Techno-economic analysis of biomass pelletization as a sustainable biofuel with net-zero carbon emissions

The impacts of the feedstock types and their blending ratios on pellet formation and system performance were studied. The pellet manufacturing facilities were simulated encompassing all processes from farm-level raw material supply to the production of the final product and its sale at the factory gate. Each model scenario is broken down into four sections: transportation of the feedstock, pre-processing, conversion to pellets, and storage of the final product. Simulations of relevant unit operations were carried out for all plant activities using the required technical information, such as operating size, number of components, materials for construction, and operational characteristics. Four simulation scenarios were selected for study, termed plant-1, plant-2, plant-3, and plant-4. Parameters were assessed by varying the costs of pelletizer, grinder, shredder, binder, feedstock, labor, utility, and revenue selling price by ± 10% and ± 20% from their current market prices, considered a base value. Capital investment ranges from $404,000 to $468,000, with plant-2 (100% SD at 15% binder and 15% moisture content (MC)) having the lowest value and plant-4 (75% SD + 25% CC at 15% binder and 20% MC) having the highest value. The operating cost (OC) of plant-3 (100% CS at 15% binder and 20% MC) was found to be the lowest, while plant-1 (100% SD at 20% binder and 20% MC) is the highest due to the higher percentage of binder having a high drying cost as well as a high procurement cost. Pellets are the main revenue stream obtained from all plants. Plant-3 is observed as the most economical among all plants, having the highest value of gross margin (GM), highest internal rate of return (IRR), highest net present value (NPV), highest percentage of return on investment (ROI), lowest operating cost (OC), and lowest payback time (PBT) of 6.54%, 11.96%, $15,8000, 18.67, $954,000, and 5.36 years, respectively. Sensitivity analysis shows that the cost of binder, the cost of feedstock, and labor costs have influential effects on input costs. Pellet selling price is the most influential factor affecting economic returns.