Economic Analysis of Manufacturing Costs of Pellet Production in the Republic of Ireland Using Non-Woody Biomass

An economic analysis of a non-woody biomass pelleting process was performed for conditions in the Republic of Ireland. The analysis considered the establishment, harvest, storage and drying costs of the feedstock’s on-farm, together with transportation costs to the processing plant and the costs associated with the pelleting process. Capital and operating costs of the pelleting process were estimated at several plant capacities – 6t / h, 8t / h and 10t / h. The pellet production cost for the base case scenario of 8t / h was 102 / t of pellets produced. By decreasing production capacity to 6t / h an increase in the production cost of 10 / t was experienced while increasing capacity to 10t / h resulted in a decrease of 6 / t in the production cost of pellets. The cost of the raw material is the largest cost component (66%) of the total pellet production cost. Other major cost factors include pelleting and cooling plant (11%), straw grinding plant (10%) and personnel costs (9%). Considering current energy prices the equivalent energy cost of 7 / GJ (excluding profit margins) the potential
production of non-woody biomass pellets competes favourably with oil and gas and was found to be economically viable.