HomeMy WebLinkAboutNative Village of Kluti-Kaah Feasibility Assessment for Biomass Heating Systems - Sep 2014 - REF Grant 7015001Feasibility Assessment for Biomass Heating Systems
Multi-Use Facility, Kluti-Kaah, Alaska
800 F Street, Anchorage, AK 99501
p (907) 276-6664 f (907) 276-5042
Tony SlatonBarker, PE, and
Lee Bolling, CEA, CEM
FINAL REPORT 9/4/2014
Feasibility Assessment for Biomass Heating Systems Kluti-Kaah, AK
Coffman Engineers, Inc. i
Contents
I. Executive Summary ............................................................................................................ 1
II. Introduction ...................................................................................................................... 2
III. Preliminary Site Investigation ........................................................................................... 3
BUILDING DESCRIPTION ................................................................................................................................................... 3
EXISTING HEATING SYSTEM .............................................................................................................................................. 3
DOMESTIC HOT WATER................................................................................................................................................... 3
BUILDING ENVELOPE ....................................................................................................................................................... 3
AVAILABLE SPACE ........................................................................................................................................................... 3
STREET ACCESS AND FUEL STORAGE ................................................................................................................................... 3
BUILDING OR SITE CONSTRAINTS ....................................................................................................................................... 4
BIOMASS SYSTEM INTEGRATION ........................................................................................................................................ 4
BIOMASS SYSTEM OPTIONS .............................................................................................................................................. 4
IV. Energy Consumption and Costs ......................................................................................... 6
WOOD ENERGY ............................................................................................................................................................. 6
ENERGY COSTS .............................................................................................................................................................. 6
EXISTING FUEL OIL CONSUMPTION .................................................................................................................................... 7
BIOMASS SYSTEM CONSUMPTION ..................................................................................................................................... 8
V. Preliminary Cost Estimating ............................................................................................... 9
VI. Economic Analysis .......................................................................................................... 11
O&M COSTS ..............................................................................................................................................................11
DEFINITIONS................................................................................................................................................................11
RESULTS .....................................................................................................................................................................13
SENSITIVITY ANALYSIS ...................................................................................................................................................13
VII. Forest Resource and Fuel Availability Assessments ........................................................ 14
FOREST RESOURCE ASSESSMENTS ....................................................................................................................................14
AIR QUALITY PERMITTING ..............................................................................................................................................14
VIII. General Biomass Technology Information ..................................................................... 15
HEATING WITH WOOD FUEL ...........................................................................................................................................15
TYPES OF WOOD FUEL ..................................................................................................................................................15
HIGH EFFICIENCY WOOD PELLET BOILERS .........................................................................................................................16
HIGH EFFICIENCY CORD WOOD BOILERS ...........................................................................................................................16
LOW EFFICIENCY CORD WOOD BOILERS ...........................................................................................................................17
HIGH EFFICIENCY WOOD STOVES ....................................................................................................................................17
BULK FUEL BOILERS ......................................................................................................................................................17
GRANTS .....................................................................................................................................................................17
Appendices
Appendix A Site Photos
Appendix B Economic Analysis Spreadsheet
Appendix C Site Plan
Appendix D AWEDTG Field Data Sheet
Feasibility Assessment for Biomass Heating Systems Kluti-Kaah, AK
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Abbreviations
ACF Accumulated Cash Flow
ASHRAE American Society of Heating, Refrigeration, and Air-Conditioning Engineers
AEA Alaska Energy Authority
AFUE Annual Fuel Utilization Efficiency
B/C Benefit / Cost Ratio
BTU British Thermal Unit
BTUH BTU per hour
CCF One Hundred Cubic Feet
CEI Coffman Engineers, Inc.
CFM Cubic Feet per Minute
Eff Efficiency
F Fahrenheit
ft Feet
GPM Gallons Per Minute
HP Horsepower
HVAC Heating, Ventilating, and Air-Conditioning
in Inch(es)
kWh Kilowatt-Hour
lb(s) Pound(s)
MBH Thousand BTUs per Hour
O&M Operations and Maintenance
MMBTU One Million BTUs
PC Project Cost
R R-Value
SF Square Feet, Supply Fan
TEMP Temperature
V Volts
W Watts
Feasibility Assessment for Biomass Heating Systems Kluti-Kaah, AK
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List of Figures
Fig. 1 Native Village of Kluti-Kaah, Alaska Google Maps ......................................................................... 2
Fig. 2 Multi-Use Facilty Google Maps ...................................................................................................... 2
Fig. 3 Maine Energy Systems Pellet Boiler and Polydome Silo .................................................................. 5
List of Tables
Table 1 Economic Evaluation Summary ..................................................................................................... 1
Table 2 Energy Comparison ....................................................................................................................... 7
Table 3 Existing Fuel Oil Consumption ....................................................................................................... 7
Table 4 Proposed Biomass System Fuel Consumption .............................................................................. 8
Table 5 Estimate of Probable Cost ...........................................................................................................10
Table 6 Inflation rates ..............................................................................................................................11
Table 7 Economic Definitions ...................................................................................................................12
Table 8 Economic Analysis Results ...........................................................................................................13
Table 9 Sensitivity Analysis ......................................................................................................................13
Feasibility Assessment for Biomass Heating Systems Kluti-Kaah, AK
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I. Executive Summary
A preliminary feasibility assessment was completed to determine the technical and economic viability of
biomass heating systems at Kluti-Kaah Multi-Use Facility in Kluti-Kaah, Alaska, near Copper Center. The
study evaluated a wood pelle
heating requirements. The high price of fuel oil is the main economic driver for the use of lower cost
biomass heating.
At this time the Multi-Use Facility is an unfinished structure with no mechanical or electrical equipment.
It is assumed that the proposed biomass system will be installed at the same time as the initial mechanical
system, which will reduce overall installation costs of the proposed biomass system.
The proposed biomass system includes two pellet boilers located in the existing mechanical room. Four
exterior pellet silos will transfer pellets via augers to the pellet boiler day hoppers. Wood pellets are
delivered by an auger truck.
The results of the economic evaluation are shown below. The proposed pellet system is economically
justified at this time, due to the fact that the benefit to cost ratio of the option is greater than 1.0, over a
20 year project life.
Economic Analysis Results
Project Capital Cost (Additional Cost of Pellet System) $130,845
Present Value of Project Benefits (20 year life) $897,857
Present Value of Operating Costs (20 year life) $586,831
Benefit / Cost Ratio of Project (20 year life) 2.38
Net Present Value (20 year life) $180,181
Year Accumulated Cash Flow is Net Positive First Year
Year Accumulated Cash Flow > Project Capital Cost 12 years
Simple Payback 16.8 years
Table 1 Economic Evaluation Summary
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II. Introduction
A preliminary feasibility assessment was completed to determine the technical and economic viability of
biomass heating systems for the Multi-Use Facility for the Native Village of Kluti-Kaah in Kluti-Kaah, Alaska,
near Copper Center. The location of the building is shown in Figures 1 and 2.
Fig. 1 Native Village of Kluti-Kaah, Alaska Google Maps
Fig. 2 Multi-Use Facilty Google Maps
Feasibility Assessment for Biomass Heating Systems Kluti-Kaah, AK
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III. Preliminary Site Investigation
Building Description
The Kluti-Kaah Multi-Use Facility is a partially constructed building located in the center of the Kluti-Kaah
Village. At the time of the site visit, the facility is an unfinished, un-insulated structure which no electricity,
lights, mechanical equipment, or interior finishes. When completed the facility will house a full
structural shell contains 12,675 SF and was completed in two phases. The gymnasium was constructed in
1999 and the office addition was constructed in 2009. The village is currently seeking funding to finish
the construction of the facility, independent of the biomass heating system upgrade.
The 2009 design drawings for the facility also show future additions that may be considered. These
additions include a future clinic and a future head start area. The building is currently unoccupied because
it is un-finished and unusable at this time. It is estimated that the facility would be used 60 hrs per week
when completed. There have been no energy audits of the building. Please refer to Appendix D for field
data sheet that contains all pertinent information gathered during the site visit.
Existing Heating System
There is no heating system installed in the building at this time. According to design drawings, the facility
will be heated by two identical Weil McLain Model 480 heating oil boilers (396 MBH output, 80%
combustion efficiency). The gym will be served by four ceiling mounted unit heaters and the office
addition will be served by radiant floors. An air handling unit will provide ventilation to the gym and office
addition. A future 1000 gallon fuel oil tank is called for on the design drawings.
Domestic Hot Water
There is no domestic hot water system installed in the building at this time. According to the design
drawings there will be six shower stalls in the locker rooms. It is anticipated that hot water will be
primarily used for hand washing and showering at the facility when it is completed. The design drawings
call for a Bock 541E oil fired hot water heater (83 gallons storage with a 623 MBH input burner).
Building Envelope
The building only consists of a structural shell. At, this time the gym appears to be partially insulated with
spray foam. The design drawings call for R-38 minimum spray foam insulation on the gym walls. The
office addition is 2x6 wood stud construction with no insulation installed at this time. According to design
drawings the office walls will have R-21 fiberglass batt insulation. There are no windows installed in the
facility at this time. The building does not have arctic entries.
Available Space
There is available space in the large mechanical room. Since there has been no mechanical equipment
installed, the room can be redesigned to allow space for new biomass boilers.
Street Access and Fuel Storage
The facility is located on a large gravel site with easy access to all sides of the building. Gravel roads run
parallel to the north and west side of the building. A bulk pellet delivery truck can easily access the west
Feasibility Assessment for Biomass Heating Systems Kluti-Kaah, AK
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side of the building where the mechanical room is located, and where future wood pellet silos can be
located. The wood pellets can be stored in four large 8.5 ton silos, which can be filled with an auger boom
from the pellet delivery truck. Please refer to Appendix C for the site plan.
Building or Site constraints
The site is flat with no significant site constraints. There were no wetlands or signs of historical structures
observed.
Biomass System Integration
partially redesigned to incorporate a biomass boiler system.
Biomass System Options
The client prefers a biomass fuel that is easy to handle, utilizes automatic fuel loading, and is locally
available. Automatic fuel loading is necessary because the village does not wish to manually handle and
load a batch burning system (such as a cord wood Garn boiler).
Based on these criteria, wood pellets are the preferred biomass fuel. Wood pellets are locally available in
Fairbanks and in Delta Junction. Cord wood was not considered as an option because it must be manually
batch loaded and fired.
After considering the multiple options available for biomass, this study focuses on a pellet boiler system
with oil fired boiler backup. The pellet boilers will be used as the primary heating source for the facility.
The oil fired boiler will be used for peaking during the coldest days of the year and also as a backup source
of heat.
The design drawings consist of two Weil McLain 480 oil fired boilers. This study considers
replacing one of the oil boilers with two Maine Energy Systems (MES) PES56 pellet boilers (191 MBH
output each). In this scenario the two MES pellet boilers and the one Weil McLain oil boiler will be able
to provide combined output of 778 MBH, which will meet the estimated building heat load during the
coldest day of the year. The facility heat load was estimated at 693 MBH, based on 25 BTU/SF conduction
losses and 1.25 CFM/SF outside air loads (with 20% outside air in winter).
Wood pellets will be stored in four 8.5 ton silos located on the west side of the building near the
mechanical room. Polydome silos were used as the basis for this study and are available through Superior
Pellets in Fairbanks. thick concrete slabs
approximately 8 ft by 8 ft across. For this study, it is assumed that one large 8 ft x 32 ft slab is made for
all four silos to be installed on, to save costs.
Transfer augers will move the pellets from the four silos to a pellet hopper integrated into each pellet
boiler. The pellet hopper is connected to the boiler and is used for daily feeding of pellets. For this study,
two Maine Energy Systems (MES) PES56 pellet boilers were considered. These boilers are high quality
pellet boilers with a good track record for reliability and lifespan. The PES56 has can modulate down to
30% firing rate, has automatic ash removal systems and is easily maintainable.
Feasibility Assessment for Biomass Heating Systems Kluti-Kaah, AK
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Fig. 3 Maine Energy Systems Pellet Boiler and Polydome Silo
(Not to scale)
Two MES pellet boilers were chosen instead of one larger pellet boiler to allow for the pellet system to
have greater turndown. Having two smaller pellet boilers sequenced together allow them to efficiently
match the heat load of the facility, which is more efficient and reduces wood pellet consumption.
Please refer to Appendix C for a site plan of the biomass system.
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IV. Energy Consumption and Costs
Wood Energy
The gross energy content of wood pellets varies depending on tree species, moisture content and
manufacturing. Wood pellets available in Alaska can range in moisture content from 4.5% to 6.5% and in
energy value from 8,000 to 8,250 BTU/lb, depending on manufacturer. For this study, wood pellets were
estimated to have 8,000 BTU/lb, which is equivalent to 16.0 MMBTU/ton. To determine the delivered
$/MMBTU of the biomass system, an 86% efficiency for the Maine Energy System pellet boiler was
assumed. This is based on manufacturer documentation.
Wood pellets were used as the biomass fuel for this study. However, the following is additional
information on cord wood fuel for future evaluations. The gross energy content of a cord of wood varies
depending on tree species and moisture content. Black spruce, white spruce and birch at 20% moisture
content have respective gross energy contents of 15.9 MMBTU/Cord, 18.1 MMBTU/cord and 23.6
MMBTU/cord, according to the UAF Cooperative Extension. Wet or greenwood has higher moisture
contents and require additional heat to evaporate moisture before the wood can burn. Thus, wood with
higher moisture contents will have lower energy contents. Seasoned or dry wood will typically have 20%
moisture content. For this study, cord wood was estimated to have 16.0 MMBTU/cord. This is a
conservative estimate based on the fact that the community has access to both spruce and birch. To
determine the delivered $/MMBTU of the biomass system, a 75% efficiency for batch burning systems
was assumed. This is based on manufacturer documentation and typical operational issues which do not
allow firing 100% of the time.
Energy Costs
The high price of fuel oil is the main economic driver for the use of lower cost biomass heating. Fuel oil is
shipped into Kluti-Kaah by truck and currently costs $3.92/gal. For this study, the energy content of fuel
oil is based on 134,000 BTU/gal, according to the UAF Cooperative Extension.
Superior Pellets out of North Pole, AK is an Alaskan source of wood pellets (contact Chad Schumacher,
General Manager at (907) 488-6055). Superior Pellets manufactures local Alaskan pellets at their North
Pole factory and will deliver pellets in bulk to the building. Delivery is made with a 32 ft long pellet truck
that can hold 15 tons of pellets. The truck has a 28 ft auger boom for filling a large pellet storage silo (or
silos) onsite. The cost for delivering bulk pellets to Glennallen is $350/ton, for a full truck load of pellets,
which includes the cost of filling the pellet silos. Since Kluti-Kaah is further away than Glennallen, it is
estimated that the pellet price for the Kluti-Kaah Multi-Use facility will be $360/ton. It is proposed that
four 8.5 ton silos are used for the biomass system. This will give the building 34 tons of storage and will
allow for a full 15 ton deliveries from Superior Pellets. The Superior Pellet option is used for the economic
analysis in this study because it includes all delivery costs to the pellet storage silo.
Another pellet distributor is End of the Alcan (contact Donna Supernaw at (907) 895-5321), which is
located in Delta Junction at milepost 272 on the Richardson Highway. The pellets are manufactured by
Premium Pellets in Canada and are transported to Alaska by semi-truck. Trucks carry a load of 30 tons of
pellets that can be delivered to Kluti-Kaah directly. The pellets are packaged in 40 lb bags and are
palletized in one ton shipping pallets (2,000 lbs). One shipping pallet contains 50 bags of pellets. Astaging
area and fork lift will be required to unload the truck and store pellets. The delivered price to the site is
$332/ton. Because this price does not include the labor and forklift required to offload the pallets or the
Feasibility Assessment for Biomass Heating Systems Kluti-Kaah, AK
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labor to rip open each bag of pellets to load a storage silo, this pellet source was not used for the economic
analysis in this study.
The table below shows the energy comparison of different fuel types. The system efficiency is used to
. The delivered cost of energy to the building,
in $/MMBTU, is the most accurate way to compare costs of different energy types. As shown below, cord
wood and wood pellets are cheaper than fuel oil on a $/MMBTU basis.
Fuel Type Units Gross
BTU/unit
System
Efficiency $/unit Delivered
$/MMBTU
Cord Wood cords 16,000,000 75% $200 $16.67
Wood Pellets tons 16,000,000 86% $360 $26.16
Fuel Oil gal 134,000 80% $3.92 $36.57
Electricity kWh 3,413 99% $0.28 $82.87
Table 2 Energy Comparison
Existing Fuel Oil Consumption
Since the building is unfinished, it does not have any historic energy consumption or energy bills. Heating
oil consumption for the facility was estimated based on 103,248 BTU/SF/year. This number is based on
Facilities e
Ahtna region near Kluti-Kaah. This estimation was corroborated with a heat load and BIN weather data
analysis for the building. It is estimated that on average the Multi-Use Facility will consume approximately
9,766 gallons of heating oil annually. This is shown in the table below.
Building Name Fuel Type
Estimated Avg.
Annual Consumption Net MMBTU/yr
Annual Fuel
Cost
Multi-Use Facility Fuel Oil 9,766 gal 1,046.9 $38,283
Table 3 Existing Fuel Oil Consumption
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Biomass System Consumption
It is estimated that the proposed biomass system will offset 91% of the heating energy for the building.
The remaining 9% of the heating energy be provided by the oil fired boiler. This result is based on an
analysis of outdoor temperature BIN data for the Copper Center region. Based on this analysis, even
though two Maine Energy System PES56 pellet boilers will only provide 55 peak design
load, it will provide 91 The four 8.5 ton silos will hold
approximately 50% of the annual pellet demand.
Option Fuel Type % Heating
Source
Net
MMBTU/yr
Annual
Consumption
Energy
Cost
Total Energy
Cost
Proposed
Biomass
System
Pellets 91% 952.7 69.2 tons $24,926
$28,506 Fuel Oil 9% 94.2 879 gal $3,446
Additional
Electricity N/A N/A 484 kWh $135
Table 4 Proposed Biomass System Fuel Consumption
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V. Preliminary Cost Estimating
At this time the Native Village of Kluti-Kaah has not purchased the mechanical system for the Multi-Use
Facility. If the building is to be finished the Village must spend money to buy the currently designed
mechanical system that includes two oil boilers, fuel tanks, ductwork, hydronic piping, pumps, air handling
unit, exhaust fans, radiant floors, unit heaters and other necessary mechanical items. Regardless of
whether or not a new biomass is installed, the village still has to purchase the mechanical system to make
the building functional.
In this situation, the additional material cost and additional installation costs of the proposed biomass
system was considered. The opinion of probable cost below accounts for the additional cost for installing
four pellet storage silos, augers, two pellet boilers and all other necessary components required to make
the pellet system work. It is assumed that the pellet system installation will be combined as part of the
This reduces the cost of the pellet system since the contractor
will already be onsite and working on a brand new system, whi
equipment. Since the proposed pellet system design only incorporates one of the two oil fired boilers,
the second oil boiler does not need to be purchased and installed. Therefore an estimated $16,000 credit
can be given to account for unneeded boiler equipment and installation costs.
The opinion of probable cost is based on a -house
engineers, mechanical contractors, and silo suppliers. A 5% remote factor was used to account for
increased shipping and installation costs to Kluti-Kaah. Project and Construction Management was
estimated at 5%. Engineering design and permitting was estimated at 20% and a 15% contingency was
used. The engineering design fee assumes that there are design cost savings because the engineering
company has already designed the rest of the building s mechanical and electrical systems.
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Estimate of Probable Cost Additional Cost of Pellet Boiler System
Category Description Cost
Site Work and Silos Site Grading $ 4,500
Concrete Slab $ 5,500
Four 8.5 Ton Silos $ 12,000
Silo Installation $ 9,000
Subtotal $ 31,000
Electrical Utilities Auger Power Connection $ 2,500
Conduit and Wiring $ 2,500
Subtotal $ 5,000
Wood Boiler and Augers
Two Maine Energy Systems PES 56 Pellet
Boiler $ 50,000
Transfer Augers $ 8,000
Subtotal $ 58,000
Interior Mechanical &
Electrical
Additional Pellet Boiler Installation, Piping &
Materials $ 8,000
Subtotal $ 8,000
Oil Boiler Offset
Equipment and Installation cost savings for
only installing one oil boiler instead of two. $ (16,000)
Subtotal $ (16,000)
Subtotal Material and
Installation Cost $ 86,000
Remote Factor 5% $ 4,300
Subtotal $ 90,300
Project and Construction
Management 5% $ 4,515
Subtotal $ 94,815
Design Fees and
Permitting 20% $ 18,963
Subtotal $ 113,778
Contingency 15% $ 17,067
Total Project Cost $ 130,845
Table 5 Estimate of Probable Cost
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VI. Economic Analysis
The following assumptions were used to complete the economic analysis for this study.
Inflation Rates
Discount Rate for Net Present Value Analysis 3%
Wood Fuel Escalation Rate 3%
Fossil Fuel Escalation Rate 5%
Electricity Escalation Rate 3%
O&M Escalation Rate 2%
Table 6 Inflation rates
The real discount rate, or minimum attractive rate of return, is 3.0% and is the current rate used for all
Life Cycle Cost Analysis by the Alaska Department of Education and Early Development. This is a typical
rate used for completing economic analysis for public entities in Alaska. The escalation rates used for the
wood, heating oil, electricity and O&M rates are based on rates used in the Alaska Energy Authority
funded 2013 biomass pre-feasibility studies. These are typical rates used for this level of evaluation and
were used so that results are consistent and comparable to the 2013 studies.
O&M Costs
Non-fuel related operations and maintenance costs (O&M) were estimated at $1,000 per year. This
estimate is based on annual maintenance time for the pellet boiler. Per manufactures recommendations
the ash trays should be manually dumped for every two tons of pellets burned. This amounts to dumping
ash a little less than once per month. Dumping the ash trays takes less than 10 minutes of non-skilled
labor per event. Once each winter a 30 minute service is recommended to clean the boilers heat
exchanger. In the summer, a 90 minute service is recommended to clean heat exchangers and maintain
other components. According to the manufacturer the summer and winter service can be easily
For only the first two years of service, the
maintenance cost is doubled to account for maintenance staff getting used to operating the new system.
Definitions
There are many different economic terms used in this study. A listing of all of the terms with their
definition is provided below for reference.
Economic Term Description
Project Capital Cost This is the opinion of probable cost for designing and constructing the
project.
Simple Payback The Simple Payback is the Project Capital Cost divided by the first year annual
energy savings. The Simple Payback does not take into account escalated
energy prices and is therefore not a good measure of project viability.
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Economic Term Description
Present Value of
Project Benefits
(20 year life)
The present value of all of the heating oil that would have been consumed
by the existing heating oil-fired heating system, over a 20 year period.
Present Value of
Operating Costs
(20 year life)
The present value of all of the proposed biomass systems operating costs
over a 20 year period. This includes wood fuel, additional electricity, and
O&M costs for the proposed biomass system to provide 97
heat. It also includes the heating oil required for the existing oil-fired boilers
to provide the remaining 3% of heat to the building.
Benefit / Cost Ratio of
Project
(20 year life)
This is the benefit to cost ratio over the 20 year period. A project that has a
benefit to cost ratio greater than 1.0 is economically justified. It is defined
as follows:
Where:
PV = The present value over the 20 year period
th ed.,
2009, pg. 440, Modified B-C Ratio.
Net Present Value
(20 year life)
This is the net present value of the project over a 20 year period.If the
project has a net present value greater than zero, the project is economically
justified. This quantity accounts for the project capital cost, project benefits
and operating costs.
Year Accumulated Cash
Flow > Project Capital
Cost
This is the number of years it takes for the accumulated cash flow of the
project to be greater than or equal to the project capital cost. This is similar
to the projec inflation
rates. This quantity is the payback of the project including escalating energy
prices and O&M rates. This quantity is calculated as follows:
Where:
J = Year that the accumulated cash flow is greater than or equal to the
Project Capital Cost.
= Project Cash flow for the kth year.
Table 7 Economic Definitions
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Results
The economic analysis was completed in order to determine the simple payback, benefit to cost ratio, and
net present value of the proposed biomass system. The estimate of probable cost is based on the marginal
cost of the pellet system. The results of the proposed wood pellet boiler system are shown below.
Please refer to Appendix B for the economic analysis spreadsheet.
The proposed pellet boiler system consists of two major parts: two new pellet boilers and four new pellet
silos. The two pellet boilers will be located inside mechanical room. Four new
exterior pellet silos will be located outside the building adjacent to the mechanical room on the west side
of the building. The benefit to cost ratio for the proposed pellet system is 2.38 over the 20 year study
period, which makes the project economically justified. Any project with a benefit to cost ratio above 1.0
is considered economically justified. The major advantage of this project is that the cost of the pellet
system can be reduced because the pellet system will be installed into the building at the same time as
mechanical space and not building a detached boiler building.
Indoor Pellet Boiler System With Exterior Silos
Project Capital Cost (Marginal Cost of Pellet System) $130,845
Present Value of Project Benefits (20 year life) $897,857
Present Value of Operating Costs (20 year life) $586,831
Benefit / Cost Ratio of Project (20 year life) 2.38
Net Present Value (20 year life) $180,181
Year Accumulated Cash Flow is Net Positive First Year
Year Accumulated Cash Flow > Project Capital Cost 12 years
Simple Payback 16.8 years
Table 8 Economic Analysis Results
Sensitivity Analysis
A sensitivity analysis was completed to show how changing heating oil costs and wood costs affect the
benefit to cost (B/C) ratios of the project. As heating oil costs increase and wood costs decrease, the
projects becomes even more economically viable. All of the B/C ratios shown below are greater than 1.0,
which makes them all economically justified.
B/C Ratios Wood Pellet Cost ($/ton)
$300/ton $325/ton $360/ton $375/ton
Heating Oil Cost
($/gal)
$3.50/gal 2.32 2.07 1.71 1.55
$3.75/gal 2.72 2.47 2.11 1.95
$3.92/gal 2.99 2.74 2.38 2.22
$4.00/gal 3.12 2.86 2.50 2.35
$4.25/gal 3.52 3.26 2.90 2.75
Table 9 Sensitivity Analysis
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VII. Forest Resource and Fuel Availability Assessments
Forest Resource Assessments
The Alaska Department of Natural Resources (DNR) has information on the timber and biomass resources
of the Valdez Copper River Area. Please refer to the DNR website at
http://forestry.alaska.gov/timber/vcra.htm#fiveyear for access to all their information. The DNR has
reports on timber sales, five year schedule of timber sales, maps and forest land use plans. The Copper
Area Forester is Gary Mullen, who has written the majority of the DNR documents for the Copper Area.
Contact with Mr. Mullen was attempted but unsuccessful, as he was out of the office for several weeks
during the writing of this report.
Air Quality Permitting
Currently, air quality permitting is regulated according to the Alaska Department of Environmental
Conservation Section 18 AAC 50 Air Quality Control regulations. Per these regulations, a minor air quality
permit is required if a new wood boiler or wood stove produces one of the following conditions per
Section 18 AAC 50.502 (C)(1): 40 tons per year (TPY) of carbon dioxide (CO2), 15 TPY of particulate matter
greater than 10 microns (PM-10), 40 TPY of sulfur dioxide, 0.6 TPY of lead, 100 TPY of carbon monoxide
within 10 kilometers of a carbon monoxide nonattainment area, or 10 TPY of direct PM-2.5 emissions.
These regulations assume that the device will operate 24 hours per day, 365 days per year and that no
fuel burning equipment is used. If a new wood boiler or wood stove is installed in addition to a fuel
burning heating device, the increase in air pollutants cannot exceed the following per AAC 50.502 (C)(3):
10 TPY of PM-10, 10 TPY of sulfur dioxide, 10 TPY of nitrogen oxides, 100 TPY of carbon monoxide within
10 kilometers of a carbon monoxide nonattainment area, or 10 TPY of direct PM-2.5 emissions. Per the
Wood-fired Heating Device Visible Emission Standards (Section 18 AAC 50.075), a person may not operate
a wood-fired heating device in a manner that causes black smoke or visible emissions that exceed 50
percent opacity for more than 15 minutes in any hour in an area where an air quality advisory is in effect.
at the Alaska Department of Environmental Conservation,
these regulations are focused on permitting industrial applications of wood burning equipment. In his
opinion, it would be unlikely that an individual wood boiler would require an air quality permit unless
several boilers were to be installed and operated at the same site. If several boilers were installed and
operated together, the emissions produced could be greater than 40 tons of CO2 per year. This would
require permitting per AAC 50.502 (C)(1) or (C)(3). Permitting would not be required on the residential
wood fired stoves unless they violated the Wood-fired Heating Device Visible Emission Standards(Section
18 AAC 50.075). The recent Garn boiler systems installed in Alaska of similar size and emissions output as
the proposed pellet boiler have not needed or obtained air quality permits.
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VIII. General Biomass Technology Information
Heating with Wood Fuel
Wood fuels are among the most cost-effective and reliable sources of heating fuel for communities
adjacent to forestland when the wood fuels are processed, handled, and combusted appropriately.
Compared to other heating energy fuels, such as oil and propane, wood fuels typically have lower energy
density and higher associated transportation and handling costs. Due to this low bulk density, wood fuels
have a shorter viable haul distance when compared to fossil fuels. This short haul distance also creates an
advantage for local communities to utilize locally-sourced wood fuels, while simultaneously retaining local
energy dollars.
Most communities in rural Alaska are particularly vulnerable to high energy prices due to the large number
of heating degree days and expensive shipping costs. For many communities, wood-fueled heating can
lower fuel costs. For example, cordwood sourced at $250 per cord is just 25% of the cost per MMBTU as
#1 fuel oil sourced at $7 per gallon. In addition to the financial savings, the local communities also benefit
from the multiplier effect of circulating energy dollars within the community longer, more stable energy
prices, job creation, and more active forest management.
The local cordwood market is influenced by land ownership, existing forest management and ecological
conditions, local demand and supply, and the State of Alaska Energy Assistance program.
Types of Wood Fuel
Wood fuels are specified by energy density, moisture content, ash content, and granulometry. Each of
these characteristic
combustion process. Higher quality fuels have lower moisture, ash, dirt, and rock contents, consistent
granulometry, and higher energy density. Different types of fuel quality can be used in wood heating
projects as 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 rural Alaska must be designed around the availability of wood fuels. Some fuels can be
harvested and manufactured on site, such as cordwood, woodchips, and briquettes. Wood pellets can
also be used, but typically require a larger scale pellet manufacturer to make them. The economic
feasibility of manufacturing on site is determined by a financial assessment of the project. Typically, larger
projects offer more flexibility in terms of owning and operating the wood harvesting and manufacturing
equipment, such as a wood chipper, splitter, or equipment to haul wood out of forest, than smaller
projects.
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High Efficiency Wood Pellet Boilers
High efficiency pellet boilers are designed to burn wood pellets cleanly and efficiently. These boilers utilize
vacuums transfer pellets from the silos to a pellet hopper adjacent to the pellet boiler, where pellets can
be fed into the boiler for burning. Pellets are automatically loaded into the pellet boiler and do not require
manual loading such as in a Garn cord wood boiler. The pellet boilers typically have a 3 to 1 turn down
ratio, which allows the firing rate to modulate from 100% down to 33% fire. This allows the boiler to
properly match building heat demand, increasing boiler efficiency. The efficiencies of these boilers can
range from 85% to 92% efficiency depending on firing rate.
Two of the best quality pellet boilers in the U.S. market are the Maine Energy Systems PES boilers and the
Froling P4 boilers. These boilers have high end controls, automatic ash removal and have a good
reputation for quality. The Maxim Pellet Boiler is a less costly option and can be used directly outdoors if
needed. According to Chad Shumacher, General Manager of Superior Pellets, his Maxim boiler
automation does not operate as well as the Maine Energy Systems units, but they are less than half the
price. The working lifespan of the Maxim boilers also may be less than the higher quality units.
High Efficiency Cord Wood Boilers
High Efficiency Low Emission (HELE) cordwood boilers are designed to burn cordwood fuel cleanly and
efficiently. The boilers use cordwood that is typically seasoned to 25% moisture content (MC) or less and
meet the dimensions required for loading and firing. The amount of cordwood burned by the boiler will
depend on the heat load profile of the building and the utilization of the fuel oil system as back up. Two
HELE cordwood boiler suppliers include Garn (www.garn.com) and TarmUSA (www.woodboilers.com).
Both of these suppliers have units operating in Alaska. TarmUSA has a number of residential units
operating in Alaska and has models that range between 100,000 to 300,000 BTU/hr. Garn boilers,
manufactured by Dectra Corporation, are used in Tanana, Kasilof, Dot Lake, Thorne Bay, Coffman Cove
and other locations to heat homes, washaterias, schools, and community buildings.
The Garn boiler has a unique construction, which is basically a wood boiler housed in a large water tank.
Garn boilers come in several sizes and are appropriate for facilities using 100,000 to 1,000,000 BTUs per
hour. The jacket of water surrounding the fire box absorbs heat and is piped into buildings via a heat
exchanger, and then transferred to an existing building heating system, infloor radiant tubing, unit
heaters, or baseboard heaters. In installations where the Garn boiler is in a detached building, there are
additional heat exchangers, pumps and a glycol circulation loop that are necessary to transfer heat to the
building while allowing for freeze protection. Radiant floor heating is the most efficient heating method
when using wood boilers such as Garns, because they can operate using lower supply water temperatures
compared to baseboards.
Garn boilers are approximately 87% efficient and store a large quantity of water. For example, the Garn
WHS-2000 holds approximately 1,825 gallons of heated water. Garns also produce virtually no smoke
when at full burn, because of a primary and secondary gasification (2,000 ºF) burning process. Garns are
manually stocked with cordwood and can be loaded multiple times a day during periods of high heating
demand. Garns are simple to operate with only three moving parts: a handle, door and blower. Garns
produce very little ash and require minimal maintenance. Removing ash and inspecting fans are typical
maintenance requirements. Fans are used to produce a draft that increases combustion temperatures
and boiler efficiency. In cold climates, Garns can be equipped with exterior insulated storage tanks for
extra hot water circulating capacity. Most facilities using cordwood boilers keep existing oil-fired systems
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operational to provide heating backup during biomass boiler downtimes and to provide additional heat
for peak heating demand periods.
Low Efficiency Cord Wood Boilers
Outdoor boilers are categorized as low-efficiency, high emission (LEHE) systems. These boiler systems are
not recommended as they produce significant emission issues and do not combust wood fuels efficiently
or completely, resulting in significant energy waste and pollution. These systems require significantly
more wood to be purchased, handled and combusted to heat a facility as compared to a HELE system.
Additionally, several states have placed a moratorium on installing LEHE boilers because of air quality
issues (Washington). These LEHE systems can have combustion efficiencies as low as twenty five (25%)
percent and produce more than nine times the emission rate of standard industrial boilers. In comparison,
HELEs can operate around 87% efficiency.
High Efficiency Wood Stoves
Newer high efficiency wood stoves are available on the market that produce minimal smoke, minimal ash
and require less firewood. New EPA-certified wood stoves produce significantly less smoke than older
uncertified wood stoves. High efficiency wood stoves are easy to operate with minimal maintenance
compared to other biomass systems. The Blaze King Classic high efficiency wood stove
(www.blazeking.com) is a recommended model, due to its built-in thermostats that monitor the heat
output of the stove. This stove automatically adjusts the air required for combustion. This unique
technology, combined with the efficiencies of a catalytic combustor with a built-in thermostat, provides
the longest burn times of any wood stove. The Blaze King stove allows for optimal combustion and less
frequent loading and firing times.
Bulk Fuel Boilers
Bulk fuel boilers usually burn wood chips, sawdust, bark or pellets and are designed around the wood
resources that are available from the local forests or local industry. Several large facilities in Tok, Craig,
and Delta Junction (Delta Greely High School) are using bulk fuel biomass systems. Tok uses a commercial
grinder to process woodchips. The chips are then dumped into a bin and are carried by a conveyor belt
to the boiler. The wood fuel comes from timber scraps, local sawmills and forest thinning projects. The
Delta Greely High School has a woodchip bulk fuel boiler that heats the 77,000 square foot facility. The
Delta Greely system, designed by Coffman engineers, includes a completely separate boiler building which
includes chip storage bunker and space for storage of tractor trailers full of chips (so handling of frozen
chips could be avoided). Woodchips are stored in the concrete bunker and augers move the material on
a conveyor belt to the boilers.
Grants
There are many grant opportunities for biomass work state, federal, and local for feasibility studies, design
and construction. If a project is pursued, a thorough search of websites and discussions with the AEA
Biomass group would be recommended to make sure no possible funding opportunities are
missed. Below are some funding opportunities and existing past grants that have been awarded.
Currently, there is a funding opportunity for tribal communities that develop clean and renewable energy
resources through the U.S. Department of Energy. On April 30, 2013, the Department of Energy
announced up to $7 million was available to deploy clean energy projects in tribal communities to reduce
Tribal
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Energy Program, in cooperation with the Office of Indian Energy, will help Native American communities,
tribal energy resource development organizations, and tribal consortia to install community or facility
scale clean energy projects.
http://apps1.eere.energy.gov/tribalenergy/
The Department of Energy (DOE) Alaska Native programs focus on energy efficiency and add ocean energy
into the mix. In addition the communities are eligible for up to $250,000 in energy-efficiency aid. The
Native village of Kongiganak will get help strengthening its wind-energy infrastructure, increasing energy
infrastructure, improving energy efficiency and exploring biomass options. The village of Minto will
explore all the above options as well as look for solar-energy ideas. Shishmaref, an Alaska Native village
faceing climate-change-induced relocation, will receive help with increasing energy sustainability and
building capacity as it relocates. The ciency, biomass and ocean
energy. This DOE program would be a viable avenue for biomass funding.
http://energy.gov/articles/alaska-native-communities-receive-technical-assistance-local-clean-energy-
development
The city of Nulato was awarded a $40,420 grant for engineering services for a wood energy project by the
United States Department of Agriculture (USDA) and the United States Forest Service. Links regarding the
award of the Woody Biomass Utilization Project recipients are shown below:
http://www.fs.fed.us/news/2012/releases/07/renewablewoods.shtml
http://www.usda.gov/wps/portal/usda/usdahome?contentid=2009/08/0403.xml
Delta Junction was awarded a grant for engineering from the Alaska Energy Authority from the Renewable
Energy Fund for $831,203. This fund provides assistance to utilities, independent power producers, local
governments, and tribal governments for feasibility studies, reconnaissance studies, energy resource
monitoring, and work related to the design and construction of eligible facilities.
http://www.akenergyauthority.org/re-fund-6/4_Program_Update/FinalREFStatusAppendix2013.pdf
http://www.akenergyauthority.org/PDF%20files/PFS-BiomassProgramFactSheet.pdf
http://www.akenergyauthority.org/RenewableEnergyFund/RFA_Project_Locations_20Oct08.pdf
The Alaska Wood Energy Development Task Group (AWEDTG) consists of a coalition of federal and state
agencies and not-for-profit organizations that have signed a Memorandum of Understanding (MOU) to
explore opportunities to increase the utilization of wood for energy and biofuels production in Alaska. A
pre-feasibility study for Aleknagik was conducted in 2012 for the AWEDTG. The preliminary costs for the
biomass system(s) are $346,257 for the city hall and health center system and $439,096 for the city hall,
health center, and future washeteria system.
http://www.akenergyauthority.org/biomasswoodenergygrants.html
http://www.akenergyauthority.org/BiomassWoodEnergy/Aleknagik%20Final%20Report.pdf
The Emerging Energy Technology Fund grand program provides funds to eligible applicants for
demonstrations projects of technologies that have a reasonable expectation to be commercially viable
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within five years and that are designed to: test emerging energy technologies or methods of conserving
energy, improve an existing energy technology, or deploy an existing technology that has not previously
been demonstrated in Alaska.
http://www.akenergyauthority.org/EETFundGrantProgram.html
Feasibility Assessment for Biomass Heating Systems Kluti-Kaah, AK
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Appendix A
Site Photos
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1. South elevation of building. 2. West elevation of building.
3. North elevation of building. 4. East elevation of building.
5. Site entrance. 6. Inside Gym
Feasibility Assessment for Biomass Heating Systems Kluti-Kaah, AK
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7. Inside Office Addition 8. Spray foam on Gym wall
9. Inside office addition 10. Inside Gym
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Appendix B
Economic Analysis Spreadsheet
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Appendix C
Site Plan
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Site Plan of Multi-Use Facility
Existing
Mechanical Room
Four 8.5 Ton Silos
for Pellet Storage
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Appendix D
AWEDTG Field Data Sheet