Abstract
As a relatively mature technology, biomass molded fuel (BMF) is widely used in distributed and centralized heating in China and has received considerable government attention. Although many BFM incentive policies have been developed, decreased domestic traditional fuel prices in China have caused BMF to lose its economic viability and new policy recommendations are needed to stimulate this industry. The present study built a regionalized net present value (NPV) model based on real production process simulation to test the impacts of each policy factor. The calculations showed that BMF production costs vary remarkably between regions, with the cost of agricultural briquette fuel (ABF) ranging from 86 US dollar per metric ton (USD/t) to 110 (USD/t), while that of woody pellet fuel (WPF) varies from 122 USD/t to 154 USD/t. The largest part of BMF’s cost composition is feedstock, which accounts for up 50%–60% of the total; accordingly a feedstock subsidy is the most effective policy factor, but in consideration of policy implementation, it would be better to use a production subsidy. For ABF, the optimal product subsidy varies from 26 USD/t to 57 USD/t among different regions of China, while for WPF, the range is 36 USD/t to 75 USD/t. Based on the data, a regional BMF development strategy is also proposed in this study.
Highlights
Since it is responsible for more than half of all global energy demand, the heating and cooling sector is a cornerstone of any energy or anti‐climate change strategy [1]
Typical unit densities of biomass pellets can be as high as 1000–1400 kg/m3, and bulk densities are about 700 kg/m3, while the density for grass type biomass ranges from 40 kg/m3 to 150 kg/m3, 150 kg/m3 to 200 kg/m3 for commercial wood chips, and 320–720 kg/m3 for most types of dried hard‐ and softwoods [4]
From the literature review we found that most policy analyses have focused on liquid biofuels and biomass power generation, whereas minimal study of BFM has taken place, most economic assessments of Biomass molded fuel (BMF) in China have been based on one particular plant or conducted at the national level, with little research occurring at the regional level
Summary
Since it is responsible for more than half of all global energy demand, the heating and cooling sector is a cornerstone of any energy or anti‐climate change strategy [1]. Typical unit densities of biomass pellets can be as high as 1000–1400 kg/m3, and bulk densities are about 700 kg/m3, while the density for grass type biomass ranges from 40 kg/m3 to 150 kg/m3, 150 kg/m3 to 200 kg/m3 for commercial wood chips, and 320–720 kg/m3 for most types of dried hard‐ and softwoods [4]. This characteristic reduces logistical costs and gives BMF wider application. An emission savings of 77% can be realized by co‐firing torrified pellets with fossil coal [6]
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