HomeMy WebLinkAboutNative Village of Nulato Biomass Energy Preliminary Fesability Assessment 04-09-2012-BIO
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Biomass Energy
Native Village of Nulato
D a l s o n E n e r g y I n c .
3 0 8 G S t . S t e 3 0 3
A n c h o r a g e , A l a s k a 9 9 5 0 1
907-2 7 7 -7900
4 / 9 / 2 0 1 2
Preliminary Feasibility
Assessment
This preliminary feasibility assessment considers the
potential for heating municipal buildings in Nulato with
woody biomass from regional forests and river logs.
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Table of Contents
Project Summary ........................................................................................................................................ 2
Summary of Findings ................................................................................................................................ 5
Wood fuel supply in Nulato ..................................................................................................................... 6
Biomass Energy Operations and Maintenance ............................................................................................. 9
Biomass Harvest Plan ................................................................................................................................ 9
Operations Plan....................................................................................................................................... 10
Community Facilities Information ........................................................................................................ 10
Tribal Offices and Clinic ..................................................................................................................... 10
City Buildings ....................................................................................................................................... 11
Upper Village Washateria & Water Plant ..................................................................................... 11
Store ........................................................................................................................................................ 12
Lower Village Washateria & Water Plant ..................................................................................... 12
Andrew K. Demoski School, Yukon-Koyukuk School District ................................................. 12
Recommended technology and fuel requirements ............................................................................. 13
Initial investment .................................................................................................................................... 16
Upper Washateria and Store .......................................................................................................... 17
Lower Washateria and School ........................................................................................................ 18
Operating Assumptions ...................................................................................................................... 19
Operating Costs & Annual Savings ................................................................................................... 21
Financial metrics .................................................................................................................................. 23
Simple payback period .................................................................................................................... 23
Present Value .................................................................................................................................... 23
Net Present Value............................................................................................................................. 24
Internal Rate of Return .................................................................................................................... 24
Life cycle cost analysis (LCCA) for School ................................................................................... 24
Conclusion ................................................................................................................................................ 27
Supplement: Community Wood Heating Basics ......................................................................................... 29
Wood fuel as a heating option .................................................................................................................... 29
The nature of wood fuels ........................................................................................................................ 29
The basics of wood-fueled heating ........................................................................................................ 30
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Available wood heating technology ...................................................................................................... 33
Cordwood Boilers ................................................................................................................................ 33
Bulk Fuel Boilers .................................................................................................................................. 33
District heat loops ................................................................................................................................ 34
Figure 1: Land Ownership Surrounding Nulato, AK. .......................................................................... 7
Figure 2: TCC Timber Inventory, 1990. ................................................................................................... 7
Figure 3: Forested Land Cover near Nulato, Alaska ............................................................................. 8
Figure 4: Illustration of Unmanaged Wood Harvesting Efforts .................................................................... 9
Figure 5: Illustration of Planned Wood Harvest by Harvest Area and Time Period. .................................... 9
Figure 6: Greg Patsy, Water Plant and Washateria Operator ............................................................ 10
Figure 7: From top to bottom: Nulato Lower Washateria and Andrew K. Demoski School. ...... 11
Figure 8: Upper Washateria and Municipal Complex highlighted in yellow ................................. 11
Figure 9: Cordwood ..................................................................................................................................... 29
Figure 10: Ground wood chips used for mulch. .......................................................................................... 29
Figure 11: Wood briquettes, as a substitute for cordwood. Cross sections of these briquettes make
“wafers” which can be automatically handled in biomass boiler systems. ................................................ 29
Figure 12: wood pellets ............................................................................................................................... 29
Project Summary
Dalson Energy was contracted by the Interior Regional Housing Authority (IRHA) and
Tanana Chiefs Conference (TCC) to do a Pre-Feasibility Study (Pre-FS) for a Biomass
Heating System for the Native Village of Nulato.
The IRHA/TCC Scope of Work stated that a study should be done to assess the
feasibility of a biomass heating system for candidate facilities, and the possibility of
potential collaboration with the City of Nulato and the Demo ski School in the village
(part of the Yukon-Koyokuk School District).
Dalson Energy biomass specialists Thomas Deerfield and Jason Hoke visited the
community on February 7 and 8, 2012 for the initial assessment. Deerfield and Hoke
made their assessment based on available data, interviews with local stakeholders and
authorities, observations, and research and review of previous studies done in Nulato.
It was noted that there are several other studies and reports that address various
aspects of biomass energy in Nulato, including the Bartz Englishoe report, an ANTHC
energy audit, and Forestry Resource assessments done by TCC Forester Will Putman
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and DNR Division of Forestry. These previous studies are the foundation for further
evaluation of institutional heating with woody biomass in Nulato, as exercised in this
prefeasibility assessment.
This report was prepared by Thomas Deerfield, Wynne Auld, Jason Hoke, Louise
Deerfield, Tom Miles and Clare Doig.
Contact and interviews with the following individuals in Nulato assisted in some of the
information gathering. Their contact information is as follows:
City: City of Nulato
P.O. Box 65009
Nulato, AK 99765
Phone 907-898-2205
Fax 907-898-2203
E-mail: nulatoclerk@gmail.com
Greg Patsy, Water/Washateria Operator
Shirley Patsy, City Bookkeeper
Stanley Demoski, Shop/Fuel Depot Manager
Neil Madros, VPO
Tribe: Nulato Village, federally-recognized
P.O. Box 65049
Nulato, AK 99765-0049
Phone 907-898-2339
Fax 907-898-2207
E-mail gloria_patsy@nulatotribe.org
Web http://www.nulatotribe.org/index.html
Paul Mountain, Tribal Administrator
Gloria Patsy, Administrative Assistant
Rosa Peter, Bookkeeper
Lisa Patsy, Administrator
Martha Demoski, Council Member
School: Andrew K. Demoski School
PO Box 65029
Nulato, AK 99765
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Phone: 907-898-2204
Fax: 907-898-2340
Vic Lewin, Principal, email: vlewin@yksd.com
Josephine McGinty, Secretary, email: jmcginty@yksd.com
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Summary of Findings
Currently, many of Nulato’s municipal buildings are excellent prospects for biomass
heating. Containerized biomass boiler systems are suggested as an expedient way to
develop biomass heating plants in Nulato.
The two identified projects are (1) the Lower Washateria and School, and (2) a small
District heating system serving the Upper Washateria and one nearby building, the
Store. Both of the candidate facilities identified could be served by HELE (high
efficiency, low emission) cordwood boiler systems; or, alternatively, the Lower
Washateria and Schoool could be served by a wood chip system.
The Consultants also recommend designing the planned Community Hall as the hub of
a small district heating facility.
The project’s success is critically dependent on a Biomass Harvest Plan and an Operations
Plan. The need for these project Plans are discussed in this Pre-Feasibility Analysis.
Boiler
Size
(BTU/hr)
Capital
Cost
Annual
Operations
Cost, Yr. 1
Annual
Cash
Savings,
Yr. 1
Simple
Payback,
Yrs.
NPV IRR
Lwr.
Washateria
+ School
350,000 $339,900 $35,800 $4,800 70 $78,500 -9%
Upper
Washateria
+ Store
350,000 $518,000 $109,000 $47,000 11 $761,000 8%
The next step is full report findings presentation to IRHA and TCC. As service
providers to the Village of Nulato, they will determine the next steps forward.
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Wood fuel supply in Nulato
In 1990 Tanana Chiefs Conference completed a timber inventory of the ANCSA Native
village lands around Nikolai. The village corporation, GANA-A'YOO, Limited, owns
approximately 115,000 acres, of which approximately 23,000 acres are forested, holding
an estimated 47.835 million cubic feet of saw timber and pole timber. Much of this
material could be considered woody biomass suitable for wood fueled heating systems.
Doyon, Limited, the regional corporation, is the other major landowner in the region, a s
indicated by Figure 1: Land Ownership Surrounding Nulato, AK.
While these inventory figures indicate a substantial timber resource, sites supporting
tree growth are widely distributed and may be difficult to access because of the area
characteristics and the lack of existing roads. The Village is located along a major river
system with expansive low elevation wetlands, resulting in widely distributed higher
elevation sites that support tree growth. These factors impact the economics of fuel
availability, which in turn impacts the size and fuel demand for a wood fueled heating
system in the community. Additional considerations include 1) the landowner’s
contractual agreement for harvest and compensation for the resource, 2) public
acceptance of larger scale timber harvest than has been experienced in recent history,
and 3) total project (from timber harvest to operation of the heating system) economic
feasibility.
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Figure 1: Land Ownership Surrounding Nulato, AK.
Figure 2: TCC Timber Inventory, 1990.
Nulato (1990)Acres Cubic Feet Board Feet
(thousands)
Saw Timber Types: (10.5"+ d.b.h.)
White Spruce 2,830 8,052,540 23,006
Cottonwood 670 1,557,080 5,973
Mixed White Spruce/Hardwood 1,240 2,229,520 8,031
Subtotal 4,740 11,839,140 37,010
Pole timber Types: (4.5" - 10.5" d.b.h.)
White Spruce 2,270 7,354,050 24,465
Cottonwood 12,126
Hardwood 6,250 12,036,200
Mixed White Spruce/Hardwood 10,040 16,606,160 6,114
Subtotal 18,560 35,996,410 42,705
Total 23,300 47,835,550 79,715
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River logging is an unproven method for dependable firewood supply, however it has
been successfully done in other villages, and could be better developed to ensure the
safety of workers and dependability of supply. At most times of the year, it may prove
more time consuming than going to the woods to harvest the desired amount of wood.
Officially, the State of Alaska owns logs and trees that are floating on the waters of the
State. The Department of Natural Resources (DNR) issues permits for beach log salvage.
The Consultant suggests that The City of Nulato consult with DNR Division of Forestry
to discuss the harvesting of river driftwood.
If river log harvesting is undertaken, the Consultant also suggests safety training as a
prerequisite for the purchase of river-caught logs.
According to a previous study, the community of Nulato uses approximately 100 cords
per year of upland firewood. However, it also harvests an estimated 250 cords per year
from the river as driftwood.
If the projects described in this study were undertaken, the community of Nulato would
harvest about 250 additional cords of wood per year, increasing their annual volume by
about 70%.
Figure 3: Forested Land Cover near Nulato, Alaska
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Biomass Energy Operations and Maintenance
Biomass Harvest Plan
Wood cutting is a subsistence activity in almost all interior villages adjacent to forest
land. This subsistence resource must be carefully managed or biomass energy projects
may be detrimental to the Community.
If biomass harvests are unmanaged, the natural tendency is to harvest the most
accessible wood supply first, as illustrated below. The effect is increased scarcity and
rising harvest cost, and, consequently, biomass fuel costs, for both the project and
household woodcutters. This puts community members’ energy security and the
project’s success at risk.
The project’s success depends on a well-developed and executed Harvest Plan. The
Harvest Plan accounts for the biomass harvests over the project lifetime, at least 20
years. It may also designate areas for Personal Use (household wood cutting). The
Harvest Plan also describes how who is responsible for executing the Harvest Plan, and
how access will be managed. Please see figure below.
Figure 4: Illustration of Unmanaged Wood Harvesting Efforts
Figure 5: Illustration of Planned Wood Harvest by Harvest Area and Time Period.
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Because the project’s success is critically dependent on a Biomass Harvest Plan, the
Consultant strongly recommends developing this Plan prior to project development.
Operations Plan
In many Villages biomass boiler
projects will depend on collaboration
among a variety of entities, including
contract wood cutters, forest
landowners, the boiler technician,
building owners and operators, and
various governmental entities.
A plan for collecting biomass, paying
wood suppliers, allocating costs
among heat users, and operating and
maintaining the boiler and heat
distribution system is crucial to the
project’s success. Persons
responsible for each task must be identified.
Because the project’s success is critically dependent on an Operations Plan, the
Consultant strongly recommends developing this Plan prior to project development.
Community Facilities Information
Tribal Offices and Clinic
A new Community Hall is currently in the design phase and not yet built. Given the
biomass resource base and local climatic conditions, it is strongly recommended that a
biomass heating system, along with passive solar design, super -insulation, and
protected artic entry be incorporated into the building design. This Hall has the ability
to cost-effectively integrate a District Heating system into its initial design. The
Consultants recommend that the designers of the Community Hall consider clustering
heat loads when siting the building.
Figure 6: Greg Patsy, Water Plant and Washateria Operator
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Existing Tribal buildings
include the Tribal Offices and
Clinic. The existing Tribal
Office is operated and
maintained by the Tribal
Council. The Clinic, however, is
maintained by the City,
according to Tribal
Administrator Paul Mountain.
The Tribal Offices use one (1)
Monitor heater (Model 2400).
The heater serves about 2,400 sq. ft., and uses 500 – 1,000 gallons per year. For the
purposes of this study, the consultants assumed 700 gallons of fuel usage per year.
The Existing Heating systems for both the offices and clinic utilize Monitor heaters,
Monitor Model 2400. This model has a maximum net output of 37,200 btu/ hr.
City Buildings
Currently the city hosts 12 buildings, most of which are within 1,000 feet of each other,
and to the Tribal offices and Clinic. A list of City buildings, and heating system
descriptions, follow:
2 Washaterias (Upper Village and Lower Village)
City Mechanical shop
Liquor Store and Storage Building
Fuel Depot
Teen Recreation Center
Village Public Officer Building
Blackberry Well-house
Head Start Building
Log Cabin
Upper Village Washateria & Water Plant
The complex uses two (2) 810,000 BTU/ hour Well-McClain Boilers, which employ
water as the heat transfer fluid. The system serves about 1200 sq. ft. of building, and
dryers, washers, and showers. The complex is heated to a constant temperature 24
Figure 8: Upper Washateria
and Municipal Complex
highlighted in yellow
Figure 7: From top to bottom: Nulato Lower Washateria and Andrew
K. Demoski School.
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hours per day, 6 days per week during the heating season. It uses approximately 6,000
gallons of Fuel Oil #1 per year.
Store
The store adjacent to the Upper Washateria is about 1,200 square feet. No information
was collected on the Store’s heating system or fuel useage. Using HDD Analysis and
RET Screen analysis, the Consultant assumed the Store uses about 600 gallons of fuel oil
#1 per year. The store is located approximately 75 feet from the Upper Washateria.
Lower Village Washateria & Water Plant
The complex uses two (2) 643,000 BTU/hour Well-McClain Boilers (Model 678), which
employ glycol as the heat transfer fluid. The system serves about 5,042 sq. ft. of
building, in addition to a water plant an 874/d lift station. The system serves dryers,
washers, showers and bathrooms. The complex is heated to a constant temperature 24
hours per day, 6 days per week during the heating season. It uses approximately 8,000
gallons of Fuel Oil #1 per year.
Andrew K. Demoski School, Yukon-Koyukuk School District
The Demoski School is adjacent to the Lower Village Washateria and connected by a
walkway. In addition to its school function, it hosts many village events.
Currently the school uses two (2) 1,714 BTU/hr Power Flame Burner (Model CR -OB),
which employ water as the heat transfer fluid. There are some units which convert hot
water to hot air. The boilers serve about 24,874 sq. ft. In 2011, the school used 17,793
gallons of fuel oil. Usage ranges from 5.5 – 14.8 gallons per hour.
The Building Administrator noted a need for more reliable heat. The School District has
significant problems with the boiler system and repair is difficult given the lack of
locally available service providers. The Administrator has noted that the school is very
interested in biomass heating if there are operational savings over fuel oil.
Building Name Tribal
Office
Upper
Village
Washateria
Store Lower
Village
Washateria
Andrew K.
Demoski
School
Annual Gallons (Fuel Oil #1) 500-1,000
gal/ yr
6,000 gal/ yr 600 gal/ yr
(assumed)
8,000 gal/ yr 17,793 gal/ yr
Building Usage During
workdays
only. No
weekends.
Six days per
week
Six days per
week
Six days per
week
Primarily the
school week
and community
functions
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Heat Transfer Mechanism Hydronic Hydronic Unknown Hydronic Hydronic
Heating infrastructure need
replacement?
No No Unknown No Yes
Est. cords to heat the building 5 46 5 62 137
Recommended technology and fuel requirements
The recommended system design is a pre-fabricated, modular, containerized wood
biomass boiler unit.
For the Upper Washateria and Store, a containerized HELE (high efficiency, low
emissions) cordwood boiler is recommended. These types of systems are produced by
GARN, TARM USA and others. The GarnPac has about 350,000 BTU output and is
currently being employed in Thorne Bay. This type of system design is reco mmended
because it has demonstrated reliability, uses an accessible fuel, cordwood, and it is a
modular unit and therefore has lower installation cost and financing advantages. The
Consultant recommends adding providers of these units, Garn/Dectra, TARM,
Greenwood, and similar system manufacturers, to the list of potential equipment
providers.
For the Lower Washateria and School, the load is significant enough that it could be
adequately served by a containerized cordwood boiler system, a small wood chip
system, or a wood pellet system. Pellets would need to be imported from outside the
Village, but woodchips and cordwood could be procured from local forests given an
effective Harvesting Plan and investment in the appropriate equipment.
Containerized wood chip systems are sold by TARM USA, KOB, and others. TARM has
two boilers that are particularly applicable to interior heating projects: the Froling TX -
150 is a small-scale woodchip or pellet system that pre-dries chips prior to combustion.
The Froling Turbomatic is small-scale chip boiler that can burn cordwood in cases of
emergency. The Turbomatic is not currently distributed in the USA, but may become so
in the future. Froling Energy containerizes these units.
To produce woodchips, the Community would need an effective way of harvesting,
processing, and handling chips. Trees could be hand-felled and hand-fed into a grinder
and then automatically fed into a storage bin or chip van. Saw log or cordwood quality
segments could be separated and merchandised separately. Screens would need to be
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utilized to control feedstock granulometry. Additionally, chips would need to managed
with a bobcat or other loading device to improve air flow and decrease moisture
content.
While the chip processing and handling infrastructure is more expensive, the
Community would benefit from decreased pressure on the Cordwood supply and
potentially cheaper biomass feedstock.
Without a biomass supply inventory or harvest plan in place, the Consultant cannot
recommend the best system for the client. It is likely that all three types of infrastructure
would prove technically and economically viable, although the actual financial,
environmental, and social aspects would differ among them.
To complete this prefeasibility analysis, the Consultant has chosen a representational
boiler, the GarnPac containerized unit. Alternatively, a containerized Froling P-4 boiler
(pellet) or Froling Turbomatic (chip boiler) could offer similar containerized, modular
heating unit.
A district loop with two (2) GarnPac boilers (or equivalent systems) could service the
School and Lower Washateria in the Winter, while the Summer heat demand would
likely require only one boiler to fire. The buildings’ existing Fuel Oil infrastructure
would be retained to meet peak demand and as back up in every project building.
Other communities operating HELE cordwood boilers of a similar size, such as Dot
Lake and Ionia, report 2 cordwood stokings per day and 0.125 – 0.5 FTE1 (Full-time
equivalent employee) per boiler.
1 Nicholls, David. 2009. Wood energy in Alaska—case study evaluations of selected facilities. Gen. Tech. Rep. PNW-
GTR-793. Portland, OR: U.S. Department of Agriculture, Forest Service, Pacific Northwest Research Station. 33 p.
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Initial project development costs for a wood heating system costs may include:
Capital costs: boiler, hydronic pipe and other hardware, wood storage shelter,
fuel-handling equipment, shipping costs.
Engineering: storage design, plumbing integration, fuel-handling infrastructure.2
Permitting: no permits required. In lieu of permits, all regulations must be met.
Installation: Site work, installation, and integration into existing system.
Fuel storage: storage building, firewood chutes, or preparation of existing
storage room.
System building: (if required).
Ongoing operational costs may include:
Financing: Principal and interest payments from project debt, or profits from
project equity investment. In Village projects, financing costs likely do not apply.
Wood fuel purchases.
Amortization costs: capital equipment and other infrastructure.3 When projects
are grant financed, amortization does not apply.
Operations and Maintenance (O&M) labor.
2 Not all projects require engineering design.
3 Cash and accrual basis are two different accounting methods for project investment. Accrual accounting
amortizes project investment over the project lifetime (“lifecycle costs”). This method results in mo nies to
reinvest in new equipment at the end of its lifetime. Cash basis is simply on the dollars spent to operate,
maintain, and finance the project.
Fuel Consumption
Assumptions:
16.2 MMBTU/ Cord White Spruce
0.1250 MMBTU per gallon Oil #1
Annual
Gallons
Annual
MMBTU
Annual
Cords
Tribal Office 1,125 141 9
Upper Washateria 6,000 750 46.30
Store (est.)600 75 4.63
Upper Washateria + district (est.)6,600 825 51
Lower Washateria 8,000 1,000 62
School 17,793 2,224 137
Lwr Wash + School (est.)25,793 3,224 199
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Fossil fuel purchases and labor.4
Initial investment
The Upper Washataria + Store has an estimated Capitalization Cost of $339,900.
The Lower Washataria + School has an estimated Capitalization Cost of $518,000.
See charts below for cost estimates and sources. Full feasibility analysis and/or bids
would provide more detailed numbers.
It should be noted that some of these capitalization and project management costs could
be significantly trimmed down by choices in the project’s development, such as
technology, project management, and engineering.
8 The existing oil heat infrastructure will be retained for supplement heat and back-up. Therefore, the
fossil fuel system has ongoing O&M costs, albeit lower than if used as the primary heat source.
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Upper Washateria and Store
System Size (estimated net BTU/ hr)350,000
Capitalization costs Footnote
Capital equipment
GarnPac FOB Minnesota 100,000$ A A Dectra Corp estimate
Freight to Nulato 15,000$ B B Crowley & Lynden Transport estimates 4/17/12
Boiler Integration 50,000$ C C Dalson Energy estimate
District loop 38,000$ D D RET Screen analysis
subtotal 203,000$
Commissioning and training 4,000$ E E Alaskan Heat Technologies estimate
Project Management and Design
Engineering/ design 50,000$ F F Dalson Energy estimate
Permitting 2,000$ G G Dalson Energy estimate
Project Management 50,000$ H H Dalson Energy estimate
sub-total 309,000$
Contingency (10%)30,900$
Total 339,900$
Footnotes
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Lower Washateria and School
System Size (estimated net BTU/ hr)700,000
Capitalization costs Footnote
Capital equipment
GarnPac FOB Minnesota, qty. (2)200,000$ A A Dectra Corp estimate
Freight to Nulato 27,000$ B B Crowley & Lynden Transport estimates, 4/17/12
Boiler Integration 50,000$ C C Dalson Energy estimate
District loop 38,000$ D D RET Screen Analysis
subtotal 315,000$
Commissioning and training 4,000$ E E Alaskan Heat Technologies estimate
Project Management and Design
Engineering/ design 85,000$ F F Dalson Energy estimate
Permitting 2,000$ G G Dalson Energy estimate
Project Management 65,000$ H H Dalson Energy estimate
sub-total 471,000$
Contingency (10%)47,100$
Total 518,100$
Footnotes
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Operating Assumptions
The following assumptions are embedded in all financial analyses in this assessment. They include crucial project variables, s uch as the
price of fuel oil, wood fuel, and labor operating costs. See chart below.
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Assumptions for project buildings Upper Washateria +
district
Lower Washateria
and School Footnotes Footnotes
Total MMBTU per year 750 3,224 A A Estimates of annual fuel gallon useage, from year 2011
% load served by wood fuel 63%80%B B Dalson Energy HDD analysis
% load served by fuel oil 32%20%C C Dalson Energy HDD analysis
Total Cordwood per year (cords)36 169 D D Dalson Energy HDD analysis
Total Fuel Oil #1 per year (gal)2,357 5,109 E E Dalson Energy HDD analysis
Price per cord 250$ 250$ F F Informational interview with Greg Patsy, Washateria Manager
Price per gallon 6$ 6$ G G Informational interview with Greg Patsy, Washateria Manager
Biomass labor hours per year 600 1,800 H H
Oil labor hours per year 45 65 I I Dalson Energy estimate
Price per hour of labor 18$ 18$ J J Informational interview with Greg Patsy, Washateria Manager
Biomass preventative maintenance supplies cost 66$ 66$ K K
Oil nozzles and filters 250$ 250$ L L Dalson Energy estimate
Biomass boilers (lifetime operating hours)60,000 120,000 M M Dalson Energy estimate
Biomass boilers (operating hours per year)3,000 6,000
Biomass refractories (lifetime operating hours)45,000 45,000 N N
Oil boiler (lifetime operationg hours)60,000 60,000 O O Dalson Energy estimate
Electricity ($/kWh)0.63$ 0.63$ P P Estimated $0.63/kWh
Electricity Consumption (biomass system)1,800 3,600 Q Q
Amount financed
Term
Rate
Estimated 3 hours per day, 300 days per year per boiler.
Consistent with Dot Lake and Ionia Ecovillage cordwood
boiler labor requirements.
Information from Alaskan Heat Technologies. Chemicals max
at $250/ yr. Gasket kit at $75. Refractory replaced every 15
years at $500 -- $1,000.
Based on Information from Alaskan Heat Technologies. Entire
refractory replacement after 15 years of operation
Boiler: estimated 6 hours uptime, 300 days per year, 1 kW per
hour boiler. Does not include pump costs, which would be
the same for an oil district loop.
Subject to full feasibility study
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Operating Costs & Annual Savings
The following analyses estimate the operating costs and annual savings from installing biomass heating districts at the
Upper Washataria + small district and Lower Washataria + School. Savings are calculated on both a cash and accrual
basis.
Biomass
Oil 39,600 Wood fuel 9,000$
Labor 810$ Labor 10,800$
Supplies 250$ Preventative maintenance supplies 66$
Lifecycle 1,500$ Electricity 1,134$
Lifecycle 16,995$
Financing subject to feasibility
Fuel Oil (supplement)
Oil 14,142$
Labor 405$
Supplies 250$
Lifecycle 480$
Total Annual O&M Costs (accural basis)42,160$ Total Annual O&M Costs (accural basis)53,272$ (11,112)$ (Accrual)
Total Annual O&M Costs (cash basis) 40,660$ Total Annual O&M Costs (cash basis) 35,797$ 4,863$ (Cash)
Annual Savings
O&M Costs Fuel Oil O&M Costs: Biomass + Fuel Oil (supplement)
Upper Washataria + small district
22
Biomass
Oil 154,758 Wood fuel 42,250$
Labor 1,170$ Labor 32,400$
Supplies 250$ Supplies 66$
Lifecycle 2,750$ Electricity 2,268$
Lifecycle 25,905$
Financing subject to feasibility
Fuel Oil (supplement)
Oil 30,654$
Labor 1,170$
Supplies 250$
Lifecycle 550$
Total Annual O&M Costs (accural basis)158,928$ Total Annual O&M Costs (accural basis)135,513$ 23,415$ (Accrual)
Total Annual O&M Costs (cash basis) 156,178$ Total Annual O&M Costs (cash basis) 109,058$ 47,120$ (Cash)
Annual Savings
O&M Costs Fuel Oil O&M Costs: Biomass + Fuel Oil (supplement)
Lower Washataria + School
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Financial metrics
The following financial analyses are entirely reliant on the preceding assumptions and
O&M models. These same models can be refined to reflect more sophisticated financial
profiles if additional study is warranted.
Simple payback period
Present Value
The prefeasibility Scope of Work does not allow building a full economic model with
escalation rates of fuel, labor, and supplies cost. Present value analysis is completed on
the basis of the savings demonstrated in this section.
Upper Washataria +
District
Lower Washataria +
School
Initial Investment 339,900$ 518,100$
Cash savings, Year 1 4,863$ 47,120$
Simple Payback (Years)69.9 11.0
SIMPLE PAYBACK
5.50%
10
Initial investment 339,900$ Initial investment 518,100$
4,863$ 47,120$
Upper Washataria +
district
Lower Washataria +
School
Interest Rate per Month 0.46%0.46%
Number of Payments in project lifetime 120 120
Payment per month (2,833)$ (4,318)$
Future Value (cash value of new project)4,863$ 47,120$
Payments at end of period = 0 0 0
Present Value $258,188 $370,610
Equation Values
Future value (cash value of new project)
Assumptions
Present Value
Upper Washateria + District
Interest Rate
Term (years)
Future value (cash value of new project)
Lower Washateria + school
24
Net Present Value
The prefeasibility Scope of Work does not allow building a full economic model with escalation rates of fuel, labor, and supp lies cost.
Net present value analysis is completed on the basis of the savings demonstrated in Year 1, generally inflating at 1.5% per year.
Internal Rate of Return
The prefeasibility Scope of Work does not allow building a full economic model with escalation rates of fuel, labor, and supp lies cost.
IRR analysis is completed on the basis of the savings demonstrated in this section.
Life cycle cost analysis (LCCA) for School
LCCA analysis for Andrew K. Demoski School follows. GSF stands for gross square feet, in this case the sum of the floor area in the school.
3.50%
1.50%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 NPV
Upper Washataria + district 4,863$ 4,936$ 5,010$ 5,085$ 5,161$ 5,239$ 5,317$ 5,397$ 5,478$ 5,560$ 5,643$ 5,728$ 5,814$ 5,901$ 5,990$ 6,080$ 6,171$ 6,263$ 6,357$ 6,453$ $78,562
Lower Washataria + School 47,120$ 47,827$ 48,544$ 49,272$ 50,011$ 50,761$ 51,523$ 52,296$ 53,080$ 53,876$ 54,684$ 55,505$ 56,337$ 57,182$ 58,040$ 58,911$ 59,794$ 60,691$ 61,602$ 62,526$ $761,259
Discount Rate
General Inflation Rate
Net Present
Value
1.50%
Year 0 1 2 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 IRR
Upper Washataria + district (339,900)$ 4,863$ 4,936$ 5,085$ 5,161$ 5,239$ 5,317$ 5,397$ 5,478$ 5,560$ 5,643$ 5,728$ 5,814$ 5,901$ 5,990$ 6,080$ 6,171$ 6,263$ 6,357$ 6,453$ -9%
Lower Washataria + School (518,100)$ 47,120$ 47,827$ 49,272$ 50,011$ 50,761$ 51,523$ 52,296$ 53,080$ 53,876$ 54,684$ 55,505$ 56,337$ 57,182$ 58,040$ 58,911$ 59,794$ 60,691$ 61,602$ 62,526$ 8%
General Inflation RateInternal Rate of Return
25
District:Yukon Koyukuk
School:Andrew K. Demoski
Project: Lower Washateria + School biomass boiler
Project No. NA
Study Period:20
Discount Rate: 3.50%
Alternative #1 (low)Alternative #2 (high)
Initial Investment Cost 471,000$ 518,100$
O&M and Repair Cost 1,761,927$ 2,486,170$
Replacement Cost 74,247$ 150,000$
Residual Value 202,031$ 352,000$
Total Life Cycle Cost 2,509,205$ 3,506,270$
GSF of Project 29,916 29,916
Initial Cost/ GSF 15.74$ 17.32$
LCC/ GSF 83.88$ 117.20$
Life Cycle Costs of Project Alternatives
Lower Washateria + Andrew K. Demoski School
26
Life cycle cost analysis (LCCA) for School, continued
YEAR 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Discount Rate 3.50%
Gen'l Inflation for O&M 1.50%
NPV
O&M $1,761,927 109,058$ 110,694$ 112,355$ 114,040$ 115,750$ 117,487$ 119,249$ 121,038$ 122,853$ 124,696$ 126,567$ 128,465$ 130,392$ 132,348$ 134,333$ 136,348$ 138,393$ 140,469$ 142,576$ 144,715$
Replacement $74,247 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 100,000$
Residual $202,031 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 402,000$
Discount Rate 3.50%
Gen'l Inflation for O&M 1.50%
NPV
O&M $2,486,170 109,058$ 109,058$ 110,694$ 112,355$ 114,040$ 115,750$ 117,487$ 119,249$ 121,038$ 122,853$ 124,696$ 126,567$ 128,465$ 130,392$ 132,348$ 134,333$ 136,348$ 138,393$ 140,469$ 142,576$
Replacement $150,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 150,000$
Residual $352,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 352,000$
Alt. 1
Alt 2
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Conclusion
The village of Nulato has significant opportunities for biomass heating, owing to the high cost of fuel
oil, accessible cordwood supply, and existing institutional heat loads that could be adequately served
by containerized biomass heating units.
For the purposes of this project, containerized cordwood boilers were scoped as the appropriate
technology. However, a project the size of Nulato’s Lower Washateria and School should seriously
consider woodchip boilers and chipping equipment. Without a biomass inventory and harvest pl an,
analysis and recommendation as to the most appropriate technology for this project cannot be
undertaken.
Cordwood is an accessible and sustainable biomass supply in the Village so long as a Biomass
Harvest Plan is appropriately developed and executed. Because the project’s success is critically
dependent on a Biomass Harvest Plan, the Consultant strongly recommends developing this Plan prior
to project development. Additionally, because the project’s success is critically dependent on an
Operations Plan, the Consultant strongly recommends developing this Plan prior to project
development.
All projects examined in this pre-feasibility report show positive NPV and cash savings, which
suggests that development may be warranted. A small district heating facility serving the Lower
Washataria and School is the most financially viable of those examined.
28
Consultant/Authors of this report:
Dalson Energy is a Renewable Energy Consulting and Technology Research firm based in
Anchorage. Dalson staff and partners have decades of experience in construction project
management, project development consulting and renewable energy technology research. Dalson
teams with licensed engineers, architects and designers in Alaska, Canada and Lower 48.
Dalson Energy has worked with Alaska Energy Authority, Alaska Center for Energy & Power,
University of Alaska Fairbanks, Washington State CTED (Community Trade & Economic
Development) and California Energy Commission on biomass energy technology research.
Dalson’s President, Thomas Deerfield, has been involved in biomass energy RD&D since 2001,
winning grants and managing projects with NREL (National Renewable Energy Labs), USFS (US
Forest Service), and CEC (California Energy Commission).
Thomas managed the field-testing of biomass CHP systems, including the first grid-connected
biomass gasification CHP system in the US. (2007). Thomas coordinated the design and creation of
the first prototype Biomass “Boiler in a Box” in Alaska, in 2010. That Garn -based system is now
deployed in Elim, in the Bering Sea region.
Thomas founded Shasta Energy Group (SEG), a 501c3 nonprofit, and managed wi nd energy research,
biomass energy feasibility studies, energy efficiency for buildings, and hydronic heating system
research design and development (RD&D). He also initiated a rural economic development think
tank and has engaged his writing skills to assist many other renewable energy project initiatives.
Wynne Auld is a Biomass Energy Specialist with Dalson Energy. She focuses on assessing and
developing woody biomass energy projects. Over the past few years, she has supported the business
development of integrated biomass energy campuses in Oregon and Idaho, especially related to their
energy initiatives. Her efforts have included marketing Campus biomass heating products to major
wholesalers and retail buyers, and planning and developing Campus sort yards and small-scale CHP.
Wynne also specializes in assisting commercial and municipal building managers in assessing the
feasibility of biomass heating, and implementing their projects. She works to ensure vibrant rural
communities through sustainable natural resource utilization.
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Supplement: Community Wood Heating Basics
Wood fuel as a heating option
When processed, handled, and combusted appropriately, wood fuels are
among the most cost-effective and reliable sources of heating fuel for
communities adjacent to forestland.
Compared to other heating energy fuels, wood fuels are characterized by
lower energy density and higher associated transportation and handling
costs. This low bulk density results in a shorter viable haul distance for
wood fuels compared to fossil fuels. However, this “limit” also creates an
advantage for local communities to utilize locally-sourced wood fuels, while
simultaneously retaining local energy dollars and excercising local resource
management.
Most Interior villages are particularly vulnerable to high energy prices
because the region has over 13,500 heating degree days5 (HDD) per year –
160% of Anchorage’s HDDs, or 380% of Seattle’s HDDs. For many
communities, wood-fueled heating lowers fuel costs. For example, cordwood
sourced at $250 per cord is just 25% of the cost per MMBTU as fuel oil #1
sourced at $7 per gallon. Besides the financial savings, local communities
benefit from the multiplier effect of circulating fuel money in the
community longer, more stable energy prices, job creation, and more active
forest management.
In all the Interior villages studied, the community’s wood supply and
demand are isolated from outside markets. Instead, the firewood market is
influenced by land ownership, existing forest management and ecological
conditions, local demand and supply, and the State of Alaska Energy
Assistance program.
The nature of wood fuels
Wood fuels are specified by moisture content, granulometry, energy density,
ash content, dirt and rocks, and fines and coarse particles. Each of these
characteristics affects the wood fuel’s handling characteristics, storage
5 Heating degree days are a metric designed to reflect the amount of energy needed to heat the
interior of a building. It is derived from measurements of outside temperature.
Figure 9: Cordwood
Figure 10: Ground wood chips
used for mulch.
Figure 11: Wood briquettes, as a
substitute for cordwood. Cross
sections of these briquettes make
“wafers” which can be automatically
handled in biomass boiler systems.
Figure 12: wood pellets
30
requirements, and combustion process. Fuels are considered higher quality if they have lower
moisture, ash, dirt, and rock contents; consistent granulometry; and higher energy density.
Many types of fuel quality can be used in wood heating projects so long as the infrastructure
specifications match the fuel content characteristics. Typically, lower quality fuel will be the lowest
cost fuel, but it will require more expensive storage, handling, and combustion infrastructure , as well
as additional maintenance.
Projects in interior Alaska must be designed around the availability of wood fuels. Some fuels can be
manufactured on site, such as cordwood, woodchips, and briquettes. The economic feasibility of
manufacturing on site can be determined by a financial assessment of the project; generally speaking,
larger projects offer more flexibility in terms of owning and operating harvesting and manufacturing
equipment, such as a wood chipper, than smaller projects.
It is unlikely that interior communities will be able to manufacture pellets, from both a financial,
operational, and fuel sourcing perspective. However, some interior communities may be able to
manufacture bricks or firelogs made from pressed wood material. These products can substitute for
cordwood in woodstoves and boilers, while reducing supply pressure on larger diameter trees than
are generally preferred for cordwood. At their simplest, brick presses are operated by hand , but
require chipped, dry fuel.
The basics of wood-fueled heating
Biomass heating systems fit into two typical categories: first, stoves and fireplaces that heat space
directly through convection and radiation by burning cordwood or pellets; second, hydronic systems
where the boiler burns cordwood, woodchips or pellets to heat l iquid that is distributed to radiant
piping, radiators or heat exchangers. The heated liquid is distributed out to users, then returned to
the heat source for re-heating.
Hydronic systems are appropriate for serving individual buildings, or multiple buildings with
insulated piping called heat loops. Systems that serve multiple buildings are called district heating
loops. District heating is common in Europe, where larger boilers sometimes serve entire villages.
Biomass boilers are dependent on the compatibility of the chosen fuel, handling system, and
combustion system. General categories for typically available biomass fuel systems follow:
Batch load solid chunk boiler
Semi-automated or fully-automated chipped or ground biomass boilers
Fully-automated densified-fuel boiler, using pellets, bricks, or pucks
The system application is typically determined by size of heat load, available wood fuels, and
available maintenance personnel. General categories for heat load and wood fuel follow:
31
Loads < 1 MMBTU often use cordwood or pellet boilers
Loads > 1MMBTU often use pellet or woodchip boilers
Loads > 10MMTU often use hog-fuel (mixed ground wood)
Each wood fuel type has different handling requirements and is associated with different emission
profiles. For example, industrial systems greater than 10 MMBTU often require additional particulate
and emission controls because of the combustion properties of hog-fuel.
One category of system that is particularly appropriate for remote rural communities is cordwood
boilers. Cordwood boilers are batch-loaded with seasoned cordwood. A significant advantage to
cordwood is that very little infrastructure is needed to manufacture or handle the heating fuel. At its
most basic, cordwood can be “manufactured” with a chainsaw (or handsaw) and an ax, and residents
of rural communities are often accustomed to harvesting wood to heat their homes and shops.
Harvesting in most Interior villages is accomplished with ATV’s, river skiffs, sleds and dog teams,
and snow machines. Since cordwood systems are batch loaded by hand, they do not require
expensive automated material handling systems. Covered storage is required; such storage may be as
simple as an existing shed or a vented shipping container, rather than newly constructed storage
structures.
Challenges to cordwood include higher labor costs associated with manual loading. Some LEHE (low
efficiency, high emission) technologies such as Outdoor Wood Boilers (OWBs) have been criticized
for their high emissions and excessive wood consumption.
Cordwood systems are typically less than 1 MMBTU. However, if needed, some types of cordwood
boilers can be “cascaded,” meaning multiple boilers can meet heat demand as a single unit. However,
above a certain heat load, automated material handling and larger combustion systems become
viable.
Woodchip systems can be automated and thereby less labor intensive. However, woodchip systems
have significantly higher capital costs than both cordwood and pellet systems. Additionally, a
reliable stream of woodchips typically depends on a regionally active forest products manufacturing
base in the area, and active forest management. In most Interior communities, institutional heating
with woody biomass does not justify the purchase of log trucks, harvesting, handling, and
manufacturing equipment.
Pellet systems are the most automated systems, and have lower capital equipment costs than
woodchip systems. Lower costs are due to the smaller size of required infrastructure and simplified
handling and storage infrastructure. However, pellet fuel and other densified fuels tend to be more
expensive than other wood fuels, and require reliable access to pellet fuels.
For any system, the mass of feedstock required annually is determined by three parameters:
1) Building heat load
32
2) Net BTU content of the fuel
3) Efficiency of the boiler system
Building heat loads are determined by square footage, orientation a nd usage, as well as energy
efficiency factors such as insulation, moisture barriers and air leakage. Usage is particularly
important because it influences peak demand. For example, a community center which is used only a
few times per month for events, and otherwise kept at a storage temperature of 55 d. F, would have a
much different usage profile than a City Office which is fully occupied during the work day and
occasionally during evenings and weekends.
Building heat load analysis, including the building usage profile, is a particularly important part of
boiler right-sizing. A full feasibility analysis would conduct analyses that optimize the return on
investment (ROI) of systems. Typically, optimizing a biomass project’s ROI depends on a
supplementary heating system, such as an oil fired system, to meet peak demand and prevent short -
cycling of the biomass boiler. Full feasibility analyses may not be necessary for small projects,
especially for those employing cordwood boilers.
Biomass boiler efficiencies vary from 60% to 80%, depending on the manufacturer and the field
conditions of the equipment. The efficiency is strongly influenced by the BTU value and MC
(moisture content) of the fuel. Wood fuels with greater than 50% MC generally result in lower
efficiency systems, because some energy is used to drive off moisture from the fuel during the
combustion process. The reduction in energy output is mathematically equal; 50% MC generally
means 50% reduction in potential BTU value.
Like other combustion-based energy systems, woody biomass boilers produce emissions in the
combustion process. Compared to fossil fuels (coal, natural gas, and fuel oil), wood fuel emissions
are low in nitrogen oxides (NOx); carbon monoxide (CO, a product of incomplete co mbustion); sulfur
dioxide (SO2); and mercury (Hg). Because these compounds are all products of the forest and CO
would release naturally during the process of decay or wildfire, they generally do not concern
regulatory agencies. For emission control agencies, the real interest is particulate matter (PM)
emissions, which affect the air quality of human communities. Some wood systems are extremely
sophisticated, producing less than 0.06 lb/ MMBTU of PM.
Effective methods of PM control have been developed to remove most of the particles from the
exhaust air of wood combustion facilities. These include introduction of pre-heated secondary air,
highly controlled combustion, and PM collection devices.
Biomass boiler systems typically integrate a hot water storage tank, or buffer tank. The storage tank
prevents short cycling for automated boilers and improves efficiency and performance of batch -fired
systems, by allowing project buildings to draw on the boiler’s hot water long after the combustion
process. The GarnPac boiler design incorporates hot water storage into the boiler jacket itself, storing
33
approximately 2,200 gallons of hot water. Other boilers are typically installed with a separate hot
water storage tank.
Available wood heating technology
This section will focus generally on manufacturers of the types of technology discussed previously.
Cordwood Boilers
High Efficiency Low Emission (HELE) cordwood boilers are designed to burn cordwood fuel cleanly
and efficiently.
Cordwood used at the site will ideally be seasoned to 25% MC (moisture content) and meet the
dimensions specified by the chosen boiler. The actual amount of cordwood used would depend on
the buildings’ heat load profile, and the utilization of a fuel oil system as back up.
The following table lists three HELE cordwood boiler suppliers, all of which have units operating in
Alaska. Greenwood and TarmUSA, Inc. have a number of residential units operating in Alaska, and
several GARN boilers, manufactured by Dectra Corporation, are used in Tanana, Kasilof, Dot Lake,
Thorne Bay and other locations to heat homes, Washaterias, and Community Buildings.
HELE Cordwood Boiler Suppliers
Vendor Btu/hr ratings Supplier
Tarm 100,000 to 198,000 Tarm USA
www.tarmusa.com
Greenwood 100,000 to 300,000 Greenwood
www.greenwoodusa.com
GARN 250,000 to 700,000 Dectra Corp.
www.dectra.net/garn
Note: These lists are representational of available systems, and are not inclusive
of all options.
Bulk Fuel Boilers
The term “bulk fuel” refers to systems that utilize wood chips, pellets, pucks, or other loose
manufactured fuel. Numerous suppliers of these boilers exist. Since this report focuses on village -
scale heating, the following chart outlines manufacturers of chip and pellet fuel boilers < 1 MMBTU.
HELE Bulk Fuel Boiler Suppliers
Vendor Btu/hr ratings Supplier
34
Froling
35,800 to 200,000; up to 4 can be
cascaded as a single unit at
800,000 BTU
Tarm USA
www.tarmusa.com
KOB
512,000 – 1,800,000 BTU (PYROT
model)
Ventek Energy Systems Inc.
peter@ventekenergy.com
Binder 34,000 BTU – 34 MMBTU BINDER USA
contact@binder-boiler.com
Note: These lists are representational of available systems, and are not inclusive
The following is a review of Community Facilities being considered for biomass heating. The
subsequent section will recommend a certain type of biomass heating technology, based on the
Facility information below.
District heat loops
District heat loops refers to a system for heating multiple buildings from a central power plant. The
heat is transported in a piping system to consumers in the form of hot water or steam.
These are the key factors that affect the cost of installing and operating a district heating system6:
Heat load density.
Distance between buildings. Shorter distances between buildings will allow use of smaller
diameter (less expensive) pipes and lesser pumping costs.
Permafrost. In the Interior, frozen soil could affect construction costs and project feasibility.
Aboveground insulated piping may be preferred to underground piping, such as the
cordwood system recently installed in Tanana, Alaska.
Piping materials used. Several types of tubing are available for supply and return water. Pre-
insulated PEX tubing may be the preferred piping material for its flexibility and oxygen
barrier.
District loop design. Water can be piped in one direction (i.e., one pipe enclosed) or two
directions (two pipes enclosed) for a given piping system. Design affects capital costs and
equality of heat distribution.
Other considerations. Pump size, thermal load (BTUs per hour), water temperature, and
electrical use are other variables.
For the purposes of this study, the consultants have chosen to estimate the costs of district heat loops
using the RET Screen, a unique decision support tool developed with the contribution of numerous
6 Nicholls, David; Miles, Tom. 2009. Cordwood energy systems for community heating in Alaska—an
overview. Gen. Tech. Rep. PNW-GTR-783. Portland, OR: U.S. Department of Agriculture, Forest
Service, Pacific Northwest Research
Station. 17 p.
35
experts from government, industry, and academia. The software, provided free-of-charge, can be
used worldwide to evaluate the energy production and savings, costs, emission reductions, financial
liability and risk for various types of Renewable-energy and Energy-efficient Technologies (RETs),
including district heat loops from biomass.