A simulation-based method for evaluation of
energy system cooperation between pulp and
paper mills and a district heating system: A case
study
Alexander Hedlund, Anna-Karin Stengard, Olof Björkqvist

Abstract— A step towards reducing greenhouse gases and energy
consumption is to collaborate with the energy system between several
industries. This work is based on a case study on integration of pulp
and paper mills with a district heating system in Sundsvall, Sweden.
Present research shows that it is possible to make a significant
reduction in the electricity demand in the mechanical pulping process.
However, the profitability of the efficiency measures could be an issue,
as the excess steam recovered from the refiners decreases with the
electricity consumption. A consequence will be that the fuel demand
for steam production will increase. If the fuel price is similar to the
electricity price it would reduce the profit of such a project. If the paper
mill can be integrated with a district heating system, it is possible to
upgrade excess heat from a nearby kraft pulp mill to process steam via
the district heating system in order to avoid the additional fuel need.
The concept is investigated by using a simulation model describing
both the mass and energy balance as well as the operating margin.
Three scenarios were analyzed: reference, electricity reduction and
energy substitution. The simulation show that the total input to the
system is lowest in the Energy substitution scenario. Additionally, in
the Energy substitution scenario the steam from the incineration boiler
covers not only the steam shortage but also a part of the steam
produced using the biofuel boiler, the cooling tower connected to the
incineration boiler is no longer needed and the excess heat can cover
the whole district heating load during the whole year.
The study shows a substantial economic advantage if all
stakeholders act together as one system. However, costs and benefits
are unequally shared between the actors. This means that there is a
need for new business models in order to share the system costs and
benefits.
Keywords — Energy system, cooperation, simulation method,
excess heat, district heating.
I. INTRODUCTION
T
HERE is a global objective to reduce greenhouse gases and
hence reduce energy consumption as a step towards
sustainable development [1] [2].
In Sweden, the industry sector is responsible for 38% of the
total energy requirements. Even if the industries have invested
A. Hedlund is employed by FrontWay AB and is with Mid Sweden
University, Sundsvall, Sweden (corresponding author phone: +46 70 678 9389;
e-mail: [email protected]).
A-K. Stengard is employed by Sundsvall Energi AB and is with Mid Sweden
University,
Sundsvall,
Sweden
(e-mail:
[email protected]).
in energy efficiency technologies for more than 30 years, a
considerable amount of excess heat from industrial processes is
still wasted. This means there is more potential for significant
efficiency improvement.
The pulp and paper industry is responsible for 51% of the
energy consumption in the industry sector [3]; this area is
important to be able to achieve a significant reduction of energy
consumption and greenhouse gas emissions.
Using excess heat from the industry is a very efficient energy
solution for the future [2], and there are synergistic effects of
using excess heat in district heating systems [4]. Today only 8%
of the energy supply to district heating nets originates from
excess heat [3]. There is a large amount of untapped excess heat
potential that when recovered may reduce the global CO2
emissions (i.e., the climate impact) [5]. The solution to use
industrial excess heat in district heating is also more cost
efficient than traditional heating mode [6].
Another way to reduce energy consumption and the use of
primary energy is to use district heating in industry processes
[7]. Only 2% of the energy consumption in the industry sector
is coming from district heating [3]. The excess heat from one
industry and the aim to reduce primary energy at another is an
opportunity for cooperation. By using the district heating net a
wider energy system is created. To collaborate and evaluate an
energy system in a wider range than the energy system at one
plant should identify the advantages of a large-scale operation
and collaboration. District heating is an example of a working
large-scale operation where households and companies share
heat from a common source. This case study aims to evaluate if
this concept could be of interest for the industry as well.
Recent research shows that collaboration between industry
and district heating is economic and good for the environment
[4]. The question is why this solution is not frequently used.
Factors for how successful cooperation emerge between energy
companies and industries have been studied in [8] and [9].
Grönqvist and Sandberg show that while establishment of such
O. Björkqvist is with Mid Sweden University, Sundsvall, Sweden, (e-mail:
[email protected]).
Founding’s from KK-stiftelsen, FrontWay AB and Sundsvall Energi AB are
acknowledged by the authors.
Figure 1. The figure to the left shows the reference scenario, how it works today. The middle figure describes how it would look if the
project to reduce electricity consumption in the paper mill is successful. The figure to the right shows how it would look if steam can be
transported from the incineration boiler to the paper mill while reducing electricity consumption in the paper mill.
cooperation could be based on favorable techno-economic
factors, it is not enough. According to research, for cooperation
to take place what is needed is people with real ambition on
both sides. Thollander et al. argue that successful collaboration
rather depends on the individuals and organizations involved in
the relationship between the two parties than on the technology
used in the collaboration. Both Grönqvist and Sandberg and
Thollander et al. cover cooperation between two parties, but do
not discuss what happens when more than two industries and a
district heating company cooperate.
We believe that the initialization and negotiation process is
important for the parties to develop trust for each other. The
business model also has an important role for successful
cooperation. To assess whether such cooperation between
several parties would be profitable, a case study was set up in
the city of Sundsvall, Sweden.
The aim of the research project is to create a method for the
evaluation of an energy optimization project between different
parties. When the stakeholders use simulation to gain
knowledge of their own process, and to gain understanding of
the cooperating parties’ processes, it will be useful for the
pricing negotiation and agreements, as simulation is a way of
describing reality mathematically [10].
Another important aim is to find new areas where a district
heating net could be used, as well as to find new business
opportunities for the owner of the district heating net, in order
to make the municipality or region more energy efficient as a
whole.
A. The case study
The case study includes three parties, a district heating
supplier, a paper mill and a pulp mill.
Sundsvall Energi AB is the district heating public utility in
Sundsvall. The district heating company owns the district
heating net and is responsible for delivering heat to the
customers in the city. The company also has a commitment to
the municipality to separate collection of waste and use waste
as an energy source. The district heat production is partly based
on refuse/waste incineration. The fuel input in the incineration
boiler is evenly distributed over the year. During the summer,
part of the heat from the incineration boiler is removed in a
cooling tower as excess heat. During the winter, Sundsvall
Energi buys heat from the pulp and paper mills owned by SCA.
This heat is based on industrial excess heat and biofuel.
SCA is a global hygiene and forest product company with
three mills in the Sundsvall region. The SCA Östrand pulp mill
in Timrå municipality produces bleached softwood kraft pulp.
SCA is investing SEK 7.8 billion in the Östrand pulp mill for a
new plant, which is under construction and will be in operation
by October 2018. SCA Östrand will double its production
capacity from 430,000 tons to 900,000 tons per year with the
new plant. The project is called Helios. With Helios, Östrand
will increase the amount of excess heat to 1600 GWh. The
excess heat will partly be used in a condensing turbine, but also
discharged to a recipient.
The SCA Ortviken paper mill produces coated and uncoated
publication papers from mechanical pulp. In the mechanical
pulping process electricity is used in the refiners to separate
fibers from the wood chip. A spin-off from the refiner is
generated steam. The steam is recovered and used in the drying
process. Engstrand et al. [11] show that it is possible to make a
significant reduction in the electricity demand in the refiners.
However, the excess steam recovered from the refiners
decreases as the electricity consumption is decreased, resulting
in a shortage of steam in the paper mill.
The third SCA production unit in the region is the SCA
Tunadal saw mill. It is a large spruce saw mill using district
heating to dry wood. The waste material from the saw mill is
used as pulp wood in the Östrand pulp mill.
This study focuses on combining the pulp and paper mills
with a district heating system, i.e. a pulp mill with excess heat,
an incineration plant with excess heat, and a paper mill with a
shortage of heat. All parts have already been connected to the
district heating net, Figure 1. To investigate possible solutions
for a collaboration energy system the following questions have
been asked: 1. How can the excess heat from the pulp mill
replace the recovered steam loss at the paper mill? 2. How can
the district heating system be used to transfer the excess heat
from the pulp mill to the paper mill? 3. How big is the economic
potential of the cooperation energy system?
II. SIMULATION METHOD
The classical approach involves an analysis of the energy
loads of the structures in steady state, but when modeling this
case the technical system requires a material and energy balance
that also considers the system dynamics. System simulation
method is a common approach in this field [12].
A key factor for the decision to use simulation is its
versatility. The simulation model is built to illustrate the actual
processes with as high level of detail as needed for a result that
can be verified and compared with process data. This
simulation model was built in steps in order to make sure that
the modeling work had a good level of detail and corresponds
to reality from the beginning of the modelling work. First, a
steady-state simulation model was built describing summer and
winter cases. It was later developed into a dynamic simulation
model calculating one year of production/heat delivery with a
time resolution of hours. The characteristics of the district
heating load require a dynamic simulation model because of the
variations throughout the year, but a static simulation model
was created to see if the result was realistic before proceeding.
The model itself was created by iterations over time as a result
of feedback and analysis.
The model needs to be at adequate level of detail in order for
actors to adopt it. This way of working gives very precise
answers because the simulation model makes calculations as if
it was operating in reality over an extended period of time.
Simulation models are also very good at handling nonlinear
calculations, which are common. It is also easier to gain
acceptance with a model that resembles the real process.
When building this simulation model, the first part built was
the district heating net and its heat consumers. This provided
information about how to design the control and logics of the
simulation model. The heat consumers have a heat demand,
which is converted to an amount of hot water corresponding to
the demand. The hot water comes from the incineration boiler
which was built in the next step. It was constructed as a
hierarchical block, i.e. there is only one icon. Inside the icon
there is a small model describing the incineration boiler. Next,
the model was calibrated to match real production data from the
company. When the basics of the district heating and the
incineration boiler was running properly, the paper and pulp
mill were included in the simulation model. These parts were
also calibrated using production data from the mills, to make
the model resemble reality as closely as possible. A material
and energy balance was generated from the model. To be able
to quantify monetary potentials the income and input factors
were included in the simulation model, and connected to fuel
and electricity prices. All of this was summed up in a system as
total potential operating margin, where no internal costs were
used. Finally, reports were generated for an overview of the
results, to improve the validation. Figure 2 shows the method
used for this case study. When building this method other
sources have been studied in order to find a common practice
[13].
Figure 2. The method used for the case study
III. MATERIALS
In order to analyze the technical system of this case a process
simulation tool has been used. A material and energy balance
has been generated from the simulation model and the results
are used to calculate different economical aspects, all in the
same simulation model. The simulation model is built with an
aggregated perspective (that compromises between level of
detail and accuracy). The software applied was PaperFront®
which is an addition in ExtendSim.
PaperFront® is a simulation software with more than 30
years of development originating from the pulp and paper
industry. PaperFront® includes all tools and blocks required to
describe the collaboration between the different actors. Key
benefits are the possibility to easily extract the results to other
tools and allowing the simulation model an initial simple setup,
and the option of adding levels of detail later on as needed. For
the dynamic simulation, PaperFront® offers group start
functionality which allows the simulation model to
automatically change settings at specific time steps. It also
includes a scenario handler which keeps track of all settings.
For future research, PaperFront® is a good choice because it
allows building, modifying and creating new functions without
having to write code. This means that there is always an option
when it comes to the calculations of material, energy balances
and financial calculations of the system. It is also possible to
use the simulation model as a prediction tool.
The dynamic simulation model is designed to calculate one
year divided into a step size of one hour. Parameters that are
dynamic input in the simulation model are:
 Heat demand in the district heating system
 Temperature changes in the district heating inlet
 Electricity price
The simulation model is set up by using production/process
parameters, such as temperature, pressure, flow and power. The
critical values for the pipes in the district heating net are
temperature and pressure, which are designed for a maximum
of 120 degrees and 16 bar. Transmission capacity in the pipes
between the mills and the customers is assumed to be sufficient
or extendable. The temperature in the supply pipes correspond
to measured data and is regulated based on the outdoor
temperature from a corresponding curve.
The biofuel used in the simulation model is pellet because it
is what is currently used in the paper mill. The pellet price used
in the simulation model is the pellet index for Nordic countries
[14]. The electricity price was collected from Nordpool
spotprices [15] as weekly during 2015, to which a power
transmission fee was added. For the income of sold electricity,
the transmission energy loss fee is subtracted from the spot
price.
The demand for district heating, Figure 3, varies during the
year and is higher during the winter months. The input values
in the simulation model are based on production data from
2015.
IV. RESULTS
This part will cover the simulation model, the different
scenarios that have been used and compared, the financial
calculations that have been combined with the simulation
model and the result of the case study.
A. The simulation model
A simulation model of the energy system, corresponding to
the plants of the three parties, was designed in the simulation
tool.
The simulation model describes the energy systems of the
processes in the plants.
The district heating net consists of supply and return pipes
and two customers. The customers’ heat demand corresponds
to the whole district heating load in the city, and this is modeled
by power consumers decreasing the temperature in the pipe
system.
A steam boiler is used to describe the incineration plant in
the model. The boiler is fed with the amount of waste required
to be processed evenly distributed over the year. The steam
produced in the incineration boiler is carried to heat exchangers
or a turbine for production of district heating and/or electricity,
depending on the district heating load. The heat demand from
the customers has the highest priority and must be delivered
before using steam to produce electricity in the turbines. The
paper and pulp mills are connected to the district heating net by
heat exchangers and deliver heat when the capacity of the
incineration boiler is insufficient. A cooling tower removes
excess heat from the district heating net during low load periods
in all scenarios.
The pulp mill has been modeled with two boilers: one
recovery boiler and one biofuel boiler. The boilers run on
different fuels, which are excess flows from the process. The
boilers generate steam that is used in the process, for power
generation and production of district heating. The steam is
generated in the boilers and runs through the back-pressure
turbines where pressure and temperature are decreased and then
used either internally in the condensing turbine or in the district
heating exchangers. Internal demand has the highest priority,
because it is needed to secure the production, followed by the
district heat exchangers’ request for steam when the flow to the
customers is insufficient, while the remainder of the steam flow
is carried to the condensing turbine.
The paper mill has been modeled as a paper machine and a
dryer, as well as a mechanical pulp production line consisting
of a refiner only. Paper production in the simulation model is
set to correspond to the three machines running in reality; the
simulation model will calculate the amount of chips needed for
the HC-refiner to supply the machines with pulp. The steam
from the refiner is led to the dryer section in the paper machine.
Steam is also added to the drying section from a biofuel boiler.
Validation of the simulation model has been performed with
several iterations where comparisons to the individual systems
have been made until representatives of the actors considered it
corresponding to reality and gave their approval.
B. Scenarios
Three different scenarios have been studied in order to
evaluate the (technical) possibility and economic potential of
the cooperation: one reference scenario, one scenario with
electricity reduction and internally replaced steam shortage and
finally a scenario where energy is transported through the
district heating net between the sites, as shown in fig 1.
Scenario 0: Reference
The reference point in the calculations is referred to as the
reference scenario. It describes the current processes, but also
includes the new plant at the pulp mill in the simulation.
When looking at the process over one year it is clear that the
heat demand in the district heating net is low during summer
and high during winter, Figure 3.
Figure 3. The heat demand from the district heating net and its
consumers over one year.
The incineration boiler must incinerate waste even if there is
no heat demand and during warm periods the heat is discharged
in a cooling tower.
When the demand for district heating is higher than the
internal heat production in the incineration boiler, the net owner
requests heat from the paper mill and the pulp mill.
The paper mill uses electricity to power the refiners and the
refiners generate excess steam. This excess steam is recovered
in the drying section of the paper machine, but steam is also
added from a boiler. In addition, the paper mill receives excess
heat from the flue gas condenser, which delivers heat to the
district heating net when needed.
The pulp mill delivers excess heat from the existing factory
to the district heating net. Parts of the excess heat will be used
in a condensing turbine, while some will still be emitted to the
recipient.
Scenario 1: Electricity reduction
Scenario 1 has its outset in recent research on energy
efficiency in mechanical pulp and paper processes [11]. The
goal of this research is to significantly reduce electricity
demand in the high consistency refiners, which is the starting
point of this scenario. The reduction is set to 50%; the
simulation shows that if the electricity is reduced by half then
this also applies to the excess steam from the refiners. This
shortage of steam is replaced by steam produced in a biofuel
boiler at the same site.
A comparison between the reference scenario and the
electricity reduction scenario shows that there will be a steam
shortage when the electricity consumption is reduced. This
means that steam must be collected from another source.
Scenario 2: Energy substitution
In Scenario 2 an alternative to using biofuel is
researched/investigated.
In the simulation of this scenario, the steam from the waste
incineration boiler contributes to the steam demand at the paper
mill. A new pipe is added in the simulation model between the
incineration boiler and the drying section in the paper mill. The
simulation shows that the steam from the incineration boiler
covers not only the steam shortage but also a part of the steam
produced using the biofuel boiler. Since all steam can be used,
the cooling tower connected to the incineration boiler is no
longer needed.
When the steam from the incineration boiler is used in the
paper mill there will be a shortage of heat in the district heating
net. The amount of excess heat available at the pulp mill has
been investigated, and the simulation shows that the excess heat
can cover the whole district heating load during the year, since
the accessible excess heat effect is above the maximum heat
load Using more steam for district heating will decrease
electricity production, but also reduce excess heat to the
recipient.
C. Scenario comparison
In the comparison, the results from the scenarios are
analyzed, and the input factors, identified as electricity, biofuel
and incineration fuel, are compared. The fuel to the incineration
boiler is constant throughout the case study. The electricity
demand is cut in half for the electricity reduction scenario and
energy substitution scenario. The biofuel is different for all
scenarios, see Figure 4.
Figure 4. The different input factors for all scenarios.
A main energy consumer in the model is the drying section
of the paper machine at the paper mill. When reducing
electricity to the dryers the steam generated in the refiners is
also reduced. The steam must be compensated and obtained
from another source. For the electricity reduction scenario, all
extra steam is produced in the biofuel boilers in the paper mill.
In the energy substitution case this steam is obtained from the
incineration boiler, see Figure 5.
Figure 5. Steam shares in the drying sections of the paper machines.
D. Financial/economical results
The economic calculation/evaluation assumes a system
boundary where the three companies fully cooperate as one
unit. Costs between the companies in the collaboration are
excluded. The economic benefit consists of input factors and
income from outside the system boundaries. The operating
margin of the system consists of biofuel and electricity fuel
costs, district heating, waste treatment and electricity delivery
income. This can be calculated as:
𝑂𝑀 = ∑ 𝑖𝑛𝑐𝑜𝑚𝑒 − ∑ 𝑖𝑛𝑝𝑢𝑡 𝑓𝑎𝑐𝑡𝑜𝑟𝑠
∑ 𝐼𝑛𝑝𝑢𝑡 𝑓𝑎𝑐𝑡𝑜𝑟𝑠 = 𝐵𝑖𝑜 𝑓𝑢𝑒𝑙 + 𝐸𝑙𝑒𝑐𝑡𝑟𝑖𝑐𝑖𝑡𝑦
(1)
∑ 𝐼𝑛𝑐𝑜𝑚𝑒 = 𝐷𝑖𝑠𝑡𝑟𝑖𝑐𝑡 ℎ𝑒𝑎𝑡𝑖𝑛𝑔 + 𝑊𝑎𝑠𝑡𝑒 𝑡𝑟𝑒𝑎𝑡𝑚𝑒𝑛𝑡 +
𝐸𝑙𝑒𝑐𝑡𝑟𝑖𝑐𝑖𝑡𝑦 𝑑𝑒𝑙𝑖𝑣𝑒𝑟𝑦
Where OM is Operating margin
The operating margin in Scenario 1 (Electricity reduction)
and 2 (Energy substitution) is compared to the operating margin
in Scenario 0 (Reference). This means that the result is always
presented as an increase from the reference scenario, as
expressed in the following equations:
𝐵𝐸𝑅 = 𝑂𝑀𝐸𝑅 − 𝑂𝑀𝑅𝑒𝑓
𝐵𝐸𝑆 = 𝑂𝑀𝐸𝑆 − 𝑂𝑀𝑅𝑒𝑓
(2)
(3)
where B is Benefit
OM is Operating margin
ER is Electricity reduction
ES is Energy substitution
Ref is Reference
Some parameters have been excluded because their effect on
the total difference in operating margin is insignificant.
Examples of excluded parameters are: maintenance costs, labor
costs, environmental taxes. Scenario 1 (Electricity reduction) is
beneficial from a 12-month perspective, but the simulation also
illustrates that it depends on electricity price and biofuel price.
As shown in Figure 6, during the summer months the operating
margin for Scenario 1 (Electricity reduction) is lower than for
the reference scenario, because the electricity price is lower
than the biofuel price. Scenario 2 (Energy substitution) shows
that collaboration is significantly more beneficial from a 12month perspective.
Figure 6. Increase of operating margin for the scenarios compared to
the reference scenario (which equals 0 in the diagram). The top
graph shows the energy substitution case compared to the reference
case, while the bottom graph shows the electricity reduction case
compared to the reference case.
The financial benefit of saving electricity (Scenario 1) is 30
MSEK/year, and for energy substitution (Scenario 2) it is 100
MSEK/year.
V. DISCUSSION
In this case study, a simulation model was built describing
the stakeholders’ current processes. The simulation model is
highly adjustable and can be used to study other aspects of the
energy system. It could be used for decision support and
operative questions, or to make future predictions for strategic
decisions.
We have identified the benefits of cooperation between three
stakeholders connected to an energy system. By building a
steam pipe between the incineration boiler and the paper mill, a
potential worth of around 100 MSEK/year was demonstrated.
The method and simulation model could be used to predict
future scenarios. In the results section, it is mentioned that
maintenance costs, environmental taxes and labor costs have
been excluded in this study. This is mainly because of the
assumption that they will not differ in the different scenarios,
and such not affect the comparison to any greater extent.
If a steam pipe is placed between the paper mill and
incineration boiler it is possible to use steam from the
incineration boiler to dry the paper. This requires that the
energy needed in the district heating is distributed from another
source, in this study the pulp mill. The energy company delivers
energy of higher quality (steam) to the paper mill, while the
pulp mill delivers energy of lower quality (hot water) to the
district heating. The energy load will also vary during a 12month period, since the energy company will deliver steam
throughout the year to the paper mill, while the energy required
in the district heating by the pulp mill will vary (e.g. it requires
less energy during summer, When looking at the process over
one year it is clear that the heat demand in the district heating
net is low during summer and high during winter, Figure 3).
The solution requires that the energy company (incineration
boiler and district heating) can come to an agreement with the
pulp and paper mills on how to exchange the energy and profits
from the cooperation. This means that industrial excess heat
would replace primary energy, while refuse incineration would
not deliver district heating.
An interesting question that has not been addressed in this
case study is how to divide the 100 MSEK/year between the
different stakeholders. The simulation model can provide good
indications on each stakeholder’s contribution, but in the end
business models and agreements are necessary to control the
share. Negotiation between the different stakeholders will be
necessary; this can be investigated more thoroughly in
negotiation analysis and gaming theory. An example of a
business model to use could be the energy company sets a price
for the steam that is sold to the paper mill, and the pulp mill sets
a price for the energy transferred to the district heating net. This
business model would probably not work for the paper mill
since it is likely that using their own boilers would be cheaper
than to buy steam from the energy company. This means that
there is a need to find a business model for the allocation of the
economic benefits of the cooperation. There is no previous
work in this research field.
The electricity reduction targeted in the mechanical pulping
process done by other researchers is important in this case study
[11]. If it is not possible to reach a 50% reduction it would also
result in a different result for scenario 1 (Electricity reduction)
and scenario 2 (energy substitution); this would be interesting
to simulate to find the breakeven point for when the cooperation
is no longer beneficial.
When it comes to simulation it is important to validate the
model in order to be able to trust the results generated. For this
case study, the results in the reference case have been compared
with real process data from the mills and the energy company.
It is the vice president of technology at the companies who has
approved the validity of the model. However, from a research
perspective it could be interesting investigate whether it is
possible to quantify the validation, to avoid personal
dependence.
The electricity efficiency project in the paper mill would be
more beneficial if the cooperation solution was used.
[7]
[8]
[9]
[10]
[11]
VI. CONCLUSION
Industrial excess heat could take on a new role in an energy
system by using the district heating system to transform it to
high value heat.
Based on the aspects presented in this case it is possible to
use district heating as a means to increase the electrical
efficiency in a system.
The paper mill can reduce electricity use and replace the
deficit of steam with steam from the waste/refuse incineration
plant. The waste incineration plant delivers steam to the paper
mill and will not have excess heat during the summer period.
The pulp mill will be provided with the possibility to use more
of the excess heat, but decrease electricity production.
ACKNOWLEDGMENT
The authors would like to thank:
Leif Olsson, Mid Sweden University
Aron Larsson, Mid Sweden University
Anders Nilsson, FrontWay AB
Anette Rhodin, Sundsvall Energi AB
Patrik Halling, SCA Forest Products
Anders Jonsson, Sundsvall Energi AB
We would also like to thank all staff members at SCA and
Sundsvall Energi who have helped us find relevant data for the
simulation model.
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