The evaluation of biomass power projects

Abstract

Biomass is a renewable energy source attracting increasing attention. At the EU level in the last years a set of activities and programs were implemented in order to support and promote the use of this source of energy. This study addresses the issue of biomass costs for electricity production and the importance of incentives schemes such as feed-in tariff for the economic development of the sector. An economic evaluation of the electricity production from biomass is presented, based on a survey of both financial and social costs applied to the Portuguese case. Economic assessment was carried out by taking into account three types of biomass: energy crops (miscanthus), forestry residues and municipal solid waste. Four set of costs were considered and included: cost of capital, cost of maintenance and operation, fuel costs and external costs.