Understanding the Economic Drivers of Originating Biomass for Power Projects

Biomass Magazine
May 2010
By Scott McDermott

Participation in the emerging biomass-to-energy industry requires knowledge of the origination, logistic, storage and handling challenges involved with the various biomass resources.

AAscendant Partners Inc. has been working with a number of power, combined-heat-and-power and densification projects to better understand and implement options for lowering energy cost, for energy diversification and for lower carbon energy. What makes this analysis different today from past economic and business energy assessments is that many of the fuel sources being considered today were rarely considered fuel sources even three years ago. It takes a forward-looking approach to understand the current and potential macroeconomic drivers of a structurally higher energy price environment and growing body of greenhouse gas legislation such as the patchwork of state renewable fuels standards and the prospect of legislation for greenhouse gas emissions.

This article focuses on the economic drivers for the utilization of biomass as a feedstock for coal-fired boilers, biomass boilers and biomass gasification. There are many intelligent researchers focused on the technology of converting biomass to energy in all of its forms. What seems to be less understood are the economics and business challenges of biomass origination, logistics, storage and handling. The fact is, we are in the early stages of the evolution of the biomass-to-energy supply chain. While woody biomass residues, crop biomass residues and energy crops will be distributed across the country, their economics vary greatly.

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