HomeMy WebLinkAboutCraig Pre Feasibility Assessment for Integration of Wood Fired Heating Systems Final Report 07-24-2012-BIO
Pre-Feasibility Assessment for
Integration of Wood-Fired Heating Systems
Final Report
July 24, 2012
City of Craig
Craig, Alaska
Presented by
CTA Architects Engineers
Nick Salmon & Nathan Ratz
Lars Construction Management Services
Rex Goolsby
For
City of Craig
In partnership with:
Fairbanks Economic Development Corporation
Alaska Wood Energy Development Task Group
Funded by
Alaska Energy Authority and U.S. Forest Service
306 W. Railroad, Suite 104
Missoula, MT 59802
406.728.9522
www.ctagroup.com
CTA Project: FEDC_KETCHCRAIG_CRAIG
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers i
July 24, 2012
TABLE OF CONTENTS
1.0 Executive Summary ................................................................................................... 1
2.0 Introduction ............................................................................................................... 2
3.0 Existing Building Systems.......................................................................................... 2
4.0 Energy Use ............................................................................................................... 3
5.0 Biomass Boiler Size ................................................................................................... 5
6.0 Wood Fuel Use .......................................................................................................... 6
7.0 Boiler Plant Location and Site Access ....................................................................... 7
8.0 Integration with Existing Heating Systems ................................................................. 8
9.0 Air Quality Permits ..................................................................................................... 8
10.0 Wood Heating Options .............................................................................................. 8
11.0 Estimated Costs ........................................................................................................ 9
12.0 Economic Analysis Assumptions ............................................................................... 9
13.0 Results of Evaluation ................................................................................................. 9
14.0 Project Funding ....................................................................................................... 10
15.0 Summary ................................................................................................................. 10
16.0 Recommended Action ............................................................................................. 10
Appendixes
Appendix A: Preliminary Estimates of Probable Cost ................................................ 2 pages
Appendix B: Cash Flow Analysis ............................................................................... 4 pages
Appendix C: Site Plan ................................................................................................. 1 page
Appendix D: Air Quality Report ............................................................................... 11 pages
Appendix E: Wood Fired Heating Technologies ........................................................ 3 pages
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers Page 1 of 10
July 24, 2012
1.0 Executive Summary
The following assessment was commissioned to determine the preliminary technical and
economic feasibility of integrating a wood fired heating system in the City Hall, Fire Hall,
Library, Police Department, City Gym, Child Care Center, Youth Center, Old Clinic, and
POWER building in Craig Alaska.
The following tables summarize the current fuel use and the potential wood fuel use:
Table 1.1 - Annual Fuel Use Summary
Fuel Avg. Use Current Annual
Facility Name Type (Gallons) Cost $/Gal Cost
City Hall Fuel Oil 1,585 $4.10 $6,500
Fire Hall Fuel Oil 679 $4.10 $2,785
Library Fuel Oil 651 $4.10 $2,670
Police Dept. Fuel Oil 1,355 $4.10 $5,560
City Gym Fuel Oil 2,480 $4.10 $10,170
Childcare
Center Fuel Oil 1,837 $4.10 $7,530
Youth Center Fuel Oil 1,008 $4.10 $4,135
Old Clinic Fuel Oil 300 $4.10 $1,230
POWER Fuel Oil 708 $4.10 $2,900
Table 1.2 - Annual Wood Fuel Use Summary
Fuel Cord Wood
Oil Wood Pellets
(Gallons) (Cords) (Tons)
City Hall (CH) 1,585 13.9 12.6
Library (LIB) 651 5.7 5.2
Fire Hall (FH) 679 5.9 5.4
Old Clinic (OC) 300 2.6 2.4
POWER 708 6.2 5.6
Youth Center (YC) 1,008 8.8 8.0
Police Department (PD) 1,355 11.8 10.8
City Gym (CG) 2,480 21.7 19.8
Childcare Center (CC) 1,837 16.1 14.6
CH + LIB + FH 2,915 25.5 23.2
CH + LIB + FH + PD + CG + CC 8,587 75.0 68.4
CH + LIB + FH + PD + CG + CC +YC +POWER 10,603 92.7 84.5
PD + CG + CC 5,672 49.6 45.2
Note: Wood fuel use assumes offsetting 85% of the current energy use.
Based on the estimated volume of wood and the estimated biomass boiler size, pellet and
cord wood options will be evaluated. Chipped/ground fuel boilers were not considered
because the potential fuel cost savings would not pay for the high capital cost of these
system types. The options reviewed were:
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers Page 2 of 10
July 24, 2012
Pellet Boiler Options:
B.1: City Hall, Fire Hall, and Library.
B.2: City Hall, Fire Hall, Library, Police Department, City Gym, and Childcare Center.
B.3: All 9 buildings.
Cord Wood Boiler Option:
C.1: Police Department, City Gym, and Childcare Center.
The following table summarizes the economic evaluation for each option:
Table 1.3 - Economic Evaluation Summary
City of Craig Biomass Heating System
Year 1 NPV NPV
20
Yr
30
Yr
Project Operating 30 yr 20 yr B/C B/C ACF ACF YR
Cost Savings at 3% at 3% Ratio Ratio YR 20 YR 30 ACF=PC
B.1 $711,000 -$3,295 $54,151 $7,705 0.01 0.08 $18,285 $118,979 >30
B.2 $1,732,000 $3,159 $451,154 $218,207 0.13 0.26 $322,473 $824,188 >30
B.3 $1,941,000 $5,244 $580,902 $286,819 0.15 0.30 $421,677 $1,054,855 >30
C.1 $313,000 $56 $270,920 $122,375 0.39 0.87 $184,329 $504,505 27
A small district heating system connecting City buildings appears to be a poor candidate
for the use of a wood biomass heating system. With the current economic assumptions,
the economic viability of all the options is poor and none of the options meet the minimum
requirement of the 20 year B/C ratio exceeding 1.0. Each building individually does not
spend enough on heating fuel to be able to pay for a project through potential savings.
Combining multiple buildings increases the project costs without substantially increasing
the annual fossil fuel use.
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers Page 3 of 10
July 24, 2012
2.0 Introduction
The following assessment was commissioned to determine the preliminary technical and
economic feasibility of integrating a wood fired heating system in the City Hall, Fire Hall,
Library, Police Department, City Gym, Child Care Center, Youth Center, Old Clinic, and
POWER building in Craig Alaska.
3.0 Existing Building Systems
The City Hall is a wood framed building constructed around 1980. The facility is
approximately 3,600 square feet and is heated by a 74,000 Btu/hr output hot water boiler.
Domestic hot water is provided by two small 4 gallon point of use electric water heaters
rated at 1.5 KW input each. One water heater is located at each of the two toilet groups.
The boiler was replaced in 2010 and is in good condition. The heating system
infrastructure is original to the building an in fair condition.
The Fire Hall a metal building constructed in 1977. The facility is approximately 2,800
square feet and is heated by a 100,000 Btu/hr furnace and a 22,000 Btu/hr output Toyo
stove. The furnace serves the vehicle parking area, and the stove serves the office area.
Domestic hot water is provided by a 32 gallon fuel-oil fired water heaters rated at 90,000
Btu/hr and a small 4 gallon point of use electric water heater. The fuel oil water heater is
only turned on and used for laundry, and the small electric water heater serves the
lavatory in the toilet room. The furnace boiler is original to the building and is in fair
condition. The age of the Toy heater is unknown, but it appears to be in good condition.
The Library is a wood framed building constructed in 1978. The facility is approximately
1,860 square feet and is heated by a 40,000 Btu/hr output Toyo stove. Domestic hot
water is provided by a small 4 gallon point of use electric water heater rated at 1.5 KW
input. The Toyo stove is new and in good condition. The building was originally heated
with a fuel oil boiler, but this was recently removed. The heating water mains are still in
place as are the perimeter hot water baseboard elements.
The Police Department is a wood framed building constructed in 1982. The facility is
approximately 1,800 square feet and is heated by a 150,000 Btu/hr output furnace.
Domestic hot water is provided by a 32 gallon fuel oil fired 104,000 Btu/hr hot water
heater. The existing furnace and hot water heater are original to the building and in fair
condition. The heating system infrastructure is original to the building and in fair condition.
The City Gym is a wood framed building constructed around 1970. The facility is
approximately 6,000 square feet and is heated by a 248,000 Btu/hr output hot water boiler.
Domestic hot water is provided by a small 7 gallon point of use electric water heater rated
at 1.5 KW input. The existing boiler is original to the building and is in fair condition. The
heating system infrastructure is original to the building and in fair condition.
The Childcare Center is a wood framed building constructed around 1980. The facility is
approximately 1,800 square feet and is heated by a 74,000 Btu/hr output hot water boiler.
Domestic hot water is provided by two propane fired 180,000 Btu/hr instantaneous water
heater. The boiler was replaced in 2010 and is in good condition.
The Youth Center is a wood framed building constructed around 1980. The facility is
approximately 1,800 square feet and is heated by a 95,000 Btu/hr output furnace.
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers Page 4 of 10
July 24, 2012
Domestic hot water is provided by a 30 gallon fuel oil fired water heater rated at 70,000
Btu/hr. The water heater is turned off and only turned on when needed for a specific
event. The existing furnace and hot water heater is original to the building and is in fair
condition. The heating system infrastructure is original to the building an in fair condition.
Facilities Dropped from Feasibility Study
No facilities were dropped from the feasibility study.
Facilities Added to Feasibility Study
The Old Clinic is a wood framed building constructed in 1975. The facility is approximately
3,970 square feet and is heated by two 14,800 Btu/hr output Toyo stoves. The building
was originally heated with a boiler, but this boiler has been turned off and abandoned and
does not function. The west wing is used for storage for the City, and is heated with a
Toyo heater. The center portion of the building is currently unheated and used for cold
storage for the City. The southeast wing is rented out to a local business and is heated
with a Toyo heater. Domestic hot water is not currently provided, but was provided by an
indirect water heater using the boiler water originally.
The Prince of Wales Emergency Response (POWER) building is a wood framed building
that formerly was a residence constructed in the 1930’s. The group that rents the building
runs a thrift shop and takes donations from the community to assist those in need. The
building is approximately 3,500 square feet and is heated by a 40,000 Btu/hr output Toyo
stove with some supplemental electric baseboard elements. The original heating system
and equipment has been abandoned and does not function. The building in general is in
poor condition.
4.0 Energy Use
Fuel oil summaries for the facilities were provided. The following table summarizes the
data:
Table 4.1 - Annual Fuel Use Summary
Fuel Avg. Use Current Annual
Facility Name Type (Gallons) Cost $/Gal Cost
City Hall Fuel Oil 1,585 $4.10 $6,500
Fire Hall Fuel Oil 679 $4.10 $2,785
Library Fuel Oil 651 $4.10 $2,670
Police Dept. Fuel Oil 1,355 $4.10 $5,560
City Gym Fuel Oil 2,480 $4.10 $10,170
Childcare
Center Fuel Oil 1,837 $4.10 $7,530
Youth Center Fuel Oil 1,008 $4.10 $4,135
Old Clinic Fuel Oil 300 $4.10 $1,230
POWER Fuel Oil 708 $4.10 $2,900
Electrical energy consumption will increase with the installation of the wood fired boiler
system because of the power needed for the biomass boiler components such as augers,
conveyors, draft fans, etc. and the additional pumps needed to integrate into the existing
heating systems. The cash flow analysis accounts for the additional electrical energy
consumption and reduces the annual savings accordingly.
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers Page 5 of 10
July 24, 2012
5.0 Biomass Boiler Size
The following table summarized the connected load of fuel fired boiler:
Table 5.1 - Connected Boiler Load Summary
Likely
Peak System
Output Load Peak
MBH Factor MBH
City Hall Boiler Fuel Oil 74 1.00 74
Library Toyo Fuel Oil 40 1.00 40
Fire Hall Furnace Fuel Oil 100 1.00 100
Toyo Fuel Oil 22 1.00 22
Total 122
Old Clinic Toyo Fuel Oil 40 1.00 40
Toyo Fuel Oil 40 1.00 40
Total 80
POWER Toyo Fuel Oil 40 1.00 40
Youth Center Furnace Fuel Oil 95 1.00 95
DWH Fuel Oil 70 0.20 14
Total 109
Police Dept Furnace Fuel Oil 150 1.00 150
DWH Fuel Oil 104 0.50 52
Total 202
City Gym Boiler Fuel Oil 248 1.00 248
Childcare Center Boiler 1 Fuel Oil 74 1.00 74
DWH Propane 180 0.00 0
Total 74
Total Of All Buildings 1277 989
Typically a wood heating system is sized to meet approximately 85% of the typical annual
heating energy use of the building. The existing heating boilers and furnaces would be
used for the other 15% of the time during peak heating conditions, during times when the
biomass boiler is down for servicing, and during swing months when only a few hours of
heating each day are required. Recent energy models have found that a boiler sized at
50% to 60% of the building peak load will typically accommodate 85% of the boiler run
hours. Several projects are under consideration in Craig, therefore the boiler size will
vary with each option as noted below.
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers Page 6 of 10
July 24, 2012
Table 5.2 - Proposed Biomass Boiler Size
Likely Biomass
System Biomass Boiler
Peak Boiler Size
MBH Factor MBH
City Hall (CH) 74 0.6 44
Library (LIB) 40 0.6 24
Fire Hall (FH) 122 0.6 73
Old Clinic (OC) 80 0.6 48
POWER 40 0.6 24
Youth Center (YC) 109 0.6 65
Police Department (PD) 202 0.6 121
City Gym (CG) 248 0.6 149
Childcare Center (CC) 74 0.6 44
CH + LIB + FH 236 0.6 142
CH + LIB + FH + PD + CG + CC 760 0.6 456
CH + LIB + FH + PD + CG + CC + YC + OC +
Power 989 0.6 593
CG + CC + PD 524 0.6 314
6.0 Wood Fuel Use
The types of fuel available in the area include cord wood and wood pellets. The estimated
amount of wood fuel needed for each wood fuel type for each building was calculated and
is listed below:
Table 6.1 - Annual Wood Fuel Use Summary
Fuel Cord Wood
Oil Wood Pellets
(Gallons) (Cords) (Tons)
City Hall (CH) 1,585 13.9 12.6
Library (LIB) 651 5.7 5.2
Fire Hall (FH) 679 5.9 5.4
Old Clinic (OC) 300 2.6 2.4
POWER 708 6.2 5.6
Youth Center (YC) 1,008 8.8 8.0
Police Department (PD) 1,355 11.8 10.8
City Gym (CG) 2,480 21.7 19.8
Childcare Center (CC) 1,837 16.1 14.6
CH + LIB + FH 2,915 25.5 23.2
CH + LIB + FH + PD + CG + CC 8,587 75.0 68.4
CH + LIB + FH + PD + CG + CC +YC +POWER 10,603 92.7 84.5
PD + CG + CC 5,672 49.6 45.2
Note: Wood fuel use assumes offsetting 85% of the current energy use.
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers Page 7 of 10
July 24, 2012
The amount of wood fuels shown in the table is for offsetting 85% of the total fuel oil use.
The moisture content of the wood fuels and the overall wood burning system efficiencies
were accounted for in these calculations. The existing fuel oil boilers were assumed to be
80% efficient. Cord wood was assumed to be 20% moisture content (MC) with a system
efficiency of 65%. Wood pellets were assumed to be 7% MC with a system efficiency of
70%
There are sawmills and active logging operations in the region. Tongass Forest
Enterprises has stared up a pellet plant in Ketchikan and is providing pellets to Sealaska.
Pellets are also available from plants in British Columbia, Washington, and Oregon. There
appears to be a sufficient available supply to service the boiler plant.
The unit fuel costs for fuel oil and the different fuel types were calculated and equalized to
dollars per million Btu ($/MMBtu) to allow for direct comparison. The Delivered $/MMBtu
is the cost of the fuel based on what is actually delivered to the heating system, which
includes all the inefficiencies of the different systems. The Gross $/MMBtu is the cost of
the fuel based on raw fuel, or the higher heating value and does not account for any
system inefficiencies. The following table summarizes the equalized fuel costs at different
fuel unit costs:
Table 6.2 - Unit Fuel Costs Equalized to $/MMBtu
Net
Gross System System
Delivered Gross
Fuel Type Units Btu/unit Efficiency Btu/unit $/unit $/MMBtu $/MMBtu
Fuel Oil gal 134500 0.8 107600 $4.00 $37.17 $29.74
$4.50 $41.82 $33.46
$5.00 $46.47 $37.17
Cord
Wood cords 16173800 0.65 10512970 $150.00 $14.27 $9.27
$200.00 $19.02 $12.37
$250.00 $23.78 $15.46
Pellets tons 16400000 0.7 11480000 $200.00 $17.42 $12.20
$250.00 $21.78 $15.24
$300.00 $26.13 $18.29
Chips tons 10800000 0.65 7020000 $40.00 $5.70 $3.70
$80.00 $11.40 $7.41
$120.00 $17.09 $11.11
7.0 Boiler Plant Location and Site Access
The boiler room is not large enough to accommodate a new wood fir ed boiler so a new
stand-alone plant would be required. The best location for a plant would be just west of
the building.
Any type of biomass boiler plant will require access by delivery vehicles. For cord wood
systems this would likely be pickup trucks and trucks with trailers. For pellet systems, this
would likely be 40 foot long vans or some similar type of trailer. Access to the plant would
be from the north side of the property. Pickup trucks with small trailers can access the
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers Page 8 of 10
July 24, 2012
boiler plant from the north side easily. It is possible for large tractor trailers to access the
plant from the north side, but it will be difficult.
8.0 Integration with Existing Heating Systems
Integration of a wood fired heating system varies from facility to facility. Integration of a
central heating system in the Craig City Hall would require installing heating hot water
supply and return pipes to the existing boiler room. Piping could run through the
crawlspace.
Integration of a central heating system in the Library, Fire Hall, Old Clinic, Youth Center,
and Police Department would require the installation of a hot water unit heaters or hot
water baseboard elemements.
Integration of a central heating system in the POWER building would require the
installation of a hot water unit heater or fan coil unit.
Integration of a central heating system for the City Gym and Child Care Center would
require installing heating hot water supply and return pipes to the existing boiler room.
The field visit confirmed the location of each boiler room and heating unit location in order
to identify an approximate point of connection from a district heating loop to each existing
building. Connections would typically be achieved with pre-insulated pipe extended to the
face of each building, and extended up the exterior surface of the building in order to
penetrate exterior wall into the boiler room or building. Once the heating water supply and
return piping enters the existing boiler room it would be connected to existing supply and
return lines in appropriate locations in order to utilize existing pumping systems within
each building.
9.0 Air Quality Permits
Resource System Group has done a preliminary review of potential air quality issues in the
area. Southeast Alaska is has meteorological conditions that can create thermal
inversions, which are unfavorable for the dispersion of emissions. The proposed boiler
size at this location is small enough, that the boiler is not likely to require any State or
Federal permits. See the air quality memo in appendix D.
10.0 Wood Heating Options
The technologies available to produce heating energy from wood based biomass are
varied in their approach, but largely can be separated into three types of heating plants:
cord wood, wood pellet and wood chip/ground wood fueled. See Appendix E for these
summaries.
Based on the estimated volume of wood and the estimated biomass boiler size, pellet and
cord wood options will be evaluated. Chipped/ground fuel boilers were not considered
because the potential fuel cost savings would not pay for the high capital cost of these
system types. The options reviewed were:
Pellet Boiler Options:
B.1: City Hall, Fire Hall, and Library.
B.2: City Hall, Fire Hall, Library, Police Department, City Gym, and Childcare Center.
B.3: All 9 buildings.
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers Page 9 of 10
July 24, 2012
Cord Wood Boiler Option:
C.1: Police Department, City Gym, and Childcare Center.
Wood pellet boiler options assume a freestanding boiler building with adjacent free
standing pellet silo. The cord wood boiler option assumes a free standing building with
interior cordwood fuel storage.
11.0 Estimated Costs
The total project costs are at a preliminary design level and are based on RS Means and
recent biomass project bid data. The estimates are shown in the appendix. These costs
are conservative and if a deeper level feasibility analysis is undertaken and/or further
design occurs, the costs may be able to be reduced.
12.0 Economic Analysis Assumptions
The cash flow analysis assumes fuel oil at $4.10/gal, electricity at $0.21/kwh, wood pellets
delivered at $300/ton, and cord wood fuel delivered at $200/cord. The fuel oil, electricity,
and cord wood costs are based on the costs reported by the facility. Pellet costs were
obtained from Tongass Forest Enterprises.
It is assumed that the wood boiler would supplant 85% of the estimated heating use, and
the existing heating systems would heat the remaining 15%. Each option assumes the
total project can be funded with grants and non obligated capital money. The following
inflation rates were used: O&M - 2%, Fossil Fuel – 5%, Wood Fuel – 3%, Discount Rate
for NPV calculation – 3%. The fossil fuel inflation rate is based on the DOE EIA website.
DOE is projecting a slight plateau with a long term inflation of approximately 5%. As a
point of comparison, oil prices have increased at an annual rate of over 8% since 2001.
The analysis also accounts for additional electrical energy required for the wood fired
boiler system, as well as the system pumps to distribute heating hot water to the buildings.
Wood fired boiler systems also will require more maintenance, and these additional
maintenance costs are also factored into the analysis.
13.0 Results of Evaluation
The following table summarizes the economic evaluation for each option:
Table 13.1 - Economic Evaluation Summary
City of Craig Biomass Heating System
Year 1 NPV NPV
20
Yr
30
Yr
Project Operating 30 yr 20 yr B/C B/C ACF ACF YR
Cost Savings at 3% at 3% Ratio Ratio YR 20 YR 30 ACF=PC
B.1 $711,000 -$3,295 $54,151 $7,705 0.01 0.08 $18,285 $118,979 >30
B.2 $1,732,000 $3,159 $451,154 $218,207 0.13 0.26 $322,473 $824,188 >30
B.3 $1,941,000 $5,244 $580,902 $286,819 0.15 0.30 $421,677 $1,054,855 >30
C.1 $313,000 $56 $270,920 $122,375 0.39 0.87 $184,329 $504,505 27
Pre-Feasibility Assessment for City of Craig
Integration of Wood-Fired Heating Systems Craig, Alaska
CTA Architects Engineers Page 10 of 10
July 24, 2012
The benefit to cost ration (B/C) takes the net present value (NPV) of the net energy
savings and divides it by the construction cost of the project. A B/C ratio greater than or
equal to 1.0 indicates an economically advantageous project.
Accumulated cash flow (ACF) is another evaluation measure that is calculated in this
report and is similar to simple payback with the exception that accumulated cash flow
takes the cost of financing and fuel escalation into account. For many building owners,
having the accumulated cash flow equal the project cost within 15 years is considered
necessary for implementation. If the accumulated cash flow equals project cost in 20
years or more, that indicates a challenged project. Positive accumulated cash flow should
also be considered an avoided cost as opposed to a pure savings.
14.0 Project Funding
The City of Craig may pursue a biomass project grant from the Alaska Energy Authority.
The City of Craig could also enter into a performance contract for the project. Companies
such as Siemens, McKinstry, Johnson Controls and Chevron have expressed an interest
in participating in funding projects of all sizes throughout Alaska. This allows the facility
owner to pay for the project entirely from the guaranteed energy savings, and to minimize
the project funds required to initiate the project. The scope of the project may be
expanded to include additional energy conservation measures such as roof and wall
insulation and upgrading mechanical systems.
15.0 Summary
A small district heating system connecting City buildings appears to be a poor candidate
for the use of a wood biomass heating system. With the current economic assumptions,
the economic viability of all the options is poor and none of the options meet the minimum
requirement of the 20 year B/C ratio exceeding 1.0. Each building individually does not
spend enough on heating fuel to be able to pay for a project through potential savings.
Combining multiple buildings increases the project costs without substantially increasing
the annual fossil fuel use.
16.0 Recommended Action
If pellets or bio bricks begin are available for $300/ton or less, consider replacing the Toyo
stoves with pellet stoves.
APPENDIX A
Preliminary Estimates of Probable Cost
Preliminary Estimates of Probable Cost
Biomass Heating Options
Craig, AK
Option 1 B - CH + LIB + FH
Biomass Boiler Building:$90,000
Wood Heating, Wood Handling System, & Silo: $110,000
Stack/Air Pollution Control Device:$50,000
Mechanical/Electrical within Boiler Building: $75,000
Underground Piping $55,000
City Hall Integration $12,750
Library Integration $8,000
Fire Hall Integration $12,750
Subtotal:$413,500
30% Remote Factor $124,050
Subtotal:$537,550
Design Fees, Building Permit, Miscellaneous Expenses 15%: $80,633
Subtotal:$618,183
15% Contingency:$92,727
Total Project Costs 710,910$
Option 2 B - CH + LIB + FH + PD + CG + CC
Biomass Boiler Building:$270,000
Wood Heating, Wood Handling System, & Silo: $265,000
Stack/Air Pollution Control Device:$50,000
Mechanical/Electrical within Boiler Building: $150,000
Underground Piping $175,000
City Hall Integration $12,750
Library Integration $8,000
Fire Hall Integration $12,750
Police Dept. Integration $22,000
City Gym Integration $24,000
Child Care Integration $18,000
Subtotal:$1,007,500
30% Remote Factor $302,250
Subtotal:$1,309,750
Design Fees, Building Permit, Miscellaneous Expenses 15%: $196,463
Subtotal:$1,506,213
15% Contingency:$225,932
Total Project Costs 1,732,144$
Preliminary Estimates of Probable Cost
Biomass Heating Options
Craig, AK
Biomass Boiler Building:$270,000
Wood Heating, Wood Handling System, & Silo: $265,000
Stack/Air Pollution Control Device:$50,000
Mechanical/Electrical within Boiler Building: $150,000
Underground Piping $245,000
City Hall Integration $12,750
Library Integration $8,000
Fire Hall Integration $12,750
Police Dept. Integration $22,000
City Gym Integration $24,000
Child Care Integration $18,000
Old Clinic Integration $16,250
Power Building Integration $17,750
Youth Center Integration $17,500
Subtotal:$1,129,000
30% Remote Factor $338,700
Subtotal:$1,467,700
Design Fees, Building Permit, Miscellaneous Expenses 15%: $220,155
Subtotal:$1,687,855
15% Contingency:$253,178
Total Project Costs 1,941,033$
Option 1 C - CH + LIB + FH
Cord Wood Storage/ Boiler Building: $55,000
Wood Heating & Wood Handling System: $16,000
Stack/Air Pollution Control Device:$2,200
Mechanical/Electrical within Boiler Building: $20,200
Underground Piping $55,000
City Hall Integration $12,750
Library Integration $8,000
Fire Hall Integration $12,750
Subtotal:$181,900
30% Remote Factor $54,570
Subtotal:$236,470
Design Fees, Building Permit, Miscellaneous Expenses 15%: $35,471
Subtotal:$271,941
15% Contingency:$40,791
Total Project Costs 312,732$
Option 3 B - CH + LIB + FH + PD + CG + CC + YC + OC + Power
APPENDIX B
Cash Flow Analysis
City of Craig, City Hall ClusterOption B.1Craig, AlaskaWood Pellet Boiler Date: July 24, 2012 Analyst: CTA Architects Engineers - Nick Salmon & Nathan Ratz EXISTING CONDITIONSCity Hall Fire Hall Library TotalExisting Fuel Type:Fuel Oil Fuel Oil Fuel Oil Fuel OilFuel Units:gal gal gal galCurrent Fuel Unit Cost:$4.10 $4.10 $4.10 $4.10 Estimated Average Annual Fuel Usage:1,585 650 6802,915Annual Heating Costs:$6,499 $2,665 $2,788 $0 $11,952ENERGY CONVERSION (to 1,000,000 Btu; or 1 dkt)Fuel Heating Value (Btu/unit of fuel):134500 134500 134500 134500Current Annual Fuel Volume (Btu):213,182,500 87,425,000 91,460,000 0Assumed efficiency of existing heating system (%):80% 80% 80% 80% Net Annual Energy Produced (Btu):170,546,000 69,940,000 73,168,000 0 313,654,000WOOD FUEL COSTWood Pellets$/ton: $300.00Assumed efficiency of wood heating system (%): 70% PROJECTED WOOD FUEL USAGEEstimated Btu content of wood fuel (Btu/lb) - Assumed 7% MC 8200 Tons of wood fuel to supplant net equivalent of 100% annual heating load.27Tons of wood fuel to supplant net equivalent of 85% annual heating load.2325 ton chip van loads to supplant net equivalent of 85% annual heating load.1 Project Capital Cost-$711,000 Project Financing InformationPercent Financed0.0%Est. Pwr Use 15650 kWh Type Hr/Wk Wk/Yr Total Hr Wage/Hr TotalAmount Financed$0 Elec Rate $0.210 /kWh Biomass System 2.0 40 80 $20.00 $1,600Amount of Grants$711,000 Other 0.0 40 0 $20.00 $01st 2 Year Learning 2.0 40 80 $20.00 $1,600Interest Rate5.00%Term10Annual Finance Cost (years)$0 -215.8 years Net Benefit B/C Ratio$54,151 -$656,849 0.08$7,705 -$703,2950.01Year Accumulated Cash Flow > 016Year Accumulated Cash Flow > Project Capital Cost31Inflation FactorsO&M Inflation Rate2.0%Fossil Fuel Inflation Rate5.0%Wood Fuel Inflation Rate3.0%Electricity Inflation Rate3.0%Discount Rate for Net Present Value Calculation 3.0%Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year YearCash flow Descriptions Unit Costs HeatingSource ProportionAnnual Heating Source VolumesHeating Units 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 20 25 30Existing Heating System Operating CostsDisplaced heating costs $4.10 1585 gal $6,499 $6,823 $7,165 $7,523 $7,899 $8,294 $8,709 $9,144 $9,601 $10,081 $10,585 $11,115 $11,670 $12,254 $12,867 $16,421 $20,958 $26,749Displaced heating costs $4.10 650 gal $2,665 $2,798 $2,938 $3,085 $3,239 $3,401 $3,571 $3,750 $3,937 $4,134 $4,341 $4,558 $4,786 $5,025 $5,277 $6,734 $8,595 $10,970Displaced heating costs $4.10 680 gal $2,788 $2,927 $3,074 $3,227 $3,389 $3,558 $3,736 $3,923 $4,119 $4,325 $4,541 $4,768 $5,007 $5,257 $5,520 $7,045 $8,992 $11,476Displaced heating costs $4.100 gal $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Biomass System Operating CostsWood Fuel ($/ton, delivered to boiler site)$300.00 85% 23 tons $6,967 $7,176 $7,391 $7,613 $7,841 $8,077 $8,319 $8,569 $8,826 $9,090 $9,363 $9,644 $9,933 $10,231 $10,538 $12,217 $14,163 $16,418Small load existing fuel$4.10 15% 238 gal $975 $1,024 $1,075 $1,128 $1,185 $1,244 $1,306 $1,372 $1,440 $1,512 $1,588 $1,667 $1,751 $1,838 $1,930$2,463 $3,144 $4,012Small load existing fuel$4.10 15% 98 gal $400 $420 $441 $463 $486 $510 $536 $562 $591 $620 $651 $684 $718 $754 $791 $1,010 $1,289 $1,645Small load existing fuel$4.10 15% 102 gal $418 $439 $461 $484 $508 $534 $560 $588 $618 $649 $681 $715 $751 $789 $828 $1,057 $1,349 $1,721Small load existing fuel$4.10 15% 0 gal $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Additional Operation and Maintenance Costs$1,600 $1,632 $1,665 $1,698 $1,732 $1,767 $1,802 $1,838 $1,875 $1,912 $1,950 $1,989 $2,029 $2,070 $2,111 $2,331 $2,573$2,841Additional Operation and Maintenance Costs First 2 years$1,600 $1,632Additional Electrical Cost $0.210$3,287 $3,385 $3,487 $3,591 $3,699 $3,810 $3,924 $4,042 $4,163 $4,288 $4,417 $4,549 $4,686 $4,826 $4,971 $5,763 $6,681$7,745Annual Operating Cost Savings-$3,295-$3,158-$1,343-$1,142-$924-$688-$431-$154$146$469$817$1,192$1,595$2,028$2,493$5,360$9,346$14,810Financed Project Costs - Principal and Interest0000000000 Displaced System Replacement Costs (year one only)0Net Annual Cash Flow(3,295) (3,158) (1,343) (1,142) (924) (688) (431) (154)146 469 817 1,192 1,595 2,028 2,493 5,360 9,346 14,810Accumulated Cash Flow(3,295) (6,453) (7,796) (8,938) (9,862) (10,550) (10,981)(11,136) (10,990) (10,521) (9,704) (8,512) (6,916) (4,888) (2,395)18,285 56,531 118,979Additional Power UseAdditional MaintenanceSimple Payback: Total Project Cost/Year One Operating Cost Savings:Net Present Value (30 year analysis):Net Present Value (20 year analysis):
City of Craig, City Hall Cluster + City Gym ClusterOption B.2Craig, AlaskaWood Pellet Boiler Date: July 24, 2012 Analyst: CTA Architects Engineers - Nick Salmon & Nathan Ratz EXISTING CONDITIONSCH Cluster Gym Police Dept Childcare TotalExisting Fuel Type:Fuel Oil Fuel Oil Fuel Oil Fuel OilFuel Units:gal gal gal galCurrent Fuel Unit Cost:$4.10 $4.10 $4.10 $4.10 Estimated Average Annual Fuel Usage:3,300 2,480 1,355 1,837 8,972Annual Heating Costs:$13,530 $10,168 $5,556 $7,532 $36,785ENERGY CONVERSION (to 1,000,000 Btu; or 1 dkt)Fuel Heating Value (Btu/unit of fuel):134500 134500 134500 134500Current Annual Fuel Volume (Btu):443,850,000 333,560,000 182,247,500 247,076,500Assumed efficiency of existing heating system (%):80% 80% 80% 80% Net Annual Energy Produced (Btu):355,080,000 266,848,000 145,798,000 197,661,200 965,387,200WOOD FUEL COSTWood Pellets$/ton: $300.00Assumed efficiency of wood heating system (%): 70% PROJECTED WOOD FUEL USAGEEstimated Btu content of wood fuel (Btu/lb) - Assumed 7% MC 8200 Tons of wood fuel to supplant net equivalent of 100% annual heating load.84Tons of wood fuel to supplant net equivalent of 85% annual heating load.7125 ton chip van loads to supplant net equivalent of 85% annual heating load.3 Project Capital Cost-$1,732,000 Project Financing InformationPercent Financed0.0%Est. Pwr Use 16500 kWh Type Hr/Wk Wk/Yr Total Hr Wage/Hr TotalAmount Financed$0 Elec Rate $0.210 /kWh Biomass System 2.0 40 80 $20.00 $1,600Amount of Grants$1,732,000 Other 0.0 40 0 $20.00 $01st 2 Year Learning 2.0 40 80 $20.00 $1,600Interest Rate5.00%Term10Annual Finance Cost (years)$0 548.3 years Net Benefit B/C Ratio$451,154 -$1,280,846 0.26$218,207 -$1,513,7930.13Year Accumulated Cash Flow > 0#N/AYear Accumulated Cash Flow > Project Capital Cost31Inflation FactorsO&M Inflation Rate2.0%Fossil Fuel Inflation Rate5.0%Wood Fuel Inflation Rate3.0%Electricity Inflation Rate3.0%Discount Rate for Net Present Value Calculation 3.0%Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year YearCash flow Descriptions Unit Costs HeatingSource ProportionAnnual Heating Source VolumesHeating Units 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 20 25 30Existing Heating System Operating CostsDisplaced heating costs $4.10 3300 gal $13,530 $14,207 $14,917 $15,663 $16,446 $17,268 $18,131 $19,038 $19,990 $20,989 $22,039 $23,141 $24,298 $25,513 $26,788 $34,190 $43,636 $55,691Displaced heating costs $4.10 2480 gal $10,168 $10,676 $11,210 $11,771 $12,359 $12,977 $13,626 $14,307 $15,023 $15,774 $16,563 $17,391 $18,260 $19,173 $20,132 $25,694 $32,793 $41,853Displaced heating costs $4.10 1355 gal $5,556 $5,833 $6,125 $6,431 $6,753 $7,090 $7,445 $7,817 $8,208 $8,618 $9,049 $9,502 $9,977 $10,476 $11,000 $14,038 $17,917 $22,867Displaced heating costs $4.10 1837 gal $7,532 $7,908 $8,304 $8,719 $9,155 $9,613 $10,093 $10,598 $11,128 $11,684 $12,268 $12,882 $13,526 $14,202 $14,912 $19,032 $24,290 $31,001Biomass System Operating CostsWood Fuel ($/ton, delivered to boiler site)$300.00 85% 71 tons $21,444 $22,087 $22,750 $23,432 $24,135$24,859 $25,605 $26,373 $27,164 $27,979 $28,819 $29,683 $30,574 $31,491 $32,436 $37,602 $43,591 $50,533Small load existing fuel$4.10 15% 495 gal $2,030 $2,131 $2,238 $2,349 $2,467 $2,590 $2,720 $2,856 $2,998 $3,148 $3,306 $3,471 $3,645 $3,827 $4,018 $5,128 $6,545 $8,354Small load existing fuel$4.10 15% 372 gal $1,525 $1,601 $1,682 $1,766 $1,854 $1,947 $2,044 $2,146 $2,253 $2,366 $2,484 $2,609 $2,739 $2,876 $3,020 $3,854 $4,919 $6,278Small load existing fuel$4.10 15% 203 gal $833 $875 $919 $965 $1,013 $1,064 $1,117 $1,173 $1,231 $1,293 $1,357 $1,425 $1,497 $1,571 $1,650 $2,106$2,688 $3,430Small load existing fuel$4.10 15% 276 gal $1,130 $1,186 $1,246 $1,308 $1,373 $1,442 $1,514 $1,590 $1,669 $1,753 $1,840 $1,932 $2,029 $2,130 $2,237 $2,855 $3,644 $4,650Additional Operation and Maintenance Costs$1,600 $1,632 $1,665 $1,698 $1,732 $1,767 $1,802 $1,838 $1,875 $1,912 $1,950 $1,989 $2,029 $2,070 $2,111 $2,331 $2,573$2,841Additional Operation and Maintenance Costs First 2 years$1,600 $1,632Additional Electrical Cost $0.210$3,465 $3,569 $3,676 $3,786 $3,900 $4,017 $4,137 $4,262 $4,389 $4,521 $4,657 $4,796 $4,940 $5,088 $5,241 $6,076 $7,044$8,165Annual Operating Cost Savings$3,159$3,911$6,382$7,280$8,239$9,263$10,357$11,524$12,768$14,094$15,506$17,009$18,609$20,310$22,120$33,003$47,633$67,161Financed Project Costs - Principal and Interest0000000000 Displaced System Replacement Costs (year one only)0Net Annual Cash Flow3,159 3,911 6,382 7,280 8,239 9,263 10,357 11,524 12,768 14,094 15,506 17,009 18,609 20,310 22,120 33,003 47,633 67,161Accumulated Cash Flow3,159 7,070 13,452 20,731 28,970 38,234 48,591 60,115 72,883 86,976 102,482 119,491 138,100 158,410 180,530 322,473 529,670 824,188Additional Power UseAdditional MaintenanceSimple Payback: Total Project Cost/Year One Operating Cost Savings:Net Present Value (30 year analysis):Net Present Value (20 year analysis):
City of Craig All BuildingsOption B.3Craig, AlaskaWood Pellet Boiler Date: July 24, 2012 Analyst: CTA Architects Engineers - Nick Salmon & Nathan Ratz EXISTING CONDITIONSCH Cluster Gym Cluster Clinic + POWER Youth Ctr TotalExisting Fuel Type:Fuel Oil Fuel Oil Fuel Oil Fuel OilFuel Units:gal gal gal galCurrent Fuel Unit Cost:$4.10 $4.10 $4.10 $4.10 Estimated Average Annual Fuel Usage:3,300 5,672 1,000 1,000 10,972Annual Heating Costs:$13,530 $23,255 $4,100 $4,100 $44,985ENERGY CONVERSION (to 1,000,000 Btu; or 1 dkt)Fuel Heating Value (Btu/unit of fuel):134500 134500 134500 134500Current Annual Fuel Volume (Btu):443,850,000 762,884,000 134,500,000 134,500,000Assumed efficiency of existing heating system (%):80% 80% 80% 80% Net Annual Energy Produced (Btu):355,080,000 610,307,200 107,600,000 107,600,000 1,180,587,200WOOD FUEL COSTWood Pellets$/ton: $300.00Assumed efficiency of wood heating system (%): 70% PROJECTED WOOD FUEL USAGEEstimated Btu content of wood fuel (Btu/lb) - Assumed 7% MC 8200 Tons of wood fuel to supplant net equivalent of 100% annual heating load.103Tons of wood fuel to supplant net equivalent of 85% annual heating load.8725 ton chip van loads to supplant net equivalent of 85% annual heating load.3 Project Capital Cost-$1,941,000 Project Financing InformationPercent Financed0.0%Est. Pwr Use 17000 kWh Type Hr/Wk Wk/Yr Total Hr Wage/Hr TotalAmount Financed$0 Elec Rate $0.210 /kWh Biomass System 2.0 40 80 $20.00 $1,600Amount of Grants$1,941,000 Other 0.0 40 0 $20.00 $01st 2 Year Learning 2.0 40 80 $20.00 $1,600Interest Rate5.00%Term10Annual Finance Cost (years)$0 370.2 years Net Benefit B/C Ratio$580,902 -$1,360,098 0.30$286,819 -$1,654,1810.15Year Accumulated Cash Flow > 0#N/AYear Accumulated Cash Flow > Project Capital Cost31Inflation FactorsO&M Inflation Rate2.0%Fossil Fuel Inflation Rate5.0%Wood Fuel Inflation Rate3.0%Electricity Inflation Rate3.0%Discount Rate for Net Present Value Calculation 3.0%Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year YearCash flow Descriptions Unit Costs HeatingSource ProportionAnnual Heating Source VolumesHeating Units 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 20 25 30Existing Heating System Operating CostsDisplaced heating costs $4.10 3300 gal $13,530 $14,207 $14,917 $15,663 $16,446 $17,268 $18,131 $19,038 $19,990 $20,989 $22,039 $23,141 $24,298 $25,513 $26,788 $34,190 $43,636 $55,691Displaced heating costs $4.10 5672 gal $23,255 $24,418 $25,639 $26,921 $28,267 $29,680 $31,164 $32,722 $34,359 $36,076 $37,880 $39,774 $41,763 $43,851 $46,044 $58,765 $75,000 $95,722Displaced heating costs $4.10 1000 gal $4,100 $4,305 $4,520 $4,746 $4,984 $5,233 $5,494 $5,769 $6,058 $6,360 $6,678 $7,012 $7,363 $7,731 $8,118$10,360 $13,223 $16,876Displaced heating costs $4.10 1000 gal $4,100 $4,305 $4,520 $4,746 $4,984 $5,233 $5,494 $5,769 $6,058 $6,360 $6,678 $7,012 $7,363 $7,731 $8,118$10,360 $13,223 $16,876Biomass System Operating CostsWood Fuel ($/ton, delivered to boiler site)$300.00 85% 87 tons $26,224 $27,011 $27,821 $28,656 $29,515$30,401 $31,313 $32,252 $33,220 $34,216 $35,243 $36,300 $37,389 $38,511 $39,666 $45,984 $53,308 $61,798Small load existing fuel$4.10 15% 495 gal $2,030 $2,131 $2,238 $2,349 $2,467 $2,590 $2,720 $2,856 $2,998 $3,148 $3,306 $3,471 $3,645 $3,827 $4,018 $5,128 $6,545 $8,354Small load existing fuel$4.10 15% 851 gal $3,488 $3,663 $3,846 $4,038 $4,240 $4,452 $4,675 $4,908 $5,154 $5,411 $5,682 $5,966 $6,264 $6,578 $6,907 $8,815 $11,250 $14,358Small load existing fuel$4.10 15% 150 gal $615 $646 $678 $712 $748 $785 $824 $865 $909 $954 $1,002 $1,052 $1,104 $1,160 $1,218 $1,554 $1,983 $2,531Small load existing fuel$4.10 15% 150 gal $615 $646 $678 $712 $748 $785 $824 $865 $909 $954 $1,002 $1,052 $1,104 $1,160 $1,218 $1,554 $1,983 $2,531Additional Operation and Maintenance Costs$1,600 $1,632 $1,665 $1,698 $1,732 $1,767 $1,802 $1,838 $1,875 $1,912 $1,950 $1,989 $2,029 $2,070 $2,111 $2,331 $2,573$2,841Additional Operation and Maintenance Costs First 2 years$1,600 $1,632Additional Electrical Cost $0.210$3,570 $3,677 $3,787 $3,901 $4,018 $4,139 $4,263 $4,391 $4,522 $4,658 $4,798 $4,942 $5,090 $5,243 $5,400 $6,260 $7,257$8,413Annual Operating Cost Savings$5,244$6,198$8,884$10,010$11,213$12,496$13,865$15,323$16,877$18,532$20,294$22,168$24,161$26,279$28,530$42,049$60,181$84,338Financed Project Costs - Principal and Interest0000000000 Displaced System Replacement Costs (year one only)0Net Annual Cash Flow5,244 6,198 8,884 10,010 11,213 12,496 13,865 15,323 16,87718,532 20,294 22,168 24,161 26,279 28,530 42,049 60,181 84,338Accumulated Cash Flow5,244 11,441 20,325 30,335 41,548 54,044 67,908 83,232 100,109 118,642 138,935 161,103 185,264 211,544 240,074 421,677 684,219 1,054,855Additional Power UseAdditional MaintenanceSimple Payback: Total Project Cost/Year One Operating Cost Savings:Net Present Value (30 year analysis):Net Present Value (20 year analysis):
City of Craig, Gym ClusterOption C.1Craig, AlaskaCord Wood Boiler Date: July 24, 2012 Analyst: CTA Architects Engineers - Nick Salmon & Nathan Ratz EXISTING CONDITIONSCity Gym Police Dept Childcare TotalExisting Fuel Type:Fuel Oil Fuel Oil Fuel Oil Fuel OilFuel Units:gal gal gal galCurrent Fuel Unit Cost:$4.10 $4.10 $4.10 $4.10 Estimated Average Annual Fuel Usage:2,480 1,355 1,8375,672Annual Heating Costs:$10,168 $5,556 $7,532 $0 $23,255ENERGY CONVERSION (to 1,000,000 Btu; or 1 dkt)Fuel Heating Value (Btu/unit of fuel):134500 134500 134500 134500Current Annual Fuel Volume (Btu):333,560,000 182,247,500 247,076,500 0Assumed efficiency of existing heating system (%):80% 80% 80% 80% Net Annual Energy Produced (Btu):266,848,000 145,798,000 197,661,200 0 610,307,200WOOD FUEL COSTCord Wood$/cord: $200.00Assumed efficiency of wood heating system (%): 65% PROJECTED WOOD FUEL USAGEEstimated Btu content of wood fuel (Btu/cord) - Assumed 20% MC, 6,700 Btu/lb x 28.4 lb/cf x 85 cf16,173,800 Cords of wood fuel to supplant net equivalent of 100% annual heating load.58Cords of wood fuel to supplant net equivalent of 85% annual heating load.4925 ton chip van loads to supplant net equivalent of 85% annual heating load.N/A Project Capital Cost-$313,000 Project Financing InformationPercent Financed0.0%Est. Pwr Use 1150 kWh Type Hr/Wk Wk/Yr Total Hr Wage/Hr TotalAmount Financed$0 Elec Rate $0.210 /kWh Biomass System 10.0 40 400 $20.00 $8,000Amount of Grants$313,000 Other 0.0 40 0 $20.00 $01st 2 Year Learning 2.0 40 80 $20.00 $1,600Interest Rate5.00%Term10Annual Finance Cost (years)$0 5,545.1 years Net Benefit B/C Ratio$270,920 -$42,080 0.87$122,375 -$190,6250.39Year Accumulated Cash Flow > 0#N/AYear Accumulated Cash Flow > Project Capital Cost25Inflation FactorsO&M Inflation Rate2.0%Fossil Fuel Inflation Rate5.0%Wood Fuel Inflation Rate3.0%Electricity Inflation Rate3.0%Discount Rate for Net Present Value Calculation 3.0%Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year Year YearCash flow Descriptions Unit Costs HeatingSource ProportionAnnual Heating Source VolumesHeating Units 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 20 25 30Existing Heating System Operating CostsDisplaced heating costs $4.10 2480 gal $10,168 $10,676 $11,210 $11,771 $12,359 $12,977 $13,626 $14,307 $15,023 $15,774 $16,563 $17,391 $18,260 $19,173 $20,132 $25,694 $32,793 $41,853Displaced heating costs $4.10 1355 gal $5,556 $5,833 $6,125 $6,431 $6,753 $7,090 $7,445 $7,817 $8,208 $8,618 $9,049 $9,502 $9,977 $10,476 $11,000 $14,038 $17,917 $22,867Displaced heating costs $4.10 1837 gal $7,532 $7,908 $8,304 $8,719 $9,155 $9,613 $10,093 $10,598 $11,128 $11,684 $12,268 $12,882 $13,526 $14,202 $14,912 $19,032 $24,290 $31,001Displaced heating costs $4.100 gal $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Biomass System Operating CostsWood Fuel ($/ton, delivered to boiler site)$200.00 85% 49 cords $9,869 $10,165 $10,470 $10,784 $11,108$11,441 $11,784 $12,138 $12,502 $12,877 $13,263 $13,661 $14,071 $14,493 $14,928 $17,305 $20,062 $23,257Small load existing fuel$4.10 15% 372 gal $1,525 $1,601 $1,682 $1,766 $1,854 $1,947 $2,044 $2,146 $2,253 $2,366 $2,484 $2,609 $2,739 $2,876 $3,020 $3,854 $4,919 $6,278Small load existing fuel$4.10 15% 203 gal $833 $875 $919 $965 $1,013 $1,064 $1,117 $1,173 $1,231 $1,293 $1,357 $1,425 $1,497 $1,571 $1,650 $2,106$2,688 $3,430Small load existing fuel$4.10 15% 276 gal $1,130 $1,186 $1,246 $1,308 $1,373 $1,442 $1,514 $1,590 $1,669 $1,753 $1,840 $1,932 $2,029 $2,130 $2,237 $2,855 $3,644 $4,650Small load existing fuel$4.10 15% 0 gal $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Additional Operation and Maintenance Costs$8,000 $8,160 $8,323 $8,490 $8,659 $8,833 $9,009 $9,189 $9,373 $9,561 $9,752 $9,947 $10,146 $10,349 $10,556 $11,654 $12,867 $14,207Additional Operation and Maintenance Costs First 2 years$1,600 $1,632Additional Electrical Cost $0.210$242 $249 $256 $264 $272 $280 $288 $297 $306 $315 $325 $334 $344 $355 $365 $423 $491 $569Annual Operating Cost Savings$56$549$2,744$3,345$3,988$4,675$5,408$6,190$7,024$7,912$8,859$9,866$10,937$12,077$13,288$20,567$30,330$43,331Financed Project Costs - Principal and Interest0000000000 Displaced System Replacement Costs (year one only)0Net Annual Cash Flow56 549 2,744 3,345 3,988 4,675 5,408 6,190 7,024 7,912 8,859 9,866 10,937 12,077 13,288 20,567 30,330 43,331Accumulated Cash Flow56 606 3,350 6,695 10,683 15,357 20,765 26,955 33,979 41,89150,750 60,616 71,553 83,630 96,919 184,329 315,323 504,505Additional Power UseAdditional MaintenanceSimple Payback: Total Project Cost/Year One Operating Cost Savings:Net Present Value (30 year analysis):Net Present Value (20 year analysis):
APPENDIX C
Site Plan
SHAAN-SEETBOILER PLANTSHAAN-SEETOFFICETRAILERRESIDENCEHEATEDSTORAGESHAAN-SEET HOTEL25'-0"225'-0"50'-0"150'-0"175'-0"75'-0"50'-0"25'-0"12'-0"50'-0"62'-0"31'-0"125'-0"25'-0"50'-0"75'-0"150'-0"25'-0"50'-0"25'-0"140'-0"60'-0"50'-0"25'-0"MISSOULA, MT(406)728-9522Fax (406)728-8287Date®BIOMASS PRE-FEASIBILITY ASSESSMENTCRAIG, ALASKACITY OF CRAIG & SHAAN-SEET BOILER PLANTSSSFNHR07/24/2012FEDCJ:SHAAN-SEET200'100'50'0SCALE: 1:100NORTHREF.LEGENDPIPE ROUTINGBOILER ROOMFIRE HALLCITY HALLLIBRARYOLDCLINICPOWERPOLICE DEPT.CITY GYMCHILDCARE CENTERCITY OF CRAIGBOILER PLANTSITE PLANYOUTHCENTERALTERNATE BOILERPLANT
APPENDIX D
Air Quality Report
55 Railroad Row White River Junction, Vermont 05001
TEL 802.295.4999 FAX 802.295.1006 www.rsginc.com
INTRODUCTION
At your request, RSG has conducted an air quality feasibility study for seven biomass energy
installations in Ketchikan and Craig, Alaska. These sites are located in the panhandle of Alaska.
The following equipment is proposed:
Ketchikan
o One 4,700,000 Btu/hr (heat output) pellet boiler at the Ketchikan High School.
o One 800,000 Btu/hr (heat output) pellet boiler at the Ketchikan Indian Council
Medical Facility.
o One 150,000 Btu/hr (heat output) pellet boiler at the Ketchikan Indian Council
Votec School.
o One 200,000 Btu/hr (heat output) pellet boiler at the old Ketchikan Indian
Council Administration Building.
Craig
o One 450,000 Btu/hr (heat output) cord wood boiler at the Craig Tribal
Association Building.
o One 450,000 Btu/hr (heat output) cord wood boiler near the Fire Hall.
o One 250,000 Btu/hr (heat output) cord wood boiler at the Shaan‐Seet Office.
To: Nick Salmon
From: John Hinckley
Subject: Ketchikan‐Craig Cluster Feasibility Study
Date: 24 July 2012
Ketchikan‐Craig Air Quality Feasibility Study Resource Systems Group, Inc.
24 July 2012 page 2
A USGS map of the Ketchikan study area is provided in Figure 1 below. As shown, the area is
mountainous, with Ketchikan located on the southwest side of a mountain range. Ketchikan has
a population of 14,070. The area is relatively fairly well populated and developed relative to
other areas in Alaska. The area is also a port for cruise ships, which are significant sources of air
pollution. The topography, population, level of development, and existing emission sources has
the potential to create localized, temporary problematic air quality.
Figure 1: USGS Map Illustrating the Ketchikan Study Area
Ketchikan‐Craig Air Quality Feasibility Study Resource Systems Group, Inc.
24 July 2012 page 3
Figure 2 shows CTA Architects’ plan of the location of the proposed biomass facility at the
Ketchikan High School. The site slopes moderately to steeply downward in the southeasterly
direction with the grade becoming very steep to the northeast of the High School building. The
school building is between two to three stories high. The biomass facility will be located in a
stand‐alone building on the north side of the school building, which is the high side of the
building. There are residential areas west, north, and east of the proposed biomass facility
which are uphill (above) the facility. The precise dimensions of that building, the stack location
and dimensions, and the biomass equipment specifications have not been determined. The
degree of separation of the biomass building from the other buildings will create a buffer for
emissions dispersion.
Figure 2: Site Map of the Ketchikan High School Project
Ketchikan‐Craig Air Quality Feasibility Study Resource Systems Group, Inc.
24 July 2012 page 4
Figure 3 shows CTA Architects’ plan of the location of the proposed biomass facility at the
Ketchikan Indian Council Medical Facility. The site slopes moderately to steeply downward in
the southeasterly direction. As a result, there are buildings above and below the site. The
biomass facility will be located in a stand‐alone building on the northeast (uphill) side of the
school building. The precise dimensions of that building, the stack location and dimensions, and
the biomass equipment specifications have not been determined. The degree of separation of
the biomass building from the other buildings will create a small buffer for emissions
dispersion.
Figure 3: Site Map of the Ketchikan Indian Council Medical Facility
Ketchikan‐Craig Air Quality Feasibility Study Resource Systems Group, Inc.
24 July 2012 page 5
Figure 4 shows CTA Architects’ plan of the location of the Ketchikan Indian Council Votec School
(marked Stedman) and Ketchikan Indian Council Admin Building (marked Deermount). The
sites slope moderately to steeply downward in the southeasterly direction. As a result, there are
buildings above and below the sites. The precise dimensions of that building, the stack location
and dimensions, and the biomass equipment specifications have not been determined.
Figure 4: Site Map of Ketchikan Indian Council Votec School (Stedman) and the Admin
Building (Deermount)
Ketchikan‐Craig Air Quality Feasibility Study Resource Systems Group, Inc.
24 July 2012 page 6
A USGS map is provided below in Figure 5. As shown, Craig Island is relatively flat with
mountainous terrain to the west, and water in all other directions. The area is relatively
sparsely populated. The population of Craig is 1,397. Our review of the area did not reveal any
significant emission sources or ambient air quality issues.
Figure 5: USGS Map Illustrating the Craig Study Area
Ketchikan‐Craig Air Quality Feasibility Study Resource Systems Group, Inc.
24 July 2012 page 7
Figure 6 shows CTA Architects’ plan of the location of the proposed biomass facility and the
surrounding buildings. The site is relatively flat and moderately populated with one and two
story high buildings. The boiler plant is located in a stand‐alone building to the west of the
Tribal Association Building and east of another building. The stack should be designed to
provide plume rise above both of these buildings. The precise dimensions of that building, the
stack location and dimensions, and the biomass equipment specifications have not been
determined.
Figure 6: Site Map of the Craig Tribal Association Building
Ketchikan‐Craig Air Quality Feasibility Study Resource Systems Group, Inc.
24 July 2012 page 8
Figure 7 shows CTA Architects’ plan of the proposed Shaan‐Seet biomass facility and the
surrounding buildings. The site is relatively flat and moderately populated with one and two
story high buildings. The boiler plant is located in a stand‐alone building. The precise
dimensions of that building, the stack location and dimensions, and the biomass equipment
specifications have not been determined.
Figure 7: Site Map of Shaan‐Seet Boiler Plant Site
Ketchikan‐Craig Air Quality Feasibility Study Resource Systems Group, Inc.
24 July 2012 page 9
METEOROLOGY
Meteorological data from Annette, AK, was reviewed to develop an understanding of the
weather conditions. Annette is the closest weather data representing the climactic conditions
occurring in the Panhandle and is therefore a good proxy of Ketchikan and Craig weather
conditions. This data indicates calm winds occur only 10% of the year when, which suggests
there will be minimal time periods when thermal inversions and therefore poor emission
dispersion conditions can occur.1
Figure 8: Wind Speed Data from Annette, AK
1 See: http://climate.gi.alaska.edu/Climate/Wind/Speed/Annette/ANN.html
Ketchikan‐Craig Air Quality Feasibility Study Resource Systems Group, Inc.
24 July 2012 page 10
DESIGN & OPERATION RECOMMENDATIONS
The following are suggested for designing this project:
Burn natural wood, whose characteristics (moisture content, bark content, species,
geometry) results in optimal combustion in the equipment selected for the project.
Do not install a rain cap above the stack. Rain caps obstruct vertical airflow and reduce
dispersion of emissions.
Construct the stack to at least 1.5 times the height of the tallest roofline of the adjacent
building. Hence, a 20 foot roofline would result in a minimum 30 foot stack. Attention
should be given to constructing stacks higher than 1.5 times the tallest roofline
given higher elevations of surrounding residences due to the moderate to steep
slopes present.
Operate and maintain the boiler according to manufacturer’s recommendations.
Perform a tune‐up at least every other year as per manufacturer’s recommendations
and EPA guidance (see below for more discussion of EPA requirements)
Conduct regular observations of stack emissions. If emissions are not characteristic of
good boiler operation, make corrective actions.
For the Ketchikan High School: install at minimum a multicyclone to filter particulate
matter emissions.
These design and operation recommendations are based on the assumption that state‐of‐the‐
art combustion equipment is installed.
STATE AND FEDERAL PERMIT REQUIREMENTS
This project will not require an air pollution control permit from the Alaska Department of
Environmental Quality given the boilers’ relatively small size and corresponding quantity of
emissions. However, this project will be subject to new proposed requirements in the federal
“Area Source Rule” (40 CFR 63 JJJJJJ). A federal permit is not needed. However, there are various
record keeping, reporting and operation and maintenance requirements which must be
performed to demonstrate compliance with the requirements in the Area Source Rule. The
proposed changes have not been finalized. Until that time, the following requirements are
applicable:
Submit initial notification form to EPA within 120 days of startup.
Complete biennial tune ups per EPA method.
Submit tune‐up forms to EPA.
Please note the following:
Oil and coal fired boilers are also subject to this rule.
Ketchikan‐Craig Air Quality Feasibility Study Resource Systems Group, Inc.
24 July 2012 page 11
Gas fired boilers are not subject to this rule.
More requirements are applicable to boilers equal to or greater than 10 MMBtu/hr heat
input. These requirements typically warrant advanced emission controls, such as a
baghouse or an electrostatic precipitator (ESP).
The compliance guidance documents and compliance forms can be obtained on the following
EPA web page: http://www.epa.gov/boilercompliance/
SUMMARY
RSG has completed an air quality feasibility study for Ketchikan and Craig, Alaska. These boilers
are not subject to state permitting requirements, but are subject to federal requirements.
Design criteria have been suggested to minimize emissions and maximize dispersion.
The following conditions suggest advanced emission control devices (ESP, baghouse) are not
mandatory in Ketchikan and Craig:
1. The wood boilers will be relatively small emission sources.
2. Most of the wood boilers will be located in a separate building which will create a
dispersion buffer between the boiler stack and the building.
3. There are no applicable federal or state emission limits.
4. Meteorological conditions are favorable for dispersion.
The following conditions suggest additional attention should be given to controlling emissions
in Ketchikan:
1. Presence of other emission sources.
2. Relatively high population density.
3. The sensitive populations housed by all Ketchikan buildings.
While not mandatory, we recommend exploring the possibility of a cyclone or multi‐cyclone
technology for control of fly ash and larger particulate emissions for all the aforementioned
boilers. We also recommend developing a compliance plan for the aforementioned federal
requirements.
Given its size and sensitive population served, air dispersion modeling can be performed for the
Ketchikan High School site to determine the stack height and degree of emission control
(multicyclone vs ESP).
Please contact me if you have any comments or questions.
APPENDIX E
Wood Fired Heating Technologies
WOOD FIRED HEATING TECHNOLOGIES
CTA has developed wood-fired heating system projects using cord wood, wood pellet
and wood chips as the primary feedstock. A summary of each system type with the
benefits and disadvantages is noted below.
Cord Wood
Cord wood systems are hand-stoked wood boilers with a limited heat output of 150,000-
200,000 British Thermal Units per hour (Btu/hour). Cord wood systems are typically
linked to a thermal storage tank in order to optimize the efficiency of the system and
reduce the frequency of stoking. Cord wood boiler systems are also typically linked to
existing heat distribution systems via a heat exchanger. Product data from Garn, HS
Tarm and KOB identify outputs of 150,000-196,000 Btu/hr based upon burning eastern
hardwoods and stoking the boiler on an hourly basis. The cost and practicality of stoking
a wood boiler on an hourly basis has led most operators of cord wood systems to
integrate an adjacent thermal storage tank, acting similar to a battery, storing heat for
later use. The thermal storage tank allows the wood boiler to be stoked to a high fire
mode 3 times per day while storing heat for distribution between stoking. Cord wood
boilers require each piece of wood to be hand fed into the firebox, hand raking of the
grates and hand removal of ash. Ash is typically cooled in a barrel before being stock
piled and later broadcast as fertilizer.
Cordwood boilers are manufactured by a number of European manufacturers and an
American manufacturer with low emissions. These manufacturers currently do not
fabricate equipment with ASME (American Society of Mechanical Engineers)
certifications. When these non ASME boilers are installed in the United States,
atmospheric boilers rather than pressurized boilers are utilized. Atmospheric boilers
require more frequent maintenance of the boiler chemicals.
Emissions from cord wood systems are typically as follows:
PM2.5 >0.08 lb/MMbtu
NOx 0.23 lb/MMbtu
SO2 0.025 lb/MMbtu
CO2 195 lb/MMbtu
Benefits:
Small size
Lower cost
Local wood resource
Simple to operate
Disadvantages:
Hand fed - a large labor commitment
Typically atmospheric boilers (not ASME rated)
Thermal Storage is required
Page 1
Wood Pellet
Wood pellet systems can be hand fed from 40 pound bags, hand shoveled from 2,500
pound sacks of wood pellets, or automatically fed from an adjacent agricultural silo with
a capacity of 30-40 tons. Pellet boilers systems are typically linked to existing heat
distribution systems via a heat exchanger. Product data from KOB, Forest Energy and
Solagen identify outputs of 200,000-5,000,000 Btu/hr based upon burning pellets made
from waste products from the western timber industry. A number of pellet fuel
manufacturers produce all tree pellets utilizing bark and needles. All tree pellets have
significantly higher ash content, resulting in more frequent ash removal. Wood pellet
boilers typically require hand raking of the grates and hand removal of ash 2-3 times a
week. Automatic ash removal can be integrated into pellet boiler systems. Ash is
typically cooled in a barrel before being stock piled and later broadcast as fertilizer.
Pellet storage is very economical. Agricultural bin storage exterior to the building is
inexpensive and quick to install. Material conveyance is also borrowed from agricultural
technology. Flexible conveyors allow the storage to be located 20 feet or more from the
boiler with a single auger.
Emissions from wood pellet systems are typically as follows:
PM2.5 >0.09 lb/MMbtu
NOx 0.22 lb/MMbtu
SO2 0.025 lb/MMbtu
CO2 220 lb/MMbtu
Benefits:
Smaller size (relative to a chip system)
Consistent fuel and easy economical storage of fuel
Automated
Disadvantages:
Higher system cost
Higher cost wood fuel ($/MMBtu)
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Wood Chip
Chip systems utilize wood fuel that is either chipped or ground into a consistent size of
2-4 inches long and 1-2 inches wide. Chipped and ground material includes fine
sawdust and other debris. The quality of the fuel varies based upon how the wood is
processed between the forest and the facility. Trees which are harvested in a manner
that minimizes contact with the ground and run through a chipper or grinder directly into
a clean chip van are less likely to be contaminated with rocks, dirt and other debris. The
quality of the wood fuel will also be impacted by the types of screens placed on the
chipper or grinder. Fuel can be screened to reduce the quantity of fines which typically
become airborne during combustion and represent lost heat and increased particulate
emissions.
Chipped fuel is fed from the chip van into a metering bin, or loaded into a bunker with a
capacity of 60 tons or more. Wood chip boilers systems are typically linked to existing
heat distribution systems via a heat exchanger. Product data from Hurst, Messersmith
and Biomass Combustion Systems identify outputs of 1,000,000 - 50,000,000 Btu/hr
based upon burning western wood fuels. Wood chip boilers typically require hand raking
of the grates and hand removal of ash daily. Automatic ash removal can be integrated
into wood chip boiler systems. Ash is typically cooled in a barrel before being stock piled
and later broadcast as fertilizer.
Emissions from wood chip systems are typically as follows:
PM2.5 0.21 lb/MMbtu
NOx 0.22 lb/MMbtu
SO2 0.025 lb/MMbtu
CO2 195 lb/MMbtu
Benefits:
Lowest fuel cost of three options ($/MMBtu)
Automated
Can use local wood resources
Disadvantages:
Highest initial cost of three types
Larger fuel storage required
Less consistent fuel can cause operational and performance issues