ECONOMICS OF PRODUCING FUEL PELLETS FROM BIOMASS

An engineering economic analysis of a biomass pelleting process was performed for conditions in North America. The pelletization of biomass consists of a series of unit operations: drying, size reduction, densifying, cooling, screening, and warehousing. Capital and operating cost of the pelleting plant was estimated at several plant capacities. Pellet production cost for a base case plant capacity of 6 t/h was about $51/t of pellets. Raw material cost was the largest cost element of the total pellet production cost followed by personnel cost, drying cost, and pelleting mill cost. An increase in raw material cost substantially increased the pellet production cost. Pellet plants with a capacity of more than 10 t/h decreased the costs to roughly $40/t of pellets. Five different burner fuels – wet sawdust, dry sawdust, biomass pellets, natural gas, and coal were tested for their effect on the cost of pellet production. Wet sawdust and coal, the cheapest burner fuels, produced the lowest pellet production cost. The environmental impacts due to the potential emissions of these fuels during the combustion process require further investigation.