and heating equipment outside your power house, ordering new trailers, and hiring drivers. This all takes about twelve months. Most of the work outside your walls is paid for by the virtual pipeline company.
Besides the conversion, your expenses are opex expenses. You can purchase the commodity yourself or the virtual pipeline provider can purchase it for you. You pay them for transportation to your mill. The price is determined by many factors, but the most important factors are your distance from the proposed compression station, the length of contract with the virtual pipeline service provider, and the volume of gas purchased.
It is pretty simple. Connecting your facility to a natural gas virtual pipeline has many advantages. It is cheaper than paying for a pipeline extension, it requires much less maintenance than complex scrubbing equipment, and now that your facility is dual-fuel, it can act as a temporary solution while you wait for the pipeline, should it ever arrive. Additionally, natural gas is a much safer and environmentally friendly fossil fuel, and it can satisfy ever more stringent clean air regulations. Using a clean fuel produced in North America has the positive effect of reducing our dependence on foreign oil, and historically it has shown significant cost savings relative to other fossil fuels. Natural gas can now be the solution to a variety of problems facing mills that use dirty and expensive fuels.