We’ve all heard about the potential — and huge benefits — of recovering waste heat from industrial processes. But for some reason this easy, quick payback approach to reducing energy consumption hasn’t taken off the way it should. It’s perplexing, really. We’re talking about free energy. An Ottawa-based company called Thermal Energy International announced this week it had entered into a heat-recovery agreement with a major North American paper company. The $20 million contract will see Thermal Energy install, own and operate its waste heat recovery system. It receives fixed payments over the life of the contract, which is more than paid for by the savings the paper company gets on its energy bill. The paper mill essentially puchases the recovered heat from Thermal Energy at a discount rate that will result in more than $40 million in total fuel oil savings over the life of the eight-year contract. It could be more as oil prices continue to rise. “This represents the first phase of a multisite agreement involving the deployment of Thermal Energy’s heat recovery technologies across five sites,” Thermal Energy said. “Initial estimates show the project would reduce fuel oil consumption by 105,000 barrels per year with commensurate annual emission reductions of 55,000 tons of CO2, and 625 tons of SO2 — equivalent to permanently removing more than 13,000 automobiles from the road,” said the company, adding that as oil prices continue to rise it’s seeing the scale of its projects get larger. No kidding.

It used to be that upfront capital is what prevented struggling industries from taking the plunge and doing energy-saving retrofits. But they no longer have this excuse, with companies such as Thermal Energy essentially paying for the system, installing it and earning the money and return on its investment back through the energy savings of the client. Of course, the father of recycled power and recycled heat is Thomas Casten, founder and chairman of Recycled Energy Development (and founder of previous similarly focused companies). I’ve met and spoken with Casten a few times and the man is passionate about this area, and at the same time frustrated that jurisdictions don’t do a better job of promoting and supporting the recycling of industrial energy that otherwise gets dumped out a flu stack. Read a great Q&A with Casten at Gristmill. Here’s one telling quote from Casten: “We have calculated that recycling industrial energy in large plants produces 72 times as much carbon reduction per dollar as a solar collector. Dollars will always be scarce. At the end of the day, what we need to do is get the maximum bang for the buck. So a dollar spent on recycling energy produces about 70 times as much C02 reduction as a dollar on solar, and about 15 times as much reduction as a dollar spent on a wind turbine.” Joe Romm over at Climate Progress has an excellent post on the potential of recycled energy, including combined heat and power (cogeneration) systems. It’s worth the read.

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