The document compares different sources for heating demand in Germany, including oil, gas, wood pellets, and biogas. It finds that biomass sources like wood chips and pellets can be economically competitive with oil and gas in the mid- to long-term due to higher fuel prices for fossil sources. Biogas heating from combined heat and power (CHP) plants is also very competitive if the heat is utilized. The levelized heat costs for different systems are compared over time, showing biomass and biogas can have lower long-term costs than fossil fuel alternatives.

1. SERVICE MIT ENERGIE.
Wood pellets in competition with other energy
carriers to provide heat – a market analysis
Frank Schillig
International Pelletforum 2011, Stuttgart , 5.10.2011
© KWA EVIVA GMBH 2010 VOGELSANGER STRASSE 250 I 50825 KÖLN I GERMANY

2. SERVICE MIT ENERGIE.
Content
• Satisfying heat demand today
• Price and price development of different energy
carriers
• Excursus heat from biogas plants
• Economics of heat suppy
– Investment and O&M costs
– levelized heat costs
© KWA EVIVA GMBH 2010 Eviva – nachhaltige Energiedienstleistungen

3. SERVICE MIT ENERGIE.
Energy carriers to satisfy German heat demand
2006 2010
…and heat from renewable energy sources?
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4. SERVICE MIT ENERGIE.
Structure of heat supply from renewable energy sources in
Germany 2010
Total: 136.1 TWh
Biogenic solid fuels
(households):
53.4 %
Near-surface Biogenic solid fuels
geothermal energy: (industry):
3.9 % 15.0 %
Biogenic solid fuels (co-
generation power
Deep geothermal
installations and
energy:
Biogenic share of heating installations):
0.2 % Biogas:
waste: 5.3 %
5.6 % Biogenic liquid fuels:
Solar thermal energy: 8.7 % 3.0 %
3.8 % Sewage gas:
Landfill gas:
0.8 %
0.3 % Share of biomass *: 92 %
* Solid and liquid biomass, biogas, sewage and landfill gas, biogenic share of waste; Source: BMU-KI III 1 according to Working Group on Renewable Energy-Statistics (AGEE-Stat);
1 TWh = 1 Bill. kWh; deviations in the totals are due to rounding; as at: July 2011; all figures provisional

5. SERVICE MIT ENERGIE.
Energy from biomasse – heating values
• LHV wood/straw (absolute dry): ~18 MJ/kg
– ~ 65-70% hard coal
– ~40% fuel oil
– ~50% natural gas
• LHV vegetable oils: ~ 35 MJ/kg (~90% diesel)
• LHV biogas: ~ 20-22 MJ/m3 (~55-65% natural
gas)
© KWA EVIVA GMBH 2010 Eviva – nachhaltige Energiedienstleistungen

6. SERVICE MIT ENERGIE.
Price development of different energy
carriers
Wood chips
Wood pellets
Fuel oil
Natural gas
© KWA EVIVA GMBH 2010 Eviva – nachhaltige Energiedienstleistungen

7. SERVICE MIT ENERGIE.
Investment costs of different heating
systems
Oil heating gas heating pellet heating wood chip heating
© KWA EVIVA GMBH 2010 Eviva – nachhaltige Energiedienstleistungen

8. SERVICE MIT ENERGIE.
O&M costs – comparing wood chip with
oil heatings
Oil heating Wood chip heating
Annuised
Investment
O&M
Fuel
© KWA EVIVA GMBH 2010 Eviva – nachhaltige Energiedienstleistungen

9. SERVICE MIT ENERGIE.
Excurs biogas heat
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10. SERVICE MIT ENERGIE.
Local district heating grid
Heat exchanger
Biogas-
CHP-unit school pool Etc.
Heat offtake Heat offtake Heat offtake
Supply boundary
biogas pipeline
© KWA EVIVA GMBH 2010 Eviva – nachhaltige Energiedienstleistungen

11. SERVICE MIT ENERGIE.
Biogas heat from CHP
© KWA EVIVA GMBH 2010 VOGELSANGER STRASSE 250 I 50825 KÖLN I GERMANY

12. SERVICE MIT ENERGIE.
Why biogas heat? I
• Biogas plants: ~70% of the CHP-unit heat is
available
• >6000 biogas plants in Germany with >2200
MWel installed capacity >2300 MWth
capacity
• Heat usage limited: ~50%, often only to heat
farm buildings or neighbouring houses
• EEG 2012: heat usage > 60% !
© KWA EVIVA GMBH 2010 Eviva – nachhaltige Energiedienstleistungen

13. SERVICE MIT ENERGIE.
Why biogas heat? II
• Improved heat usage results in:
– Income from heat sales
– Income from CHP-bonus
improved economics
– Relating the heat price to fossile fuel prices
increased economic stability by hedging price
variations
– Constant EEG-tariffs + market driven heat sales
hedging the market variations in biogas substrate
prices
© KWA EVIVA GMBH 2010 Eviva – nachhaltige Energiedienstleistungen

14. SERVICE MIT ENERGIE.
Comparison of levelised heat costs for
different heating systems
Fuel oil
Natural gas
Wood pellets
Wood chips
Biogas heat
Levelised heat costs (€/kWh)
Operational years
© KWA EVIVA GMBH 2010 Eviva – nachhaltige Energiedienstleistungen

15. SERVICE MIT ENERGIE.
summary
• Heat supply from biomass more economic in the
mid- and long-term
• Today wood chips (HHS) and Pellets can be
competitive to oil and gas, depending on the case
– Investment costs higher for biomass based
heatings compared to oil or gas heatings
– Energy carrier prices of oil and gas higher than
wood chips or pellets
• Biogas heat can be very competitve if available
© KWA EVIVA GMBH 2010 Eviva – nachhaltige Energiedienstleistungen

16. SERVICE MIT ENERGIE.
Don‘t hesitate to contact us!
Frank Schillig
e: f.schillig@eviva-energy.com
t: +49-221-789469-10
w: www.eviva-energie.com
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