Decisions under uncertainty in municipal solid waste cogeneration investments

Athanasios J. Tolis, Athanasios Rentizelas, Konstantin Aravossis, Ilias Tatsiopoulos

Research output: Chapter in Book/Report/Conference proceedingChapter (peer-reviewed)

Abstract

The issue of Municipal Solid Waste (MSW) management is an ever increasing problem for all countries. Developed countries face the problem of dealing with very large amounts of MSW per capita, forcing them to develop new technologies and systems. On the other hand, countries with developing or transitional economies may generate lower amounts of MSW per capita, but the rate of increase is high and the current practices of MSW management are not as advanced as those of developed countries. Therefore, countries with developing or transitional economies may benefit from adopting MSW management technologies used by developed economies. One aspect of MSW management in developed economies is the energy recovery from MSW. The advantages of this type of technologies are mainly the significantly reduced waste volume for landfilling, the reduction of total greenhouse gas emissions, the potential for generating electricity or co-generation of electricity and heat. In this work, a comparative study of the most prominent co-generation technologies using MSW as a fuel source is presented, focusing on the evolution of their economical performance over time. An algorithm based on real-options has been applied for four technologies of MSW energy recovery: (1) incineration, (2) gasification, (3) landfill biogas exploitation using a pipeline system and (4) anaerobic digestion facilities. The financial contributors are identified and the impact of greenhouse gas trading is analysed in terms of financial yields, considering landfilling as the baseline scenario. The greenhouse gas trading system presents an opportunity for investing in environmentally friendly technologies for MSW energy recovery, through the Clean Development Mechanism (CDM), in most developing countries. The results of this work indicate an advantage of combined heat and power over solely electricity generation. The most attractive technology among the ones examined proves to be incineration, mainly due to its higher power production efficiency, lower investment costs and lower emission rates. Despite the fact that these characteristics may not drastically change over time, either immediate or irreversible investment decisions might be reconsidered under the current selling prices of heat, power and CO2 allowances.
LanguageEnglish
Title of host publicationWaste to energy
Subtitle of host publicationgreen energy and technology
EditorsAvraam Karagiannidis
Place of PublicationLondon
PublisherSpringer
Pages197-218
Number of pages22
ISBN (Print)9781447123057
DOIs
Publication statusPublished - 2011

Fingerprint

cogeneration
Municipal solid waste
municipal solid waste
Waste management
waste management
Greenhouse gases
transitional economy
greenhouse gas
Electricity
electricity generation
incineration
Recovery
decision
Uncertainty
combined heat and power
clean development mechanism
Incineration
Waste incineration
Anaerobic digestion
Biogas

Keywords

  • municipal solid waste
  • cogeneration investments

Cite this

Tolis, A. J., Rentizelas, A., Aravossis, K., & Tatsiopoulos, I. (2011). Decisions under uncertainty in municipal solid waste cogeneration investments. In A. Karagiannidis (Ed.), Waste to energy: green energy and technology (pp. 197-218). London: Springer. https://doi.org/10.1007/978-1-4471-2306-4_8
Tolis, Athanasios J. ; Rentizelas, Athanasios ; Aravossis, Konstantin ; Tatsiopoulos, Ilias. / Decisions under uncertainty in municipal solid waste cogeneration investments. Waste to energy: green energy and technology. editor / Avraam Karagiannidis. London : Springer, 2011. pp. 197-218
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Tolis, AJ, Rentizelas, A, Aravossis, K & Tatsiopoulos, I 2011, Decisions under uncertainty in municipal solid waste cogeneration investments. in A Karagiannidis (ed.), Waste to energy: green energy and technology. Springer, London, pp. 197-218. https://doi.org/10.1007/978-1-4471-2306-4_8

Decisions under uncertainty in municipal solid waste cogeneration investments. / Tolis, Athanasios J.; Rentizelas, Athanasios; Aravossis, Konstantin; Tatsiopoulos, Ilias.

Waste to energy: green energy and technology. ed. / Avraam Karagiannidis. London : Springer, 2011. p. 197-218.

Research output: Chapter in Book/Report/Conference proceedingChapter (peer-reviewed)

TY - CHAP

T1 - Decisions under uncertainty in municipal solid waste cogeneration investments

AU - Tolis, Athanasios J.

AU - Rentizelas, Athanasios

AU - Aravossis, Konstantin

AU - Tatsiopoulos, Ilias

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N2 - The issue of Municipal Solid Waste (MSW) management is an ever increasing problem for all countries. Developed countries face the problem of dealing with very large amounts of MSW per capita, forcing them to develop new technologies and systems. On the other hand, countries with developing or transitional economies may generate lower amounts of MSW per capita, but the rate of increase is high and the current practices of MSW management are not as advanced as those of developed countries. Therefore, countries with developing or transitional economies may benefit from adopting MSW management technologies used by developed economies. One aspect of MSW management in developed economies is the energy recovery from MSW. The advantages of this type of technologies are mainly the significantly reduced waste volume for landfilling, the reduction of total greenhouse gas emissions, the potential for generating electricity or co-generation of electricity and heat. In this work, a comparative study of the most prominent co-generation technologies using MSW as a fuel source is presented, focusing on the evolution of their economical performance over time. An algorithm based on real-options has been applied for four technologies of MSW energy recovery: (1) incineration, (2) gasification, (3) landfill biogas exploitation using a pipeline system and (4) anaerobic digestion facilities. The financial contributors are identified and the impact of greenhouse gas trading is analysed in terms of financial yields, considering landfilling as the baseline scenario. The greenhouse gas trading system presents an opportunity for investing in environmentally friendly technologies for MSW energy recovery, through the Clean Development Mechanism (CDM), in most developing countries. The results of this work indicate an advantage of combined heat and power over solely electricity generation. The most attractive technology among the ones examined proves to be incineration, mainly due to its higher power production efficiency, lower investment costs and lower emission rates. Despite the fact that these characteristics may not drastically change over time, either immediate or irreversible investment decisions might be reconsidered under the current selling prices of heat, power and CO2 allowances.

AB - The issue of Municipal Solid Waste (MSW) management is an ever increasing problem for all countries. Developed countries face the problem of dealing with very large amounts of MSW per capita, forcing them to develop new technologies and systems. On the other hand, countries with developing or transitional economies may generate lower amounts of MSW per capita, but the rate of increase is high and the current practices of MSW management are not as advanced as those of developed countries. Therefore, countries with developing or transitional economies may benefit from adopting MSW management technologies used by developed economies. One aspect of MSW management in developed economies is the energy recovery from MSW. The advantages of this type of technologies are mainly the significantly reduced waste volume for landfilling, the reduction of total greenhouse gas emissions, the potential for generating electricity or co-generation of electricity and heat. In this work, a comparative study of the most prominent co-generation technologies using MSW as a fuel source is presented, focusing on the evolution of their economical performance over time. An algorithm based on real-options has been applied for four technologies of MSW energy recovery: (1) incineration, (2) gasification, (3) landfill biogas exploitation using a pipeline system and (4) anaerobic digestion facilities. The financial contributors are identified and the impact of greenhouse gas trading is analysed in terms of financial yields, considering landfilling as the baseline scenario. The greenhouse gas trading system presents an opportunity for investing in environmentally friendly technologies for MSW energy recovery, through the Clean Development Mechanism (CDM), in most developing countries. The results of this work indicate an advantage of combined heat and power over solely electricity generation. The most attractive technology among the ones examined proves to be incineration, mainly due to its higher power production efficiency, lower investment costs and lower emission rates. Despite the fact that these characteristics may not drastically change over time, either immediate or irreversible investment decisions might be reconsidered under the current selling prices of heat, power and CO2 allowances.

KW - municipal solid waste

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DO - 10.1007/978-1-4471-2306-4_8

M3 - Chapter (peer-reviewed)

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A2 - Karagiannidis, Avraam

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ER -

Tolis AJ, Rentizelas A, Aravossis K, Tatsiopoulos I. Decisions under uncertainty in municipal solid waste cogeneration investments. In Karagiannidis A, editor, Waste to energy: green energy and technology. London: Springer. 2011. p. 197-218 https://doi.org/10.1007/978-1-4471-2306-4_8