Torrefied wood pellets as an alternative fuel to coal : climate benefits and social desirability of production and use

• Main Author: Happonen, Kiira
• Other Authors: Helsingin yliopisto, Maatalous-metsätieteellinen tiedekunta, Taloustieteen laitos, University of Helsinki, Faculty of Agriculture and Forestry, Department of Economics and Management, Helsingfors universitet, Agrikultur- och forstvetenskapliga fakulteten, Institutionen för ekonomi
• Format: Master Thesis
• Language: English
• Published: Helsingfors universitet 2012
• Subjects: torrefied pellets; torrefaction; climate benefits; life cycle; social desirability; net social benefits; biohiili; torrefiointi; ilmastohyöty; elinkaari; yhteiskuntataloudellinen kannattavuus; Miljöekonomi; Environmental Economics; Ympäristöekonomia; Northern Finland
• Online Access: http://hdl.handle.net/10138/31435

The objective of this thesis is to study the climate impacts and the social returns and social desirability of torrefied wood pellet production and use as an alternative fuel to coal. The raw material of torrefied pellets is forest chips and production and use are assumed to take place in Finland. Climate impacts are assessed with focus on the full fuel chain, or the torrefied pellet life cycle. A brief review of other environmental impacts of the fuel chain is also provided. A socio-economic model is then developed for analyzing how desirable torrefied pellet production and use would be from society’s viewpoint when both private profits and climate benefits are taken into account. The model is applied to a hypothetical case where torrefied pellets are produced in Northern Finland and co-fired with coal at Helsingin Energia’s cogeneration plant. The purpose of this study is thus to analyze whether co-firing torrefied pellets with coal in combined heat and power production generates social surplus and is socially desirable when both net climate benefits and the private revenue and costs of torrefied pellet production and use are taken into account. Results show that co-firing torrefied pellets and coal in combined heat and power production leads to a reduction in greenhouse gas emissions compared to a coal-only situation when the life cycle of both fuels is taken into account. In the case studied, torrefied pellet production and use also generates positive social returns. The energy producer’s private profits proved to have the greatest impact on net social benefits. Tutkielman tavoitteena on arvioida biohiilen eli torrefioidun ja pelletöidyn biomassan tuotannon ja käytön ilmastovaikutuksia ja yhteiskuntataloudellista kannattavuutta, kun sillä korvataan kivihiiltä. Biohiilen raaka-aineena on metsähake, ja tuotannon ja käytön oletetaan tapahtuvan Suomessa. Ilmastovaikutusten tarkastelussa otetaan huomioon koko polttoaineketju eli biohiilen elinkaari. Käsittelen lyhyesti myös ketjun muita ympäristövaikutuksia. ...