Techno-economic analysis of plantation biomass production and small-scale wood pellet processing for bioenergy market

ABSTRACT There has been an increased demand for wood pellets for energy production, hence pellet production is a valuable market opportunity to explore. The purpose of the study was to assess the economic feasibility of on-site wood pellet processing for bioenergy market. The benefit–cost model was used to estimate the nett return over the projected investment period. Monte Carlo simulation was performed for the possible range of nett returns and to identify the effect of stochastic variables on profitability. The simulation results showed positive nett return from both biomass production and processing of pellets. The sweetgum yield, market price of biomass and pellet, and projected volume of pellets had the greatest positive effect on profitability. The results will help to make pelletizing readily available to those who are looking to make the switch and go green by using alternative and renewable energy.