Socio-economics of Woodfuel

1
Socio-economics of Woodfuel

• Does it all stack up?

2
Sometimes

• It all depends!

3

• Customer perspective
• Fuel supplier perspective
• Its got to work for both!

4
Customers economic perspective

• How much is the fuel?
• How much fuel will I use?
• How much is the heating system?
• Over what period do I expect to see a return?
• Lifecycle Comparison
• Oil or wood?
• Chip or pellet?

5
Who is the customer?

• A household
• Commercial space heat user
• Developer (new build or refurbishment)
• Public sector
• Industrial (process heat user)

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Case studies

• 12,000 pellet boiler in a large domestic home.
  84 year payback period!!!
• 275,000 500kw chip boiler in a school with
  swimming pool. 10 year payback (no grants)

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Customers Socio (non-economic) perspective

• Desire to be green (driven by policy, personal
  preference or regulation)
• Attitude to risk/ perception of woodfuel
• Interest in wider local economic development and
  fuel security

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Pressure to be green
Local Authorities
Developers
Industrial
Households
Commercial heat users
Attitude to risk
Running hours
High cost per kw installed
Low cost per kw installed
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Fuel suppliers economic perspective

• Start up considerations
• Have I got a customer?
• Have I got the equipment and facilities?
• What is my source of raw material wood and how
  much is it?

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Fuel suppliers perspective

• What price do I charge?
• Cost of capital
• Operating cost of processing, storage and
  delivery
• Profit

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Fuel suppliers perspective

• Benchmark price

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Fuel suppliers socio (non-economic) perspective

• Feel good factor
• Doing the right thing

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Conclusions

• Does it all stack up?
• Three top things this depends on
• 1. The oil price
• 2. Our desire to be green (ethics and regulation)
• 3. ..