PelletNews Cost per MWh of electricity (at the power station bus bar) Natural gas combined cycle
$21.84
Hydro
$34.72
Pulverized coal
$36.74
Conversion: Pulverized coal to pellets
$36.74
Nuclear
$50.80
Land-based wind
$75.36
Offshore wind
$95.46
Solar PV
$125.31
SOURCE: FUTUREMETRICS; A COST EFFECTIVE, JOB CREATING, AND READY TO DEPLOY STRATEGY FOR BASELOAD DISPATCHABLE LOW CARBON POWER GENERATION
Analysis reveals low cost of biomass conversion A new report published by FutureMetrics shows that converting old coal plants to burn wood pellets provides a ready-to-go solution for meeting carbon mitigation goals while creating jobs. The white paper, authored by William Strauss, president of FutureMetrics, and titled “A Cost Effective, Job Creating, and Ready to Deploy Strategy for Baseload Dispatchable Low Carbon Power Generation,” discusses the costs of fuel switching to pellets compared to the costs of other pathways to lower carbon emissions. The analysis performed by Strauss reveals that converting an older pulverized
coal-fired power plant to wood pellets results in cost per MWh that is “surprisingly low and very competitive to other power generation methods.” With regard to price, Strauss noted that the cost of generation is primarily dependent on three factors, including the capital cost to build the plant, the fixed and variable operations and maintenance costs, and the fuel cost. While the analysis shows the cost of wood pellets is approximately 2.88 times the cost of coal on a per-Btu basis, the total cost of generation with wood pellet fuel is actually only 1.387 times more expensive than coal-based generation.
Drax to expand US pellet production As part of its 2013 investor call in February, the Drax Group plc revealed plans to develop up to 2 million tons of additional pellet capacity, primarily in the U.S. Recent announcements in South Carolina and Mississippi indicate the company is moving forward with those plans. Abbeville County, South Carolina, has passed an ordinance that would allow Drax Biomass, a subsidiary of the Drax Group, an option to purchase a 119-acre tract of land for the development of a new pellet plant. According to information released by the county, the proposed pellet manufacturing plant would be located approximately 3 miles from Calhoun Falls, a town on the western border of the state. Drax is also proposing to build a second pellet plant in Mississippi. Documents recently filed with the Mississippi Department of Environmental Quality state that a unit of Drax is planning to build a pellet plant near Magnolia, Mississippi. The project, proposed under the title Pike BioEnergy LLC, would be located on a 103-acre site.
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