Title:
Optimal Plant Size and Feedstock Supply Radius: Minimize the Production Costs or Maximize the Profits?
Author(s):
Monteleone, M., Cammerino, A.R.B.
Document(s):
Paper
Abstract:
The biomass plant size is significantly affected both by negative and positive "economies of scale". As a result, an optimal plant size should be identified and, consequently, an optimal radius of the biomass supply basin should also derived. Negative economies of scale are mostly related to biomass transport costs, while positive economies of scale are observed with respect to plant capital costs, non-fuel operating costs and energy conversion efficiencies. In order to evaluate the economic viability of a biomass plant investment, two different objective criteria were compared: "minimize" the total unit costs vs. "maximise" the profit, respectively. An integrated biomass-to¬-energy production system was properly modelled considering revenues and several cost components, thus allowing the identification of the economic optimum scale for a biomass plant. The two approaches are not equivalent and do not lead to the same "optimal" results. A scaling procedure that brings cost to a minimum does not necessarily brings profit to a maximum. Results are also interpreted in view of strategic technological advancements that can generate more profitable economic conditions, greatly influencing the size of the biomass plant to be set up.
Keywords:
cost analysis, efficiency, power generation, straw, transportation, supply chain
Topic:
Biomass Resources
Subtopic:
Biomass potentials and biomass mobilisation
Event:
20th European Biomass Conference and Exhibition
Session:
1AO.3.1
Pages:
1 - 7
ISBN:
978-88-89407-54-7
Paper DOI:
10.5071/20thEUBCE2012-1AO.3.1
Price:
FREE
