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Proposal : Research the viability of pellet heating in Australia. Graham Palmer MIET2127 October 2006. Introduction. What is pellet heating? Pellet heaters Characteristics Existing pellet markets Logistics of pellet heating market Heater market in Australia Opportunities What next?.
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Proposal : Research the viability of pellet heating in Australia Graham PalmerMIET2127October 2006
Introduction • What is pellet heating? • Pellet heaters • Characteristics • Existing pellet markets • Logistics of pellet heating market • Heater market in Australia • Opportunities • What next?
What is pellet heating? • Small pellets manufactured from wood dust without additives • Potential to revolutionise wood heating • High efficiency • Low emissions • Automatic operation • More expensive than log burners
Characteristics • Energy density 18 MJ/kg • 3 to 4 times more energy than timber per unit volume • Efficiency 80 to > 90% • Open fire 10%, combustion 40-60% • Ash content < 5% • Empty tray few times a year • Emissions • Biomass emissions have decreased by 3 orders of magnitude in 2 decades
Historical emissions improvement- measured biomass heater in Austria Source : Rakos (2002)
Existing markets • Sweden, Austria, Germany etc - already using wood + mix of other fuels including gas, oil, coal, electric • US - high mains gas, electric + some oil • UK - high mains gas penetration + some oil • Australia - one importer and one manufacturer
Pellet production by country 2005 (tonnes) Note: Australian price for pellets $360/tonne Sources: Bioenergy International December 2005 (see note in text); Wood Pellet Association of Canada
Key logistical issues • Pellet manufacture • Quality • Reliability of supply • Sufficient competition • Pellet distribution and logistics • Bulk • Bagged • Pellet burners and boilers
Economics of pellet heating • Economics of existing heating • Gas - ducted, wall, hydronic • Electric element • Electric reverse cycle - ducted, wall, split • Wood - open fire, combustion, pot belly • Oil • Floor slab • Solar • Economics of pellet heating • Heaters • Pellets • Pelletising equipment • Distribution
The pellet paradox • No-one will buy a heater without access to pellets • No-one will maufacture pellets unless there are heaters to make use of them • Europe overcame problem because importing was feasible, and fuel costs of competitors are higher
Main reason for purchasing heater - Australia Source : ABS (2005)
Heating in Australia Source : ABS (2005)
Opportunities • Victorian timber communities • Cool climate, access to raw material, log burning already, no mains gas • Launceston • Cool climate, access to raw material, problem with particulate pollution from log fires
Cost of pellets in Melbourne(updated since original presentation) • 2006 $360/tonne • 2008 $475/tonne • 2009 $600/tonne • little competition and captive market • Assuming 18 MJ/kg, $600/tonne equates to 3.3 cents/MJ – compare gas at 1 cent/MJ and electricity 5.6 cents/MJ (20 cents/kWh)
TBL Analysis Economic • Support local industry • Competitive except with mains gas • Develop regional industry Social • Maintain energy autonomy within a regional district • Consumers may prefer pellet heating • Greenhouse challenge front runner Environment • Net greenhouse benefit • Less particulate pollution • Increased resources for forest management • High efficiency • Close the carbon loop
Interested parties Users • Consumers • Retailers • Installers Creators • Appliance manufacturers • Pellet manufacturers • Manufacturer associations Supporters • Australian Greenhouse Office • Sustainability Victoria • RMIT • Investors
What next? • Complete a credible report on performance, environmental impacts, economics and market opportunities of pellet heating • Bring together interested parties • Lobby for support • Greenhouse a big issue • Part of the biomass debate (enthanol, biodiesel, biogas) • May be cost effective outside of mains gas • Local pollution in urban areas