Renewable Energy 36 (2011) 282e288

Contents lists available at ScienceDirect

Renewable Energy
journal homepage: www.elsevier.com/locate/renene

Biomass co-firing options on the emission reduction and electricity generation

costs in coal-fired power plants
Prabir Basu a, *, James Butler b,1, Mathias A. Leon a
a
Mechanical Engineering Department, Dalhousie University, 1360, Barrington St., P.O. Box 1000, Halifax, Nova Scotia B3J 2X4, Canada
b
Greenfield Research Inc., Halifax, Canada

a r t i c l e i n f o a b s t r a c t

Article history: Co-firing offers a near-term solution for reducing CO2 emissions from conventional fossil fuel power
Received 30 July 2008 plants. Viable alternatives to long-term CO2 reduction technologies such as CO2 sequestration, oxy-firing
Accepted 28 June 2010 and carbon loop combustion are being discussed, but all of them remain in the early to mid stages of
Available online 27 July 2010
development. Co-firing, on the other hand, is a well-proven technology and is in regular use though does
not eliminate CO2 emissions entirely. An incremental gain in CO2 reduction can be achieved by imme-
Keywords:
diate implementation of biomass co-firing in nearly all coal-fired power plants with minimum modifi-
Biomass
cations and moderate investment, making co-firing a near-term solution for the greenhouse gas emission
Co-firing
Indirect co-firing
problem. If a majority of coal-fired boilers operating around the world adopt co-firing systems, the total
Greenhouse gas reduction in CO2 emissions would be substantial. It is the most efficient means of power generation from
Emission reduction biomass, and it thus offers CO2 avoidance cost lower than that for CO2 sequestration from existing power
Gasification plants. The present analysis examines several co-firing options including a novel option external (indi-
rect) firing using combustion or gasification in an existing coal or oil fired plant. Capital and operating
costs of such external units are calculated to determine the return on investment. Two of these indirect
co-firing options are analyzed along with the option of direct co-firing of biomass in pulverizing mills to
compare their operational merits and cost advantages with the gasification option.
Ó 2010 Elsevier Ltd. All rights reserved.

1. Introduction Although a number of emission reduction options are available

to the industry, many of them still face financial penalties for
The evidence of the effects of anthropogenic emission on global immediate implementation. Some measures are very site/location
climate is overwhelming [1]. The threat of increasing global specific while others are still in an early stage of development.
temperatures has subjected the use of fossil fuels to increasing Carbon dioxide sequestration or zero emission power plants
scrutiny in terms of greenhouse gas (GHG) and pollutant emissions. represent the future of a CO2 emissions-free power sector, but they
The issue of global warming needs to be addressed on an urgent will take years to come to the mainstream market. The cost of CO2
basis to avoid catastrophic consequences for humanity as a whole. capture and sequestration is in the range of 40e60 US$/ton of CO2,
Socolow and Pacala [2] introduced the wedge concept of depending on the type of plant and where the CO2 is stored [4,5].
reducing CO2 emissions through several initiatives involving This is a significant economic burden on the industry, and could
existing technologies, instead of a single future technology or potentially escalate the cost of electricity produced by as much
action that may take longer to develop and stronger willpower to as 60%.
implement. A wedge represents a carbon-cutting strategy that has Canada has vast amounts of biomass in its millions of hectares of
the potential to grow from zero today to avoiding 1 billion tons of managed forests, most of which remain untapped for energy
carbon emissions per year by 2055. It has been estimated [3] that at purposes. Currently, large quantities of the residues from the wood
least 15 strategies are currently available that, with scaling up, products industry are sent to landfill or are incinerated [6]. In the
could represent a wedge of emissions reduction. agricultural sector, grain crops produce an estimated 32 million
tons of straw residue per year. Allowing for a straw residue of 85%
remaining in the fields to maintain soil fertility, 5 million tons
* Corresponding author. Tel.: þ1 902 494 3227; fax: þ1 902 423 6711.
would still be available for energy use. Due to an increase in land
E-mail address: [email protected] (P. Basu).
1
Presently at Chemical Engineering Department, University of British Columbia, productivity, significant areas of land in Canada, which were earlier
Vancouver, Canada. farmed, are no longer farmed. These lands could be planted with

0960-1481/$ e see front matter Ó 2010 Elsevier Ltd. All rights reserved.
doi:10.1016/j.renene.2010.06.039
 P. Basu et al. / Renewable Energy 36 (2011) 282e288 283

fast-growing energy crops, like switch-grass offering potentially factors on the viability of different technical co-firing options in
large quantities of biomass for energy production [6]. coal-fired power plants. To illustrate these effects, an analysis of the
Living biomass plants absorb CO2 from the atmosphere. So, its economic aspects of different co-firing options is performed by
combustion/gasification for energy production is considered carbon considering the case of a 150 MW pulverized coal (PC) fired power
neutral. Thus if a certain amount of biomass is fired in an existing plant in Canada.
fossil (coal, coke or oil) fuel fired plant generating some energy, the
plant could reduce firing the corresponding amount of fossil fuel in 2. Co-firing options
it. Thus, a power plant with integrated biomass co-firing has a lower
net CO2 contribution over conventional coal-fired plants. Biomass co-firing has been successfully demonstrated in over
Biomass co-firing is one technology that can be implemented 150 installations worldwide for a combination of fuels and boiler
immediately in nearly all coal-fired power plants in a relatively types [9]. The co-firing technologies employed in these units may
short period of time and without the need for huge investments. It be broadly classified under three types:
has thus evolved to be a near-term alternative to reducing the
environmental impact of electricity generation from coal. Biomass i. Direct co-firing,
co-firing offers the least cost among the several technologies/ ii. indirect co-firing, and
options available for greenhouse gas reduction [7]. iii. gasification co-firing.
Principally, co-firing operations are not implemented to save
energy but to reduce cost, and greenhouse gas emissions (in some In all three options, the use of biomass displaces an equivalent
cases). In a typical co-firing plant, the boiler energy usage will be amount of coal (on an energy basis), and hence results in the direct
the same as it is operated at the same steam load conditions (for reduction of CO2 and NOx emissions to the atmosphere. The
heating or power generation), with the same heat input as that in selection of the appropriate co-firing option depends on a number
the existing coal-fired plant. The primary savings from co-firing of fuel and site specific factors. The objective of this analysis is to
result from reduced fuel costs when the cost of biomass fuel is determine and compare the economics of the different co-firing
lower than that of fossil fuel, and avoiding landfill tipping fees or options. Brief descriptions of the three co-firing options are pre-
other costs that would otherwise be required to dispose of sented here.
unwanted biomass. Biomass fuel at prices 20% or more below the
coal prices would usually provide the cost savings needed [8]. 2.1. Direct co-firing
Apart from direct savings in fuel cost, other financial benefits
that can be expected from co-firing include the following: Direct co-firing involves feeding biomass into coal going into the
mills, that pulverize the biomass along with coal in the same mill.
 Various pollution-reduction incentives: As co-firing, through Sometime separate mills may be used or biomass is injected
synergetic effects, reduces the net SOx, NOx and heavy metal directly into the boiler furnace through the coal burners, or in
emissions, the plant could claim the applicable pollution- a separate system. The level of integration into the existing plant
reduction incentives offered by government agencies. depends principally on the biomass fuel characteristics.
 Financial incentives for plant greenhouse gas (GHG) emission Four different options are available to incorporate biomass co-
reduction: A co-firing plant that uses biomass to replace an firing in pulverized coal power plants [10]. In the first option, the
amount of coal in an existing boiler will reduce almost an equal pre-processed biomass is mixed with coal upstream of the existing
amount of net CO2 emission from the plant. coal feeders. The fuel mixture is fed into the existing coal mills that
 On-demand power production: Unlike other renewable energy pulverize coal and biomass together, and distribute it across the
technologies (e.g.: solar, wind), biomass-based power genera- existing coal burners, based on the required co-firing rate. This is
tion can be made available whenever it is needed. This helps to the simplest option, involving the lowest least capital costs, but has
accelerate the capital investment payoff rate by utilizing a highest risk of interference with the coal firing capability of the
a higher capacity factor. boiler unit. Alkali or other agglomeration/corrosion-causing agents
 An option towards meeting a renewable energy portfolio: Co- in the biomass can build-up on heating surfaces of the boiler
firing offers a fast track, low-cost opportunity to add renewable reducing output and operational time [11]. Furthermore, different
energy capacity economically as it can be added to any coal- combustion characteristics of coal and biomass may affect the
fired plant immediately, with minimum investment. stability and heat transfer characteristics of the flame [12]. Thus,
 Earning of renewable energy tax credits: The use of biomass as this direct co-firing option is applicable to a limited range of
an energy source to displace fossil fuel can be eligible for biomass types and at very low biomass-to-coal co-firing ratios.
special tax credits from many governments. The second option involves separate handling, metering, and
 Fuel flexibility: Biomass as a fuel provides a hedge against price pulverization of the biomass, but injection of the pulverized
increases and supply shortages of coal ore. In co-firing, biomass biomass into the existing pulverized fuel pipe-work upstream of
can be viewed as an opportunity fuel, used only when the price the burners or at the burners. This option requires only modifica-
is favorable. tions external to the boiler. One disadvantage would be the
 Economic and environmental benefits to local communities: As requirement of additional equipment around the boiler, which may
biomass fuels are generally sourced from the areas in the already be congested. It may also be difficult to control and to
immediate vicinity of the plant (to save on transportation maintain the burner operating characteristics over the normal
costs), the local communities benefit economically from the boiler load curve.
production of biomass fuels. The third option involves the separate handling and pulveriza-
tion of the biomass fuel with combustion through a number of
All these potential benefits are, however, complex functions of burners located in the lower furnace, dedicated to the burning of
local factors such as the price of coal and biomass, government the biomass alone. This demands a highest capital cost, but involves
policies, capital investment, and the carbon market in the evalua- the least risk to normal boiler operation as the burners are specif-
tion of the cost effectiveness of electricity production using ically designed for biomass burning and would not interfere with
biomass co-firing. The present paper discusses the effect of these the coal burners.
284 P. Basu et al. / Renewable Energy 36 (2011) 282e288

The final option involves the use of biomass as a reburn fuel for
NOx emission control. This option involves separate biomass
handling and pulverization, with installation of separate biomass-
fired burners at the exit of the furnace. As with the previous option,
the capital cost is high, but risk to boiler operation is minimal.

2.2. Indirect or external co-firing

Indirect co-firing involves the installation of a completely

separate biomass boiler to produce low-grade steam for utilization
in the coal-fired power plant prior to being upgraded, resulting in
higher conversion efficiencies. An example of this option is the
Avedore Unit 2 project in Copenhagen, Denmark. In Canada,
Greenfield Research Inc. has developed a similar CFB boiler design
that utilizes a number of units of the existing power plant systems
like ID fan etc. to reduce the capital cost. In this system, a sub-
compact circulating fluidized bed boiler is designed specifically to
have a piggy-back ride on an existing power plant boiler. Since it is
not a stand-alone boiler it does not need many of the equipment or
component of a separate boiler. This unit releases flue gas at rela-
tively high temperature and joins the existing flow stream of the
parent coal-fired boiler after air heater. Thus, the flue gas from the
co-firing unit does not come in contact with any heating elements
of the existing boiler, thus avoiding the biomass related fouling or
corrosion problem, which is the largest concern of biomass co-
firing. This boiler is totally independent of the parent unit, and as
such, any outage in the co-firing unit does not affect the generation
of the parent plant. Thus this indirect combustion-based option
offers high reliability. The piggy-back boiler produces low pressure
steam feeding into the process steam header of the power plant.
Fig. 1 shows the photograph of one such unit built by Greenfield
Research Inc., for a 220 MWe Pulverized coal-fired boiler in India. In
Fig. 1. A photograph of a piggy-back CFB boiler used for indirect co-firing in an existing
this specific case, the piggy-back boiler fired waste fuel from the
power plant, built by Greenfield Research Inc. of Canada in a Thermal Power Plant in
parent boiler as that was the need of the plant. India.

2.3. Gasification co-firing

Gasification co-firing is also an attractive option. Three exam-
Co-firing through gasification involves the gasification of solid ples of the plants operating on this type of co-firing are: the 137
biomass and combustion of the product fuel gas in the furnace of MWe Zeltweg Power Plant in Styria in Austria, the AMERGAS
the coal-fired boiler. This approach offers a high degree of fuel biomass gasification project at the Amer Power Plant in Geer-
flexibility. Since the gas can be injected directly into the furnace for truidenberg, Holland, and the Kymiarvi power station at Lathi in
burning, the plant can avoid expensive flue gas cleaning as one Finland.
would need for syngas or fuel gas for diesel engines. As the The majority of biomass co-firing installations is operated at
enthalpy of the product gas is retained, this results in a very high biomass:coal co-firing ratios of less than 10%, on a heat input basis.
energy conversion efficiency. If the biomass contains highly The successful operation of these plants shows that co-firing at low
corrosive elements like chlorine, alkali etc., a certain amount of gas ratios does not pose any threat or major problems to the boiler
cleaning may be needed prior to its combustion in the furnace. operation. For higher co-firing ratios, however, it might be neces-
Another important benefit of injection of gas in the furnace is that it sary to use an indirect co-firing method.
serves as a gas-over firing designed to minimize NOx.
Although less popular, indirect or external and gasification co- 4. Case study methodology
firing options have certain advantages, such as the possibility to use
a wide range of fuels and easy removal of ash. Despite the significantly The present analysis of co-firing options considers only the
higher capital investment requirement, these advantages make economic and emissive effects of co-firing biomass within the plant
these two options more attractive to utility companies in some cases. facility and does not include changes in fuel transportation
requirements. In North America, many local sources of biomass are
3. Current status of biomass co-firing available, and the use of a locally available source of biomass could
have benefits beyond those discussed in this paper, in terms of
There are a number of co-firing installations worldwide, with reduced costs and emission generated from transportation of fuel.
approximately a hundred in Europe, 40 in the US and the remainder In areas where the supply of high quality biomass is limited
in Australia and Asia (Fig. 2) [9,13]. Most of these installations transportation of biomass to the plant would likely be an important
employ direct co-firing, mainly because it is the simplest and least part of the economic and environmental costs.
cost option. Examples include the 635 MWe EPON Project of Gel- The amount of fuel replacement with biomass is generally very
derland Power Station in Holland which uses direct co-firing with low in co-firing because especially in direct firing, the boiler
waste wood and the 150 MWe Studstrup Power Plant, Unit 1, near furnace designed for a specific fossil fuel may not respond favorably
Aarhus, Denmark co-firing straw. as there is a major departure in combustion and flame radiation
 P. Basu et al. / Renewable Energy 36 (2011) 282e288 285

Fig. 2. Worldwide co-firing plant locations.

characteristics when some other fuels in used. If co-firing is applied Qplant  fbf
to a fluidized bed boiler, this limit may not be that stringent. The mco ¼  3600  24  365  CF (2)
HHVcoal
present economic analysis is based on a 150 MW pulverized coal
plant located in Eastern Canada. As such, only 10% biomass co-firing where, mco is the mass of coal offset by co-firing (tons/year), fbf
rate is considered in all the three different co-firing options is the biomass co-firing fraction, HHVcoal is the higher heating value
examined here. Engineering design of the indirect co-firing system, of coal (MJ/ton), and CF is the plant capacity factor. The capacity
its capital cost estimation, including fuel requirements for all three factor specifies as to what extent the installed capacity of the plant
options, was carried out through a computer-based analysis. is utilized, either for technical reasons, or for operational reasons.
Table 1 lists the inputs of the thermodynamic design. The Technical reasons, leading to technical availability of the plant, may
properties of the biomass fuel used in the analysis were taken as be less than 100% due to forced shutdown or routine maintenance.
that of the hardwood maple. Hardwood species are widely available The higher the reliability of the co-firing option, the higher is this
in Eastern Canada and are often discarded when harvesting of factor. Direct firing means, which could interfere with the operation
softwood trees for the pulp and paper industry takes place, making of the existing plant, could result in lower CF.
hardwood very cost effective. For coal, a low ash bituminous type
coal was considered, typical of the fuel type used in the specific
pulverized coal boilers. Table 2 presents the results of the ultimate 4.1. Direct co-firing
analysis of coal and biomass.
For all three co-firing options, the energy input remains the Biomass firing in coal plants can result in increased tube
same, and was determined using the overall plant generation and corrosion/fouling or problems in the fuel pulverization and feed
heat rate: system, leading to increased maintenance and down time for the
plant. This reduces the CF further. In the analysis of the direct co-
Pplant firing option, a generation loss of 1% was therefore considered,
Qplant ¼ (1) which reduced the plant capacity factor to 79%.
HRplant
The capital cost associated with the implementation of direct
where, Qplant is the plant heat input (MJ), Pplant is plant electrical co-firing was calculated using a value of 279 USD/kWth, from
generation (MWh) and HRplant is the plant heat rate (MJ/MWh). Cantwell [7]. The increased O&M costs due to direct co-firing were
The heat input required from the biomass was calculated at 10% estimated at $0.29/MWth.
of the overall heat required by the plant. The amount of coal that
would be offset through the co-firing of biomass, in a year, was
Table 2
found through the following equation: Ultimate analysis of fuels.

Parameter Coal Biomass (wood)

Table 1 Carbon (%) 70.17 40.51
Thermodynamic design inputs. Hydrogen (%) 4.65 4.82
Oxygen (%) 4.55 33.39
Input parameter Value Nitrogen (%) 1.12 0.20
Plant generation (MWe) 150 Sulphur (%) 2.88 0.00
Biomass energy fraction (%) 10 Ash (%) 9.57 1.08
Plant heat rate (kJ/kWh) 10,326 Moisture (%) 7.06 20.00
Capacity factor (%) 80 HHVa (kJ/kg) 29,887 14,628
Turbine efficiency (%) 88 a
HHV ¼ higher heating value, as received basis.
286 P. Basu et al. / Renewable Energy 36 (2011) 282e288

4.2. Indirect or external co-firing calcium is needed, and production of 1 mol of calcium is associated
with the generation of 1 mol of CO2.
Analysis of the external co-firing option required a preliminary The effect of NOx reduction is a little more complex. An increase
design of a Circulating Fluidized Bed (CFB) boiler. The required in the volatile content of a fuel combusted in a PC burner could
thermal input for the steam generated by the biomass boiler was potentially reduce the NOx produced, but it would not reduce the
determined using a turbine efficiency of 88%. A thermal design of thermal NOx in direct co-firing. The reduction would therefore be
the boiler was done using CFBCAD in order to calculate the effi- small when compared to reductions in CO2 and SO2. In external co-
ciency of the CFB boiler and used in conjunction with the turbine firing using a CFB boiler or gasifier, NOx emissions from the plant
efficiency to calculate the required biomass fuel flow rate. would be reduced due to the lower combustion temperatures
The capital costs of the external co-firing were determined using found in CFB furnaces. Actual NOx reductions through decreased
a detailed cost assessment. This included the estimated costs of coal firing are dependent on the PC burner design and would be
engineering design work, project management, boiler fabrication, difficult to quantify. Gases produced from the gasification of
civil footing, secondary components, controls and instrumentation, biomass could be used to reduce the NOx emissions from PC plants
and erection and commissioning. This cost estimate was based on if the gas was used in a NOx re-burning situation.
previous work done by Greenfield Research Inc. on the feasibility of The analysis indicates that the cost of CO2 reduction through
a sub-compact, biomass-fired CFB boiler for placement within an direct co-firing works out to 33$/ton of CO2. For the purposes of
existing PC-fired plant. The capital cost of the CFB boiler worked this analysis, no sulphur capture technology was built into the
out to $139/kWth. The O&M costs were conservatively estimated at design.
$5/MWhth.

4.3. Gasification co-firing 5.1. Carrying charge

In the analysis of the gasification co-firing option, a generation Each technology option has its associated costs of imple-
loss of 0.5% was taken, thus reducing the plant capacity factor to mentation over and above the regular plant operational costs. All
79.5%. The product gas produced by the gasifier can cause problems three options had associated carrying charge for the initial capital
in the back-pass of the boiler with increased tube corrosion/fouling. cost of the co-firing system. This is calculated using the following
This would lead to a slight increase in time for boiler maintenance equation (input values are presented in Table 1):
and repairs, and hence the lower capacity factor.
CC ¼ V  ðD=VÞ  cc (7)
The capital cost of the gasification co-firing option was calcu-
lated based on the analysis of Antares [14]. Antares proposed where V is the initial investment, D/V is the debt fraction of
a capital cost estimate of 382 USD/kWe. The capital cost was then investment and cc is the carrying charge fraction.
found using the heating rate of the existing coal-fired plant. The Another annual cost associated with the implementation of
O&M costs of the gasifier were estimated at $6/MWhth. biomass co-firing is increased plant operation and maintenance
costs. The gasification and direct co-firing options also have
5. Economic evaluation criteria increased cost due to reduced capacity factor and plant’s annual
generation. From these yearly savings and costs, the yearly income
The economic evaluation of each co-firing option was based on after tax was calculated. All inputs for the economic analysis are
any savings/increase in fuel cost arising from the price difference of also listed in Table 3.
coal and biomass, and income generated through the sale of The cost of biomass in this analysis is the cost of delivered
emissions credits, both carbon and sulphur. As biomass is a carbon chipped hardwood, as shown in Table 2. Co-firing costs could be
neutral fuel, any reduction in coal use can be see as a subsequent less if a biomass waste material, such as sawdust from lumber mills
reduction in CO2 produced. A further reduction in carbon emissions or sewage sludge from nearby plants were available and used.
could be gained if the PC plant uses a sorbent based scrubber. Biomass fuels need to be sourced locally as the transportation costs
Sorbents such as limestone, used to capture sulphur dioxide of biomass could erode its cost advantage due to the low energy
produced by coal combustion, release additional carbon dioxide in density of biomass fuels.
the capture process adding to the plant’s carbon emissions. As the
sulphur content of biomass is nearly zero, sulphur produced from
coal combustion is reduced by the corresponding co-firing amount. Table 3
Inputs used in the economic analysis.
The carbon dioxide and sulphur dioxide produced from the offset
coal were calculated using the following equations: Input parameter Value
Price of biomass delivered dry basis 25.95
Price of coal delivered 68.76
C þ O2 / CO2 (3) Projected CO2 offset price (Dec’08) $30.77 (V21.4/ton)a
SO2 offset price (Dec’08) $607 (US$628/ton)b
Electricity price ($/kWh) 0.05
S þ O2 / SO2 (4) Tax rate, % 38.11
Cost of (return on) equity, Re 16%
½CO2  ¼ 3:66  ½C  mco (5) Debt cost, Rd 15%
Discount rate 15%
Debt fraction of investment, (D/V) 75%
½SO2  ¼ 2  ½S  mco (6) Equity in investment, (E/V) 25%
Capital cost depreciation 20%
where [CO2] is the carbon dioxide offset by co-firing (tons/year), [C] Carrying charge fraction 10%
is the carbon fraction in coal, [SO2] is the sulphur dioxide offset by Inflation 1.1084%
co-firing (tons/year), [S] is the sulphur fraction in coal and mco is the a
Carbon pool information (www.climatecorp.com accessed 18 Jun 2007).
amount of coal displaced by biomass (tons/year). From combustion b
www.evomarkets.com Spot price on 18 Jun 2007 (US$605/ton), inflation-
stoichiometry [15], to capture every mole of sulphur, 1.5e2 mol of adjusted to Dec 2008.
 P. Basu et al. / Renewable Energy 36 (2011) 282e288 287

Table 4 Table 6
Losses in external CFB boiler. Yearly coal offset.

Percentage Energy loss Parameter Amount offset

loss (kW) Coal (tons/year) 36,321
Dry Flue Gas 4.06% 2397 Carbon dioxide (tons/year) 93,279
Moisture in fuel 3.69% 2183 Sulphur dioxide (tons/year) 1046
Moisture in air 0.22% 129 Carbon credit Income ($/year) 2,760,544
Moisture from hydrogen 8.01% 4731 Sulphur credit Income ($/year) 636,017
Unburnt carbon 0.05% 29
Radiation 1.50% 886
Convection 1.50% 886
Bottom ash 0.00% 3 5.3. Internal rate of return
Fly ash 0.01% 3
Fan credit 0.45% 266 Internal rate of return (IRR) for this new investment is the
Margin 1.00% 591
discount rate that would make the net present value (NPV) of
the investment’s income stream total to zero. It is an indicator of
the efficiency or quality of an investment, as opposed to net present
The present analysis is very conservative as it did not include value (NPV), which indicates value or magnitude. The present
the avoided tipping fees that would otherwise be incurred analysis is based on IRR.
through the disposal of unwanted biomass. In one analysis per-
formed by the U.S. Department of Energy (TR-109496), the avoi-
6. Results
ded tipping fees accounted for over 50% of the savings generated.
The increasing demand for biomass products in the power
6.1. Fuel consumption
generation industry has made them a commodity in a number
of regions around the world. For this reason the authors did
The biomass consumption differs for each co-firing option due
not include this savings as owing to this demand, it is unlikely
to the different efficiencies of the co-firing systems. The fuel
that the income from tipping fee avoidance would continue in
required for direct co-firing is the lowest and represents the base
the future.
amount of biomass required to provide 10% of the heat energy in
For the evaluation we used the Weighted Average Cost of Capital
the furnace of the PC boiler. The fuel requirement for the external
(WACC). This represents the rate of return required by a corporation
CFB boiler is the highest of the three and was calculated based on
on its new assets to maintain a firm value, and is comprised of the
the given turbine efficiency of 88% as well as the calculated effi-
rate of return required by both equity holders and debt holders. It is
ciency of CFB boiler. This efficiency was found to be 80.42% and was
calculated by the following equation:
based on the calculated losses from the boiler. Table 4 presents the
E D breakdown of energy losses in the external CFB boiler.
WACC ¼ Re þ Rd ð1  Tc Þ (8) The biomass consumption rates and costs of the three co-firing
V V
options are given in Table 5.
where Re is the cost of equity, Rd is the cost of debt, Tc is the
corporate tax rate, E is the equity amount, D is the debt amount and 6.2. Emission credits income
V is the total investment.
For the economic analysis, the main source of income for the
5.2. Capital cost allowance (CCA) three co-firing options is the emissions credits earned through the
reduction in coal usage. The yearly offset of coal, subsequent
Capital cost allowances for power generation equipment fall reductions in emissions and emission credit income are presented
under CCA class 47 of Revenue Canada with a depreciation rate of in Table 6. IRR estimates for the three co-firing options are given in
8%. Since biomass co-firing is not currently employed in Canada, Table 7.
equipment use for a co-firing operation is not specifically described The analysis indicates that direct co-firing can offer an internal
under Canadian Income Tax Act. From the foregoing description of rate of return of more than twice that of indirect co-firing. Direct
co-firing technologies it would appear that direct co-firing option co-firing however suffers from the largest uncertainty about
requires capital investment primarily for new fuel processing and fouling and corrosion of its superheater tubes, and resulting
handling equipment as it uses existing boiler and electrical gener-
ating equipment at the power plant. The CCA class 8 definition,
Table 7
which applies to processing machinery and material handling and Economic analysis breakdown.
storage equipment, better reflects the type of equipment used. The
Direct Indirect Gasification
CCA class 8 has a 20% rate.
co-firing co-firing co-firing
For the other two co-firing options (indirect co-firing and
Capital investment (m$) 4.373a 5.946 5.673b
gasifier co-firing), for capital cost amortization, the Revenue Fuel cost savings (m$/year) 0.788 0.718 0.324
Canada guideline of allowing half the rate in the first year was Credit income (m$/year) 3.397 3.397 3.397
used. Generation losses (m$/year) 0.657c 0 0.329d
O&M cost (m$/year) 0.856 1.713 1.809
Carrying charge (m$/year) 0.328 0.456 0.425
Table 5 Net after tax (m$/year) 1.927 1.210 0.717
Biomass consumption. Internal rate of return (%) 51.37 25.98 16.54
a
Direct Indirect Gasification Scaled up from $279/kW estimate of Cantwell [5] using an escalation factor of
co-firing co-firing co-firing 1.1084%/year.
b
Cantwell [5] took $25,000/yr using an escalation factor of 1.1084%/year.
Biomass consumption (tons/year) 73,278 101,918 85,589 c
Capacity factor loss of 1%.
Biomass costs ($/year) 1,901,563 2115,825 1,776,824 d
Capacity factor loss of 0.5%.
288 P. Basu et al. / Renewable Energy 36 (2011) 282e288

Table 8 D/V debt fraction of investment

Results of the sensitivity analysis, indicating the change in IRR for a corresponding E equity amount ($)
change in loss of CF for direct co-firing option.
fbf biomass co-firing fraction
Capacity Electricity generation IRR HRplant plant heat rate (kJ/kWh)
factor (MWh/year) HHVcoal higher heating value of coal (MJ/ton)
80% 1,051,200 60.55% IRR internal rate of return (%)
79% 1,038,060 51.37%
mco mass of coal offset by co-firing per year (tons/year)
78% 1,024,920 42.05%
77% 1,011,780 32.44% Pplant plant electrical power generation (kW)
76% 998,640 22.20% Qplant fuel heat required in plant (kW)
75% 985,500 10.22% Re cost of equity ($)
Rd cost of debt ($)
Tc corporate tax rate (%)
breakdown of the plant while handling biomass. This loss, V initial investment ($)
conservatively estimated at 1%, could have significant impact on the WACC weighted average cost of capital ($)
viability of the co-firing option. For high alkali, high chlorine
biomass with high moisture content, the loss in capacity factor
could increase significantly. To assess this impact, a sensitivity References
study was carried out. Table 8 presents the results of the analysis.
[1] Houghton JT, Ding Y, Griggs DJ, Noguer M, Van der Linden PJ, Dai X, et al.,
It can be observed from Table 8 that the IRR reduces at a steady editors. “Climate change 2001: the scientific basis". For the intergovern-
rate for a corresponding loss of capacity factor. However, the plant mental panel on climate change, contribution of working group I to the
can operate viably even at a CF loss of 4%, offering an IRR of 22.2%. third assessment report of the intergovernmental panel on climate change;
2001.
[2] Socolow R, Pacala S. Stabilisation wedges: solving the climate problem for the
7. Conclusion next fifty years with current technology. Science 13 Aug 2004;305.
[3] “Stabilization wedges: a concept & game. Carbon mitigation initiative”, http://
www.princeton.edu/wcmi/resources/CMI_Resources_new_files/CMI_Wedge_
Co-firing reduces the cost of CO2 reduction as its cost is poten- Game_Jan_2007.pdf [accessed 16.06.08].
tially lower than that for CO2 sequestration in an existing power [4] Byrer CW, Guthrie HD. Carbon dioxide sequestration potential in coalbed
plant. For example, the cost of sequestration of 40e60$/ton of CO2 deposits, http://www.netl.doe.gov/publications/proceedings/98/98ps/ps4-8.
pdf [accessed 17.0709].
was much higher than the 33$/ton CO2 reduction cost through co-
[5] IEA. International energy agency, greenhouse gas R&D programme, http://
firing. The present analysis examines a special external co-firing www.co2captureandstorage.info [accessed 17.07.09].
option in an existing plant with two other co-firing options: direct [6] “Resource assessment: biomass in Canada”. Natural Resources Canada, http://
www.canren.gc.ca/resou_asse/index.asp?CaId¼53&PgId¼57 [accessed 16.06.08].
combustion co-firing, and gasification based indirect co-firing. An
[7] Cantwell K. “Economic value of biomass for aging power plants”, MBA Thesis,
analysis carried out for a plant in the eastern Canada indicates that Saint Mary’s University; April 2002.
direct co-firing can offer an IRR of more than twice that of indirect [8] “Biomass co-firing in coal-fired boilers”. Federal Technology Alert. Energy
co-firing. Direct co-firing however suffers from a major uncertainty efficiency and renewable energy, Federal energy management program, US
department of energy, http://www1.eere.energy.gov/femp/pdfs/fta_biomass_
about fouling and corrosion of its superheater tubes, and break- co-firing.pdf [accessed 17.06.08].
down of the mills while handling biomass. This loss, conservatively [9] “Biomass combustion and co-firing: global scenario”. Task 32 of the IEA bio-
estimated at 1%, could have significant impact on the viability of the energy agreement, http://www.ieabcc.nl/database/co-firing.php [accessed
16.06.08].
co-firing option. The novel external co-firing option, needs higher [10] “Renewable energy technology characterization”. Technical Report No. TR-
capital investment, but is entirely free from these uncertainties. For 109496, office of utility technologies, energy efficiency and renewable energy,
high alkali, high chlorine biomass with high moisture content, the U.S. DoE. 20585 and EPRI, Palo Alto, California 94304, http://www1.eere.
energy.gov/ba/pdfs/entire_document.pdf [accessed 12.11.07].
loss in capacity factor could increase significantly. A sensitivity [11] Miles TR, Baxter LL, Bryers WR, Jenkins BM, Oden LL. Alkali deposits found in
analysis of the effect of plant capacity factor on the IRR indicates biomass power plants. Publication of the National Renewable Energy Labo-
a strong dependency of IRR on the Capacity Factor (CF). IRR reduces ratory, US Department of Energy; Apr 1995.
[12] Dai J, Sokhansanj S, Grace JR, Bi X, Jim Lim C, Melin S. Overview and some
at an increasing rate for a steady loss of CF. However, the plant can issues related to co-firing biomass and coal. The Canadian Journal of Chemical
operate viably even at a CF loss of 4%, offering an IRR of 22.2%. Engineering 2008;86(3):367e86.
[13] Loo SV, Koppejan J, editors. Handbook of biomass combustion and co-firing.
Prepared by task 32 of the implementing agreement on bioenergy under the
Nomenclature
auspices of the international energy agency. the Netherlands: Twente
University Press; 2002. reprinted in 2003.
[14] Antares Group, Inc. Biomass CHP catalog, EPA, combined heat and power
cc carrying charge fraction partnership, US environmental protection agency, http://www.epa.gov/CHP/
documents/biomass_chp_catalog.pdf [accessed 22.07.08].
CF capacity factor [15] Basu P. Combustion and gasification in fluidized beds. Baton Roca:
D debt amount ($) Taylor & Francis; 2006. pp. 445e451.