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182 WASTE HEAT AND EUROPEAN CLEAN ENERGY POLICIES treatment would distort the market to the detriment of operators located in rural areas with little demand for district heating or process heat, as they do not have a choice but to opt for energy recovery in the form of electricity generation. The table below provides an overview of allocation methods in relation to the production and consumption of waste gases. It should be noted that the producing and the consuming sub-installations can be part of the same industrial facility. Production / Recovery Consumption Type of consumption Outside system boundary of PBM consumption Product BM Inside system Product BM boundary of PBM Outside system Measurable PBM Heat Electricity Table no. 1: Allocation approaches for energy recovery and the consumption of that energy.141 While the use of the energy content of the off-gas (through combustion or heat recovery) is always eligible for free allocation, the consumption of the released energy for electricity production is not, though the consumption of the resulting heat for other purposes is. According to the relevant Heat and Fuel Benchmarks, installations not covered by a product benchmark which are consuming heat for a purpose other than electricity generation are allocated 62.3 allowances per TJ of thermal energy or 56.1 allowances per TJ of chemical energy consumed; this allocation is additional to the allocation made to the type (c) process emissions sub-installation. In the reference scenario of a 75/25 mix, this compensates roughly for the number of allowances not allocated as type (c) process emissions due to the deduction of energy-equivalent natural gas emissions and the 0.97 factor applying for all allocations made according to the process emissions approach.142 The result is full allocation for the combustion of waste gas for the generation of heat, in contrast to 91.14% allocation for waste heat/gas electricity. 5.2.1.2 The Inherent Carbon Price of Electricity However, the disparate levels of free allocation might be compensated by the inherent carbon price of electricity not paid due to the reduced intake of grid energy. As stated before, the generation and on-site consumption of electricity reduces the amount of allowances the operator has to pay for through the grid power price. Calculated on the Formula boundary of heat Non Measurable 141 DG CLIMA, Guidance Document 8 (2011) 18 (highlights added, captions modified). 142 Fuel Benchmark: 0.97 ∗ 10 ∗ 0.00177TJ/t ∗ (621.71 − 56.1 ∗ 0.667 + 56.1)t CO2/TJ = 0.9995. 10 11 Heat Benchmark: 0.97 ∗ 11 ∗ 0.00177TJ/t ∗ (621.71 − 56.1 ∗ 0.667 + 62.3)t CO2/TJ = 1.0092. Allocation for recovery Allocation for Formula Heat BM Formula Fuel BM Formula NonePDF Image | ELECTRICITY PRODUCTION FROM INDUSTRIAL WASTE HEAT
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