Wood Pellet Overview An often overlooked energy source: shawresources.ca Introduction Provision of space heat for commercial, institutional and residential spaces or process heat for manufacturing operations can utilize a variety of fuel types. These fuel types include natural gas, fuel oil, propane and electricity. An often-overlooked heating method is Wood Pellets. Using Wood Pellets to supply either process heat or space heat has many advantages: Reduced Annual Fuels Costs and resulting net annual operational savings Life Cycle Cost Savings – strategic, long term life cycle approach is quantified with net present value analysis Fuel Price Stability for predicable costs and budgeting confidence Carbon Tax – protection from escalation effect on future fuel prices Green Solution & LEED Points Reduced Risk of Fuel Leak & resulting environmental contamination Support of Local Economy & Jobs
Transcript
Wood Pellet
Overview
An often overlooked energy source:
shawresources.ca
IntroductionProvision of space heat for commercial, institutional and residential spaces or process heat for manufacturing operations can utilize a variety of fuel types. These fuel types include natural gas, fuel oil, propane and electricity. An often-overlooked heating method is Wood Pellets.
Using Wood Pellets to supply either process heat or space heat has many advantages:
Reduced Annual Fuels Costs and resulting net annual operational savings
Life Cycle Cost Savings – strategic, long term life cycle approach is quantified with net present value analysis
Fuel Price Stability for predicable costs and budgeting confidence
Carbon Tax – protection from escalation effect on future fuel prices
Green Solution & LEED Points
Reduced Risk of Fuel Leak & resulting environmental contamination
Support of Local Economy & Jobs
Carbon taxTo meet national emission reduction goals, the Canadian federal government has mandated taxes on carbon emissions. Starting in 2018, carbon emissions will be taxed at $10 per tonne, increasing by the same amount every year until the tax reaches $50 per tonne of CO2 emissions in 2022. All fossil fuels will be subject to the carbon tax, placing additional upward pressure on their future unit costs.
Wood pellets are a carbon neutral fuel source and are not subject to the carbon tax.
Green solution and LEEDWood pellets are a green energy solution. Management of harvesting operations means pellets are a sustainable fuel resource. Further the burning of wood pellets is carbon neutral. Eastern Embers is PEFC (Programme for the Endorsement of Forest Certification) Chain of Custody certified which exists to support our customers’ requirements for a socially responsible and sustainable, renewable energy source. Additionally Eastern Embers wood pellets are certified under the Sustainable Biomass Program (SBP) in demonstrating that our biomass sources are legal, sustainable and contribute to a low carbon economy.
LEED points can be earned by using wood pellets instead of fossil fuels to provide heat.
Reduced environmental risk Wood pellet systems greatly reduce the risk of fossil fuel leakage incidents and resulting environmental contamination and expensive clean-up costs. Most fossil fuel leakage incidents occur during fuel delivery. By reducing fossil fuel consumption by up to 85% the frequency and risk associated with fossil fuel delivery and storage is greatly reduced. Wood pellets are harmless to the environment and can be easily cleaned up if spilled.
Reduced fuel costs Wood Pellets provide reduced fuel costs based on their low (and reliable) price relative to other fuel options.
To calculate annual fuel cost savings the unit costs of the available/alternate fuel types are determined considering historical price levels and macro-market conditions (i.e. not simple “spot” pricing).
During the design process, the wood pellet boiler is sized to handle the heating load which allows it to run efficiently at full capacity as often as possible – typically 2/3 of the facility’s peak load. A wood pellet boiler sized at 65% of the peak load can supply 85% of the total building heating requirement.
The fuels savings is equal to the annual quantity of higher price fuel displaced multiplied by the price differential between wood pellets and the higher cost fuel.
Wood pellet prices can be as much as 50% less than the cost of fossil fuels and the resulting annual fuel savings can be substantial!
Life cycle cost savingsA longer term life cycle analysis considers initial capital costs and on-going net operational savings over a defined life cycle. Typically, a 25 year boiler life is evaluated with a Net Present Value (NPV) analysis. The net operational savings provided by wood pellets and incorporated in the NPV analysis considers both fuel savings and maintenance/cleaning costs.
While pellet fired boilers can represent a minor initial investment premium the simple payback afforded by the operational savings can be as low as 3 years with a 25 year NPV value many multiples of the annual savings. The magnitude of the NPV savings and length of payback period vary from project to project and are a function of the annual heat consumption (more heat demand means greater savings).
“ Wood pellet prices can be as much as 50% less than the cost of fossil fuels and the resulting annual fuel savings can be substantial!”
Fuel Price StabilityOne advantage of wood pellets over fossil fuels is price stability.
Historic prices of wood pellets, propane and fuel oil per unit energy for the Halifax area (2012 to 2016) are provided in the included graph. These prices are based on multiple sources including Natural Resources Canada and numerous heating fuel suppliers.
The graph illustrates that wood pellets are not subject to price fluctuations and volatility as fossil fuels are. Shaw Resources produces wood pellets locally at Eastern Embers in Nova Scotia with a secondary production facility in New Brunswick consequently pellet prices do not react to fluctuations in currency value.
Additionally, wood pellet prices do not trail the price of oil and gas. These features make wood pellets a reliable and economic fuel source.
DATE Furnace Oil ($/GJ) Propane ($/GJ) Pellets ($/GJ)
$/GJ
Support Of Local EconomyWood pellets are manufactured regionally in Atlantic Canada as opposed to imported oil and fossil fuels. Additionally, wood fibre is harvested as a regional resource.
Existing facilities using wood pelletsIn Atlantic Canada there are a host of projects which have implemented wood pellet fired boiler systems including:
• Cape Breton University, Sydney NS • Bluenose Academy, Lunenburg NS • Millwood High School, Sackville NS • Bridgetown Regional High School, Bridgetown NS • Sussex High School, Sussex NB • Woodstock Centennial High School, Woodstock NB • Les Résidences Jodin Inc., Edmundston NB • Shaw Resources NSSG packaging facility,
Hardwoodlands NS • Forest Glen Green Houses, Brookfield NS • Grand Falls General Hospital, Grand Falls NB • Yarmouth Consolidated Memorial High School,
Yarmouth NS • West Kings District High School, Auburn NS • Yarmouth Elementary School, Yarmouth NS • Southern Carleton K-8 School, Bedell NB • Fredericton Elementary School, Fredericton NB • Caledonia Regional High School, Hillsborough NB • Madawaska Regional Correctional Centre,
Saint-Hilaire NB • École Marie-Gaétane, Kedgwick NB
For more information of the benefits of wood pellet heat or for an assessment of your facility, please visit us at
