Economic Feasibility Study of Different Biomass Firing Models in China

Abstract

Considering the various costs of current existing three biomass firing models in China, the most economically feasible biomass firing model is obtained according to discounted cash flow (DCF) methodology, which refers to net present value(NPV), payback period (np), internal rate of return(IRR) and discounted fuel price. Due to lower shipping cost and initial investment in equipments the biomass co-firing in PC furnace is better than dedicated biomass firing in grate furnace. And biomass pellet co-firing in existing larger capacity PC furnace is the most economical, followed by co-firing with rebuilt biomass firing device, dedicated biomass firing in grate furnace is the worse. Biomass pellet co-firing in existing larger capacity PC furnace has the highest NPV and IRR as well as the shortest np. Dedicated biomass firing in grate furnace has the second NPV, the lowest IRR and the longest np with state subsidy, without the state subsidy it is serious deficit. Meanwhile, biomass pellet co-firing in existing larger capacity PC furnace can save discounted fuel costs 25.9 RMB/ton and 14.07 RMB/ton in comparison with co-firing in PC furnace with rebuilt biomass firing device and dedicated biomass firing in grate furnace. And the economic benefits of co-firing can be further improved by taking account of the additional environmental benefits and higher boiler efficiency.