Torrefied pellet production: Comparison of some forestry industry integration opportunities to stand alone plants

Feedstock as well as heat integration of a torrefied pellet plant into existing forestry operations is a potential way to the energy efficient and economically feasible production of a new energy carrier for replacing pulverised coal (PC) in power or combined heat and power (CHP) plants. Benefits are foreseen in energy integration, especially in the drying process of wood material. However, the main potential advantages of integrates compared to stand-alone plants are economical due to savings, for example, in raw material logistics, personnel costs, maintenance costs as well as in common equipment use. This economic assessment was part of the European Commission 7th Framework programme's project "Production of Solid Sustainable Energy Carriers from Biomass by Means of Torrefaction". The assessment report "Report on optimisation opportunities by integrating torrefaction to existing industries" is public and available at project home pages www.sector-project.eu. A mass and energy balance calculation was based on information by Topell Energy, ECN and CENER on their respective processes. The economic assessment was carried out mainly based in VTT and Pöyry Management Consulting Ltd in-house information. The assessment of investment is based on a number of feasibility studies and budget offers of commercially available equipment and components. The operation costs reflect mainly a Scandinavian price level. Torrefaction gas, waste heat or biomass was used as an energy source for processes, mainly for wood drying. The largest single cost item regarding the production cost of torrefied pellets was the cost of wood feedstock. The price of wood fuels in the Nordic countries has stabilised to levels of 18-25 /MWh. In outside Europe regions (Brazil, Chile, South Africa, Russia) the price variation is larger from 10 to 20 /MWh. In a ten years perspective the prices are expected to rise due to increasing demand from other wood industry sectors. A feedstock price of 18-20 /MWh at plant gate in Nordic Countries and 15 /MWh in outside Europe plant was used. Annual operation time was in all cases 8 000 hours and torrefied pellets production capacity varied from 72 000 t/a (typical medium scale European commercial plant) to 500 000 t/a (outside Europe large scale plant). Production costs in a medium scale European stand-alone torrefaction plant was estimated to over 40 /MWh. The integration of torrefaction to wood industry plants results in clear savings. A production price level of 34-38 /MWh was reached. The integration to a saw mill was especially favourable if a new combined plant is constructed. The estimated production cost of torrefied pellet at a large scale plant outside Europe was 32 /MWh, including overseas transportation costs to Europe. The PIX Index for wood pellets (FOEX Indexes Ltd.) is currently about 30 /MWh (industrial pellets). For the more detailed assessments site specific case studies will be needed.