The Basics of Owning a Biomass Heat & Power Plant (CHP)

Here are some broad brush head line figures for the owning and operating of a particular kind of advanced staged combustion power plant, obtained from a leading manufacturer, suitable for biomass, waste materials and waste wood. The  process is essential combustion, but is referred to as gasification / combustion, meaning the material is first charred on a grate, with the off syngas being burnt in a separate adjacent and low level refractory chamber.  The char is then burnt at a later stage as it moves down the grate.  This leads to greater burn up of fuel and lower emissions. The syngas combustion is maintained within the ceramic, and special gas flows prevent the contaminants in the gases fouling and degrading the ceramics.

This is a big issue in conventional plants since refractories have to be replaced every few years due to chlorine attack.


Since 3 of these plants have now been built, with extensive operating cost, they are fully bankable.  Indeed the vendor will build, finance, own and operate units if clients desire.



These plants are modular in nature so any size up to 200 MWe can be constructed from 4 basic sizes – this keeps costs down.


Build costs for a 5 MWe plant

Civil build including all utility connections grid gas water and drains small power and lighting site completed will cost some 4-6 million pounds.

Power plant with gross output of circa 5 MWe will cost in the region of £16 Million depending on final design and spec and commodity costs at the time of order.

So turn key installation could cost 20-22 Million pounds.


Cost of capital

If we amortise 17 million over a period of 15 years the cost would be for money paid back on a 7% rate of interest on a yearly basis is £2.32 million to pay back per year.


Staffing levels

Six members of staff, in total, will be needed to operate the plant at a yearly cost of £200,000 and all these staff will be able to service the unit basic maintenance needs with  specialist help brought in from time to time.


Spares and other consumables

For all the spare parts needed and the dosing agents required and all other requirements in costs to run a power plant use a high budget of £500,000 per year.


Total running costs

This will then gives a total running and purchasing cost figure of £3.02 million pounds per year.

The net output will be around 5 MWe depending on final specifications.



This will produce £4,807,269 of revenue per year under new feed in tariff or FIT.


Fuel cost and return

The fuel needed for 30% wet waste wood paper and card will be 5-6 tones per hour or 45,000 tones per year. If we presume this to be zero gain zero cost, assume no gate fee then this makes a very robust safety margin, ie income over costs, for the future.

Ie a  net profit of £1,787,269 as a likely worse case scenario.


Joint Ventures, Build Own Operate, etc

The manufacturers are interested in owning plants either partly or fully as a project partner if this is of interest to the client. The above type of plant will be performance bonded to give absolute surety’s to maximum continuous ratings.


General performance and costs figures

Virgin wood generally are cheaper to build and have higher efficiencies than plant burning waste or contaminated wood.

The following budget figures are reasonable:


Waste wood, reclaimed contaminated wood, card etc

Forest wood

Power Output

2 MW

20 MW

(2 x 10 MW)

80 MW

(4 x 20 MW)

2 MW

20 MW

(2 x 10MW)

80 MW

(4 x 20 MW)


4000 3500 3000 3500 3000 2500

Efficiency %

20 21 22 23 25 27


Note – the above figures are provisional – but near enough – they will be finalised in the next two weeks. DA – 31 October 2009 (This is a draft paper)



Waste Compliance Directive – WID

All waste combustion plants must meet the Waste Compliance Directive – typically the plants concerned are half WID limits.


Heights of buildings

Typical most conventional stage combustion plants tend to have very tall buildings, due to the need for long residence times demanded by WID, and chimneys for dispersion. Advanced combustion techniques as used here, by virtue of existing horizontally, rather than upwards, can be restricted to 14 m in height, which is a significant advantage for planning permission.


Fuels – ability to deal with a wide range of fuel types and contaminants.

These kind of plants can deal with anything from virgin wood to highly contaminated waste wood, ie containing plastics and metals, up to 30 % moisture content, and even 40% aggregate / brick.  Partly this is due to the ability to recycle hot air, but other advanced techniques are employe.