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Table 4-6 Wood Residue Characteristics ......................................................................4-14Table 4-7 Corncob Characteristics................................................................................4-16Table 4-8 Cassava Residue Characteristics...................................................................4-19Table 4-9 Distillery Slop Characteristics .......................................................................4-21Table 4-10 Coconut Residue Characteristics ................................................................4-24Table 4-11 Sawdust Characteristics ..............................................................................4-26Table 5-1 General Technical Compatibility Ratings (L-Low, M-Medium, H-High) forVarious Fuels and Boiler Types ..................................................................5-4Table 5-2 Steam Generator Technology Comparison for Different Plant Sizes 5-5Table 5-3 Steam Generator Technology Ash Characteristics Comparison 5-6Table 10-1 Summary of Financial Analyses 10-6Table 10-2 Summary Results of Proposed New Power Facilities ...............................10-14Table 10-3 Summary Results of Proposed Facility Modifications .............................10-15Table 10-4 Summary Results of Proposed New Power Facilities ..............................10-16Table 11-1 Summary Results Sommai Rice Mill Facility ............................................11-1Table 11-2 Summary Results Sanan Muang Rice Mill Facility....................................11-2Table 11-3 Summary Results Thitiporn Thanya Rice Mill Facility..............................11-3Table 11-4 Summary Results Plan Creations Facility .................................................11-4Table 11-5 Summary Results Chumporn Palm Oil Facility .........................................11-6Table 11-6 Summary Results Karnchanaburi Sugar Industry Facility .........................11-7Table 11-7 Summary Results Woodwork Creation Facility .........................................11-8Table 11-8 Summary Results Mitr Kalasin Sugar Facility ...........................................11-9Table 11-9 Summary Results Liang Hong Chai Facility ............................................11-10Table 11-10 Summary Results Southern Palm Oil Facility ........................................11-11Table 12-1 Power Purchases from Small Power Producers as of February 2000.........12-8November 7, 2000 TC-4 Final Report

List of FiguresFigure 2-1. Aggregate Potential Net Electric Capacity From Most Viable ResiduesAnd Candidate Facility Locations..............................................................2-5Figure 3-1. Fresh Oil Palm Bunch At A Thailand Palm Oil Mill. ..................................3-7Figure 3-2. Harvesting Of Rubber From A Parawood Plantation...................................3-8Figure 3-3. Industrial Energy Use In Thailand. ..............................................................3-9Figure 4-1. Aggregate Potential Net Electric Capacity From Most Viable Residues.....4-3Figure 4-2. Rice Husk Distribution.................................................................................4-7Figure 4-3. Palm Oil Residue Distribution....................................................................4-10Figure 4-4. Bagasse Distribution...................................................................................4-12Figure 4-5. Parawood Residue Distribution..................................................................4-15Figure 4-6. Corncob Distribution..................................................................................4-17Figure 4-7. Cassava Residue Distribution.....................................................................4-20Figure 4-8. Distillery Slop Distribution. .......................................................................4-22Figure 4-9. Coconut Residue Distribution. ...................................................................4-25Figure 10-1. Candidate Facility Locations....................................................................10-2Figure 10-2. Baht/Us$ Daily Average Interbank Exchange Rate .................................10-3Figure 10-3. Typical Biomass Power Plant Configuration. ..........................................10-5Figure 12-1. Variation In Sugarcane Output Between 1993 And 1999. .....................12-11List Of AnnexesAnnex 1Annex 2Annex 3Annex 4Annex 5Annex 6Annex 7Annex 8Annex 9Annex 10Rice HuskPalm Oil ResiduesBagasseWood ResiduesCorncobCassava ResiduesDistillery SlopCoconut ResiduesBiomass Questionnaire FormMOU FormNovember 7, 2000 TC-5 Final Report

1.0 Executive Summaryรายงานฉบับยอสารบัญ1.1 บทนํา 1-21.1.1 วัตถุประสงค์1-21.1.2 ขอบข่ายการศึกษา1-21.1.3 ภาพรวมของพลังงานชีวมวล1-31.1.4 โครงการรับซื้อไฟฟ้าจากผู้ผลิตรายเล็ก1-31.2 การประเมินแหล่งชีวมวลในประเทศ 1-41.3 เทคโนโลยี่ที่เหมาะสม1.3.1 ข้อพิจารณาเกี่ยวกับเชื้อเพลิงชีวมวล1.3.2 ทางเลือกการเปลี่ยนพลังงานทางเคมีเป็นพลังงานความร้อน1.4 การคัดเลือกโครงการ1.4.1 การสรรหาและคัดเลืิอกโครงการ1.4.2 บันทึกความเข้าใจ1.4.3 การรวบรวมข้อมูล1.4.4 การประเมินผลเบื้องต้น1-61-61-61-61-61-71-71-71.5 การศึกษาความเป็นไปได้อย่างละเอียด 1-81.6 การส่งเสริมพลังงานชีวมวลในอนาคต1-111.6.1 ความคิดเห็นต่อระเบียบการรับซื้อไฟฟ้า ฯ1-111.6.2 องค์ประกอบอื่นๆที่มีผลกระทบต่อการพัฒนาโรงไฟฟ้าชีวมวล1-121.6.3 สิ่งจูงใจ1-12รายละเอียดตารางตาราง 1-1 ศักยภาพการนำชีวมวลในการนำมาผลิตไฟฟ้าตาราง 1-2 สรุปข้อมูลที่สำคัญของแต่ละโครงการรายละเอียดรูปภาพรูปที่ 1-1 แสดงจังหวัดที่ศักยภาพในการผลิตไฟฟ้าและสถานที่ตั้งของโครงการที่ได้ศึกษาความเป็นไปได้ทั้ง 10 โครงการ1-41-141-51-1

1.1 บทนำรายงานการศึกษาโรงไฟฟ้าชีวมวลของภาคอุตสาหกรรมชนบทขนาดเล็ก ได้จัดทำโดย บ.แบล็คแอนด์วิชช์(ประเทศไทย) จำกัด ตามข้อกำหนดของสำนักงานคณะกรรมการนโยบายพลังงานแห่งชาติ (สพช.) คลอบคลุมสาระ-สำคัญต่างๆ ของพลังงานชีวมวลและผลสรุปการศึกษาความเป็นไปได้ของโรงชีวมวล 10 แห่งรายงานฉบับย่อนี้กล่าวถึงข้อคิดเห็นที่สำคัญ และผลการศึกษาซึ่งประกอบด้วยความเป็นมา การประมาณหาศักยภาพชีวมวลแต่ละชนิด เทคโนโลยี่ที่เหมาะสม ผลสรุปการศึกษาความเป็นไปได้โรงไฟฟ้าชีวมวล และการส่ง-เสริมการใช้พลังงานหมุนเวียนในอนาคตของประเทศไทย1.1.1 วัตถุประสงค์วัตถุประสงค์หลักของการศึกษาคือ พัฒนาโครงการโรงไฟฟ้าชีวมวลให้เป็นแหล่งพลังงานไฟฟ้าของประเทศแหล่งหนึ่ง รวมถึงนำชีวมวลมาเป็นเชื้อเพลิงผลิตไอน้ำและไฟฟ้าเพื่อใช้ในอุตสาหกรรมของตนเองซึ่งเป็นการกำจัดชีวมวลในเวลาเดียวกัน และผลดีอีกประการหนึ่งคือลดการนำเข้าเชื้อเพลิงฟอสซิลจากต่าง-ประเทศ” เป้าหมายเฉพาะของการศึกษานี้คือ• ทบทวนสถานภาพพลังงานชีวมวลในประเทศไทย• ศึกษาความเป็นไปได้ในการก่อสร้างโรงไฟฟ้าชีวมวล ในภาคอุตสาหกรรมชนบทขนาดเล็กจำนวน10 แห่ง เพื่อประมาณหาศักยภาพในการผลิตไฟฟ้าและไอน้า• แสดงผลวิเคราะห์ทางด้านการเงิน เพื่อให้เจ้าของโครงการสามารถตัดสินใจในการดำเนินโครงการต่อไป• ช่วยเหลือเจ้าของโครงการสามารถเริ่มโครงการได้ และเข้าร่วมในโครงการรับซื้อไฟฟ้าจากผู้ผลิตราย-เล็กของการไฟฟ้าฝ่ายผลิตแห่งประเทศไทย(กฟผ.)1.1.2 ขอบข่ายการศึกษาการศึกษาได้แบ่งออกเป็น 3 ขั้นตอน ดังนี้ขั้นตอนที่ 1 รวบรวมข้อมูลและศึกษาความเป็นไปได้เบื้องต้นขั้นตอนนี้เป็นการรวบรวมข้อมูลและศึกษาความเป็นไปได้เบื้องต้น เพื่อหาชีวมวลชนิดใดที่มีศักยภาพเป ็นเชื้อเพลิง อุตสาหกรรมหรือโรงงาน และเทคโนโลยี่ที่เหมาะสมกับโรงไฟฟ้าชีวมวล ตลอดจนถึงการ-ร่างบันทึกความเข้าใจระหว่างสพช.กับเจ้าของชีวมวล และทบทวนระเบียบการรับซื้อไฟฟ้าจากผู้ผลิตรายเล็กขั้นตอนที่ 2 ศึกษาความเป็นไปได้บ.แบล็คแอนด์วิชช์ฯได้ศึกษาความเป็นไปได้ในการก่อสร้างโรงไฟฟ้าชีวมวล จำนวน 10 แห่ง (ใช้เชื้อเพลิงอาทิเช่น แกลบ ชานอ้อย เศษไม้ ฯลฯ) ซึ่งกระจายอยู่ทั่วทุกภาคของประเทศ รายงานของการ-ศึกษาฯนี้ได้แนบไว้ต่างหาก ซึ่งมีหัวข้อหลักๆ คือผลการศึกษาด้านเทคนิค เศรษฐกิจ การเงิน การพาณิชย์เศรษฐกิจสังคม สภาพแวดล้อม กฎหมาย และ การเมืองขั้นตอนที่ 3 ช่วยเหลือเจ้าของโครงการในการพัฒนาโครงการบ.แบล็คแอนด์วิชช์ฯได้เสนอผลการศึกษาความเป็นไปได้ และช่วยเหลือในการพัฒนาโครงการเบื้องต้นต่อเจ้าของโครงการ พร้อมกันนี้ได้จัดทำคู่มือการพัฒนาโครงการโรงไฟฟ้าชีวมวลสำหรับผู้ผลิตเอกชนรายเล็กเพื่อเป็นแนวทางในการดำเนินโครงการต่อไป1-2

1.1.3 ภาพรวมของพลังงานชีวมวลประมาณ 12 % ของพลังงานของโลกมาจากพลังงานชีวมวล เช่น ขยะ วัสดุเหลือใช้ทางการเกษตร มูลสัตว์และพืชให้พลังงานบางชนิด 1 ในประเทศอุตสาหกรรมเชื้อเพลิงเหล่านี้ ได้ถูกนำมาผลิตไฟฟ้าและไอน้ำใช้ในอุตสาห-กรรมขนาดใหญ่ (เช่นโรงงานกระดาษ และ โรงงานน้ำตาล เป็นต้น) ตรงกันข้ามกับประเทศกำลังพัฒนาส่วนใหญ่ใช้ชีวมวลเป็นเชื้อเพลิงในการหุงต้มและอุตสาหกรรมขนาดเล็กซึ่งยังไม่มีประสิทธิภาพ และสร้างมลภาวะต่อสภาพ-แวดล้อม แต่การเพิ่มขึ้นของรายได้และอุตสาหกรรมจะเป็นตัวผลักดันให้มีการใช้เทคโนโลยี่ชีวมวลที่มีประสิทธิภาพมากขึ้นและสะอาดขึ้นถ้ามองในด้านเศรษฐศาสตร์ เชื้อเพลิงชีวมวลเสียเปรียบเชื้อเพลิงฟอสซิล แต่ถ้านำเรื่องการทำลายสภาวะ-แวดล้อมมาร่วมด้วย เชื้อเพลิงชีวมวลมีข้อได้เปรียบ กล่าวคือ เชื้อเพลิงชีวมวลมีความหนาแน่นน้อยกว่า ให้พลังงานน้อยกว่า มีน้ำหนักเบากว่าเชื้อเพลิงฟอสซิลและยากในการจัดการกว่า แต่เชื้อเพลิงชีวมวลมีข้อดีด้านสิ่งแวดล้อม คือมีขึ้นใหม่ทุกปี ไม่ก่อให้เกิดสภาวะเรือนกระจก (การเผาไหม้ของชีวมวลให้ก๊าซคาร์บอนไดออกไซด์ไม่เกินกว่าที่พืชได้ดูดซับไว้ระหว่างการเจริญเติบโต) มีกำมะถันน้อยกว่า(จึงทำให้เกิดก๊าซซัลเฟอร์ไดออกไซด์น้อยกว่า) และอุณหภูมิเผาไหม้ต่ำกว่า(ช่วยลดก๊าซไนโตรเจนออกไซด์ได้มากกว่า) อย่างไรก็ตามประโยชน์เหล่านี้จะเกิดขึ้นได้ต่อเมื่อชีวมวลถูกใช้ไปอย่างมีประสิทธิภาพและไม่สร้างมลภาวะต่อสภาพแวดล้อมเท่านั้น ด้วยเหตุผลนี้ควรนำเทคโนโลยีใหม่ๆทันสมัยมาทดแทนของเดิมในประเทศไทยมีการใช้ประโยชน์จากชีวมวลเป็นแหล่งพลังงานในอุตสาหกรรมโดยเฉพาะในชนบท และภาคการเกษตร เช่นโรงงานน้ำตาล โรงสีข้าว โรงสกัดน้ำมันปาล์ม และอุตสาหกรรมไม้ยางพารา แปรรูป ถึงแม้พลังงานชีวมวลมีอัตราเพิ่มขึ้น 8 % ต่อปี แต่ยังถือว่าน้อยกว่าอัตราการเพิ่มขึ้นของการใช้พลังงานโดยรวม ส่วนแบ่งการใช้พลังงานชีวมวลที่ถูกใช้ในอุตสาหกรรมตั้งแต่ พ.ศ. 2528 ถึง พ.ศ. 2540 ได้ลดลงอย่างต่อเนื่องจาก 46% เป็น25% สิ่งที่น่าสนใจคือ เมื่อเกิดวิกฤตเศรษฐกิจปีพ.ศ. 2540 การใช้พลังงานในอุตสาหกรรมทั้งหมดมีสัดส่วนลดลงแต่ส่วนแบ่งพลังงานชีวมวลกลับเพิ่มขึ้นเป็น 28 %1.1.4 โครงการการรับซื้อไฟฟาจากผูผลิตรายเล็กอุตสาหกรรมขนาดเล็กที่เกี่ยวของกับการผลิตไฟฟาจากชีวมวล สามารถขายไฟฟาที่เหลือใหแก กฟผ. ตาม ระเบียบการรับซื้อไฟฟาจากผูผลิตรายเล็กโครงการนี้ริเริ่มโดยคณะกรรมการนโยบายพลังงานแหงชาติและดําเนิน- การโดยรัฐวิสาหกิจดานไฟฟา (กฟผ. กฟน. และกฟภ.) ประโยชนที่ไดรับคือเปนการอนุรักษเชื้อเพลิงฟอสซิล ลดการ นําเขาเชื้อเพลิง ประหยัดเงินตราตางประเทศ และทําใหแหลงผลิตไฟฟากระจายตัวออกไป จุดมุงหมายของโครงการ นี้คือใหตระหนักวาผลประโยชนภายนอกดังกลาว มีผลทําใหตนทุนของผูซื้อไฟฟาไมสูงกวาตนทุนจากแหลงอื่นๆโครงการการรับซื้อไฟฟาจากผูผลิตรายเล็กดังกลาวมีเงื่อนไขหลายประการคือ กําหนดปริมาณรับซื้อไมเกิน 60 เมกกะวัตต (อาจสูงถึง 90 เมกกะวัตตในบางพื้นที่) กฟผ. เปนผูรับซื้อแตผูเดียว และการจายเงินมี 2 แบบ แบบแรก จายเฉพาะคาพลังงาน(Non-firm) แบบสองจายทั้งคาพลังงานและพลังไฟฟา (Firm) ซึ่งตองทําสัญญาซื้อขาย 5-25 ป และมีเงื่อนไขอื่นๆเพิ่มเติมอีก ถึงแมแบบสองจะทําใหผูผลิตไฟฟามีรายไดที่แนนอน แตมีเพียง 3 ใน 24 รายเทานั้น ของจํานวนโครงการโรงไฟฟาชีวมวลทั้งหมด 2 นอกจากนี้มีเพียง 6.8 % หรือ 101 เมกกะวัตต จาก 1,491 เมกกะวัตต ที่มาจากพลังงานนอกรูปแบบ 31.2 การประเมินแหล่งชีวมวลในประเทศบ.แบล็คแอนด์วิชช์ฯได้ศึกษาชีวมวล 9 ชนิดคือ แกลบ กากอ้อย กากปาล์ม เศษไม้ กาบมะพร้าว ซังข้าวโพดส่าเหล้า กากมันสำปะหลัง และขี้เลื่อย สิ่งที่ได้ศึกษาคือปริมาณคงเหลือ การกระจายตัว กำลังการผลิต การคาดการณ์-ผลผลิตในอนาคต อุตสาหกรรมที่เกี่ยวข้อง ราคา และความเหมาะสมที่จะนำมาเป็นเชื้อเพลิงเพื่อผลิตไฟฟ้า1 “World Energy Council, Renewable Energy Resource: Opportunities and Constraints 1990-2020, 1993”2 NEPO Website, www.nepo.go.th/power/pw-spp-purch00-02-E.html3 Arthur Anderson, “Thailand Power Pool and Electricity Supply Industry Reform Study- Phase 1 Final Report,”Volume 5, March 1, 2000.1-3

ตาราง 1-1 แสดงข้อมูลศักยภาพของชีวมวลที่นำมาใช้ในการผลิตไฟฟ้า มี แกลบ กากอ้อย กากปาล์ม และเศษไม้(รวมขี้เลื่อย) เชื้อเพลิงอื่นๆไม่ได้ระบุในที่นี้ ได้ตรวจสอบแล้วพบว่าไม่เหมาะสมหลายเหตุผลด้วยกันคือ ซัง-ข้าวโพด และกาบมะพร้าวโดยทั่วไปอยู่กระจัดกระจายยากแก่รวบรวม เหมาะเป็นเชื้อเพลิงเสริมไม่เหมาะเป็นเชื้อ-เพลิงหลักในการผลิตไฟฟ้า ส่วนกากมันสำปะหลังและส่าเหล้ามีความชื้นสูงไม่ค่อยเหมาะนำมาเป็นเชื้อเพลิงปริมาณผลผลิต, ล้านตัน/ปีปริมาณชีวมวลเหลือใช้, ล้านตัน/ปี *ค่าความร้อนสูงสุด, กิโลจูลส์/กก.อัตราการกินเชื้อเพลิง, ตัน/เมกกะวัตต์-ปี**ปริมาณไฟฟ้าที่ผลิตได้, เมกกะวัตต์ตาราง 1-1ศักยภาพของชีวมวลในการนำมาผลิตไฟฟ้าแกลบ กากปาล์ม กากอ้อย เศษไม้202.3-3.714,1009,800234-375หมายเหตุ:* หลักเกณฑในการประเมินปริมาณชีวมวลแตละชนิดมีดังนี้แกลบ - ประเมินจากโรงสีขาวที่มีขนาดกําลังผลิต 100 ตันขาวเปลือก/วันขึ้นไป2.20.41-0.7410,80014,05033-53กากปาลม - ประเมินจากโรงงานสกัดน้ํามันปาลมดิบที่ไดมาตรฐาน จํานวน 17 โรง ประกอบดวยกะลาไฟเบอรและทะลายเปลากากออย - ประเมินจากโรงงานผลิตน้ําตาลทราย จํานวน 46 โรงเศษไม - ประเมินจากเศษไมและขี้เลื่อยของโรงเลื่อยไมทั่วๆ ไป และโรงงานแปรรูปไมยางพาราและจากจํานวนปลายไมของสวนยางพารา** ประเมินจากกำลังการผลิตไฟฟ้าที่ 85%502.25-3.510,00014,100160-2485.81.810,00015,500118ศักยภาพในการผลิตไฟฟ้าจากชีวมวลที่ได้ศึกษามา โดยรวมอยู่ระหว่าง 779 ถึง 1,043 เมกกะวัตต์ ค่าที่ได้คำนวณจากปริมาณชีวมวลที่เหลือ และไม่ได้เผื่อในกรณีที่มีการปรับปรุงเพิ่มประสิทธิภาพเครื่องจักรที่ผลิตไฟฟ้าในปัจจุบัน(เช่นโรงงานน้ำตาล) รูป 1-1 แสดงการกระจายตัวของปริมาณชีวมวล 4 ชนิด จังหวัดที่มีศักยภาพผลิตไฟฟ้าสูงคือ สุราษฎร์ธานี สุพรรณบุรี กาญจนบุรี นครสวรรค์ นครราชสีมา อุดรธานี กำแพงเพชร กระบี่ ตรัง และ นครศรี-ธรรมราช รวมกันแล้วประมาณ 300 เมกกะวัตต์1-4

จ.กําแพงเพชรจ.นครสวรรคจ.ขอนแกนจ.กาฬสินรุจ.รอยเอ็ดจ.อุทัยธานีจ.ชุมพรจ.สุราษฎรธานีจ.กระบี่จ.ตรังรูปที่ 1-1 แสดงจังหวัดที่มีศักยภาพการผลิตไฟฟ้าและสถานที่ตั้งของโครงการที่ได้ศึกษาความเป็นไปได้ ทั้ง 10โครงการ1-5

1.3 เทคโนโลยี่ที่เหมาะสมหัวข้อนี้พิจารณาเทคโนโลยี่หลายแบบที่สามารถนำไปใช้กับโครงการชนิดนี้1.3.1 ข้อพิจารณาเกี่ยวกับเชื้อเพลิงชีวมวลประสบการณ์ที่ผ่านมาพบว่า เชื้อเพลิงชีวมวลทุกชนิดสามารถนำมาเผาโดยใช้เทคโนโลยี่การเผาไหม้ต่างๆได้ ถ้าคุณสมบัติของชีวมวลได้มีการวิเคราะห์และพิจารณาอย่างถูกต้องเพื่อใช้ในการออกแบบเชื้อเพลิงชีวมวลเมื่อเปรียบเทียบกับถ่านหิน มีความหนาแน่นน้อยกว่า ให้พลังงานความร้อนต่ำกว่า และมีความยุ่งยากในการขนส่ง นอกจากนี้ขี้เถ้ายังมีส่วนประกอบของอัลคาไลน์ ซึ่งก่อให้เกิดตะกรัน การจับตัวเป็นก้อนและการทำให้ท่อน้ำในหม้อน้ำชำรุดเสียหาย ถ้าเป็นขี้เถ้าแกลบมีลักษณะคล้ายทรายละเอียดทำให้เกิดการกัดกร่อนได้ปัญหาเกี่ยวกับสารอัลคาไลน์แตกต่างกันไปแล้วแต่ชนิดของชีวมวล การแก้ไขที่ดีที่สุดต้องอาศัยประสบการณ์ เช่นโอกาสท่ี่ขี้เถ้าจับตัวเป็นก้อน แม้ว่าสามารถตรวจสอบได้โดยการนำชีวมวลมาวิเคราะห์คุณสมบัติก่อนก็ตาม การลด-อุณหภูมิเผาไหม้ลงช่วยได้เช่นกัน1.3.2 ทางเลือกการเปลี่ยนพลังงานทางเคมีเป็นความร้อนมีเทคโนโลยี่หลายระบบที่ใช้เผาไหม้ชีวมวลได้ดีดังนี้• Mass burn stoker boiler• Stoker boiler (stationary sloping grate, traveling grate, and vibrating grate)• Fluidized bed boiler (bubbling and circulating)• Gasification with combustion in a close-coupled boiler• Pulverized fuel suspension fired boilerแตละเทคโนโลยี่ที่กลาวมานี้สามารถใชไดกับชีวมวลทุกชนิด แตจะมีขอดี ขอเสีย แตกตางกันออกไป Stoker boiler เปนที่นิยมมากที่สุด แตไมใชดีที่สุด ยกตัวอยางเชน แกลบจะเผาไหมไดดีใน Fluidized bed และ Gasifier เพราะ อุณหภูมิเผาไหมต่ําชวยลดการจับตัวเปนกอนของขี้เถา เตาเผาแบบ Stoker และ Suspensionfiringสามารถใชไดแต ตองระวังใหการจับตัวเปนกอนของขี้เถามีนอยสุด โดยทั่วไป Fluidized Bed เปนทางเลือกที่ดีที่สุดเพราะสามารถใช กับเชื้อเพลิงที่มีความชื้นสูง และมีหลายขนาด Suspension firing ไม่เหมาะกับชีวมวลเป็นส่วนใหญ่เพราะต้องนำมา- ย่อยก่อน Gasificationอาจเป็นทางเลือกที่น่าสนใจ แต่ติดปัญหาในด้านการยอมรับทางเทคนิคและการค้าการศึกษานี้ไดแนะนํา Stoker boiler เพราะมีใชแพรหลาย ราคาถูก และประสิทธิภาพพอสมควร1.4 การคัดเลือกโครงการบทนี้กล่าวถึงการสรรหาและคัดเลือกโครงการ การร่วมลงนามในบันทึกความเข้าใจ การรวมรวมข้อมูล และการประเมินผลความเป็นไปได้เบื้องต้นของโครงการที่ได้คัดเลือกมา เพื่อการศึกษาความเป็นไปได้อย่างละเอียดต่อไป1.4.1 การสรรหาและคัดเลือกโครงการในการสรรหาโครงการ ทางคณะผู้ศึกษาได้ติดต่อสมาคมต่างๆที่เกี่ยวข้องกับอุตสาหกรรมการเกษตร ตลอด-จนแหล่งผลิตชีวมวล โดยการออกแบบสอบถามและติดต่อโดยตรงเพื่อสอบถามข้อมูลแหล่งผลิตชีวมวลและความสนใจในเรื่องโรงไฟฟ้าชีวมวล แนวทางเบื้องต้นในการคัดเลือกมีดังนี้• ปริมาณเชื้อเพลิงที่มีเหลืออยู่เพียงพอที่จะผลิตไฟฟ้าได้• มีปัญหาในการกำจัดชีวมวล และความตั้งใจในการพัฒนาโรงไฟฟ้าชีวมวล• มีประสบการณ์และความสามารถในการพัฒนาโรงไฟฟ้า1-6

ประเด็นที่สำคัญประเด็นหนึ่งคือ ถึงแม้เจ้าของโครงการจะมีความตั้งใจในการพัฒนาโครงการโรงไฟฟ้าชีวมวล แต่เนื่องจากขณะที่เริ่มการสรรหาโครงการเกิดภาวะเศรษฐกิจตกต่ำ ผู้สนใจหลายรายไม่พร้อมที่จะลงทุนในโครงการขนาดใหญ่โดยเฉพาะในธุรกิจโรงไฟฟ้าซึ่งแตกต่างจากธุรกิจเดิมที่ทำอยู่ ด้วยเหตุนี้ทางคณะผู้ศึกษาประสบความยากลำบากในการสรรหาผู้สนใจร่วมโครงการมากกว่าที่คาดคะเนไว้ในตอนแรก1.4.2 บันทึกความเข้าใจหลังจากคัดเลือกผู้ที่สนใจในโครงการได้แล้ว ขั้นตอนต่อไปเป็นการลงนามบันทึก ความเข้าใจระหว่างสพช. ผู้สนใจหรือเจ้าของโครงการ และบ.แบล็คแอนด์วิชช์ฯ สาระสำคัญในบันทึกความเข้าใจระบุว่าถ้าผลการศึกษาความเป็นไปได้มีความเหมาะสมทางด้านเทคนิค สิ่งแวดล้อม และการเงิน (มีผลตอบแทนต่อเงินลงทุนไม่ต่ำกว่า 23%) เจาของโครงการตองพัฒนาโรงไฟฟาตอไปจนสําเร็จ ถาไมดําเนินตอเจาของโครงการอาจจะตองออกคาใชจาย ของการศึกษานี้จํานวนครึ่งหนึ่งใหแก สพช. ถาไมแจงเหตุผลที่เพียงพอตอการไมปฏิบัติตามขอผูกพันตอสพช.อยางไรก็ตามไดมีผูสนใจในโครงการนี้จํานวนหลายราย แตคัดเลือกเหลือเพียง 10 รายดวยกันคือ• หจก.โรงสีข้าวสมหมาย จ.ร้อยเอ็ด• โรงสีข้าวสนั่นเมือง จ.กำแพงเพชร• หจก.โรงสีไฟฐิติพรธัญญา จ.นครสวรรค์• บ.แปลนครีเอชั่นส์ จำกัด จ.ตรัง• บ.ชุมพรอุตสาหรรมน้ำมันปาล์ม จำกัด (มหาชน) จ.ชุมพร• บ.อุตสาหกรรมน้ำตาลกาญจนบุรี จำกัด จ.อุทัยธานี• บ.วู้ดเวอร์คครีเอชั่น จำกัด จ.กระบี่• บ.นำ้ตาลมิตรกาฬสินธุ์ จำกัด จ.กาฬสินธุ์• บ.โรงสีเลียงฮงไชย จำกัด จ.ขอนแก่น• บ.ทักษิณอุตสาหกรรมน้ำมันปาล์ม (1993) จำกัด จ.สุราษฎร์ธานี1.4.3 การรวบรวมข้อมูลขั้นตอนต่อไปทางคณะผู้ศึกษาจะขอข้อมูล รายละเอียดต่างๆจากเจ้าของโครงการ เช่น ประเภทของอุตสาห-กรรม ชนิดของชีวมวล ปริมาณที่มีอยู่ ความแน่นอนของผลผลิต และลักษณะอื่นๆของชีวมวล ซื่งเป็นตัวกำหนดขนาดและรูปแบบโรงไฟฟ้า สามารถนำมาวิเคราะห์ความเป็นไปได้เบื้องต้น และผลประโยชน์ทางอ้อมที่เจ้าของโครงการได้รับ นอกจากนี้ยังมีข้อมูลประกอบเพิ่มเติมอีกคือ แหล่งน้ำ ขบวนการผลิต แผนผังโรงงาน แผนที่ตั้งโรงงาน จำนวนพนักงาน วิธีการกำจัดของเสียในปัจจุบันเป็นอย่างไร ค่าใช้จ่ายค่าไฟฟ้า จำนวนชั่วโมงทำงานต่อวัน ความต้องการใช้-ไอน้ำและโครงการขยายงานในอนาคต เป็นต้น1.4.4 การประเมินผลเบื้องต้นจากข้อมูลเบื้องต้น คณะผู้ศึกษาเดินทางไปดูสถานที่ผลิตชีวมวล ซึ่งจะเป็นสถานที่เดียวกับโรงไฟฟ้าทบทวนข้อมูลที่มีอยู่ แลกเปลี่ยนข้อมูลกับผู้ปฏิบัติงานและรวบรวมข้อมูลอื่นๆที่เกี่ยวข้องกับโรงไฟฟ้า เพื่อนำมาประ-เมินผลความเป็นไปได้เบื้องต้นว่าควรสร้างโรงไฟฟ้าใหม่หรือปรับปรุงโรงไฟฟ้าที่ใช้อยู่ในปัจจุบัน และพบว่าทั้ง 10โครงการ มีความเหมาะสมที่จะดำเนินการศึกษาอย่างละเอียดต่อไป1.5 การศึกษาความเป็นไปได้อย่างละเอียด1-7

ในหัวข้อนี้ได้สรุปผลของการศึกษาความเป็นไปได้ทั้ง 10 โครงการ และการนำเสนอผลของการศึกษาต่อเจ้าของโครงการ รูป 1-1 แสดงถึงสถานที่ตั้งของทั้ง 10 โครงการและตาราง 1-2 แสดงถึงผลสรุปข้อมูลที่สำคัญทั้ง 10โครงการเนื่องจากระยะเวลาการศึกษาค่อนข้างใช้เวลานาน ทำให้สมมติฐานสองข้อของรายงานการศึกษาความเป็นไปได้ 4 โครงการแรก จะแตกต่างกับรายงานการศึกษาความเป็นไปได้ 6 โครงการหลังคืออัตราแลกเปลี่ยน และต้นทุนโครงการ ทั้งนี้ในการศึกษา 4 โครงการแรกเริ่มเดือนมิถุนายน 2541 ซึ่งอยู่ในช่วงวิกฤตทางการเงิน อัตราแลกเปลี่ยนเงินมีความผันผวนตลอดเวลา กำหนดไว้ที่ 43.53 บาท/เหรียญสหรัฐ จากนั้นอัตราแลกเปลี่ยนได้ลดลงมาเรื่อยๆ จนถึง 37.15 บาท/เหรียญสหรัฐ ซึ่งได้นำมาใช้ในการศึกษา 6 โครงการหลังประการที่สองในส่วนของต้นทุนโครงการ ต้นทุนของ 6 โครงการหลัง สูงกว่า 4 โครงการแรกเพราะ• ได้มีการเปลี่ยนแปลงแหล่งผู้ผลิตอุปกรณ์ เครื่องมือ เครื่องจักร จากฝั่งแปซิฟิค (เช่นประเทศจีน) เป็นยุโรปและสหรัฐอเมริกา ซึ่งมีราคาแพงกว่า ทำให้ต้นทุนโครงการสูงขึ้น• 6 โครงการหลังมีขนาดเล็กกว่าเดิม เป็นผลให้มีต้นทุนต่อหน่วยสูงขึ้นผลการศึกษาความเป็นไปได้สรุปว่าทั้ง 10 โครงการมีความเหมาะสมทั้งทางด้านเทคนิคและสิ่งแวดล้อม ใน10 โครงการนี้มีทั้งโครงการสร้างใหม่ และโครงการปรับปรุงเครื่องจักรเดิมประกอบด้วยโรงไฟฟ้าที่ใช้แกลบ 4 โครงการ เศษไม้ 2 โครงการ กากปาล์ม 2 โครงการ และกากอ้อย 2 โครงการ นอกจากนี้ยังมีชีวมวลอื่นๆ อีกเป็นเชื้อเพลิงเสริมคือ กาบมะพร้าว ก๊าซชีวภาพ และซังข้าวโพด ขนาดกำลังการผลิตอยู่ระหว่าง 1.9 ถึง 8.8 เมกกะวัตต์ และในส่วนการวิเคราะห์ทางด้านการเงิน ได้มีการเปลี่ยนตัวแปรต่างๆ เช่น เพิ่มขนาดโรงไฟฟ้าจนถึง 30 เมกกะวัตต์ และกำหนดว่าไอน้ำที่ผลิตเพิ่มมีมูลค่าโดยเฉพาะโรงงานน้ำมันปาล์ม เป็นต้น เพื่อดูแนวโน้มของผลตอบแทนการเงินว่าเปลี่ยนไปอย่างไรผลการศึกษาและความเห็นของเจ้าของแต่ละโครงการได้สรุปไว้ตามรายละเอียดข้างล่างนี้• หจก.โรงสีข้าวสมหมายโครงการโรงไฟฟ้าโรงสีข้าวสมหมาย เป็นโครงการใหม่ ตั้งอยู่ที่จ.ร้อยเอ็ด ปัจจุบันโรงสีข้าวสมหมายได้ขยายกำลังการผลิตเป็น 1,300 ตันข้าวเปลือก/วัน จึงมีแกลบเหลือจากการสีข้าว 100,000 ตัน/ปี สามารถนำมาผลิตไฟฟ้าได้ 10 เมกกะวัตต์ (สุทธิ 8.8 เมกกะวัตต์) ผลการศึกษาความเป็นไปได้สรุปว่า มีความเหมาะสมทั้งทางด้านเทคนิค สิ่งแวดล้อมและการเงิน (ผลตอบแทนต่อเงินลงทุน 32.6 %)ผลของการศึกษาฯได้นำเสนอต่อเจ้าของโรงสีข้าวสมหมาย ซึ่งได้ตัดสินใจดำเนินโครงการต่อโดยได้ร่วมทุนกับบ.ผลิตไฟฟ้า จำกัด (มหาชน) ปัจจุบันอยู่ในขั้นตอนประกวดราคาหาผู้รับเหมาทำการก่อสร้างโครงการ• โรงสีข้าวสนั่นเมืองโครงการโรงไฟฟ้าโรงสีข้าวสนั่นเมืองจะเป็นโครงการโรงไฟฟ้าใหม่ตั้ง อยู่ในโรงสีข้าวสนั่นเมือง จ.กำแพงเพชร มีกำลังการผลิต 250 ตันข้าวเปลือก/วัน มีแกลบเหลือจาการสีข้าว 13,800 ตัน/ปี และเมื่อรวมกับส่วนของโรงสีใกล้เคียง อีก 5 โรง ประมาณ 65,200 ตัน/ปี สามารถนำมาผลิตไฟฟ้าได้ 9.1 เมกกะวัตต์1-8

(สุทธิ 8.0 เมกกะวัตต์) ผลการศึกษาความเป็นไปได้สรุปว่ามีความเหมาะสมทั้งทางด้านเทคนิค สิ่งแวดล้อมและการเงิน (ผลตอบแทนต่อเงินลงทุน 25.5 %)ผลของการศึกษาฯได้นำเสนอต่อเจ้าของโรงสีข้าวสนั่นเมือง ซึ่งมีความสนใจมากและต้องการร่วมทุนกับนักลงทุนที่สนใจ ที่จะทำโครงการ• หจก.โรงสีไฟฐิติพรธัญญาโครงการโรงไฟฟ้าโรงสีไฟฐิติพรธัญญาเป็นโครงการใหม่ตั้งอยู่ที่ จ.นครสวรรค์ โรงสีไฟฟ้าฐิติพรธัญญามีกำลังการผลิต 500 ตันข้าวเปลือก/วัน มีแกลบเหลือจากการสีข้าว 27,600 ตัน/ปี และเมื่อรวมกับส่วนของโรงสีใกล้เคียง อีก 7 โรง ประมาณ 51,400 ตัน/ปี สามารถนำมาผลิตไฟฟ้าได้ 9.1 เมกกะวัตต์ (สุทธิ8.0 เมกกะวัตต์) ผลการศึกษาความเป็นไปได้สรุปว่ามีความเหมาะสมทั้งทางด้านเทคนิค สิ่งแวดล้อม และการเงิน (ผลตอบแทนต่อเงินลงทุน 26.4 %)ผลของการศึกษาฯได้นำเสนอต่อเจ้าของโรงสีไฟฐิติพรธัญญา ซึ่งมีความสนใจและพร้อมที่จะลงทุนกับนักลงทุนภายนอก อย่างไรก็ตามทางเจ้าของโรงสีแสดงความกังวลเพราะโรงไฟฟ้านี้ต้่องพึ่งพาแกลบจากโรงสีอื่น• บ.แปลนครีเอชั่นส์ จำกัดโครงการโรงไฟฟ้าบ.แปลนครีเอชั่นส์ เป็นโครงการใหม่ ตั้งอยู่ที่จ.ตรัง บ.แปลนครีเอชั่นส์ ผลิตของ-เล่นเด็กโดยใช้ไม้ยางพาราเป็นวัตถุดิบ มีเศษไม้ เหลือประมาณ 4,000 ตัน/ปี และเมื่อรวมกับ เศษไม้จากโรงเลื่อยใกล้เคียง และจากสวนยางพารา เป็น 134,000 ตัน/ปี สามารถนำมาผลิตไฟฟ้าได้ 10 เมกกะวัตต์(สุทธิ 8.8 เมกกะวัตต์) ผลการศึกษาความเป็นไปได้สรุปว่ามีความเหมาะสมทั้งทางด้านเทคนิค และสิ่งแวด-ล้อม แต่ด้านการเงินมีผลตอบแทนต่อเงินลงทุน 7.95 % ถ้าโครงการนี้ขยายให้ใหญ่ขึ้น เช่นประมาณ 28เมกกะวัตต์ ผลตอบแทนต่อเงินลงทุนจะสูงขึ้นเป็น 38.5 %ผลของการศึกษาฯได้นำเสนอต่อเจ้าของโครงการ ซึ่งมีความสนใจมากแต่มีความสนใจลงทุนโรงไฟฟ้าชีวมวลขนาดเล็ก (2 เมกกะวัตต์) ขณะนี้อยู่ระหว่างการขอราคาของโครงการจากผู้จำหน่ายอุปกรณ์อยู่• บ.ชุมพรอุตสาหรรมน้ำมันปาล์ม จำกัด (มหาชน)โครงการโรงไฟฟ้าบ.ชุมพรอุตสาหรรมน้ำมันปาล์ม เป็นโครงการปรับปรุงโรงไฟฟ้าเดิม ตั้งอยู่ที่จ.ชุมพร บ.ชุมพรอุตสาหรรมน้ำมันปาล์ม เป็นโรงสกัดน้ำมันปาล์มดิบ และน้ำมันปาล์มบริสุทธิ์ มีโรงไฟฟ้าขนาด 3.5 เมกกะวัตต์ แต่ผลิตได้จริง 2.4 เมกกะวัตต์ ใช้กากปาล์มคือ กะลา ไฟเบอร์ ทะลายเปล่าและก๊าซชีวภาพเป็นเชื้อเพลิง จากการศึกษาพบว่าถ้านำเชื้อเพลิงจากภายนอกมาเสริม คือ กาบมะพร้าว และกะลา-ปาล์มจากโรงงานอื่น จะผลิตไฟฟ้าได้ถึง 3.7 เมกกะวัตต์ และถ้าติดตั้งกังหันไอน้ำแบบมีคอนเดนเซอร์ต่อจากกังหันปัจจุบันและปรับปรุงระบบบำบัดน้ำดี เป็นต้น จะผลิตไฟฟ้าได้สูงถึง 5.4 เมกกะวัตต์ ขายไฟฟ้าแก่ภายนอกได้ประมาณ 2.5 เมกกะวัตต์ผลการศึกษาความเป็นไปได้สรุปว่ามีความเหมาะสมทั้งทางด้านเทคนิค สิ่งแวดล้อม และการเงิน มีผล-ตอบแทนต่อเงินลงทุน 20.4 % ถ้ารวมผลประโยชน์ที่ได้รับจากการผลิตไอน้ำที่เพิ่มขึ้น ทำให้กำลังการผลิตเพิ่มมากขึ้นด้วย ผลตอบแทนต่อเงินลงทุนจะสูงขึ้นเป็น 39 ถึง 69 % ตามค่าไอน้ำ 5 ถึง 15 US ดอลลาร์ต่อ-ตัน1-9

ผลของการศึกษาฯได้นำเสนอต่อเจ้าของโครงการซึ่งมีความสนใจมาก แต่มีความเป็นห่วงความผัน-ผวนของราคากะลาปาล์มที่ซื้อจากภายนอก อย่างไรก็ตามทางบ.ชุมพรฯ มีโครงการที่จะขยายกำลังการผลิตในอนาคต ซึ่งจะต้องทำการปรับปรุงทั้งระบบการผลิตไฟฟ้าและไอน้ำ• บ.อุตสาหกรรมน้ำตาลกาญจนบุรี จก.โครงการโรงไฟฟ้าบ.อุตสาหกรรมน้ำตาลกาญจนบุรี เป็นโครงการปรับปรุงโรงไฟฟ้าเดิม ตั้งอยู่ที่จ.อุทัยธานี บ. อุตสาหกรรมน้ำตาลกาญจนบุรีเป็นโรงงานผลิตน้ำตาล ซึ่งต้องใช้ทั้งไอน้ำและไฟฟ้าเพื่อการผลิต กำลังการผลิตไฟฟ้าสูงสุดในปัจจุบัน 17.5 เมกกะวัตต์ เนื่องจากในขบวนการผลิตมีไอน้ำและไฟฟ้าเหลืออยู่จำนวนหนึ่ง มีกากอ้อยเหลือเมื่อเสร็จสิ้นฤดูการผลิต และมีซังข้าวโพดเหลือมากมายใน จ.อุทัยธานีสิ่งเหล่านี้เมื่อนำมารวบรวมจะผลิตไฟฟ้าได้ 2 เมกกะวัตต์ (สุทธิ 1.85 เมกกะวัตต์) ประมาณ 6 เดือน โดยต้องทำการปรับปรุง และเพิ่มเติมเครื่องจักรบางส่วนผลการศึกษาความเป็นไปได้สรุปว่ามีความเหมาะสมทั้งทางด้านเทคนิค สิ่งแวดล้อมและการเงิน (ผลตอบแทนต่อเงินลงทุน 18.9 %) จากการศึกษาเพิ่มเติมพบว่า ถ้ามีการเพิ่มประสิทธิภาพหม้อน้ำทั้ง 5 ชุด จะทำให้มีกากอ้อยเหลือเพิ่มขึ้น ซึ่งสามารถทดแทนซังข้าวโพดได้โดยไม่ต้องซื้อ ผลตอบแทนต่อเงินลงทุนเพิ่มขึ้นเป็น 27.5 %ผลของการศึกษาฯได้นำเสนอต่อเจ้าของโครงการ ซึ่งมีความสนใจมากและต้องการที่จะดำเนินโครงการต่อไป• บ.วู้ดเวอร์คครีเอชั่น จำกัดโครงการโรงไฟฟ้า บ.วู้ดเวอร์คครีเอชั่น เป็นโครงการใหม่ ตั้งอยู่ที่จ.กระบี่ บ.วู้ดเวอร์คครีเอชั่น เป็นโรงเลื่อยไม้ยางพารา มีเศษไม้เหลือประมาณ 31,680 ตัน/ปี หลังขยายกำลังการผลิตและเมื่อรวมเศษไม้จากโรงเลื่อยใกล้เคียง และจากสวนยางพารา อีก 23,000 ตัน/ปี สามารถนำมาผลิตไฟฟ้าได้ 3.55 เมกกะวัตต์(สุทธิ 3.1 เมกกะวัตต์) ผลการศึกษาความเป็นไปได้สรุปว่ามีความเหมาะสม ทั้งทางด้านเทคนิค และสิ่งแวด-ล้อม แต่ด้านการเงินมีผลตอบแทนต่อเงินลงทุน 4.4 % ถ้าโครงการนี้ขยายให้ใหญ่ขึ้น เช่น ประมาณ 30เมกกะวัตต์ ผลตอบแทนต่อเงินลงทุนจะสูงขึ้นเป็น 25 %ผลของการศึกษาฯได้นำเสนอต่อเจ้าของโครงการ ซึ่งขอศึกษารายละเอียดเพิ่มเติมก่อนตัดสินใจ• บ.นำ้ตาลมิตรกาฬสินธุ์ จำกัดโครงการโรงไฟฟ้า บ.นำ้ตาลมิตรกาฬสินธุ์ เป็นโครงการตั้งโรงไฟฟ้าใหม่ ตั้งอยู่ในบริเวณโรงน้ำตาลปัจจุบันที่จ.กาฬสินธ์ุ บ.นำ้ตาลมิตรกาฬสินธุ์ ใช้กากอ้อยที่เหลือ 76,000 ตัน/ปี สามารถนำมาผลิตไฟฟ้าโดยใช้หม้อน้ำแรงดันสูง ได้ 6.1 เมกกะวัตต์ (สุทธิ 5.6 เมกกะวัตต์) ในส่วนของโรงไฟฟ้าปัจจุบัน ยังดำเนิน-การอยู่โดยผลิตไฟฟ้าและไอน้ำใช้ในการผลิตน้ำตาล ผลการศึกษาความเป็นไปได้สรุปว่ามีความเหมาะสมทั้งทางด้านเทคนิค สิ่งแวดล้อมและการเงิน (ผลตอบแทนต่อเงินลงทุน 13.3 %) แนวทางศึกษาอีกทางหนึ่งถ้าดัดแปลงและเพิ่มเติมเครื่องจักรบางส่วนของโรงน้ำตาลปัจจุบันจะสามารถผลิตไฟฟ้าได้ 3.2 เมกกะวัตต์แต่ผลตอบแทนต่อเงินลงทุนเพิ่มขึ้นเป็น 46 %ผลของการศึกษาฯได้นำเสนอต่อเจ้าของโครงการซึ่งมีความสนใจมาก และพร้อมที่จะดำเนินโครงการต่อไป1-10

• บ.โรงสีเลียงฮงไชย จำกัดโครงการโรงไฟฟ้าโรงสีเลียงฮงไชย เป็นโครงการใหม่ ตั้งอยู่ที่จ.ขอนแก่น โรงสีเลียงฮงไชย เป็นโรง-สีข้าว มีแกลบเหลือจาการสีข้าว 33,000 ตัน/ปี สามารถนำมาผลิตไฟฟ้าได้ 3.8 เมกกะวัตต์ (สุทธิ 3.3 เมกกะ-วัตต์) ผลการศึกษาความเป็นไปได้สรุปว่ามีความเหมาะสมทั้งทางด้านเทคนิค และสิ่งแวดล้อม แต่ผลตอบ-แทนต่อเงินลงทุนเท่ากับ 7.6 % ถ้ามีการขยายกำลังการผลิตเพิ่มขึ้นเป็น 13.4 เมกกะวัตต์ ผลตอบแทนต่อเงินลงทุนเพิ่มขึ้นเป็น 29 %ผลของการศึกษาฯได้นำเสนอต่อเจ้าของโรงสี ซึ่งขอศึกษารายละเอียดเพิ่มเติม• บ.ทักษิณอุตสาหกรรมน้ำมันปาล์ม (1993) จำกัด จ.สุราษฎร์ธานีโครงการโรงไฟฟ้าบ.ทักษิณอุตสาหกรรมน้ำมันปาล์ม เป็นโครงการใหม่ ตั้งอยู่ที่ จ.สุราษฎร์ธานีบ.ทักษิณฯ เป็นโรงสกัดน้ำมันปาล์มดิบ จากการศึกษาพบว่าถ้านำเชื้อเพลิงเฉพาะกะลาและไฟเบอร์ รวมทั้งก๊าซชีวภาพจากบ่อบำบัดน้ำเสียที่จะสร้างในอนาคตจะสามารถผลิตไฟฟ้าได้ถึง 7.0 เมกกะวัตต์ (สุทธิ 6.2เมกกะวัตต์) โดยโรงไฟฟ้าขนาด 0.88 เมกกะวัตต์ที่มีอยู่ จะคงไว้เพื่อเป็นแหล่งผลิตสำรอง ผลการศึกษาความเป็นไปได้สรุปว่ามีความเหมาะสมทั้งทางด้านเทคนิค สิ่งแวดล้อม และการเงิน (ผลตอบแทนต่อเงินลง-ทุน 11.6 %)จากการศึกษาเพิ่มเติมพบว่าถ้ารวมผลประโยชน์ที่ได้รับจากการขยายกำลังการผลิตในอนาคต การนำทะลายปาล์มเปล่ามาใช้และหาเชื้อเพลิงเสริมอีกจำนวนหนึ่ง จะผลิตไฟฟ้าเพิ่มขึ้น 28.3 เมกกะวัตต์ และผล-ตอบแทนต่อเงินลงทุนจะสูงขึ้นเป็น 25 %ผลของการศึกษาฯได้นำเสนอต่อเจ้าของโครงการซึ่งมีความสนใจเพราะมีโครงการขยายกำลังการผลิตในอนาคต ซึ่งจำเป็นต้องปรับปรุงระบบการผลิตไฟฟ้าและไอน้ำในปัจจุบัน1.6 การส่งเสริมพลังงานชีวมวลในอนาคตตามที่ได้กล่าวมาแล้ว โรงไฟฟ้าชีวมวลในโครงการผู้ผลิตไฟฟ้าเอกชนรายเล็ก มีสัดส่วนกำลังการผลิตน้อย-มาก และส่วนมากมีการทำสัญญาซื้อขายแบบ Non-firm มีสาเหตุหลายประการ ส่วนหนึ่งเกี่ยวข้องกับระเบียบการรับซื้อไฟฟ้าจากผู้ผลิตรายเล็ก เฉพาะการผลิตไฟฟ้าจากพลังงานนอกรูปแบบ ฉบับมกราคม พศ. 2541 ของกฟผ. ดังรายละเอียดต่อไปนี้1.6.1 ความคิดเห็นต่อระเบียบการรับซื้อไฟฟ้าฯค่าพลังไฟฟ้าและพลังงานไฟฟ้าที่จ่ายให้แก่โรงไฟฟ้าชีวมวลที่มีสัญญาแบบ Firm คำนวณจากต้นทุนที่หลีก-เลี่ยงได้ในระยะยาวของโรงไฟฟ้าใช้น้ำมันเป็นเชื้อเพลิง ซึ่งโรงไฟฟ้าชีวมวลไม่สามารถแข่งขันได้ตามหลักทางเศรษฐศาสตร์ ต่อไปนี้• เนื่องจากเชื้อเพลิงชีวมวลอยู่กระจัดกระจาย โรงไฟฟ้าชีวมวลจึงมีขนาดเล็ก (ประมาณ 5-30 เมกกะวัตต์) ซึ่งเมื่อเปรียบเทียบกับโรงไฟฟ้าใช้น้ำมันเป็นเชื้อเพลิง โรงไฟฟ้าชีวมวลจะมีต้นทุนการก่อสร้างสูงกว่า• การจ่ายค่าพลังงานไฟฟ้าอ้างอิงกับ ค่าความสิ้นเปลืองในการใช้เชื้อเพลิงเพื่อผลิตพลังงานไฟฟ้า (Netplant heat rate) กำหนดไว้เท่ากับ 8,600 บีทียู/กิโลวัตต์-ชม. ซึ่งใช้สำหรับโรงไฟฟ้าพลังความร้อน แต่สำหรับโรงไฟฟ้าชีวมวล บวกกับเทคโนโลยี่ที่ทันสมัย ตัวเลขดังกล่าวจะสูงกว่ามากจึงไม่สามารถแข่งขันกับโรงไฟฟ้าทั่วไปได้1-11

1.6.2 องค์ประกอบอื่นๆที่มีผลกระทบต่อการพัฒนาโรงไฟฟ้าชีวมวลนอกจากระเบียบการรับซื้อไฟฟ้าฯยังมีองค์ประกอบเหตุผลอื่นๆอีกที่ทำให้โรงไฟฟ้าชีวมวลในประเทศไทยที่ทำสัญญาซื้อขายไฟฟ้าแบบ Firm กับกฟผ. มีเพียง 2-3 ราย และสาเหตุที่โรงไฟฟ้าชีวมวลในประเทศไทยมีน้อยคือ• ราคาของพลังงานไม่สะท้อนถึงต้นทุนทางสังคม เช่น มลภาวะทางอากาศ การปล่อยก๊าซคาร์บอนได-ออกไซด์ ผลกระทบต่อสังคมและเศรษฐกิจ และการนำเข้าเชื้อเพลิงจากต่างประเทศ• นักลงทุนและหรือผู้ให้กู้เงินเน้นที่จะลดความเสี่ยงโครงการมากกว่าการบริหารความเสี่ยง โดยทำสัญญาจัดหาเชื้อเพลิงในระยะยาว ซึ่งค่อนข้างยากที่จะประสบผลสำร็จ• เจ้าของชีวมวลส่วนใหญ่ไม่คุ้นเคยธุรกิจการผลิตไฟฟ้า จึงมีความกังวลที่จะมีการลงทุนขนาดใหญ่ในธุรกิจที่ตนเองไม่ถนัด• ค่าใช้จ่ายเบื้องต้นในการพัฒนาโรงไฟฟ้าชีวมวล มีค่าใกล้เคียงกับโรงไฟฟ้าขนาดใหญ่ ทั้งๆที่กำลังการผลิตน้อยกว่ามากจากเหตุผลดังกล่าวข้างต้น ทำให้การกู้เงินของโครงการโรงไฟฟ้าชีวมวลมีความยุ่งยาก และมีค่าใช้จ่ายที่สูง-กว่าโรงไฟฟ้าทั่วๆไป ผลลัพธ์คือโรงไฟฟ้าชีวมวลที่สร้างขึ้นใหม่ไม่สามารถผลิตไฟฟ้าขายในอัตราเดียวกับโรงไฟฟ้าปัจจุบันได้1.6.3 สิ่งจูงใจมาตรการจูงใจต่างๆได้นำมาใช้ทั่วโลก เพื่อการสนับสนุนแหล่งพลังงานชีวมวลและพลังงานทดแทนอื่นๆในส่วนของประเทศไทย นอกจากการเพิ่มค่าพลังไฟฟ้าและพลังงานไฟฟ้าแล้ว ควรมีมาตรการอื่นมาเสริมอีกดังนี้• ตั้งเป้าหมาย 10 ปีข้างหน้าสำหรับการผลิตไฟฟ้าจากพลังงานนอกรูปแบบ• จัดตั้งแผนการช่วยเหลือ เพื่อส่งเสริมการพัฒนาโรงไฟฟ้าที่ใช้พลังงานนอกรูปแบบมากขึ้น• ส่งเสริมการใช้พลังงานนอกรูปแบบเป็นพลังงาน “สีเขียว” เพื่อให้สาธารณะชนสนับสนุน• รวมมือกับอุตสาหกรรมที่มีศักยภาพสูง (เชน โรงงานน้ําตาล) ในการเพิ่มประสิทธิภาพเครื่องจักรและ สนับสนุนใหมีการผลิตไฟฟาจากชีวมวลมากขึ้น• ศึกษาทางเลือกอื่นๆเกี่ยวกับกลไกการจัดหาแหล่งเงินกู้ระยะยาว อัตราดอกเบี้ยต่ำ สำหรับโรงไฟฟ้าชีวมวลการให้สิ่งจูงใจใดๆ ควรอยู่ในกรอบของการแข่งขันเสรีในการผลิตไฟฟ้า และมีความยึดหยุ่นเพียงพอต่อสภาพของตลาดที่มีการเปลี่ยนแปลงอยู่เสมอสพช.มีความสำเร็จในการรณรงค์ การสนับสนุนพลังงานนอกรูปแบบ โดยมีโครงการตั้งเป้าหมายการผลิตไฟฟ้าจากพลังงานนอกรูปแบบ 300 เมกกะวัตต์ และจัดหาเงินช่วยเหลือไว้จำนวนหนึ่ง โดยนำมาจากกองทุนน้ำมันโครงการดังกล่าวจะเปิดให้มีการแข่งขันอย่างเสรี ซึ่งถือว่าเป็นขั้นตอนสำคัญของการนำไปสู่เป้าหมายของนโยบายด้านพลังงานในระยะยาวของประเทศ1-12

ตาราง 1-2สรุปข้อมูลที่สำคัญของแต่ละโครงการรายงานความก้าวหน้าครั้งที่ 2 รายงานความก้าวหน้าครั้งที่ 3โครงการ โรงสีสมหมาย โรงสีสนั่นเมือง โรงสีฐิติพร บ.แปลนฯ บ.ชุมพรฯ บ.กาญจนบุรีฯ บ.วู้ดเวอร์คฯ บ.มิตรกาฬสินธุ์ โรงสีเลียงฮงไชย บ.ทักษิณฯธุรกิจ โรงสีข้าว โรงสีข้าว โรงสีข้าว ผลิตภัณฑ์ไม้ โรงสีข้าว น้ำตาล โรงเลื่อยไม้ยางฯ น้ำตาล โรงสีข้าว โรงสีข้าวลักษณะโครงการ ใหม่ ใหม่ ใหม่ ใหม่ ปรับปรุง ปรับปรุง ใหม่ ใหม่ ใหม่ ใหม่ปริมาณชีวมวลที่เหลือ, ตัน/ปี 98,670 13,800 27,600 4,000 89,100 20,834 31,680 76,000 33,000 73,500ปริมาณชีวมวลที่ใช้, ตัน/ปี 86,900 79,000 79,000 134,000 111,860 34,216 54,000 76,000 33,000 73,500ชนิดของชีวมวล แกลบ แกลบ แกลบ เศษไม้ยางพารา กากปาล์ม, กากอ้อย, เศษไม้ยางพารา กากอ้อย แกลบ กากปาล์ม,ก๊าซชีวภาพ ซังข้าวโพด a ก๊าซชีวภาพ aพลังงานความร้อน, จิกะจูลส์/ปี 1,225,868 1,113,900 1,113,900 1,380,200 1,564,000 b 406,980 510,300 725,040 465,300 1,072,932 bอัตราการใช้พลังงานความร้อนสุทธิ, กิโลจูลส์/กิโลวัตต์- ชม. 18,708 18,708 18,708 21,015 49,500 c 47,205 c d 21,900 17,400 18,700 21,700 eพลังไฟฟ้าสุทธิ, กิโลวัตต์ 8,800 8,000 8,000 8,800 4,550 1,850 3,100 5,600 3,300 6,200พลังไฟฟ้าที่ขายกฟผ., กิโลวัตต์ 8,800 8,000 8,000 8,800 2,520 1,850 3,100 5,600 3,300 5,366ปริมาณไอน้ำ, ตัน/ชม. ไม่มี ไม่มี ไม่มี ไม่มี 31.85 ไม่มี ไม่มี ไม่มี ไม่มี 13.9 eราคาโครงการโดยประมาณ, ล้านเหรียญสหรัฐ 9.71 9.27 9.27 10.59 5.0 1.95 8.65 13.4 9.73 14.6ผลตอบแทนโครงการ, % 32.6 25.5 26.4 7.95 20.4 18.9 4.4 13.3 7.6 11.6ผลตอบแทนโครงการ ที่อัตราแลกเปลี่ยน 43 ฿/US$, % – – – – 15.8 15.9 2.1 9.8 5.1 8.4ผลตอบแทนโครงการ เมื่อลดต้นทุน 20 %, % – – – – 29.4 26.7 8.5 20.1 12.6 17.9ผลตอบแทนโครงการ กรณีทางเลือกอื่นๆ, % – – – 38.5 39-69 27.5 25 46 13-29 13-25หมายเหตุ :a บ.ชุมพรฯใช้เชื้อเพลิง กากปาล์ม ( กะลา, ไฟเบอร์ และทะลาย) , ก๊าซชีวภาพ และกาบมะพร้าว ส่วนบ.ทักษิณ ใช้กากปาล์ม (กะลา และ ไฟเเบอร์) และก๊าซชีวภาพb บ.ชุมพรฯ ใชกาซชีวภาพ 6,000,000 ลบ.เมตร/ป สวนบ.ทักษิณ ใช 3,570,000 ลบ.เมตร/ปc อางอิงจากประสิทธิภาพของโรงไฟฟาในโรงงานปจจุบันd รวมสวนที่เปนกําลังไฟฟาสวนเกินของโรงงานน้ําตาลชวงเปดหีบe เปนคาโดยเฉลี่ย เนื่องจากอัตราการใชมีการเปลี่ยนแปลงตามฤดูกาล1-13

or cogeneration. A standard Memorandum of Understanding (MOU) betweenNEPO, the facility owner/developer, and Black & Veatch was developed andthe regulations of the SPP program were reviewed.Task 2Task 3Feasibility StudiesBlack & Veatch performed feasibility studies for ten power plants burningbiomass fuels (rice husks, bagasse, wood, etc.) at sites throughout Thailand.The feasibility studies are contained in a separate report to the Final Report.The studies assess feasibility in the following areas: technical, economic,financial, commercial, socioeconomic, ecological, juridical, and political.Assist Development of Biomass-Based Power GenerationOwners were presented the results of their respective feasibility studies andthen assisted in initial project implementation activities. A handbook wasdeveloped outlining the procedure for entering the SPP program, including allresponsibilities and performance standards for the SPP.2.1.3 Biomass Energy OverviewAbout 12 percent of the world's energy comes from the use of biomass fuels,which include items as diverse as residential yard waste, manure, agricultural residues,and dedicated energy crops. 1 In industrialized nations, bioenergy facilities typically usebiomass fuels in large industrial cogeneration applications (pulp and paper production,sugar cane milling, etc.). Conversely, developing nations largely rely on biomass forrural cook stoves or small industries. Such applications are relatively inefficient anddirty. Increasing industrialization and household income are driving the economies ofdeveloping nations to implement cleaner and more efficient biomass technologies.Environmental concerns may help make biomass an economically competitivefuel. Because biomass fuels are generally less dense, lower in energy content, and moredifficult to handle than fossil fuels, they usually do not compare favorably to fossil fuelson an economic basis. However, biomass fuels have several important environmentaladvantages. Biomass fuels are renewable, and sustainable use is greenhouse gas neutral(biomass combustion releases no more carbon dioxide than absorbed during the plant’sgrowth). Biomass fuels contain little sulfur compared to coal (reduced sulfur dioxideemissions) and have lower combustion temperatures (reduced nitrogen oxide emissions).However, unless biomass is efficiently and cleanly converted to a secondary energy form,the environmental benefits are only partially realized, if at all. For this reason, efficient,modern biomass utilization must be favored over traditional applications.The use of biomass as an energy source is widely practiced throughout Thailandindustries, particularly in rural and agricultural areas. Major industrial users of biomassenergy include sugar cane milling, rice milling, palm oil production, and the wood1 World Energy Council, “Renewable Energy Resources: Opportunities and Constraints 1990-2020,” 1993.January 5, 2001 2-2 Final Report

products industry. Although biomass energy use has been increasing at 8 percent annualgrowth recently, this rate has not been as fast as the overall growth in industrial energyuse. Consequently, the share of biomass energy used in industrial processes has steadilydropped from 46 percent in 1985, to 25 percent in 1996. Interestingly, although overallindustrial energy use declined when the financial crisis started in 1997, use of agriculturaland wood residues actually climbed, increasing the share of biomass energy to 28 percent.2.1.4 Small Power Producers (SPP) Program OverviewSmall rural industries engaged in biomass power production may sell excessgeneration back to the grid through the SPP program. The SPP program was initiated bythe National Energy Policy Council and is implemented by Thailand electricity authorities(EGAT, PEA, MEA). Benefits of the program include conservation of fossil fuels,reduced fuel imports, conservation of foreign hard currency, and distributed generation.The intent of the program is to realize these external benefits, yet result in a direct cost toratepayers that is no higher than supplying electricity without SPP projects.The SPP regulations establish several conditions for purchases from SPPs. Theseinclude a purchased capacity limitation of 60 MW (up to 90 MW in certain locations) andthe stipulation that EGAT be the sole purchaser of electricity. Payments to the SPP canconsist of an energy-only payment for electricity delivered (kWh) or an energy and acapacity payment. Capacity payments are made for contracts that are 5 to 25 years(“firm”) and that meet certain other requirements. Although capacity payments providesubstantial revenue to power projects, only three out of the 24 biomass projects acceptedso far into the SPP program receive such payments. 2 Furthermore, only 6.8 percent(101 MW) of the total SPP capacity connected to the EGAT system (1,491 MW) involveswaste or renewable resources. 32.2 Thailand Biomass Resource AssessmentBlack & Veatch conducted a biomass fuel supply review for Thailand. Thereview investigated nine types of biomass as possible fuel for power and cogenerationplants: rice husk, oil palm residues, bagasse, wood residues, corncob, cassava residues,distillery slop, coconut residues, and sawdust. Availability, distribution, production ratesand forecasts, involved industries, prices, and the general suitability of the fuels for powerproduction were assessed. This section provides a summary of the investigation.2 NEPO website, www.nepo.go.th/power/pw-spp-purch00-02-E.html3 Arthur Anderson, “Thailand Power Pool and Electricity Supply Industry Reform Study-Phase 1 FinalReport,” Volume 5, March 1,2000.January 5, 2001 2-3 Final Report

Table 2-1 provides basic information on the most viable fuels identified: rice husk,palm oil residues, bagasse (from sugar cane milling), and wood residues. Other fuelsexamined are not considered as viable for various reasons. Corncobs and coconutresidues are generally left scattered, making collection difficult. They are suitablesupplementary fuels but are not a significant source of energy for power generation.Because of their high moisture content, cassava residues and distillery slop are not likelyto find widespread implementation as fuels.FuelTable 2-1Most Viable Biomass Fuels in ThailandRice huskPalm OilResiduesBagasseWoodResiduesSource output, 10 6 tonne/yr 20 2.2 50 5.8Available residue, 10 6 tonne/yr a 2.3-3.7 0.41-0.74 2.25-3.5 1.8Higher heating value, kJ/kg 14,100 10,800 10,000 10,000Fuel consumption, tonne/yr/MW b 9,800 14,050 14,100 15,500Aggregate power generation potential, MW 234-375 33-53 160-248 118Notes:aEach biomass was estimated based on the following assumptions.Rice-husk –Based on rice mills of capacity minimum 100 tonnes of paddy/day.Palm Oil Residues – Based on the 17 crude palm oil extracting facilities. Residues consistof shells, fibre, and empty fruit bunch.Bagasse – Based on the 46 Sugar mills.Wood Residues – Included discarded processed wood and sawdust from general sawmillsand parawood processing facilities and small logs from parawood plantation forest.bA uniform 85 percent capacity factor is assumed in this study.Aggregate power generation potential from all residues surveyed in this studyranges from 779 to 1,043 MW. This value is for residues not already in use and does notaccount for generation gains by increases in existing process or power generationefficiency (e.g., sugar cane milling). Figure 2-1 shows distribution of capacitydevelopable from the four most viable fuels. The most promising provinces account forabout 300 MW of developable capacity and include Suratthani, Suphan Buri,Kanchanaburi, Nakhon Sawan, Nakhon Ratchasi, Udon Thani, Kamphaeng Phet, Krabi,Trang, and Nakhon Sri Thammarat.January 5, 2001 2-4 Final Report

Kamphaeng PhetNakorn SawanUthai ThaniKhon KaenRoi EtKalasinChumpornSurat ThaniKrabiTrangFigure 2-1.Aggregate Potential Net Electric Capacity from Most Viable Residues andCandidate Facility Locations.January 5, 2001 2-5 Final Report

2.4.1 Identification and Screening of Candidate FacilitiesTo identify potential sites, the study team contacted various agro-industrialassociations, approached sites that generate large amounts of residues, and developed aquestionnaire to solicit facility information and interest in project development. Initialsite selection guidelines for identification of suitable facilities included:• Availability of biomass supply for power generation or cogeneration.• Biomass disposal concerns and the intention to develop a power plant.• Capability and experience of the facility owner(s) in developing power plants.One of the most important aspects in site selection was owner willingness toproceed with a power project. Because of the downturn in the economy, many facilitieswere uncomfortable with making large investments, especially in power generation, afield outside their regular business. For this reason, the study team had more difficultythan expected locating candidate facilities.2.4.2 Memorandum of Understanding (MOU) DevelopmentHaving identified potential sites and established a desire in the facility owners toproceed with the study, the next step in the process was to develop a MOU between theowner, NEPO, and Black & Veatch. The MOU outlines the commitment of the owner topursue development of a biomass power facility if the feasibility study determines theproposed facility to be technically, environmentally, and financially viable. Throughexecution of the MOU, it is understood that NEPO is financing the study under theassumption that the facility owner will pursue further development of a viable project orrefund half the cost of the study unless acceptable reasons are provided to NEPO inwriting. The MOU defines the internal rate of return (IRR) for determining financialviability at 23 percent.The study team eventually received signed MOUs from each of the ten facilities:• Sommai Rice Mill Co., Ltd. Facility in Roi Et Province• Sanan Muang Rice Mill Co., Ltd. in Kamphaeng Phet Province• Thitiporn Thanya Rice Mill Co., Ltd. in Nakorn Sawan Province• Plan Creations Co., Ltd. in Trang Province• Chumporn Palm Oil Industry Plc., in Chumporn Province• Karnchanaburi Sugar Industry Co., Ltd. in Uthai Thani Province• Woodwork Creation Co., Ltd. in Krabi Province• Mitr Kalasin Sugar Co., Ltd. in Kalasin Province• Liang Hong Chai Rice Mill Co., Ltd. in Khon Kaen Province• Southern Palm Oil Industry (1993) Co., Ltd. in Surat Thani Province2.4.3 Data CollectionFollowing identification and initial screening of prospective facilities, Black &Veatch provided detailed data requests to facility owners. Data requests were facilityJanuary 5, 2001 2-7 Final Report

specific and were used to help Black & Veatch identify the optimal configuration of thepower facility, evaluate project feasibility, and identify other benefits of the project. Ofparticular importance was the quantity of biomass fuel available to the project, reliabilityof supply, and other characteristics of the fuel. Other information collected includedwater resource data, process descriptions, plant layouts, maps, labor requirements, currentwaste disposal practices, cost of electricity purchases, process steam needs, hours ofoperation, and plans for future expansion.2.4.4 Preliminary AssessmentWhen review of this information indicated a favorable potential for development,facility site visits were arranged to perform a preliminary assessment of the selectedfacility. The assessment was accomplished through review of the existing facilities,discussions with the staff, and gathering of other pertinent facility information.Each assessment addresses the facility’s potential for power plant development ormodification. None of the assessments completed identified any obvious developmentproblems that would preclude further investigation in a feasibility study.2.5 Facility Feasibility StudiesThis section summarizes the feasibility studies for the ten facilities and thepresentations made to facility owners. Figure 2-1 shows the location of the facilities andTable 2-2 summarizes results of the studies.Due to the length of the project and other factors, two major assumptions werechanged during the course of the study. These are the exchange rate for financialevaluation and the capital cost basis. Because the study commenced near the start of thefinancial crises, the Baht to US dollar exchange rate has fluctuated significantly over thecourse of this study. Evaluation of the first four sites was initially issued in June 1998and used an exchange rate of 43.53 Baht/US$. Since that time the exchange rate hasdropped significantly. The financial analysis for the last six sites reflects this drop andassumes an exchange rate of 37.15 Baht/US$.Secondly, there is an overall increase in project costs for facilities. This increaseis due to two factors.• Assumed equipment sourcing changed from Pacific Rim (e.g. Chinese)suppliers to higher cost European and US suppliers. These suppliersprovided higher cost information.• The last six sites were smaller resulting in higher specific costs due toeconomies of a scale.January 5, 2001 2-8 Final Report

FacilitySommaiRice MillSananMuangRice MillThitipornThanyaRice MillTable 2-2Facility SummaryPlanCreationsFacility type Rice mill Rice mill Rice mill WoodproductsChumpornPalm OilPalm oilmillKarnchanaburiSugar MillSugar millWoodworkCreationWoodproductsMitrKalasinSugar MillLiangHong ChaiRice MillSouthernPalm OilSugar mill Rice mill Palm oilmillNew plant or modifications? New New New New Mods. Mods. New New New NewResidue available from facility, t/yr 98,670 13,800 27,600 4,000 89,100 20,834 31,680 76,000 33,000 73,500Total residue use, t/yr 86,900 79,000 79,000 134,000 111,860 34,216 54,000 76,000 33,000 73,500Residue type Rice husk Rice husk Rice husk WoodwastePalm oilres. others aBagasse,corncobWoodwasteBagasse Rice husk Palm oilres. others aAnnual heat available, GJ/yr 1,225,868 1,113,900 1,113,900 1,380,200 1,564,000 b 406,980 510,300 725,040 465,300 1,072,932 bNet plant heat rate, kJ/kWh 18,708 18,708 18,708 21,015 49,500 c 47,205 c d 21,900 17,400 18,700 21,700 eNet plant output, kW 8,800 8,000 8,000 8,800 4,550 1,850 3,100 5,600 3,300 6,200Output sold to EGAT, kW 8,800 8,000 8,000 8,800 2,520 1,850 3,100 5,600 3,300 5,366Cogeneration? Steam flow, tonne/hr No No No No Yes, 31.85 No No No No Yes, 13.9 eEst. total project cost, US$ mil 9.71 9.27 9.27 10.59 5.0 1.95 8.65 13.4 9.73 14.6IRR (base case), percent 32.6 25.5 26.4 7.9 20.4 18.9 4.4 13.3 7.6 11.6IRR at 43.5 Baht/US$ exchange rate – – – – 15.8 15.9 2.1 9.8 5.1 8.4IRR at 20% reduced capital cost – – – – 29.4 26.7 8.5 20.1 12.6 17.9IRR for alternative study (seewriteup)– – – 38.5 39-69 27.5 25 46 13-29 13-25Notes:aChumporn Palm: palm oil residues (fiber, shells, empty fruit bunch), biogas, coconut husks; Southern Palm: palm oil residues (fiber and shells only), biogas.bChumporn Palm: includes biogas use of 6,000,000 m 3 /yr (136,000 GJ/yr); Southern Palm: includes biogas use of 3,570,000 m 3 /yr (80,682 GJ/yr).cBased on existing power facility performance information considering proposed modifications.dIncludes credit for surplus power generated by the existing sugar mill during the on-season.eAverage value. Southern Palm Oil requires varying amounts of process steam depending on the season.January 5, 2001 2-9 Final Report

Based on the assumptions noted in each study, the results of the studies indicatethat all ten of the candidate facilities are technically and environmentally viable. Avariety of biomass fuels were examined in the studies including rice husk (4 facilities),wood waste (2), palm oil residues (2), and bagasse (2) as primary fuels and coconut husks(1), biogas (2), and corncobs (1) as supplementary fuels. Both entirely new powerfacilities and modifications to existing plant power facilities were examined.The power outputs examined ranged from 1.9 MW to 8.8 MW net for the basecase analyses. In support of financial sensitivity analyses, some preliminaryinvestigations were done for facilities sized up to 30 MW. Cogeneration of steam was avery significant design factor for the two palm oil mills and played a lesser role for theother facilities. In general, the studies found relatively few technical or environmentalobstacles.In base case analyses, the financial viability of the facilities was mixed. Three ofthe facilities identified (Sommai, Sanan Muang, and Thitiporn Thanya rice mills)surpassed the financial IRR hurdle of 23 percent in the base case analyses. Black &Veatch investigated alternative scenarios aimed at improving the financial rating of theother facilities. These studies, which are preliminary in nature, indicate that severalfactors could change to raise the IRR above 23 percent for these projects. In some cases,such as simply accounting for the value of cogenerated steam at the Chumporn Palm OilMill, the improvement in IRR can be dramatic and is compelling from an investmentstandpoint.The results of the studies for each site and owner reaction to the studies are brieflydiscussed below.• Sommai Rice Mill Co., Ltd.A new power facility was studied at the Sommai Rice Mill Co., Ltd. located inRoi Et. After an expansion that would raise the facility milling capacity to 1,300 tonnesof paddy per day, it is estimated that 100,000 tonne/year of rice husk could be availablefor power production. The proposed rice husk power plant would have a gross output of10.0 MW (8.8 MW net). The feasibility study concludes that the proposed developmentis technically, environmentally, and financially viable (IRR of 32.6 percent).The study results were presented to the facility owner who decided to pursuefurther project development. The development is proceeding well as a joint venturebetween Sommai and EGCO (Electricity Generating Plc.), and has reached the step atwhich a contractor is being selected to provide engineering, procurement, andconstruction services for the project.• Sanan Muang Rice Mill Co., Ltd.A new power facility was studied at the Sanan Muang Rice Mill Co., Ltd. inKamphaeng Phet. Rice husk from the 250 tonne paddy per day mill would beJanuary 5, 2001 2-10 Final Report

supplemented with husks from five other area mills. Total husks available for powerproduction are estimated to be 79,000 tonne/year. The proposed power plant would havea gross output of 9.1 MW (8.0 MW net). The study concludes that the proposeddevelopment is technically, environmentally, and financially viable (IRR of 25.5 percent).The study results were presented to the facility owner. The owner is interested infurther project development through a joint venture with other interested investor(s).• Thitiporn Thanya Rice Mill Co., Ltd.A new power facility was studied at the Thitiporn Thanya Rice Mill Co., Ltd.located in Nakorn Sawan. Rice husk from the 500 tonne paddy per day mill would besupplemented with husks from seven other area mills. Total husks available for powerproduction are estimated to be 79,000 tonne/year. The proposed power plant would havea gross output of 9.1 MW (8.0 MW net). The study concludes that the proposeddevelopment is technically, environmentally and financially viable (IRR of 26.4 percent).The study results were presented to the facility owner who is interested in furtherproject development through a joint venture with interested investor(s). However, theowner has exhibited some hesitancy since the plant would depend on outside fuel sources.• Plan Creations Co., Ltd.A new power facility was studied at the Plan Creations Co., Ltd. parawoodprocessing plant located in Trang. Only about 4,000 tonne/year of wood waste would beavailable from the facility. Additional residues could be obtained from other area millsand a large forestry residue collection operation. Total wood waste would be about134,000 tonne/year, which is sufficient to power a facility with a gross output of10.0 MW (8.8 MW net). The feasibility study concludes that the proposed developmentis technically and environmentally viable, but financially marginal (IRR of 7.95 percent)in the base case analysis. If a larger facility could be built, the project may be moreviable. Black & Veatch investigated the economics at a plant size of 28 MW and foundthat the IRR would increase to 38.5 percent at this size. The owner was presented thestudy results but is interested in implementation of a small (about 2 MW) system at thesite. At present the owner is soliciting project price information from a vendor.• Chumporn Palm Oil Industry Plc.Power facility modifications were studied at the Chumporn Palm Oil Industry Plc.palm oil mill located in Chumporn. Preliminary technical and economic analysis foundthat combustion of additional fuels using existing equipment for power generation up to3.7 MW is viable. The fuels used include facility wastes of palm shell, fiber, and emptyfruit bunch (EFB); biogas produced by the processing facility; and coconut husk andadditional palm shell procured from the surrounding area. In addition, modifications tothe facility to allow greater power production were studied. The configuration selectedJanuary 5, 2001 2-11 Final Report

utilizes a low pressure condensing turbine to capture and generate power from the exhaustof the existing back pressure steam turbine, a condenser to recover turbine and processexhaust steam, an improved makeup water treatment system, and other modifications.The average gross plant output under this configuration would be approximately 5.4 MW(3.0 MW increase over the current capacity).The feasibility study concluded that the proposed development is technically andenvironmentally viable, and financially viable under certain conditions (base case IRR of20.4 percent). The new power plant will allow CPOI to operate at a higher palm oilproduction capacity because of increased steam cogeneration. It was found that inclusionof this benefit would make the project very attractive financially (IRR ranging from 39 to69 percent for steam value of 5 to 15 US$/tonne, respectively).Study results were presented to the facility, who generally concurred with thestudy but expressed some concern over recent fluctuations in the price of outsidesupplementary fuel. The facility would like to expand their processing capabilities in thenear future. This will likely require some sort of upgrade to the power and steamsystems.• Karnchanaburi Sugar Industry Co., Ltd.Power facility modifications were studied at the Karnchanaburi Sugar IndustryCo., Ltd. located in Uthai Thani. The sugar mill currently operates a cogeneration facilitywith a maximum gross electrical output of 17.5 MW. Depending on the steam needs ofthe sugar mill, there is unused and unsold electrical capacity averaging about 455 kW atthe plant. In addition, excess bagasse and/or supplemental corncobs could be burned inthe off-season to provide power to the grid on a firm basis. The combination of theexcess existing power production, excess bagasse fuel, and supplemental corncob fuel canprovide a total of 1,850 kW net (capacity factor: 53.2 percent). Minor plant modificationsand new equipment additions would be required. The feasibility study concludes that theproposed development is technically and environmentally viable, and financially viableunder certain conditions (IRR of 18.9 percent). Additional analysis found that increasesin sugar milling efficiency would allow enough bagasse to be produced so thatcombustion of supplemental corncob fuel would not be required. The IRR under thisscenario increases significantly to 27.5.Study results were presented to the facility owner who is interested and agreed tofurther development.• Woodwork Creation Co., Ltd.A new power facility was studied at the Woodwork Creation Co., Ltd. parawoodprocessing plant located in Krabi. A total of 31,680 tonne/yr of wood residue will beavailable at the facility after an upcoming expansion. In the base case analysis, a smallamount of fuel from the surrounding are is used, bringing the total fuel consumption toJanuary 5, 2001 2-12 Final Report

54,000 tonne/year and allowing a plant with a gross output of 3.55 MW (3.1 MW net).The analysis for this case was financially marginal (IRR of 4.4 percent). If a largerfacility (about 30 MW) could be built at the site or in the area, more favorable economicswould be achieved. Black & Veatch estimates an IRR of 25 percent that at this size,subject to the assumptions presented in the full report. The study results are under furtherconsideration by the owner.• Mitr Kalasin Sugar Co., Ltd.A new power facility was studied at the Mitr Kalasin Sugar Co., Ltd. sugar milllocated in Kalasin. The high pressure boiler for the proposed power plant would befueled with 76,000 tonne/yr of excess bagasse produced by the sugar mill. The newpower plant would have a gross output of 6.1 MW (5.6 MW net) and would operate yearround.The existing power facility (16.4 MW gross) would remain and would supply theprocessing operations with the required steam and power. The feasibility study concludesthat the proposed development is technically and environmentally viable, but financiallymarginal (base case IRR of 13.3 percent). An alternative option utilizes the existingequipment with minor additions and modifications to produce about 3.2 MW. Thispreliminary option has a much higher IRR of 46 percent. Both options were presented tothe facility, which is considering further development.• Liang Hong Chai Rice Mill Co., Ltd.A new power facility was studied at the Liang Hong Chai Rice Mill Co., Ltd.located in Khon Kaen. Liang Hong Chai owns two rice mills that together could supplyapproximately 33,000 tonne/yr of rice husk for power production. This level of residuewould allow a power plant of 3.8 MW gross (3.3 MW net). At this size, the financialfeasibility of the site is marginal (IRR of 7.6 percent). If a larger facility (about13.4 MW) could be built at the site, more favorable economics would be achieved. Black& Veatch estimates an IRR of 29 percent that at this size, subject to assumptionspresented in the full report. The study results are under further consideration by theowner.• Southern Palm Oil Industry (1993) Co., Ltd.A new power facility was studied at the Southern Palm Oil Industry (1993) Co.,Ltd. mill located in Surat Thani. The boiler for the proposed power plant would be fueledwith fiber, shells, and biogas produced by the processing facility. The power plant wouldhave a gross output of 7.0 MW (6.2 MW net) and would generate process steam. Theexisting power facility (880 kW) would remain and would be used for backup purposes.The feasibility study concludes that the proposed development is technically andenvironmentally viable, but financially marginal (IRR of 11.6 percent) in the base case.January 5, 2001 2-13 Final Report

However, due to increased steam production, the new power plant will allowSPOI to operate at a higher palm oil production capacity. If this benefit is included in thefinancial analysis and a larger plant size (28.3 MW) is assumed, significantly higherfinancial returns are attainable. Black & Veatch estimates that IRR of about 25 percentare possible under this scenario.The study results were presented to the facility owner. Although the financialperformance of the power project is marginal under base case assumptions, the facilitywould like to expand their palm oil processing capabilities in the near future. This willlikely require some sort of upgrade to the mill power and steam systems.2.6 Promotion of Biomass in Thailand’s Energy FutureAs discussed previously, the percent of biomass capacity in the SPP program issmall and mostly contracted on a non-firm basis. Black & Veatch feels that there areseveral reasons for this relating to the current SPP program regulations (datedJanuary 1998) and other factors.2.6.1 Black & Veatch Comments on the SPP Program RegulationsThe present SPP regulations for biomass were established for payment of capacityand energy based on the long-term avoided cost of electricity from a fuel oil plant.However, biomass plants cannot be economically competitive on this basis:• Due to dispersed fuel, most biomass plants are small (about 5-30 MW)compared to fuel oil based plants. Thus, the capital cost per megawatt of abiomass power plant is usually higher than that for fuel oil power plants.• The fixed rate for the energy payment is based on the net plant heat rate for acombined cycle power plant, which is 9,070 kJ/kWh (8,600 Btu/kWh). Evenwith leading edge technology, biomass plants cannot achieve this level ofefficiency and are thus less competitive.2.6.2 Other Factors Impacting Biomass Project DevelopmentOwing to the existing regulations and other factors, very few biomass powerplants have sold electricity to the grid through firm contracts. Other reasons for the lackof biomass-based power generation in Thailand include:• Energy prices do not reflect external social costs such as air pollution, carbondioxide emissions, socioeconomic impacts, fuel imports, etc.• Investors or lenders would like to minimize biomass fuel supply risk simplyby establishing long term supply contracts, but these are very difficult toachieve. Alternative methods of risk management are often not explored.• Host facilities are often not familiar with the power generation business andare wary of making large investments in businesses outside their coreexperience.January 5, 2001 2-14 Final Report

• In addition to relatively high specific capital costs, development costs forbiomass plants are similar to larger plants, even though the capacities aremuch smaller.The combination of high up-front capital costs, unfamiliar technology, andunmanageable fuel supply risk, makes financing of biomass projects more difficult andexpensive than conventional energy plants. The result is that those plants that are builtmay not be able to produce electricity at rates as low as conventional technologies.2.6.3 IncentivesA variety of incentive measures have been implemented around the world toencourage biomass and other renewable energy sources. Beyond direct increases incapacity and energy prices, Thailand should examine several measures:• Set a target for biomass and other renewable power plant generating capacityfor the next 10 years.• Establish a competitive subsidy scheme to encourage development of newrenewable energy power plants.• Promote marketing of biomass and other renewable energy sources as“green” energy to encourage public support of projects.• Collaborate with specific high potential industries (e.g., sugar cane milling) topromote higher efficiency plants and expanded biomass power generation.• Investigate alternative funding mechanisms to provide long-term loans withlow interest rates to biomass projects.Any incentive offered should be cognizant of the liberalization of the electricitysupply industry and flexible enough to respond to changing market conditions.NEPO has begun a successful campaign to promote renewable energy. This effortwill be further strengthened by the recent commissioning of an initiative to subsidize upto 300 MW of renewable energy projects through the Energy Conservation PromotionProgram (ENCON) fund. The capacity, which will be bid on a competitive basis, will bean important step to further the long-term energy policy goals of Thailand.January 5, 2001 2-15 Final Report

3.0 IntroductionThis Final Report has been prepared by Black & Veatch according to the Terms ofReference (TOR) for the “Biomass-Based Power Generation and Cogeneration WithinSmall Rural Industries” study commissioned by the National Energy Policy Office(NEPO) of Thailand. NEPO is promoting the use of biomass, such as wood waste,bagasse, rice husks, and oil palm residues, as fuel for electricity and steam production insmall rural industries. The benefits of this policy include reduction of petroleum imports,conservation of natural resources, and strengthening of rural economies. Under the SmallPower Producers (SPP) program, electricity generated by such plants can be sold to theElectricity Generating Authority of Thailand (EGAT). NEPO has commissioned Black &Veatch to perform a study of biomass power and cogeneration projects and to prepare thisFinal Report to summarize the results of the project. This report presents many aspectsrelated to biomass energy and includes summaries of ten biomass power plant feasibilitystudies done for sites around Thailand.This section of the report provides a description of the study objective, scope ofwork, and approach. The section also includes a brief overview of biomass energy.3.1 Study ObjectiveThe ultimate objective of this study is to develop biomass-based power generationas a source of electricity in Thailand. Using biomass agricultural residues in powergeneration and cogeneration schemes have the benefits of helping the involved facility tobe self-sufficient in meeting its own electricity and process heat demands, whileeliminating the problem of waste disposal. Developing the biomass energy resource willalso benefit Thailand’s economy because it helps the country to become less dependenton imported fossil fuels. The specific goals of this study are as follows:• To review the existing status of biomass fuels in Thailand.• To conduct feasibility studies on 10 small rural industries inorder to assess their potential for biomass-based powergeneration and cogeneration.• To demonstrate the financial viability of biomass-based powergeneration or cogeneration at the facilities in order toencourage investment decisions of the owners towardsimplementing the projects.• To assist the facilities to implement power generation andcogeneration, and to enter EGAT’s SPP Program.3.2 Study Scope of WorkThis subsection details the scope of work for the project.January 5, 2001 3-1 Final Report

3.2.1 Task DetailsTask 1 – Data Collection and Prefeasibility Study1. Review the existing status of biomass fuels in Thailand, including types, availability,production rates, forecasts, and the specific industry involved. Review the potentialof each type of biomass resource for electricity generation, the prices of each type ofbiomass resource in the existing market, and other uses of the biomass resources.Geographical location of the biomass resources is also important.2. Gather background information regarding the existing small rural industriesproducing agricultural residues which can be used as biomass fuels in Thailand.Review technical aspects of the industries including the process energy requirementsand energy consumption. Review the standards and regulations of the Small PowerProducers Program.3. Locate a minimum of 10 facilities which have potential for biomass-based powergeneration or cogeneration. Touch base with personnel of the identified facilities inorder to initiate a working relationship.4. Develop a Memorandum of Understanding (MOU). The MOU will commit thefacility owners to pursue project implementation if the project provides to becommercially viable. The Consultant should seek to sign MOUs with 10 facilities.Projects with MOUs will have the highest priority for subsequent feasibility studies.5. Conduct detailed data collection of the 10 facilities which have signed MOUs. Thismay include field surveys of the actual site. The data collected in this step will beused in the detailed feasibility study of Task 2, therefore the data should includetechnical, economic, and ecological information.6. Evaluate the collected data and make preliminary assessment of biomass-based powergeneration and cogeneration in specific small rural industries. Complete otherappropriate pre-feasibility tasks.7. Compile a list of local and/or foreign suppliers of biomass-based power generationand cogeneration equipment. Locate contractors capable of installation of theequipment. Obtain prices of the equipment, installation costs, operations andmaintenance costs, etc.Task 2 – Feasibility StudyThe tasks to be undertaken are identical for each of the 10 small rural industrieswhich are capable of implementing biomass-based power generation or cogenerationprojects and have signed MOUs. A project to be suitably evaluated is the to be placedwithin the system to which it belongs, and therefore, the evaluation is to consider theinterrelationships of the project and the other natural and socioeconomic components ofthe project system. The basic components of a detailed feasibility study are:1. Technical Feasibility: Determine the present status and future prospects of the localtechnological capacity, and requirement for foreign technology. Conduct preliminaryJanuary 5, 2001 3-2 Final Report

designs. Assess human and material requirements. Evaluate topographical andgeological conditions, etc.2. Economic Feasibility: Establish costs and benefits related to the project from anoverall economic and social point of view. Assess indirect effects and evaluate theproject economic attractiveness.3. Financial Feasibility: Establish costs and benefits related to the project from the pointof view of the beneficiary of the project. Assess the financial attractiveness throughthe use of financial indicators. Establish a financing plan for the project. Assess thepast financial performance of the beneficiary of the project and potential for futuresound financial performance.4. Commercial Feasibility: Assess the status and prospects for the project product(s) tomeet demands of the current market. Survey the suitability of commercial systems fordistribution of the project product(s), and of the systems to supply raw materials andother inputs.5. Socioeconomic Feasibility: Evaluate the effects of the project with regard to thesociety involved, for instance creation or reduction of employment, etc.6. Ecological Feasibility: Asses the impacts and benefits of the project to the ecologicalenvironment. Check standards on ecological pollution.7. Juridical Feasibility: Check existing laws and other juridical constraints, andobligations favoring (or discouraging) the development and operation of the project.8. Political Feasibility: Evaluate the regional and sectoral planning, policy, andobjectives. Determine whether the project implementation is consistent with relevantsectoral/energy policies.Task 3 – Assist Facility Owners to Invest in Biomass-Based Power Generation andCogenerationOnce biomass-based power generation and cogeneration has proved to be feasible,the next step is to assist the facilities to implement the project. The details of this workare as follows:1. Present the results of the feasibility studies to the respective facility owner. Thepresentation should emphasize how implementing cogeneration can help the ownerssave operation costs by producing electricity on-site and negating the cost ofdisposing biomass residue.2. Demonstrate the commercial viability of implementing biomass-based powergeneration and cogeneration to the facility owners. This includes briefing the ownerson EGAT’s SPP Program, and how owners can sell excess electricity back to the grid.Substantial economic and financial data should be presented to the owners in order topersuade them to invest in cogeneration projects are their facilities.3. Produce a handbook for facility owners in Thai and English explaining the procedurefor entering EGAT’s SPP Program, including all relevant implications concerned suchJanuary 5, 2001 3-3 Final Report

as commercial and juridical aspects. The handbooks should also identify financingsources for the project implementation.3.2.2 Activities by TaskThis section describes the task activities undertaken by Black & Veatch(corresponding sections of this report are given to the right of the task title). Details onthese tasks are provided in the Detailed Work Plan and Methodology document preparedby Black & Veatch.Task 1Data Collection and Prefeasibility StudyBlack & Veatch collected data and conducted prefeasibility studies to identifypotential fuels, facilities, and technology for biomass-based power generationor cogeneration. The following subtasks were performed.Task 1.1 Status of Fuel Supply Section 4The existing status of biomass fuels in Thailand was reviewed. Fuels reviewedincluded rice husk, palm oil residues, bagasse, wood residues, corncobs,cassava residues, distillery slop, coconut residues, and sawdust. Availability,location, production rates, forecasts, industries involved, prices, and the generalsuitability of the fuel for power production were assessed.Task 1.2 Identification of Candidate Facilities Section 6 and 12Candidate industries and specific facilities with good potential for biomasspower generation were identified (Section 6). Such facilities included ricemills, sugar mills, palm oil mills, etc. This task also reviewed the regulationsand requirements of the SPP program (Section 12).Task 1.3 Screening of Candidate Facilities Section 6A screening approach was used to select ten preferred facilities for furtheranalysis. A key consideration in light of the economic crisis was ownerwillingness to proceed with the project.Task 1.4 Development of a Memorandum of Understanding Section 7A generic Memorandum of Understanding (MOU) was developed. The MOUcommits facility owners to pursue project implementation in the event theproject proves to be financially viable. An MOU was signed with each of theten selected facilities and is included with the site feasibility studies.Task 1.5 Detailed Data Collection for Selected Facilities Section 8Site visits followed by continued dialog were used to collect data from theselected facilities for use in the feasibility studies.Task 1.6 Preliminary Assessment of Selected Facilities Section 9Black & Veatch made a preliminary evaluation of each of the biomass facilitiesbased on data collected in Task 1.5. Topics covered generally included currentoperations, power potential, proposed facility features, environmental aspects,January 5, 2001 3-4 Final Report

socioeconomic aspects, economic aspects, and elevation and climatologicaldata. In addition, a conclusion is provided for each of the preliminaryassessments that indicates whether a full feasibility study of the proposedpower plant is warranted.Task 1.7 Identification of Candidate Technologies Section 5Technologies appropriate for biomass power plants were characterized. Thischaracterization takes into account potential fuels and plant size range. A listof relevant equipment vendors was produced.Task 2Task 3Feasibility StudiesBlack & Veatch performed a feasibility study for each of the ten sites for whichan MOU had been signed. The feasibility studies are available as separatedocuments. The feasibility studies consider the interrelationship of the projectwith all surrounding systems. The basic components of each feasibility studyare:• Technical Feasibility• Economic Feasibility• Financial Feasibility• Commercial Feasibility• Socioeconomic Feasibility• Ecological Feasibility• Juridical Feasibility• Political FeasibilityAssist Development of Biomass-Based Power GenerationOwners were given the results of their respective feasibility studies and thenassisted in initial project implementation activities. The following subtaskswere performed.Task 3.1 Presentation of Feasibility Study Results to Facility Owners Section 11Representatives of Black & Veatch made presentations to facility owners foreach of the facilities found to be viable.Task 3.2 Develop Owner Understanding of Project Benefits Section 11In addition to making the presentation above, Black & Veatch presented andexplained the financial results of the project pro forma and the benefits andregulations of the SPP program to the facility owners.Task 3.3 SPP Program Handbook PreparationBlack & Veatch has prepared a handbook outlining the procedure for enteringthe SPP program, including all responsibilities and performance standards forthe SPP. The Handbook itself is issued concurrently with the Final Report.January 5, 2001 3-5 Final Report

3.3 Biomass Energy OverviewBiomass has been used by human civilization as a primary energy source for morethan 1 million years. Today, about 12 percent of the world's energy comes from the useof biomass fuels. 4 In industrialized nations, bioenergy facilities typically use waste fuelssuch as residue from pulp and paper production in large scale power and process steamapplications. Conversely, developing nations have largely relied on biomass to providefuel for rural cook stoves. These stoves are relatively inefficient and dirty. Increasingindustrialization and household income are driving the economies of developing nationsto implement cleaner and more efficient biomass technologies.Biomass is any material of recent biological origin. Biomass fuels include itemsas diverse as residential yard clippings, manure, urban wood waste, and dedicated energycrops. Compared to coal, biomass fuels are generally less dense, have a lower energycontent, and are more difficult to handle. With some exceptions, these qualities generallymake biomass fuels economically disadvantaged compared to fossil fuels.Environmental concerns may help make biomass an economically competitivefuel. Unlike fossil fuels, biomass fuels are renewable and do not contribute to greenhousegas emissions. Biomass combustion releases no more carbon dioxide (CO 2 ) than theplant absorbed during its growing cycle and which would be released during the biomassnatural decay process. Fossil fuel combustion releases CO 2 into the atmosphere that hasbeen stored for centuries under the surface of the earth. Biomass fuels contain little sulfurcompared to coal, resulting in decreased production of sulfur dioxide (SO 2 ). They alsohave lower combustion temperatures that help reduce nitrogen oxide (NO x ) emissions.However, unless biomass is efficiently and cleanly converted to a secondaryenergy form, the environmental benefits are only partially realized, if at all. For thisreason efficient, modern biomass utilization must be favored over traditional applications.3.3.1 Modern Biomass ApplicationsBesides such simple changes as improved cook stoves, modern biomasstechnology has many applications throughout the world. Three of these applications aredistributed generation, utility plants, and industrial cogeneration.3.3.1.1 Distributed Generation. There are many situations where the developmentof small, modular distributed generators can be more economical than investing inexpensive transmission and distribution systems. One possible scenario is the use of ananaerobic digester or biomass gasifier coupled with an engine-generator to provide gas,heat, and electricity at the village scale.4 World Energy Council, “Renewable Energy Resources: Opportunities and Constraints 1990-2020,” 1993.January 5, 2001 3-6 Final Report

3.3.1.2 Utility Plants. For environmental reasons, utilities are increasingly lookingfor renewable resources to add to their generation mix. Biomass is an attractiverenewable option because the technology is well understood and can be baseloaded,unlike the intermittent output of solar and wind plants. Properly conceived, a biomassplant can use waste fuels from the surrounding area that are available at low, zero, or evennegative cost (tipping fees). Fuels can consist of urban wood waste, agricultural residues,and other waste fuels.3.3.1.3 Industrial Power Generation and Cogeneration. Many agriculturalprocessing and rural industries have large electrical and thermal demands and a readysupply of biomass waste fuels. In many cases, these facilities can economically burn thewaste to met at least a portion of their electrical demand and possibly generate processsteam as well. Specific industries with potential include palm oil (Figure 3-1), sugar canemilling, wood processing (Figure 3-2), and rice milling.Thailand, which has been an agrarian country for most of its history, haswidespread agricultural and rural industry that could benefit from modern application ofbiomass technologies. Biomass energy use in Thailand is discussed in the next section.Figure 3-1. Fresh Oil Palm Bunch at a Thailand Palm Oil Mill.January 5, 2001 3-7 Final Report

Figure 3-2. Harvesting of Rubber from a Parawood Plantation.3.3.2 Biomass Energy in ThailandThe use of biomass as an energy source is widely practiced throughout Thailandindustries, particularly in rural and agricultural areas. Out of 754 industries surveyed inrecent study, 71 percent still use fuelwood as a source of energy. 5 Figure 3-3 showsindustrial energy use and the amount of industrial energy derived from two biomasstypes: fuelwood and agricultural residues. This figure also plots the fraction of totalindustrial energy use derived from biomass sources.Use of biomass as an energy source has not been rising as fast as total industrialenergy use. For this reason, the share of biomass energy used in industrial processes hassteadily dropped from 46 percent in 1985, to 25 percent in 1996, despite averaging8 percent annual growth over the period. Although overall industrial energy use declinedin 1997 with the financial crisis, use of agricultural and wood residues actually climbed,increasing the share of biomass energy to 28 percent. The increase was nearly entirelydue to an almost 25 percent surge in fuelwood consumption. This increase in fuelwoodconsumption underscores its importance as a locally available inexpensive fuel.5 Panyathanya, W., S. Rawiwan, S. Benjachaya, “A Survey of Industrial Fuelwood Consumption inThailand,” 1993.January 5, 2001 3-8 Final Report

80050%70045%40%600500400FuelwoodCrop residuesTotal IndustryBiomass Share of Total Industry35%30%25%30020%20015%10%1005%01985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997YearFigure 3-3. Industrial Energy Use in Thailand. 60%As Thailand’s economy recovers, the share of biomass energy used in industry islikely to continue falling even though overall use of biomass as a primary energy sourcewill likely rise. In either case, biomass use could be reduced even while maintainingelectrical capacity growth if modern, efficient biomass energy conversion systems werewidely adopted. Properly implemented policy encouraging sustainable and efficient useof biomass fuels will benefit Thailand in several ways. Benefits include reduceddependency on foreign energy sources, strengthening of rural economies through creationof local fuel markets and jobs, and addition of renewable baseload power with minimalenvironmental impact. Regardless of policy, biomass will continue to be heavily reliedon in many industries such as sugar cane and palm oil milling.3.3.3 Small Power Producers Program OverviewSmall rural industries engaged in power production from biomass may sell theirexcess energy generation back to the electrical grid through the Small Power Producers(SPP) Program. The SPP program was initiated by the National Energy Policy Counciland implemented by the Electricity Generating Authority of Thailand (EGAT),Metropolitan Electricity Authority (MEA), and Provincial Electricity Authority (PEA).The SPP program was initiated based on the conclusions of the National Energy PolicyCouncil that:6 Extracted from the Regional Wood Energy Development Programme in Asia (RWEDP) biomass energyuse database located at: http://www.rwedp.org/cgi-bin/consumptionQuery.pl.January 5, 2001 3-9 Final Report

“generation from non-conventional energy, waste or residual fuels andcogeneration increases efficiency in the use of primary energy and by-productenergy sources and helps to reduce the financial burden of the public sector withrespect to investment in electricity generation and distribution.”The national and external benefits of the SPP program include the conservation offossil fuels, reduced fuel imports, conservation of foreign hard currency, and distributedgeneration benefits. The intent of the program is to realize these external benefits, yetresult in a direct cost to ratepayers that is no higher than the alternative of supplyingelectricity without SPP projects.The SPP regulations establish several conditions for purchases from SPPs. Theseinclude a purchased capacity limitation of 60 MW (up to 90 MW in certain locations) andthe stipulation that EGAT be the sole purchaser of electricity. Payments to the SPP canconsist of an energy-only payment for electricity delivered (kWh) or an energy and acapacity payment. No capacity payments are made for contracts with a term of less than5 years (“non-firm” contracts). In order to receive capacity payments (given under “firm”contracts) the SPP must meet certain criteria (for example, contract length of 5 to25 years, minimum hours of operation, etc.). Although capacity payments providesubstantial revenue to power projects, only three out of the 24 biomass projects acceptedso far into the SPP program receive such payments. All projects examined in this studywere designed from the outset to qualify for the capacity payments.Candidate SPPs must file applications for sale of power to EGAT and mustundergo evaluation to be certain the proposed project meets all terms of the SPP program.Black & Veatch has prepared guidelines to assist developers and facilities entering theSPP program. These are included in the Development and Construction Handbook of thisstudy, issued jointly with this Final Report.January 5, 2001 3-10 Final Report

4.0 Thailand Biomass Fuel Resource Assessment (Task 1.1)This fuel supply review investigates nine types of biomass resources as potentialfuel for power and cogeneration plants:• Rice husk• Oil palm residues• Bagasse• Wood residues• Corncob• Cassava residues• Distillery slop• Coconut residues• SawdustThis section of the Final Report provides updated information on the fuels anddraws conclusions concerning the viability of each biomass fuel. Availability,distribution, production rates, forecasts, industries involved, prices, and the generalsuitability of the fuels for power production are assessed and presented in the followingsections. The section starts with a general overview of the biomass fuel supply situationin Thailand.4.1 Fuel Supply OverviewThailand is a nation rich in agricultural and forestry resources that providepotential sources for biomass fuel. This study attempted to identify viable biomass fuelsand quantify their attributes. Table 4-1 provides basic information on the most viablefuels identified: rice husk, palm oil residues, bagasse, and wood residues (includingsawdust). Each of these fuels is associated with a particular industry where they areproduced as byproducts (rice milling, palm oil production, sugar cane milling and woodproducts, respectively). Since the fuel is concentrated at the milling site, it is generallyinexpensive – transportation costs are avoided and the resource might otherwise representa disposal problem.The other fuels are not considered as viable for various reasons. Corncobs andcoconut residues are generally left scattered, making collection difficult. They aresuitable supplementary fuels but are not a significant source of energy for powergeneration. Because of their high moisture content, cassava residues and distillery slopare not likely to find widespread implementation as fuels.January 5, 2001 4-1 Final Report

Table 4-1Most Viable Biomass FuelsFuelRice huskPalm OilWoodBagasseResiduesResiduesSource output, 10 6 tonne/yr 20 2.2 50 5.8Available unused residue, 10 6 tonne/yr a 2.3-3.7 0.41-0.74 2.25-3.5 1.8Higher heating value, kJ/kg 14,100 10,800 10,000 10,000Fuel consumption, tonne/yr/MW b 9,800 14,050 14,100 15,500Aggregate power generation potential, MW 234-375 33-53 160-248 118Notes:aEach biomass was estimated based on the following assumptions.Rice-husk –Based on rice mills of capacity minimum 100 tonnes of paddy/day.Palm Oil Residues – Based on the 17 crude palm oil extracting facilities. Residues consistof shells, fibre, and empty fruit bunch.Bagasse – Based on the 46 Sugar mills.Wood Residues – Included discarded processed wood and sawdust from general sawmillsand parawood processing facilities and small logs from parawood plantation forest.bA uniform 85 percent capacity factor is assumed in this study.Aggregate power generation potential from all residues surveyed in this studyranges from 779 to 1,043 MW. It should be noted that this value is for residues notalready in use and does not account for generation gains by increases in existing processor power generation efficiency (e.g., sugar cane milling). As such, the estimates are forincremental capacity and are slightly conservative. Figure 4-1 shows distribution of thiscapacity in the various provinces. The most promising provinces account for about300 MW of developable capacity and include Suratthani, Suphan Buri, Kanchanaburi,Nakhon Sawan, Nakhon Ratchasi, Udon Thani, Kamphaeng Phet, Krabi, Trang, andNakhon Sri Thammarat.Similar fuel supply studies have been performed by other researchers andorganizations. These are compared in Table 4-2. 7, 8 The results of these investigationsvary widely depending on three primary factors:• Initial assessment of residue source production. Estimates can be based oncrop production, which vary significantly from year to year.• Amount of residue potentially available and ultimately suitable for economicpower generation. Some fuels, such as palm oil residues, are concentrated atfew sites and are thus easy to collect and highly suitable for power generation.Others, such as rice husk, are scattered over thousands of mills throughout thecountry and have alternative competitive uses. The viability of this fuel ishighly site specific.7 EC-ASEAN COGEN Program, “Evaluation of Conditions for Electricity Production Based on Biomass,”August 1998, available at: http://www.nepo.go.th/encon/encon-DANCED.html.8 Charles M. Kinoshita, et al, “Potential for Biomass Electricity in four Asian Countries,” presented at the32 nd Intersociety Energy Conversion Engineering Conference, 1997.January 5, 2001 4-2 Final Report

Figure 4-1. Aggregate Potential Net Electric Capacity from Most Viable Residues.January 5, 2001 4-3 Final Report

IndustryTable 4-2Comparison of Thailand Biomass Fuel Supply Studies aRice huskPalm OilResiduesBagasseWoodResiduesSource output, 10 6 tonne/yr Rice paddy Fresh fruit bunch Sugar cane WoodBlack & Veatch (average) 20 2.2 50 5.8EC-ASEAN COGEN 22 2.25 50.5 b >17 bKinoshita, et al 20

(average 49.4) over the period from 1993 to 1999. Kinoshita assumed production of43 million tonnes, whereas COGEN used the value for 1994/95 of 50.5 million tonnes.The percent bagasse residue produced from the sugar cane was similar for the threestudies: 29, 24, and 29 percent for Black & Veatch, Kinoshita, and COGEN, respectively.The largest differences between the three estimates arise due to the assumptionsused to determine what percentage of the potential residue is ultimately available forpower production. Black & Veatch assumed that only those residues that are not usedcurrently at the mills would be available (about 20 percent of the total bagasse). Thisestimate does not include upgrades of existing mills to higher efficiency power systems.Kinoshita and COGEN assume that 50 and 100 percent, respectively, of total bagassesupply could be used. These assumptions would require replacement or extensiveupgrades to a significant portion of the existing mill systems in Thailand.To determine the electricity generation potential from the available residues, anenergy conversion efficiency factor is applied. Black & Veatch estimates 527 kWh/tonnebagasse (TB). This number is equivalent to a net plant heat rate of about 19,060 kJ/kWh(LHV). Kinoshita and COGEN appear to use estimates of 190 and 333 kWh/TB,respectively. For reference, the two sugar mills examined for this study currently havevery low conversion efficiencies of about 60 kWh/TB. The higher conversion efficiencyestimated by Black & Veatch is due to the assumption that the bagasse would be used indedicated (non-cogeneration) power plants built alongside existing mill systems, whichwould be retained to meet process steam and power requirements. The new powerfacilities would burn the excess bagasse produced by the mills. Such an arrangementallows for year-round operation of the power plant to provide firm power to the grid. Assuch, Black & Veatch assumed a capacity factor of 85 percent compared to about30 percent used for each of the other two studies. Ultimately, this results in a smallerestimate of new capacity of 204 MW for this study. The much higher COGEN programestimate (1900 MW) is more indicative of the industry potential if most mill powersystems in Thailand are upgraded or replaced. The Kinoshita estimate (370 MW) liesbetween the two extremes.Black & Veatch feels that, given observed reluctance of the sugar mill industry todevelop higher efficiency plants, the estimate prepared for bagasse-based powergeneration is a realistic view of the near-term potential. To the extent that sugar millsmigrate towards higher efficiency equipment (which is advisable when plants areestablished, relocated, or rehabilitated), the potential for power generation from bagassewill increase. As there is tremendous potential in this industry, such a transition shouldbe encouraged.The following sections present data on availability, distribution, production rates,involved industries, prices, etc., of nine biomass fuels: rice husk, oil palm residues,bagasse, wood residues, corncob, cassava residues, distillery slop, coconut residues, andsawdust.January 5, 2001 4-5 Final Report

4.2 Rice HuskRice is grown in every region of Thailand including the Southern region. Paddyproduction over the period from 1986/87 to 1995/96 has averaged about 20 million tonnesper year. Despite decreasing planted and harvested area and a strong dependence onweather, production over the 5 year period from 1992 to 1996 was stable. Thegovernment has targeted a 1 to 2 percent increase in production through increased yieldwhile maintaining nearly the same planted area.Rice husk is produced during paddy milling. Information on this resource is givenin Table 4-3. Based on milling statistics, rice husk constitutes about 23 percent of thepaddy weight. Potential residue availability by province is shown in Figure 4-2.Assuming an annual paddy production of 20 million tonnes and a residue collectivity of50 to 80 percent, the availability of this resource is estimated at 2.3 to 3.68 million tonnesper year. Based on a heating value of 13,500 kJ/kg and the preceding assumptions,aggregate power generation potential from rice husk ranges from 234 to 375 MW.Rice husk has been used as fuel for power plants in Thailand. There are currentlyfour power plants with the ability to burn rice husk accepted into the EGAT SPP program.The total capacity of the plants is 66.8 MW. Some of the plants burn other biomass fuels(e.g., wood chips) with the rice husk. Three of the plants are contracted to sell power toEGAT on a firm basis. Plans to develop other rice husk based power plants have stalledsince the financial crisis began.Most of the 40,000 rice mills located in Thailand are small and are not suited forpower production from their own supply of rice husk. However, there are 215 mills withcapacities ranging from 100 to 2,000 tonnes of paddy per day. Five of these mills areTable 4-3Rice Husk CharacteristicsSource industryRice mills, ~40,500 mills in countrySource of biomassRice paddySource output, tonne/yr 20,000,000 (avg. 1986-1995)Supply forecastSlightly increase, 1 to 2 percent per yearBiomass production rate, percent of source 23In process use, percent of sourcenegligibleTotal biomass supply, percent of source 23Biomass collectivity, percent of supply 50-80Total biomass availability, tonne/yr 2,300,000-3,680,000Higher heating value, kJ/kg 14,100Fuel consumption, tonne/yr/MW 9,800Aggregate power generation potential, MW 234-375Price, Baht/tonne 50-100Other usesSoil conditioner, fuel, brick makingJanuary 5, 2001 4-6 Final Report

Figure 4-2. Rice Husk Distribution.January 5, 2001 4-7 Final Report

large and have capacities over 1,000 tonne/day. Because of the limited number of largemills, it may be necessary to build central power plants fed with husks from several millsin the surrounding area. This concept was shown to be technically and economicallyfeasible for two sites evaluated in this study: Sanan Muang, a 250 tonne/day mill, andThitiporn Thanya, a 500 tonne/day mill.In conclusion, in combination with appropriate technology and sufficient quantity,rice husk is a viable fuel for power plants. Detailed study of specific sites and thesurrounding area is required to ensure adequate fuel supply and long-term availability.Additional information on rice husk as a potential biomass fuel is available inAnnex 1.4.3 Palm Oil ResiduesPalm oil is produced throughout tropical regions of the world from oil palm trees.In Thailand, oil palm trees are grown mainly in the Southern region in Krabi, Surat Thani,Chumporn, and Satun. In 1995, about 886,000 rai were harvested producing 2.17 milliontonnes. Oil palm production has been increasing rapidly (22 percent per year over theperiod form 1987 to 1995), and future annual growth rates are predicted to be 10 to 15percent. This will be achieved through increased productivity and harvested area.Fresh fruit bunches (FFB) harvested from oil palm trees are the raw material forthe palm oil industry. FFB consist of fruit stems, commonly known as empty fruitbunches (EFB), and fruits, which contain crude palm oil, fiber, and nuts. The nut portionof the fruits contains a shelled kernel, which can be further processed to produce palmkernel oil. Solid residues (EFB, fiber, and shells) account for about 44 percent of the FFBweight. Properties of the solid residues are given in Table 4-4. Potential residueavailability by province is shown in Figure 4-3.In general, palm oil mills use the solid byproducts (primarily shells and fiber) ofthe processing operations to provide steam to mill operations. The fuels are typicallyburned in low pressure watertube boilers. Some mills also include back pressure steamturbines for cogeneration of electricity and diesel generators for backup powerproduction. In general, production of steam and electricity is not given much economicvalue by mill owners, and overall system efficiencies are poor. Biogas produced byanaerobic treatment of mill effluents may be used as fuel, but this is not common practice.In addition, oil palm trees at the end of their useful production life might be used as fuel.These trees otherwise represent a disposal problem. There are no known power facilitiesutilizing this resource.January 5, 2001 4-8 Final Report

Table 4-4Palm Oil Residue (EFB, Fiber, Shell) CharacteristicsSource industryPalm oil millsSource of biomassFresh fruit bunchesSource output, tonne/yr 2,176,000 (1995)Supply forecast10 to 15 percent growth per yearBiomass production rate, percent of source 44 (EFB: 23-25; Fiber: 11-15, Shell: 6-8)In process use, percent of source 10-20Total biomass supply, percent of source 24-34Biomass collectivity, percent of supply 90-100Total biomass availability, tonne/yr 470,000-740,000Higher heating value, kJ/kg 8,400-18,250 (avg. ~10,800)Fuel consumption, tonne/yr/MW 14,050Aggregate power generation potential, MW 33-53Price, Baht/tonne 0-200Other usesFertilizerAssuming an annual FFB production of 2.2 million tonnes, the availability of thisresource is estimated at 470 to 740 thousand tonnes per year. Based on an averageheating value of 10,800 kJ/kg and the preceding assumptions, power generation potentialranges from 33 to 53 MW. This figure does not include any contribution from biogasproduced by treatment of mill effluent, old age palm trees, or palm fronds. In addition,the figure does not consider improvements to existing mill power systems.A study by Songkla University indicates that there are 52 palm oil mills inThailand. Of this number only about 20 percent have cogeneration systems, ranging fromless than 1 MW to 3.5 MW in electrical capacity. There are currently no palm oil millsenrolled in the SPP program. A 40 MW plant was proposed, but plans did not materializeafter the financial crisis.In conclusion, palm oil residues are a proven fuel for cogeneration plants.Cogeneration at new facilities, in addition to modernization and expansion of existingfacilities, appears viable. Combustion of EFB and other process residues will allow forsignificantly larger plants that can benefit from economies of scale. Nevertheless,detailed site-specific study is required to ascertain the viability of individual projects.Additional information on palm oil residues as a potential biomass fuel isavailable in Annex 2.January 5, 2001 4-9 Final Report

Figure 4-3. Palm Oil Residue Distribution.January 5, 2001 4-10 Final Report

4.4 BagasseBagasse is the fiber residue remaining after sugar cane has been processed toremove the sugar laden juice. In Thailand, sugar cane is grown primarily in the Centralregion with some production in the Northern and Northeast regions. Annual productionof sugar cane over the period from 1985 to 1996 was about 40 million tonnes. Duringthis period, production grew at an average rate of 13.7 percent per year. The governmenthas set a target annual production of 50 million tonnes. Sugar milling is seasonal andonly lasts 4 to 5 months. During the off-season, mill maintenance is performed.Sugar mills require large amounts of steam and electricity to process sugar cane.Sugar mills burn bagasse to provide the steam for these operations. (Bagasse propertiesand distribution are given in Table 4-5 and Figure 4-4, respectively.) The steam drivescane shredders, mills, and other mechanical drive turbines. The steam is also passedthrough back pressure turbine generators for cogeneration of electricity. Turbine exhauststeam is used for sugar juice heating and evaporation. The high demand for steam andlarge quantities of bagasse may result in excess electricity production. Fourteen sugarmills have entered the SPP program to sell excess power to EGAT on a non-firm basis.Based on milling statistics, bagasse constitutes 28 to 30 percent of the cane.Because of the large amount of bagasse used for steam and power supply, typically7 percent of the cane weight remains as excess. Assuming an annual cane production of50 million tonnes, the annual availability of this resource is estimated at 2.25 to3.5 million tonnes. Based on a heating value of 10,000 kJ/kg, power generation potentialfrom the excess bagasse ranges from 160 to 248 MW. Significant additional capacitycould be obtained through upgrades of existing mill power systems.Table 4-5Bagasse CharacteristicsSource industrySugar millsSource of biomassSugar caneSource output, tonne/yr50,000,000 (as planned)Supply forecastStableBiomass production rate, percent of source 28-30In process use, percent of source 23Total biomass supply, percent of source 5-7Biomass collectivity, percent of supply 90-100Total biomass availability, tonne/yr2,250,000-3,500,000 (excess only)Higher heating value, kJ/kg 10,000Fuel consumption, tonne/yr/MW 14,100Aggregate power generation potential, MW 160-248 (existing excess bagasse only)Price, Baht/tonne 0-150Other usesProduction of medium density fiber board, fuelJanuary 5, 2001 4-11 Final Report

Figure 4-4. Bagasse Distribution.January 5, 2001 4-12 Final Report

Because it is viewed as a waste product, bagasse generally has low economicvalue to mill owners in Thailand. For this reason, mill power systems are typicallyinefficient and do not attempt to conserve bagasse. Mills can employ many methods toincrease bagasse production, and reduce steam and power requirements. Theseapproaches could allow a mill to build sufficient bagasse supply to operate a power plantyear-round and sell to EGAT on a firm basis as an SPP. (Alternatively, other fuels couldbe burned during the off-season.) This approach is not currently taken. Although thereare fourteen sugar mills accepted into the SPP program, all are scheduled to sell power ona non-firm basis. Contracted sales to EGAT total 70.5 MW.Various approaches can be taken to upgrade mills to allow for power export to thegrid. These range from simple upgrades to sell existing excess capacity to the grid (onseasonoperation), to development of new central power plants with associated millprocessing improvements (year-round operation). The condition and age of existing millpower equipment, as well as the willingness of the mill owner to invest capital in a powerproject, is a strong factor in the approach taken. Options must be assessed at each site todetermine the most viable alternative. In general, improvements can usually be made.Additional information on bagasse as a potential biomass fuel is available inAnnex 3.4.5 Wood ResiduesWood residues include chips, bark, and sawdust produced within various woodprocessing industries including sawmills, furniture factories, and other industries (e.g.,toys, packing cases, crates, etc.). Excluding parawood from rubber tress, in-country woodproduction in Thailand has decreased dramatically from about 2,000,000 m 3 in 1988, to35,000 m 3 in 1995. The deficit has been made up with imports of raw saw logs andprocessed wood. From 1991 to 1995, wood imports averaged about 3.7 million m 3 or2.6 million tonnes annually; processed wood was about 55 percent of total imports. Amajor source of domestic wood is parawood from old age para-rubber trees. An IFTCmarketing study estimates that parawood production averages about 4.57 million m 3 or3.2 million tonnes annually. Unlike the other wood resources, parawood production isrelatively stable. It is planted largely in the Southern region as shown in Figure 4-5.Processing of parawood, saw logs, and processed wood occurs at sawmills andproduction plants and is accompanied by residue production of 30 to 60 percent (average53 percent). There are more than 400 sawmills and 400 parawood factories in Thailand.The aggregate properties of residues produced in these industries are given in Table 4-6.January 5, 2001 4-13 Final Report

Table 4-6Wood Residue CharacteristicsSource industrySawmills, production plantsSource of biomassSaw logs, parawood trees, processed woodSource output, tonne/yr 5,800,000Supply forecastFluctuatingBiomass production rate, percent of source53 (average)In process use, percent of sourcenegligibleTotal biomass supply, percent of source 53Biomass collectivity, percent of supply 60Total biomass availability, tonne/yr 1,836,000Higher heating value, kJ/kg 10,000Fuel consumption, tonne/yr/MW 15,500Aggregate power generation potential, MW 118Price, Baht/tonne 50-100Other usesFuel, particle board, charcoalBased on a residue percentage of 53 percent and a collectivity of 60 percent, theannual availability of this resource is estimated at 1.84 million tonnes. Based on a heatingvalue of 10,000 kJ/kg, power generation potential from wood residues is about 118 MW.There are currently five power plants with the ability to burn wood residues accepted intothe EGAT SPP program. The total capacity of the plants is 120 MW. Most of the plantsburn other biomass fuels (e.g., rice husk, black liquor) with the wood. Two of the plantsare contracted to sell power to EGAT on a firm basis. The largest of the five is a 56.7MW plant located at a paper mill. The plant is owned by Advance Agro, Plc.Wood combustion for power production is well understood. In the U.S., there isabout 7,000 MW of installed wood power capacity. However, in Thailand, alternativeuses compete strongly for wood residues. These include fuel for domestic heating andcooking, charcoal production, and particle board production. Because of these alternateuses, the fuel supply of any proposed power plant will have to be examined in detail.Additional information on wood residues as a potential biomass fuel is availablein Annex 4.January 5, 2001 4-14 Final Report

Figure 4-5. Parawood Residue Distribution.January 5, 2001 4-15 Final Report

4.6 CorncobCorn plants are the source of corncob, which remains after the ear is milled toremove the corn seed. Corn is grown mainly in the Northern region (about 48 percent),with the remainder grown primarily in the Central and Northeast regions. Annualproduction of corn over the period from 1986 to 1996 was about 3.88 million tonnes. Thegovernment has set a target for increased corn production through increased planted areaand productivity. Accordingly, it is expected that production will increase at about5 percent annually. Generally, corn is grown in two crops per year. The growing seasonis 90 to 110 days.Corn is mostly milled using portable milling machines at locations around theplantations. Thus, most of the residue (corncob) is left scattered in the field, posingcollection difficulty. A small portion is processed in milling shops located in provincesthat grow the crop. Based on milling statistics, corncob constitutes about 25 percent ofthe corn seed weight. Further information on corncob as a potential biomass resource isgiven in Table 4-7. Potential residue availability by province is shown in Figure 4-6.Based on a residue percentage of 25 percent and a collectivity of 50 percent, theannual availability of this resource is estimated at 500,000 tonnes. Based on a heatingvalue of 15,000 kJ/kg, power generation potential from corncobs is estimated at 54 MW.It is believed that there are currently no power plants burning corncob accepted into theEGAT SPP program. However, there is a cogeneration plant fired with corncob in LopBuri. In addition, one of the sugar mills examined in this study has used corncobs asupplemental fuel in the past. The corncobs were fed directly into the sugar mill boilerwithout need for chipping or grinding.Table 4-7Corncob CharacteristicsSource industryCorn milling/agricultureSource of biomassCornSource output, tonne/yr 4,000,000Supply forecast5 percent increase per yearBiomass production rate, percent of source 25In process use, percent of sourcenegligibleTotal biomass supply, percent of source 25Biomass collectivity, percent of supply 50Total biomass availability, tonne/yr 500,000Higher heating value, kJ/kg 15,000Fuel consumption, tonne/yr/MW 9,200Aggregate power generation potential, MW 54Price, Baht/tonne 300-400Other usesFurfuryl alcohol, fertilizer, fuelJanuary 5, 2001 4-16 Final Report

Figure 4-6. Corncob Distribution.January 5, 2001 4-17 Final Report

Based on experience with corncobs it appears to be a viable fuel. However,collection of large enough quantities to support a central power plant would likely bedifficult and costly. The most likely role for corncobs will be as a supplementary fuel.This concept was examined in the feasibility study for Karnchanaburi Sugar Industry Co.,Ltd.Additional information on corncobs as a potential biomass fuel is available inAnnex 5.4.7 Cassava ResiduesCassava, the source of tapioca, is a bushy tropical plant producing starch-richtubers (the underground portion of the plant). In Thailand, cassava is produced mainly inthe Northeast region, with some production in the Central and Northern regions.Production of cassava roots over the period from 1987 to 1995 has averaged about20 million tonnes per year. Production has been decreasing slightly due to competitiveexport market conditions.Cassava is processed to make to make two major products: tapioca pellets andstarch/flour. Approximately 75 to 80 percent of cassava production is exported (primarilyas pellets). The remainder is consumed in country. Direct use of cassava as fuel forpower generation is not economically viable because the present cost is too highcompared to other alternative fuels. However, production of tapioca starch produceswaste tapioca skin (peelings) and slurry that could be potential low cost fuels.Information on these residues is given in Table 4-8. Based on milling statistics, slurryproduction is about 30 percent of the raw cassava weight, while skin production is 5 to10 percent. Potential residue availability by province is shown in Figure 4-7. Tapiocastarch factory capacity is about 7 million tonnes in terms of raw cassava. Based on thislevel of production and a collectivity of 90 to 100 percent, total residue availability is2.5 to 2.8 million tonnes per year.Laboratory tests of skin and slurry samples reveal that they have high moisturecontents of 67 and 83 percent, respectively. Dry heating values were measured at 15,100and 15,500 kJ/kg, respectively. In order to utilize cassava residues as fuel, a moistureseparation or drying process would be necessary. This would imply additional cost andoverall efficiency loss. Based on a reduction in moisture content to 40 percent, it isestimated that heating values would be around 9,150 kJ/kg. Using the residue availabilitygiven above, power potential from this resource is estimated at 75 to 84 MW.January 5, 2001 4-18 Final Report

Table 4-8Cassava Residue CharacteristicsSource industryTapioca starch factorySource of biomassCassavaSource output, tonne/yr 7,000,000Supply forecastStableBiomass production rate, percent of source 40 (Slurry: 30; Skin: 10)In process use, percent of sourcenegligibleTotal biomass supply, percent of source 40Biomass collectivity, percent of supply 90-100Total biomass availability, tonne/yr2,520,000-2,800,000 (67-83 percent moisture)Higher heating value, kJ/kg9,150 (dried to 40 percent moisture)Fuel consumption, tonne/yr/MW17,100 (average at 40 percent moisture)Aggregate power generation potential, MW 75-84Price, Baht/tonne Slurry: 100-200; Skins: 250-300Other usesSlurry: alcohol, pellet admixture; Skins: fertilizerSlurry waste may be used for alcohol production or as an admixture for pelletproduction. The skins are normally left to decompose as fertilizer. The prices of cassavawastes vary by location and quantity available and range from 100 to 300 Baht/tonne.Limited information is available on the use of cassava wastes as a boiler fuel. Because ofthe high moisture content, the residues would require drying before use in a boiler. Moreresearch is required to determine if such a scheme is feasible, both technically andeconomically.Additional information on cassava residues as a potential biomass fuel is availablein Annex 6.January 5, 2001 4-19 Final Report

Figure 4-7. Cassava Residue Distribution.January 5, 2001 4-20 Final Report

4.8 Distillery SlopDistillery slop (also known as spent wash, molasses distiller's solubles, dunder, orstillage) is a waste product of liquor production from sugar cane molasses. Thirteendistilleries are located throughout Thailand with the greatest concentration in the Centralregion. Most of the distilleries have capacities of 12 to 16 million liters of 100 percentalcohol per year, with one, located in Pathum Thani having a capacity of 56 million litersper year. Total liquor production in Thailand has averaged 750 million liters (about30 percent alcohol) recently. It is expected that production will increase slightly due tothe introduction of competition in the liquor industry.The properties of distillery slop are given in Table 4-9. Distribution throughoutthe provinces is shown in Figure 4-8. Distillery slop consists of organic substancesincluding yeast, ammonia phosphate, and molasses residue. Because of the high organiccontent, direct discharge of slop into waterways would pollute the water. Thus, distilleryslop requires treatment before disposal is allowed. Modern technology is available fortreatment and includes: evaporation followed by incineration, use of an upflow anaerobicsludge blanket, and use of an upflow anaerobic sludge blanket followed by activatedsludge. However, these techniques are expensive for distillery owners to implement.Current recommended practice for the disposal of distillery slop is to contain it in aclosely monitored evaporation pond. When the slop dries, it looks like a solid slurry andcan be used as fertilizer. In Thailand, there have been long term experiments on the directuse of unconcentrated slop as fertilizer for rice paddy. Encouraging increases in rice yieldhave been observed.Table 4-9Distillery Slop CharacteristicsSource industryWhiskey distillery factorySource of biomassWhiskeySource output, liter/yr 750,000,000Supply forecastSlightly increaseBiomass production rate, percent of source *48 (300 percent x 16 percent)In process use, percent of sourcenegligibleTotal biomass supply, percent of source * 48Biomass collectivity, percent of supply 90-100Total biomass availability, tonne/yr * 356,000-396,000Higher heating value, kJ/kg * 15,500Fuel consumption, tonne/yr/MW * 7,700Aggregate power generation potential, MW * 46-52Price, Baht/tonneNo commercial valueOther usesFuel, fertilizer* Values are for concentrated distillery slop (1.35 percent moisture).January 5, 2001 4-21 Final Report

Figure 4-8. Distillery Slop Distribution.January 5, 2001 4-22 Final Report

Production of each liter of liquor produces about 3 liters of distillery slop. Basedon an annual liquor production of 750 million liters, about 2,250 million liters of slop areproduced annually. However, due to high moisture content, the slop must beconcentrated before it can be used to fuel a boiler. It is estimated that about 16 percent ofthe distillery slop would be available in a concentrated form suitable for use as fuel.Thus, about 360,000 m 3 of concentrated slop is available annually (approximately396,000 tonne/yr). Assuming a nearly dry (moisture: 1.35 percent) heating value of15,500 kJ/kg, power generation potential is estimated to be 46 to 52 MW. It needs to beemphasized that this estimate is based on the indicated moisture content. In order toutilize distillery slop as fuel, a moisture separation or drying process would be necessary.This would imply additional cost and overall efficiency loss.At least one distillery is equipped with an evaporation and incineration processthat uses evaporated slop as fuel for incinerators. Slop produced in the distillation processhas a solids content of about 16 percent. The diluted slop is passed through an evaporatorsystem in order to concentrate the slop to a solids content of 60 percent. The concentratedslop is then burned in the incinerators, which are initially heated using heavy oil. Theincinerators produce process steam for use in the distillery.As indicated above, distillery slop can be directly used as a fertilizer. In contrast,use of slop as fuel for steam generation involves installation of expensive evaporation andsteam generation equipment. The amount of slop generated from one or two distilleryplants may not be sufficient to justify the economics of a power plant. Thus, the potentialfor power generation for this resource does not appear viable.Additional information on distillery slop as a potential biomass fuel is available inAnnex 7.4.9 Coconut ResiduesCoconut is grown in every region of Thailand but is concentrated in the Centraland Southern regions, which together produce over 90 percent of the total. Surat Thani,Prachuap Khiri Khan, and Chumporn are among provinces with the highest production.Coconut production over the period 1986 to 1995 has averaged about 1.4 million tonnesper year. Production is relatively stable.Coconut is either directly consumed or used to produce coconut oil or milk. Asmall fraction (less than 1 percent) is exported. Because of the variety of end uses,processing of coconut is non-uniform. Generally, coconut fiber is a major waste productand is peeled off by planters in order to reduce transportation costs. Merchants come tobuy the peeled coconut to sell to distributors who will sell to local markets and factories.In certain areas, the coconut meat is extracted, chipped, and left to dry in the open air.These chips are sold to factories to make coconut oil.January 5, 2001 4-23 Final Report

Table 4-10Coconut Residue CharacteristicsSource industryCoconut plantations, peeling shops and oil millsSource of biomassCoconutSource output, tonne/yr 1,400,000Supply forecastStableBiomass production rate, percent of source 47 (Fiber 35; Shell: 12)In process use, percent of sourcenegligibleTotal biomass supply, percent of source 47Biomass collectivity, percent of supply Fiber: 60; shell 40Total biomass availability, tonne/yr 361,000Higher heating value, kJ/kg16,500 (average)Fuel consumption, tonne/yr/MW 8,400Aggregate power generation potential, MW 43Price, Baht/tonne Fiber: 50; Shell: 500-800Other usesFiber: furniture, fertilizer; Shell: fuel, carbonpowderCoconuts are comprised of fiber (35 percent), shell (12 percent), meat(28 percent), and juice (25 percent). Fiber, shell, and meat residue are the major coconutresidues. Meat residue after extraction of milk is relatively small. Fiber and shellproperties are given in Table 4-10. Distribution of the residues is shown in Figure 4-9.Based on an annual coconut production of 1.4 million tonnes and assumed collectionlevels of 60 percent for fiber and 40 percent for shell, residue availability is294,000 tonne/yr and 67,200 tonne/yr, respectively. Based on an average heating value of16,500 kJ/kg, estimated power generation potential is 43 MW.Common uses of coconut fiber and coconut shell are as stuffing material forfurniture components and as fuel and carbon powder, respectively.This review indicates that there is a potential for power generation using coconutresidues. However, collection of an adequate supply for a power plant may be difficultbecause the residues are generally widely scattered. The residues may be more aptly usedas a supplemental fuel. To achieve sufficient economies of scale, a coconut oil factory orgroup of factories could be a developer for this resource. However, suitability of this typeof supply needs to be studied in detail and on an area-specific basis.Additional information on coconut residues as a potential biomass fuel is availablein Annex 8.January 5, 2001 4-24 Final Report

Figure 4-9. Coconut Residue Distribution.January 5, 2001 4-25 Final Report

4.10 SawdustSawdust is produced in wood sawing and milling activities. Section 3.4 indicatesthat total wood processed in Thailand is on the order of 5.8 million tonnes per year. Thisfigure includes domestically produced wood, imported wood, and parawood from old agerubber trees. Industries involved include sawmills and factories that make woodproducts. Section 3.5 indicates there are more than 400 saw mills and more than400 parawood factories in Thailand.No statistics were readily available to demonstrate sawdust availability. Anestimate was made based on observations of sawmill operations. A figure of 7 percent interms of weight of wood input is considered a reasonable estimate of the sawdustgenerated. This number would vary significantly with the number of sawing operationsundergone by a particular piece of wood. Net availability is generally much less becausea significant amount is dispersed in the form of dust, perhaps more than 50 percent.Table 4-11 summarizes the potential for this biomass fuel. Based on a netavailability of 4 percent, and an assumed collectivity of 95 percent, this resource wouldamount to about 220,400 tonne/yr. With a heating value of 10,300 kJ/kg, powergeneration potential is about 16 MW. Distributed over the whole country, this potential isnot significant. Because of the limited quantities, dedicated sawdust fired power facilitiesare not likely to be viable. However, sawdust could be easily burned with the other woodwastes that are in relative abundance at wood processing facilities.Table 4-11Sawdust CharacteristicsSource industryWood productsSource of biomassWoodSource output, tonne/yr 5,800,000Supply forecastFluctuatingBiomass production rate, percent of source 7In process use, percent of source 3Total biomass supply, percent of source 4Biomass collectivity, percent of supply 95Total biomass availability, tonne/yr 220,400Higher heating value, kJ/kg 10,300Fuel consumption, tonne/yr/MW 13,400Aggregate power generation potential, MW 16Price, Baht/tonne 0-300Other usesJoss-stick, fuel, mushroom plantingJanuary 5, 2001 4-26 Final Report

5.0 Identification of Candidate Technologies (Task 1.7)Worldwide experience indicates that biomass fuels can be successfully burned byall of the major combustion technologies currently used in steam generation provided thatcharacteristics of the biomass have been properly evaluated and accounted for in thedesign. This section discusses the various technology considerations as applicable for thecandidate facilities included in this project.5.1 Biomass Fuel ConcernsCompared to coal, biomass fuels are generally less dense, have a lower energycontent, and are more difficult to handle. In addition to these concerns, the ash ofbiomass fuels usually has high levels of alkali components. The alkali components,typically potassium and sodium compounds such as potassium oxide (K 2 O) and sodiumoxide (Na 2 O), cause the ash to remain sticky at a much lower temperature than coal ash.This increased stickiness creates the potential for substantial slagging and foulingproblems, along with accelerated tube wastage. The ash of some biomass fuels is alsohighly abrasive (notably rice husks).The problems associated with alkali materials in biomass vary widely betweendifferent biomass fuels. To a certain extent, slagging potential can be determined byanalysis of fuel properties. However, the slagging tendency of a particular fuel cannot bepredicted from fuel properties alone. Boiler design and operating conditions (especiallytemperature) have a large impact on the nature of deposits. Gasification of high alkalifuels and subsequent combustion of the gas in the boiler may reduce ash deposition. Thesuccess of this approach depends on maintaining gasification temperatures belowcombustion temperatures. Temperatures of 1,400°F (760°C) and below have been shownto significantly reduce deposition. 9Common biomass fuels with the highest alkali contents are typically nut hulls, riceand grain straws, and grasses. The hulls of rice and grains typically have a much loweralkali content than the straw. Therefore, if a unit will only burn rice husks, some of thedesign parameters applied to biomass fuels with much higher alkali material contents maybe relaxed. However, if any rice straw or other local biomass is likely to be included inthe fuel mix in addition to the rice husks, the design parameters discussed should bestrictly applied.5.2 Thermochemical Conversion OptionsThere are several proven conversion systems for burning biomass fuels. Theseinclude the following:• Mass burn stoker boilers.9 Thomas R. Miles, et al, “Alkali Deposits Found in Biomass Power Plants,” April 15, 1995.January 5, 2001 5-1 Final Report

• Stoker boilers (stationary sloping grate, travelling grate, and vibrating grate).• Bubbling fluidized bed boilers.• Circulating fluidized bed boilers.• Gasification with combustion in a close-coupled boiler.• Pulverized fuel suspension fired boilers.5.2.1 Mass Burn Stoker BoilerMass burn stoker boilers offer very good fuel flexibility, but these units aretypically larger and more costly than the other types of boilers. This is because mass burnunits have historically been designed to burn unprocessed municipal solid waste (MSW).MSW can vary significantly in size, heating value, and moisture content, and thusrequires special accommodations in the boiler design. Fuel flexibility and the ability toaccommodate a wide variation in fuel properties are generally not required for biomassboilers.5.2.2 Stoker BoilerStoker combustion is a proven technology that has been successfully used withbiomass fuels (primarily wood) for many years. In the vibrating grate variety, fuel is fedthrough the front wall of the boiler above the grate. Because most biomass readilydevolatilizes, much of the fuel burns in suspension above the grate. Unburned particlesand ash settle on the grate and protect it from the high combustion temperatures. Thevibration of the grate causes ash accumulated on the grate to move toward the dischargeend of the grate where it falls into the bottom ash collection and conveying system.Because stoker boilers have been in widespread use for many years, localmanufacturers and maintenance companies are available in many countries (includingThailand). For this reason, capital costs for stoker boilers can be comparatively low.5.2.3 Bubbling Fluidized BedCombustion of biomass fuels in fluidized beds has been commercially applied formore than 20 years. A bubbling fluidized bed consists of fuel, ash from the fuel, inertmaterial (sand), and possibly a sorbent (e.g. limestone) to reduce sulfur emissions. Thefluidized state of the bed is maintained by hot air flowing upward through the bed. Theair causes the bed material to rise and separate, and creates circulation patterns throughoutthe bed. Because of the turbulent bed mixing, heat transfer rates are very high andcombustion efficiency is good. Consequently, combustion temperatures can be kept lowcompared to stoker boilers. This reduces NO x formation and is an advantage withbiomass fuels, because they may have relatively low ash fusion temperatures. Low ashfusion temperatures can lead to excessive boiler slagging.Due to the large amount of heat stored in the bed material, the bubbling fluidizedbed has the potential to accommodate a wider range of fuel heating values and moistureJanuary 5, 2001 5-2 Final Report

contents than the stoker boiler. This may make them an ideal choice for centrally locatedpower plants fed with several different biomass residues. However, despite the apparentacceptance of bubbling bed technology, recent bubbling bed experience in Thailand issomewhat discouraging.5.2.4 Circulating Fluidized BedCirculating fluidized bed units also offer a high degree of fuel flexibility andwould be a suitable technology for burning biomass. While early circulating fluidizedbed units were in the size range appropriate for most biomass plants (10-50 MW), presentcirculating fluidized bed technology is focusing on fossil fueled units of 200 to 300 MW.Although manufacturers quote small circulating fluidized bed units, these units generallycost more than other combustion technologies, making them difficult to justify forbiomass plants. Additionally, on a recent 35 MW rice husk power project, one of themajor circulating fluidized bed suppliers declined to bid. The supplier stated that thetechnology was not the best approach to burning rice husk or rice straw.5.2.5 GasificationAnother potential conversion option is gasification. Gasification is typicallycharacterized as incomplete combustion of a fuel to produce a fuel gas of low to mediumheating value. Gasification lies between the extremes of combustion and pyrolysis(anaerobic thermal decomposition) and occurs as the amount of oxygen supplied to theburning biomass is decreased. Combustible constituents in the fuel gas include methane,carbon monoxide, hydrogen, and some higher hydrocarbons; inert constituents areprimarily nitrogen, carbon dioxide, and water vapor. Depending on the gasificationscheme used, the heating value of the fuel gas generally ranges between 3.7 and7.5 MJ/Nm 3 (100-200 Btu/scf) for direct gasifiers, and between 11 and 17 MJ/Nm 3 (300-450 Btu/scf) for indirect gasifiers. By comparison, natural gas has a heating value ofaround 37 MJ/Nm 3 (1,000 Btu/scf). Direct gasifiers have been used extensivelyworldwide, including over 1 million small vehicles gasifiers used during World War II.Most development effort is now focussed on generally higher efficiency indirect gasifiers.Gasification expands the use of solid biomass to include all the uses of natural gasand petroleum-based fuels, giving it a distinct advantage over combustion. Besidesproviding higher efficiency power generation through advanced processes, the fuel gascan be used for the chemical synthesis of methanol, ammonia, and gasoline. Gasificationis also better suited for providing precise process heat control (e.g., for glass-making).Energy conversion options for the fuel gas include close-coupled boilers, internalcombustion engines, gas turbines, and fuel cells. Of these, only close-coupled boilers areconsidered technically mature for large scale applications.January 5, 2001 5-3 Final Report

There are only a few suppliers of proven gasification systems in the world. Oneof the most successful fuels gasified is rice husk, which can be troublesome to combustdirectly. Several rice husk gasifiers are located in Malaysia.5.2.6 Conversion Options ConclusionAlthough stoker boilers are widely in use, they are not always the mostappropriate technical choice. For example, rice husks are most easily fired in fluidizedbeds or gasifiers because the lower operation temperatures reduce the risk of slagging.Stokers and suspension-fired units may also be used, but precautions should be taken tominimize the slagging potential. Fluidized beds are good choices in general because theycan tolerate wide variations in fuel moisture content and size. Suspension firing is notsuitable for most of the biomass fuels (except rice husks) due to their higher moisturecontents and densities (which make them more difficult to be ground) compared to nonbiomassfuels. Gasification may be a suitable choice, but lacks widespread technical andcommercial acceptance. A comparison of the capital cost, ash characteristics and fuelcompatabilities of the various combustion technologies are provided in Tables 5-1, 5-2and 5-3, respectively.Due to their widespread availability, relatively low cost, and reasonableefficiency, stoker boilers were recommended for each of the new power facilities studiedin this report.Table 5-1General Technical Compatibility Ratings (L-Low, M-Medium, H-High)for Various Fuels and Boiler TypesBoiler TypeFuel type Stoker Bubbling BedPulverized FuelSuspension FiredRice husk M H MOil palm residues L M LBagasse M H LWood chip H H LCorncob M M LCassava residues M M LDistillery slop * L M LCoconut residues M M L*Assuming that the distillery slop has undergone an evaporation process.January 5, 2001 5-4 Final Report

Table 5-2Steam Generator Technology Comparison for Different Plant SizesBoiler typePlant Size 1 Stoker 2 Bubbling BedGross: 3.4 MW Net: 3.0 MWPulv. FuelSusp. FiredBoiler cost (equipment only), $M 3 3.6 4.30 4.20Balance of plant cost over base, $M -- 0.37 0.37Total cost over base, $M -- 1.07 0.97Total cost over base, $/kW net -- 357 323Gross: 5.7 MW Net: 5.0 MWBoiler cost (equipment only), $M 3 3.8 4.80 4.60Balance of plant cost over base, $M -- 0.50 0.50Total cost over base, $M -- 1.50 1.30Total cost over base, $/kW net -- 300 260Gross: 8.0 MW Net: 7.0 MWBoiler cost (equipment only), $M 3 4.0 5.30 5.00Balance of plant cost over base, $M -- 0.61 0.61Total cost over base, $M -- 1.91 1.61Total cost over base, $/kW net -- 272 229Gross: 10.0 MW Net: 8.8 MWBoiler cost (equipment only), $M 3 4.25 5.70 5.40Balance of plant cost over base, $M -- 0.86 0.86Total cost over base, $M -- 2.31 2.01Total cost over base, $/kW net -- 263 229Notes1. 12% auxiliary load assumed in calculating net output.2. Stoker used as base plant for cost comparisons.3. Values represent approximate costs for European supplied boiler and auxiliaries.January 5, 2001 5-5 Final Report

Fly Ash:Percent of total ashParticle sizeBottom Ash:Percent of total ashParticle sizeTable 5-3Steam Generator Technology Ash Characteristics ComparisonBoiler typeStoker Bubbling Pulverized FuelSuspension Fired40Fine90Fine90Extra Fine60CoarseWasteN/A a 10N/A baBottom ash from bubbling fluidized beds may include scrap metal, rocks, agglomerated bedmaterial, etc.b Bottom ash from pulverized fuel boilers may be gathered through either a wet or dry collectionsystem. Particle size is thus not applicable.5.3 Emission ControlsEmissions of concern from biomass plants include nitrogen oxides andparticulates (sulfur content of biomass is typically very low). Injection of urea orammonia (selective non-catalytic reduction) can be used to reduce nitrogen oxideemissions, while electrostatic precipitators (ESP) or fabric filters (FF) can be used tocontrol particulate emissions.5.3.1 Nitrogen Oxide ControlThe large majority of biomass boilers rely on selective non-catalytic reduction(SNCR) for control of nitrogen oxide emissions. SNCR is a commercially availabletechnology to control NO x emissions from fossil fueled boilers. Rather than a catalyst toachieve NO x reductions, SNCR systems rely on an appropriate reagent injectiontemperature, good reagent-gas mixing, and adequate reaction time. SNCR systems canuse either ammonia (marketed as Thermal DeNOX systems) or urea (marketed asNOxOUT systems) as a reagent. Ammonia or urea is injected into areas of the steamgenerator where the flue gas temperature ranges from 1,500 to 2,200°F. It is expectedthat the SNCR system would achieve approximately 50 percent NO x reduction, withammonia slip between 10 and 15 ppmvd. Lower ammonia slip values can be achievedwith lower reduction capabilities.The major considerations for the NO x reduction potential of an SNCR system are1) the boiler temperature profile, as a function of load, and 2) the geometry, which affectsreagent and flue gas mixing. The ideal temperature ranges from 1,500 to 2,200°F basedon the inlet concentration of NO x . Injection above the high end of the temperature rangewill result in increased NO x emissions. Hydrogen can be injected along with ammoniaJanuary 5, 2001 5-6 Final Report

(or additives to the urea reagent) to extend the effective range of the SNCR process downto 1,300°F. The specific geometry of each boiler dictates the positioning of reagentinjection lances to ensure relatively good NO x reduction performance with relatively lowammonia slip.5.3.2 Particulate Emissions ControlA review of the United States Environmental Protection Agency database showsthat both ESPs and FFs have been used in biomass-fired power plants. A general reviewof these two technologies is provided in this section.ESPs have several advantages over the FFs in biomass applications. ESPs havelow risk potential for fire while the bags in FFs are combustible to varying degreesdepending on the material of the bags. These bags can be set on fire by hot emberscarried over from the boiler. Typically, the ESPs have lower O&M costs since theyoperate on lower pressure drop that relates to lower power usage by the fans compared tothe FFs. In addition, the ESPs do not have maintenance costs related to periodic bagreplacement that are inherent in the FFs. Black & Veatch has designed biomass firedpower plants that utilize ESPs as the emission control technology.FFs hold the advantages of potential capital cost savings and offer greaterflexibility in maintaining emission limits over a wide range of conditions compared to theESPs. The capital cost savings are realized in cases when the ash is difficult to collect,the emission limits are strict, or the ash loading is large. These factors impact the ESPsizing such that an ESP gets proportionally large as compared to an FF, which isunaffected by these same parameters. The ESP must be designed for the worst fuelanalysis and flue gas conditions. The FF performance is not as sensitive as the ESP tochanges in operating parameters such as flue gas temperature and flow rate. Theseparameters can adversely impact ESP performance to a significant extent.In summary, the ESPs and the FFs have advantages and disadvantages that mayfavor their selection in a given application. The selection of the appropriate controltechnology for a biomass project can only be made based upon a comprehensiveevaluation of the specific project design and economic analysis criteria.January 5, 2001 5-7 Final Report

6.0 Identification and Screening of Candidate Facilities (Task 1.2& Task 1.3)Section 4 and Section 5 of this report established the various biomass fuels andtechnologies suitable for further study. Application of these fuels and technologies atselected sites was investigated for ten facilities. The first step in this process wasidentification and screening of candidate facilities, as discussed in this section.6.1 Identification ProcessIn parallel with the collection of agricultural biomass data, the study teamcontacted various associations of agro-industries to make known to them this feasibilitystudy of the biomass fired power/generations sponsored by NEPO and conducted byBlack & Veatch. In the beginning, the associations contacted included Federation of ThaiIndustries, Sugarcane Factories Association, Thai Rice Mills Association, and TapiocaFactories Association. The intent was to seek interest of their members in pursuingdevelopment of the biomass projects. The team also approached directly, either in personor by correspondence, the selected agro-industrial firms or factories which appear togenerate large quantity of residues. The team also developed a questionnaire form forthe facility owners to indicate their interest in development of a biomass fired power plantand to provide the biomass information. This questionnaire is attached in Annex 9.The initial site selection guidelines developed for identification of suitablefacilities include the following:• Availability of biomass supply for power generation or cogeneration at eachsite.• Biomass disposal concerns and the intention to develop a power plant.• Capability of the facility owner(s) to develop the power plant.• Experience of the facility owner(s) involving power plant development.6.2 Screening of Candidate FacilitiesAs it turned out, one of the most important aspects in initial site selection wasowner willingness to proceed with a power project. Because of the downturn inThailand’s economy, many facilities were uncomfortable with making large investments,especially in power generation, a field that is outside of their regular business.For this reason, the study team had difficulty locating facilities interested inproceeding with the study process. “Screening” to narrow the field of candidate facilitiesto a manageable number was not formally practiced. Practically, facilities screenedthemselves by either choosing to pursue this opportunity or to forgo it. Fortunately,facilities making the decision to proceed were generally well suited for further study.January 5, 2001 6-1 Final Report

One of the first milestones in the process through which potential facilities couldadvance to a candidate facility was the execution of a Memorandum of Understanding(MOU) between NEPO, the facility owner/developer, and Black & Veatch. The purposeof such an MOU is to have a facility-specific document which clearly illustrates theinterest of the facility in pursuing further facility development should the project be bothtechnically and commercially viable.With these criteria as a basis, a draft generic MOU was approved by NEPO foruse in early discussions with the potential facilities. A copy of the generic (non-facilityspecific MOU) is attached in Annex 10. For further discussion of MOU development seethe next section.The study team eventually received signed MOUs from each of the following tenfacilities:• Sommai Rice Mill Co., Ltd. Facility in Roi Et Province• Sanan Muang Rice Mill Co., Ltd. in Kamphaeng Phet Province• Thitiporn Thanya Rice Mill Co., Ltd. in Nakorn Sawan Province• Plan Creations Co., Ltd. in Trang Province• Chumporn Palm Oil Industry Plc., in Chumporn Province• Karnchanaburi Sugar Industry Co., Ltd. in Uthai Thani Province• Woodwork Creation Co., Ltd. in Krabi Province• Mitr Kalasin Sugar Co., Ltd. in Kalasin Province• Liang Hong Chai Rice Mill Co., Ltd. in Khon Kaen Province• Southern Palm Oil Industry (1993) Co., Ltd. in Surat Thani ProvinceEach of the ten facilities for which an MOU was obtained underwent preliminarilyassessment and was approved by NEPO as a Candidate Facility for further screening in afeasibility study.January 5, 2001 6-2 Final Report

7.0 Development of a Memorandum of Understanding (Task 1.4)Having identified potential sites and established a desire in the facility owners toproceed with the study, the next step in the process was to develop a Memorandum ofUnderstanding (MOU) between the owner, NEPO, and Black & Veatch.In general, the MOU outlines the commitment that the owner intends to pursuedevelopment of a biomass power facility if the feasibility study determines the proposedfacility to be technically, environmentally, and financially viable. The MOU generallyidentifies the facility, outlines the essential technical requirements, and defines theexpected “successful” internal rate of return. Through execution of the MOU, it isunderstood that NEPO is financing the study under the assumption that the facility ownerwill pursue further development or, if this is not the case, then the facility will fund onehalfof the cost of the feasibility study performed for their proposed development unlessacceptable reasons notified to NEPO in writing. This last provision is an insurancemeasure that the facility truly has the intent of moving forward with development of theirproposed facility in order for NEPO to fund the feasibility study, or will cover a portionof the costs if they do not move forward with a technically and commercially viableproject.7.1 Potential Project OwnersThere are three categories of people who might qualify as the “project owner” indeveloping the project. These are described in the following sections.7.1.1 Facility OwnerFacility owners are the owners of biomass residues. A few facility owners couldproceed to develop a project by themselves, but some could not proceed for a variety ofreasons:• Insufficient biomass residue created by their own processing facilities to fuela plant of sufficient capacity to be economically feasible.• Lack of experience in initiating and implementing projects of this type.• Lack of financial support for the project.For these reasons, facilities owners may wish to cooperate with other biomasssuppliers in the area or may team with outside developers or advisors.7.1.2 DeveloperAnother possible role is one of a developer. Usually the developer has nofacilities that produce biomass residues but knows how to obtain financial support,develop a procedure for project implementation, etc. The developer may join the facilityowners to form a project development team.January 5, 2001 7-1 Final Report

7.1.3 AdvisorSometimes a project may be developed through a promoter or an advisor, whonormally has creditability to locate financing sources. Most developers or facility ownersusually have limited capital investment. In order to finance the whole project, theyusually have a financial advisor and developer (or facility owner) who can act as theproject owner/developer.7.2 Generic MOUAfter review of the MOU relationship discussion submitted in the Detailed WorkPlan and Methodology, it was strongly recommended that one standard MOU be used foreach potential project. Black & Veatch believes a separate but standard form for eachfacility will best protect NEPO’s interest in future commitments. By utilizing a separateMOU for each facility, the process is simplified and the commitment is specific to apotential facility. Therefore, if a developer is pursuing three potential facilitydevelopments, but only one proves to be viable (as shown in the feasibility study results),there is no doubt that the commitment for each facility stands on its own.A draft generic MOU was developed. This form has been set up to work for eachpotential facility with only minor modifications needed based on the number ofdeveloper/owner(s) and location of the potential facility.For each of the sites selected for full feasibility study, an MOU was executed priorto commencement of study work.January 5, 2001 7-2 Final Report

8.0 Candidate Facility Data Collection (Task 1.5)Following identification and initial screening (Task 1.2 and 1.3) of prospectivefacilities, Black & Veatch provided detailed data requests to facility owners. Datarequests were facility specific and were used to help Black & Veatch identify the optimalconfiguration of the power facility, evaluate project feasibility, and identify other benefitsof the project. Of particular importance was the quantity of biomass fuel available to theproject, reliability of supply, and other characteristics of the fuel (heat content, ash andmoisture content, delivery methods, cost, etc.). When available, detailed historical datafrom the facility owner was utilized to develop this information. Other relevantinformation collected included process descriptions, plant layouts, maps, laborrequirements, cost of current waste disposal practices, cost of electricity purchases, needfor process steam, hours of facility operation, and plans for future expansion.In addition, Black & Veatch personnel visited each of the candidate facilities forfurther data collection in support of making a preliminary assessment on project viability.During the site visits, Black & Veatch personnel met with representatives of the candidatefacilities to discuss different aspects (technical, financial, environmental, andsocioeconomic) of the current plant operations and the proposed power project. Facilitytours were conducted after the discussions and photographs were taken of the facilities.A field reconnaissance report was prepared summarizing the data collected.January 5, 2001 8-1 Final Report

9.0 Preliminary Assessment of Selected Facilities (Task 1.6)The first milestone indicating a mutual interest in developing the site for powergeneration/cogenration is through signature of an MOU between NEPO, the facilityOwner/Developer, and Black & Veatch (see Section 6 of this report). Once this milestonehas been accomplished, a cursory review of the information included in the facility surveyquestionnaire (consistency of quantity of fuel, quality of fuel, availability of supplementalfuel, etc.) was performed. When review of this information indicated a favorablepotential for development, facility site visits were arranged to perform a preliminaryassessment of the selected facility. The assessment was accomplished through review ofthe existing facilities, discussions with the staff, and gathering of other pertinent facilityinformation. These steps were followed and site visits were performed by Black &Veatch personnel between February 1998 and April 1999 for the following ten facilities:• Sommai Rice Mill Co., Ltd. in Roi Et Province• Sanan Muang Rice Mill Co., Ltd. in Kamphaeng Phet Province• Thitiporn Thanya Rice Mill Co., Ltd. in Nakorn Sawan Province• Plan Creations Co., Ltd. in Trang Province• Chumporn Palm Oil Industry Plc. in Chumporn Province• Karnchanaburi Sugar Industry Co., Ltd. in Uthai Thani Province• Woodwork Creation Co., Ltd. in Krabi Province• Mitr Kalasin Sugar Co., Ltd. in Kalasin Province• Liang Hong Chai Rice Mill Co., Ltd. in Khon Kaen Province• Southern Palm Oil Industry (1993) Co., Ltd. in Surat Thani ProvinceThe resulting preliminary assessments for these ten sites were issued to NEPO.Each preliminary assessment addresses the initial review of a facility’s potential forpower plant development or modification. Topics covered generally include currentoperations, power potential, proposed facility features, environmental aspects,socioeconomic aspects, economic aspects, and elevation and climatological data. Inaddition, a conclusion is provided for each of the preliminary assessments that indicateswhether a full feasibility study of the proposed power plant is warranted.None of the ten assessments completed identified any obvious developmentproblems that would preclude further investigation in a feasibility study (althoughpotential difficulties were occasionally identified for further investigation). The ten siteswere fully investigated in feasibility studies as described in the next section of this report.January 5, 2001 9-1 Final Report

10.0 Feasibility Study Summary Results (Task 2)In accordance with Task 2, Black & Veatch prepared a full feasibility study forten selected agro-industrial facilities. This section presents the facilities studied, structureof the feasibility studies, general study assumptions, and the summary results of eachstudy.In general, the feasibility studies were performed using the best data availablefrom the sites. As not all facilities had detailed information readily accessible,assumptions often had to be made to complete the studies. These assumptions areidentified in the individual study reports.10.1 Facilities StudiedAs discussed in Section 8 of this report, preliminary assessments of the followingten potential facilities resulted in the recommendation that these sites be consideredcandidate facilities and be further investigated through a full feasibility study:• Sommai Rice Mill Co., Ltd. Facility in Roi Et Province• Sanan Muang Rice Mill Co., Ltd. in Kamphaeng Phet Province• Thitiporn Thanya Rice Mill Co., Ltd. in Nakorn Sawan Province• Plan Creations Co., Ltd. in Trang Province• Chumporn Palm Oil Industry Plc., in Chumporn Province• Karnchanaburi Sugar Industry Co., Ltd. in Uthai Thani Province• Woodwork Creation Co., Ltd. in Krabi Province• Mitr Kalasin Sugar Co., Ltd. in Kalasin Province• Liang Hong Chai Rice Mill Co., Ltd. in Khon Kaen Province• Southern Palm Oil Industry (1993) Co., Ltd. in Surat Thani ProvinceA map showing the location of these candidate facilities is included as Figure10-1. As can be seen on the map, the facilities are distributed throughout the four regionsof Thailand.January 5, 2001 10-1 Final Report

Figure 10-1. Candidate Facility Locations.January 5, 2001 10-2 Final Report

10.2 Study AssumptionsAside from facility specific information, most of the underlying assumptions werekept the same during the course of the study. There are two exceptions to this: theexchange rate used in the financial evaluation and the capital cost basis.As shown in Figure 10-2, the Baht to US dollar exchange rate has fluctuatedsignificantly over the course of this study. Evaluation of the first four sites was initiallyissued in June 1998 and used an exchange rate of 43.53 Baht/US$. Since that time theexchange rate has dropped significantly. The financial analysis in the last six sitesreflects this drop and assumes an exchange rate of 37.15 Baht/US$. To determine theeffect of the exchange rate movement, sensitivity analyses for each site assessed in thelast six sites were performed at +/-4 Baht/US$ and at the original exchange rate used forthe first four sites.5550Exchange Rate, Baht/US$45403530First 4 Sites – 43.53 Baht/US$Final 6 Sites – 37.15 Baht/US$2520Initial InvestigationsEvaluation Period forFirst Four SitesEvaluation Period forFinal Six SitesJan-97 Apr-97 Jul-97 Oct-97 Jan-98 Apr-98 Jul-98 Oct-98 Jan-99 Apr-99 Jul-99 Oct-99 Jan-00DateFigure 10-2. Baht/US$ Daily Average Interbank Exchange Rate (Source:http://www.onada.com).There is an overall increase in project costs for the last six sites relative to the firstfour sites. (Tables 10-2, 10-3, and 10-4 at the end of this section contain pricinginformation for the sites). This increase is due to two factors. First, total project costs forthe first four sites were developed assuming aggressive international sourcing (includingChinese manufacturers). Financial sensitivity analyses were performed to provideinformation on alternatively sourced equipment. Costs for the last six sites weredeveloped assuming that equipment with extensive performance records and provenreliability would be used. This implies that generally higher cost US, European, andJanuary 5, 2001 10-3 Final Report

Japanese equipment suppliers would be specified, resulting in higher total project costs.Second, the first four sites focused on new facilities 9 to 10 MW gross in size, whereasthe last six sites examined new facilities 3.5 to 7 MW gross in size. Economies of scaleare significant in this size range, with specific costs ($/kW) increasing as project sizedecreases. The combination of different suppliers with better costing information andsmaller facility size for the base case analyses results in increased project costs ($/kW) forthe last six sites.It is possible that significant cost reductions could be obtained through aggressiveinternational sourcing while still maintaining technical acceptability. Therefore, anadditional financial sensitivity analysis was performed for each of the last six sites wherethe direct EPC cost was reduced 20 percent from the base case.10.3 Summary ResultsBased on the assumptions noted in each feasibility study, the results of the studiesindicate that all of the ten candidate facilities are technically and environmentally viable.A variety of biomass fuels were examined in the studies including rice husk (4 facilities),wood wastes (2), palm oil residues (2), and bagasse (2) as primary fuels and coconuthusks (1), biogas (2), and corncobs (1) as supplementary fuels. Combustion of these fuelsis generally considered proven and stoker grate boilers were specified for all the sitesbased on their widespread availability and relatively low capital cost. Both entirely newpower facilities and modifications to existing plant power facilities were examined,although most studies examined new power facilities. A typical plant configuration for anew facility is shown in Figure 10-3. The power outputs examined ranged from 1.9 MWto 8.8 MW net for the base case analyses. In support of financial sensitivity analyses,some preliminary investigations were done for facilities sized up to 30 MW.Cogeneration of steam was a very significant design factor for the two palm oil mills andplayed a lesser role for the other facilities. In general, the studies found relatively fewtechnical or environmental obstacles.January 5, 2001 10-4 Final Report

Flue GasSYSTEM BOUNDARYPOWER PLANTSteamSteamTurbineGeneratorPower forExportBoilerFeedwaterAuxiliaryPowerAirB O I L E RCondenser /Process UseMakeupWaterFuelPreparationFuelParticulateControlSupplementalFuel fromSurrounding AreaFuel StorageSYSTEM BOUNDARYBiomassFeedstockWaste Byproduct(Fuel)ProcessingOperationsBoilerBlowdownAshCondensate ReturnProcess SteamPower (from Grid orPower Plant)Figure 10-3. Typical Biomass Power Plant Configuration.However, the financial viability of the facilities is mixed as demonstrated inTable 10-1. Only three of the facilities identified (Sommai Rice Mill, Sanan Muang RiceMill, and Thitiporn Thanya Rice Mill) surpassed the initial financial internal rate of returnhurdle of 23 percent in the base case financial analyses. (The 23 percent figure isestablished in the MOU as the minimum rate of return requiring facilityowners/developers to either proceed with the project or repay NEPO for the cost of thestudy.) Black & Veatch investigated alternative scenarios aimed at improving thefinancial rating of the remaining facilities. These studies, which are preliminary innature, indicate that several factors could change to improve the viability of theseprojects. In some cases, such as simply accounting for the value of cogenerated steam atthe Chumporn Palm Oil Mill, the improvement in IRR can be dramatic and is compellingfrom an investment standpoint. In other cases, the base case IRR can only be improvedsignificantly by a combination of several positive factors, some of which would requireaggressive implementation. For this reason, the long term prospects for development atthese sites appears limited.January 5, 2001 10-5 Final Report

FacilitySommai Rice Mill Co.,Ltd.Sanan Muang Rice MillCo., Ltd.Thitiporn Thanya RiceMill Co., Ltd.Base CaseIRRTable 10-1Summary of Financial AnalysesAlternativeStudy IRRFeatures of Alternative StudyDevelopmentStatus32.6 NA NA EPC bid stage25.5 NA NA Under furtherconsideration26.4 NA NA Under furtherconsiderationPlan Creations Co., Ltd. 8.2 38.5 Larger facility Under furtherconsiderationChumporn Palm OilIndustry Plc.Karnchanaburi SugarIndustry Co., Ltd.Woodwork Creation Co.,Ltd.Mitr Kalasin Sugar Co.,Ltd.Liang Hong Chai RiceMill Co., Ltd.Southern Palm OilIndustry (1993) Co., Ltd.20.4 39 to 69 Added revenue to account foravoided steam generation cost18.9 27.5 Existing boiler efficiencyincrease to save bagasse4.4 25 Larger facility, more efficientfacility, drier fuel, lower projectcost basis ($/kW)13.3 46 Modification of existing facilityrather than new plant7.6 13 to 29 Larger facility, lower projectcost basis ($/kW)11.6 13 to 25 Added revenue to account foravoided steam generation cost,larger facilityUnder furtherconsiderationUnder furtherconsiderationUnder furtherconsiderationDevelopmentproceedingUnder furtherconsiderationUnder furtherconsiderationAt this time, eight of the ten facilities either are under active development or areunder further consideration by the owners. For any project that proceeds withdevelopment, additional development activities should include detailed evaluations offuel supply (quantity, quality, etc.), as well as power facility conceptual design to supportand confirm assumptions in the feasibility study, development of a more detailed projectcapital cost estimate with specific vendor pricing on major equipment, and additional proforma analyses as new data warrants.The first four studies examined building entirely new facilities. Table 10-2 at theend of this section summarizes the major attributes of these studies. Of the last sixstudies, two of the studies examined modifications to existing facility power plants, whilefour of the studies examined entirely new power facilities. Table 10-3 summarizes theresults of the two power facility modification studies. Table 10-4 summarizes the resultsof the new power facility studies for the last set of sites. (Table 2-2 in the ExecutiveSummary provides a side by comparison of major facility features for all sites.) Theresults of the studies for each site are briefly discussed below.10.3.1 Sommai Rice Mill Co., Ltd.A new power facility was studied at the Sommai Rice Mill Co., Ltd. located inRoi Et province, Thailand. The Sommai rice mill currently processes aboutJanuary 5, 2001 10-6 Final Report

1,000 tonne/day of rice paddy in two process lines of 700 tonne/day and 300 tonne/day.An additional process line of 300 tonne/day is under construction. When the facilityexpansion is completed, it is anticipated that an average of 98,670 tonne/yr of rice huskwill be generated at the plant.The feasibility of building a new power plant at the Sommai rice mill facility wasstudied. The boiler for the plant would be fueled with rice husk and would generatesteam for use in a turbine generator with a gross output of 10.0 MW. Net plant output isestimated at 8.8 MW. The feasibility study concludes that the proposed development istechnically, environmentally, and financially viable (IRR of 32.6 percent).10.3.2 Sanan Muang Rice Mill Co., Ltd.A new power facility was studied at the Sanan Muang Rice Mill Co., Ltd. locatedin Kamphaeng Phet province, Thailand. The Sanan Muang rice mill currently processesabout 250 tonne/day of rice paddy. Typical operation of a rice mill yields 23 tonnes ofrice husks for every 100 tonnes of rice paddy. Thus, on average about 13,800 tonne/yr ofrice husk is generated at the plant. Additional rice husks are also available from fivefacilities in the surrounding area (within 50 km). It is anticipated that a total of about79,000 tonne/yr of rice husks would be available to fuel the proposed power facility.The feasibility of building a new power plant at the Sanan Muang facility wasstudied. The boiler for the plant would be fueled with rice husk and would generatesteam for use in a turbine generator with a gross output of 9.1 MW. Net plant output isestimated at 8.0 MW. The feasibility study concludes that the proposed development istechnically, environmentally, and financially viable (IRR of 25.5 percent).10.3.3 Thitiporn Thanya Rice Mill Co., Ltd.A new power facility was studied at the Thitiporn Thanya Rice Mill Co., Ltd.located in Nakorn Sawan province, Thailand. The Thitiporn Thanya rice mill currentlyprocesses 500 tonne/day of rice paddy. Typical operation of a rice mill yields 23 tonnesof rice husks for every 100 tonnes of rice paddy. Thus, on average about 27,600 tonne/yrof rice husk is generated at the plant. Additional rice husks are also available from sevenfacilities in the surrounding area (within 50 km). It is anticipated that a total of about79,000 tonne/yr of rice husks would be available to fuel the proposed power facility.The feasibility of building a new power plant at the Thitiporn Thanya facility wasstudied. The boiler for the plant would be fueled with rice husk and would generatesteam for use in a turbine generator with a gross output of 9.1 MW. Net plant output isestimated at 8.0 MW. The feasibility study concludes that the proposed development istechnically, environmentally and financially viable (IRR of 26.4 percent).January 5, 2001 10-7 Final Report

10.3.4 Plan Creations Co., Ltd.A new power facility was studied at the Plan Creations Co., Ltd. parawoodprocessing plant located in Trang province, Thailand. Plan Creations makes educationaltoys from rubber wood (parawood). The residue from the process is a combination ofbark, outer cuts, curfs (from sawing), sawdust (from sanding operations), and discardedstock (low quality, diseased, discolored, etc.). It is estimated that about 4,000 tonne/yr ofresidue will be available at the facility. In order to take advantage of economies of scale,additional wood resources were sought. About 14,000 tonnes of parawood residue couldbe delivered from area manufacturing facilities. An additional 116,000 tonnes could beobtained by implementing forestry residue collection operations over an area of about15,000 rais. The total fuel available would then be about 134,000 tonne/yr.The feasibility of building a power plant at the Plan Creations site was studied.The boiler for the plant would be fueled with wood residues and would generate steam foruse in a turbine generator with a gross output of 10.0 MW. Net plant output is estimatedat 8.8 MW. The feasibility study concludes that the proposed development is technicallyand environmentally viable, but financially marginal (IRR of 7.95 percent).Following the base case analysis, the study team investigated what factors wouldhave to change to increase the viability of a power plant at this site. It was found that alarge increase in fuel consumption and plant size would allow an IRR of about38.5 percent. In the most optimistic scenario analyzed, where about 74 percent(356,000 tonnes) of all available parawood logging residues from the Trang province arecollected, a power plant of about 28 MW net is possible. The extent to which additionalfuel can be collected at a relatively low cost (320 Baht/tonne) will determine the ability ofthe project to achieve the higher rates of return.10.3.5 Chumporn Palm Oil Industry Plc.Power facility modifications were studied at the Chumporn Palm Oil Industry Plc.(CPOI) palm oil mill located in Chumporn province, Thailand. CPOI processes fresh oilpalm to produce crude palm oil, refined palm oil, and palm kernel oil. There are variousbiomass residues produced in the process including palm shells, fiber, empty fruit bunch(EFB), and biogas (to be produced from a new wastewater treatment system). CPOIcurrently burns all the solid byproducts of the production process in a power plant locatedat the site. The plant produces power and process steam for the operations. The powerplant has an installed maximum capacity of 4.3 MW gross but currently only producesabout 2.4 MW gross (1.9 MW net) on average.Several modifications were proposed for CPOI to improve efficiency and increasepower output. Preliminary technical and economic analysis found that combustion ofadditional fuel up to the current facility capacity (4.3 MW) is viable. Fuels used includepalm shell, palm fiber, EFB, and biogas produced by the expanded processing facility,and coconut husk fiber and additional shell procured from the surrounding area. Due toJanuary 5, 2001 10-8 Final Report

its lower cost, coconut husk is preferred over old age palm trees, which will become adisposal problem as the palm plantation matures. Major capital improvements requiredfor this option include a new shredder to prepare the additional EFB and minor upgradesto the existing interconnection to allow electricity to be sold to the grid.Additional modifications were selected for further analysis. The finalconfiguration utilizes a low pressure condensing turbine to capture and generate powerfrom the exhaust of the existing back pressure steam turbine, a condenser to recoverturbine and process exhaust steam, an improved makeup water treatment system, andother modifications. The average gross plant output under this configuration would beapproximately 5.4 MW, an increase of 3.0 MW over the existing plant. Peak plant outputwill be about 6.4 MW gross. The new configuration would also allow more processsteam to be generated allowing for greater palm oil production capacity.The feasibility study concluded that the proposed development is technically andenvironmentally viable, but financially marginal (base case IRR of 20.4 percent). Theseconclusions are based on preliminary assumptions concerning process data, futureproduction, and equipment requirements and costs. Additional study work and detaileddata collection may be required to determine the optimal plant modifications andassociated financial returns. In addition, the new power plant will allow CPOI to operateat a higher palm oil production capacity. The value of this benefit was not included in thebase case financial analysis but was evaluated through sensitivity analysis by assigning avalue to the cogenerated steam. It was found that inclusion of this benefit would makethe project very attractive financially (IRR ranging from 39 to 69 percent for steam valueof 5 to 15 US$/tonne, respectively).10.3.6 Karnchanaburi Sugar Industry Co., Ltd.Power facility modifications were studied at the Karnchanaburi Sugar IndustryCo., Ltd. (KSI) located in Uthai Thani province, Thailand. KSI mills sugarcane to extractits juice for the production of sugar. Bagasse is produced as residue in the process. KSIcurrently burns a portion of the bagasse in a power plant located at the site to producepower and process steam for the milling operation. The maximum capacity of the powerplant is 17.5 MW gross. Based on recent statistics, about 21,000 tonnes of excess bagasseremain at the end of the processing season.Depending on the steam needs of the processing operations, there is unused andunsold electrical capacity at the plant. This surplus power could be sold to the grid but isnot currently. During the on-season (about 100 days), the plant could export the excesspower, which is estimated to average about 455 kW. In addition, during both the on andoff-season, excess bagasse could be utilized in existing idle mill power equipment withthe intent to export “firm” power to the grid year-round. To supplement the bagassesupply, corncobs would be gathered from the surrounding area. The combination of theexcess existing power production, excess bagasse fuel, and supplemental corncob fuel canJanuary 5, 2001 10-9 Final Report

provide a total of 1,850 kW net at an annual capacity factor of 53.2 percent. This optionwould use the existing factory boilers, turbine-generators, and tie line to PEA. Newequipment required includes interconnection equipment, additional condensing capacity,and piping and valving upgrades.The feasibility study concludes that the proposed development is technically andenvironmentally viable, and financially viable under certain conditions (IRR of18.9 percent). These conclusions are based on relatively conservative assumptionsconcerning process data, future crop production, and equipment requirements and costs.Additional study work and detailed data collection may be required to determine theoptimal plant modifications and associated financial returns. Additional analysis foundthat increases in sugar milling efficiency would allow enough bagasse to be produced sothat combustion of supplemental corncob fuel would not be required. The IRR under thisscenario increases significantly to 27.5.10.3.7 Woodwork Creation Co., Ltd.A new power facility was studied at the Woodwork Creation Co., Ltd. located inKrabi province, Thailand. Woodwork Creation makes processed wood sheets fromrubber wood (parawood). Residue produced by the process includes bark, sawdust, andwood chips. A total of 40,320 tonne/yr of residue will be generated at the facility after anupcoming expansion. Some of this fuel is used to power an existing steam boiler at thefacility. Limited additional fuel could be purchased from the surrounding area. The totalfuel available to the power facility would be 54,000 tonne/yr.The feasibility of building a new power plant at the Woodwork Creation site wasstudied. The boiler for the plant would be fueled with wood residues and would generatesteam for use in a turbine generator with a gross output of 3.55 MW. Net plant output isestimated at 3.1 MW. The feasibility study concludes that the proposed development istechnically and environmentally viable, but financially marginal (IRR of 4.4 percent).Following the base case analysis the study team investigated what factors wouldhave to change to increase the viability of a power plant at this site. It was found that thefollowing factors, when combined, would allow an IRR of almost 25 percent:• Large increase in base fuel supply (additional 300,000 tonnes).• Reduced moisture content assumption of 40 percent for the additional fuel(base assumption is 60 percent).• 15 percent improvement in net plant heat rate over base assumption.• 25 percent decrease in project cost basis over base assumption.The combination of these assumptions resulted in a plant with a net output ofabout 30 MW and a total project cost of about US$1,060/kW. The extent to which theabove requirements can be met will determine the ability of the project to achieve thehigher rates of return. As some of these requirements are fairly aggressive, it may bedifficult to obtain acceptable rates of return at this site.January 5, 2001 10-10 Final Report

10.3.8 Mitr Kalasin Sugar Co., Ltd.A new power facility was studied at the Mitr Kalasin Sugar Co., Ltd. (MKS)located in Kalasin province, Thailand. MKS mills sugarcane to extract its juice for theproduction of sugar. Bagasse is produced as residue in the process. MKS currently burnsa portion of the bagasse in a power plant located at the site to produce power and processsteam for the milling operation. The maximum capacity of the power plant is 16.4 MWgross. Based on recent statistics, about 76,000 tonnes of excess bagasse remain at the endof the processing season.The study investigated the feasibility of building an entirely new power plantfueled with the excess bagasse produced by the processing facility. A boiler wouldgenerate steam for use in a turbine generator with a gross output of 6.1 MW. Net plantoutput is estimated at 5.6 MW. The existing power facility would remain and wouldsupply the processing operations with required steam and power. The feasibility studyconcludes that the proposed development is technically and environmentally viable, butfinancially marginal (base case IRR of 13.3 percent).An alternative generation option, which involves modification to the existingpower facility rather than construction of a new plant, initially appears more promisingfrom a financial standpoint. The modifications would allow about 3 MW to be exportedfrom one of the existing generators at an annual capacity factor of 71 percent (firm basis).Because of greatly reduced capital requirements, the projected IRR for this case is muchhigher, 46 percent. Due to time and budget constraints, this option was only brieflyanalyzed; additional study work and detailed data collection would be required toproperly assess this option.10.3.9 Liang Hong Chai Rice Mill Co., Ltd.A new power facility was studied at the Liang Hong Chai Rice Mill Co., Ltd.(LHC) located in Khon Kaen province, Thailand. LHC owns two rice mills, each ofwhich currently processes a maximum of 250 tonnes of rice paddy per day or about75,000 tonnes of paddy per year (150,000 tonnes per year total). The proposeddevelopment would be at the newer facility, which is about 5 km from the old plant. Atotal of approximately 33,000 tonne/yr of rice husk will be available for powerproduction.The feasibility of building a new power plant at the new LHC facility was studied.The boiler for the plant would be fueled with rice husk and would generate steam for usein a turbine generator with a gross output of 3.8 MW. Net plant output is estimated at3.3 MW. The feasibility study concludes that the proposed development is technicallyand environmentally viable, but financially marginal (IRR of 7.6 percent). Following thebase case analysis the study team investigated what factors would have to change toincrease the viability of a power plant at this site. It was found that the following factors,when combined, would allow an IRR of about 29 percent:January 5, 2001 10-11 Final Report

• Increase in rice husk supply from 33,000 to 133,000 tonne/yr. Additional ricehusk could be procured from the Nakorn Ratchasima province.• 20 percent decrease in project cost basis over base assumption.The combination of these assumptions resulted in a plant with a net output ofabout 13.4 MW and a total project cost of about US$1,550/kW. This additionalinvestigation appears encouraging and indicates that a rice husk power plant in the area, ifnot at this site, might be viable.10.3.10 Southern Palm Oil Industry (1993) Co., Ltd.A new power facility was studied at the Southern Palm Oil Industry (1993) Co.,Ltd. (SPOI) palm oil mill located in Surat Thani province, Thailand. SPOI processesfresh oil palm to produce crude palm oil. There are various biomass residues produced inthe process including palm shells, fiber, EFB, and biogas (to be produced from a newwastewater treatment system). SPOI currently burns the shells and fiber in a power plantlocated at the site. The plant produces power and process steam for the operations. Theexisting power plant has an installed capacity of 880 kW gross. SPOI would like toexpand palm oil production but is limited by the power and steam production of itsexisting power plant.The feasibility of building an entirely new power plant at the SPOI site wasstudied. The boiler for the plant would be fueled with fiber and shells produced by theprocessing facility (EFB would not be burned). The boiler would generate steam for usein a turbine generator with a gross output of 7.0 MW. Net plant output is estimated at6.2 MW. The existing power facility would remain and would be used for backuppurposes. The feasibility study concludes that the proposed development is technicallyand environmentally viable, but financially marginal (IRR of 11.6 percent). However,due to increased steam production, the new power plant will allow SPOI to operate at ahigher palm oil production capacity. The value of this benefit was not included in thebase case financial analysis but was evaluated through sensitivity analysis by assigning avalue to the cogenerated steam. It was found that inclusion of this benefit would notimprove the IRR above the hurdle rate without making other changes to the project. Itwas found that the following factors, when combined, would allow an IRR of about25 percent:• Increase in plant size to 28.3 MW through additional fuel supply from thesurrounding area.• Increase in palm oil mill processing time such that 40,000 tonne/yr of steamare required over current needs. This might be obtained by increasing lowseason operation from 16 hr/day to 24 hr/day. The additional steam is valuedat $10/tonne in the pro forma analysis.The resulting IRR of 25 percent exceeds the hurdle rate. This indicates thatdevelopment of an enhanced cogeneration plant at this site is promising. To fullyJanuary 5, 2001 10-12 Final Report

establish the financial impact of the modifications, SPOI or an outside developer wouldneed to investigate this issue further. The investigation would need to consider allimpacts, positive and negative, that the power facility modifications would have on theprocessing operations.January 5, 2001 10-13 Final Report

FacilityGeneral Facility InformationTable 10-2Summary Results of Proposed New Power FacilitiesSommaiSananMuangThitipornThanyaPlanCreationsFacility type Rice mill Rice mill Rice mill Wood productsProvinceRoi EtKamphaengPhetNakorn SawanTrangFacility annual capacity, tonne/yr 429,000 a 60,000 120,000 10,000Fuel InformationFacility residue type (solid fuels) Rice husk Rice husk Rice husk Wood wasteRatio of residue to capacity 0.23 0.23 0.23 0.40Facility residue, tonne/yr 98,670 13,800 27,600 4,000Reserved residue for mill, tonne/yr 0 0 0 0Additional residue purchased, tonne/yr 0 65,200 51,400 130,000Total residue available, tonne/yr 86,900 b 79,000 79,000 134,000Composite heating value (HHV), kJ/kg 14,100 14,100 14,100 10,300Annual heat input available, GJ/yr 1,225,868 1,113,900 1,113,900 1,380,200Power Plant CharacteristicsEstimated plant capacity factor, percent 85 85 85 85Boiler efficiency, percent 82 82 82 73Gross turbine heat rate, kJ/kWh 13,500 13,500 13,500 13,500Auxiliary power, percent 12 12 12 12Calculated net plant heat rate, kJ/kWh 18,708 18,708 18,708 21,015Cogeneration? Steam flow, tonne/hr No No No NoPower PotentialCalculated solid fuel burn rate, tonne/hr 11.7 10.6 10.6 18.0Calculated total fuel burn rate, GJ/hr 164.6 149.5 149.5 184.9Calculated gross plant capacity, kW 10,000 9,100 9,100 10,000Calculated net plant capacity, kW 8,800 8,000 8,000 8,800Average internal process use, kW 0 0 0 0"Firm" capacity for sale to grid, kW 8,800 8,000 8,000 8,800Annual energy sales to grid, GWh 65.5 59.6 59.6 65.5Economic AspectsEstimated total project cost, US$ mil c 9.71 9.27 9.27 10.59Estimated total project cost, US$/kW netc1,100 1,160 1,160 1,200Internal rate of return (IRR), percent c 32.6 25.5 26.4 7.95IRR for “European equipment,” percent 24.6 19.2 20.0 5.1Notes:a After proposed facility expansion.b Fuel supply limited to keep plant size at 10 MW gross.c Costs based on use of Chinese equipment.January 5, 2001 10-14 Final Report

FacilityGeneral Facility InformationTable 10-3Summary Results of Proposed Facility ModificationsChumporn Palm OilIndustryKarnchanaburi SugarIndustryFacility type Palm oil mill Sugar millProvince Chumporn Uthai ThaniFacility annual capacity, tonne/yr 270,000 a 1,000,000Fuel InformationFacility residue type (solid fuels)Oil palm fiber, shell, emptyfruit bunchesBagasseRatio of residue to capacity 0.33 0.25Facility residue, tonne/yr 89,100 250,000Reserved residue for mill, tonne/yr 0 229,166Additional residue purchased: quantity,tonne/yrPalm shell and coconut husk:22,760Corncobs: 13,382Total residue available, tonne/yr 111,860 34,216Composite heating value (HHV), kJ/kg 12,765 11,895Annual heat input available, GJ/yr 1,564,000 b 406,980Power Plant CharacteristicsEstimated plant capacity factor, percent 82 53.2Boiler efficiency, percent 70 c 72-80 cAuxiliary power, percent 16.1 c 8 cAverage net plant heat rate, kJ/kWh 49,500 c 47,205 c dCogeneration? Steam flow, tonne/hr Yes, 31.85 NoPower PotentialAverage solid fuel burn rate, tonne/hr 15.5 7.3Average total fuel burn rate, GJ/hr 217.1 87.3Average gross plant output, kW 5,400 2,000Average net plant output, kW 4,550 e 1,850Average internal process use, kW 2,030 f 0"Firm" capacity for sale to grid, kW 2,520 1,850Annual energy sales to grid, GWh 18.1 8.62Economic AspectsEstimated total project cost, US$ mil 5.0 1.95Estimated total project cost, US$/kW net 1,887 (per additional net kW) 1,054Internal rate of return (IRR), percent 20.4 18.9IRR at exchange rate of 43.5 Baht/US$ 15.78 15.94IRR at 20 percent reduced capital cost 29.41 26.68IRR for alternative study (see writeup) 39-69 27.5Notes:a After proposed facility expansion.b Includes biogas use of 6,000,000 m 3 /yr (136,000 GJ/yr).c Based on existing power facility performance information considering proposed modifications.d Includes credit for surplus power generated by the existing facility during the on-season.e Previous: approximately 1,900 kW average.f Electricity required for milling operations.January 5, 2001 10-15 Final Report

FacilityGeneral Facility InformationTable 10-4Summary Results of Proposed New Power FacilitiesWoodworkCreationMitr KalasinSugar MillLiang HongChai Rice MillSouthern PalmOil IndustryFacility type Wood prod. Sugar mill Rice mill Palm oil millProvince Krabi Kalasin Khon Kaen Surat ThaniFacility annual capacity, tonne/yr 80,640 a 1,360,000 150,000 350,000 aFuel InformationFacility residue type (solid fuels)WoodwasteBagasseRice huskOil palm fiber,shellRatio of residue to capacity 0.50 0.27 0.22-0.23 0.21Facility residue, tonne/yr 40,320 369,000 33,000 73,500Reserved residue for mill, tonne/yr 8,640 293,000 0 0Additional residue purchased, tonne/yr 22,320 0 0 0Total residue available, tonne/yr 54,000 76,000 33,000 73,500Composite heating value (HHV), kJ/kg 9,450 9,540 14,100 13,500Annual heat input available, GJ/yr 510,300 725,040 465,300 1,072,932 bPower Plant CharacteristicsEstimated plant capacity factor, percent 85 85 85 90.4Boiler efficiency, percent 70 77 82 77Gross turbine heat rate, kJ/kWh 13,500 12,400 13,500 14,680 dAuxiliary power, percent 12 8 c 12 12Calculated net plant heat rate, kJ/kWh 21,900 17,400 18,700 21,700 dCogeneration? Steam flow, tonne/hr No No No Yes, 13.9 dPower PotentialCalculated solid fuel burn rate, tonne/hr 7.3 10.2 4.4 9.3 dCalculated total fuel burn rate, GJ/hr 68.5 97.4 62.5 135.5 dCalculated gross plant capacity, kW 3,550 6,100 3,800 7,000Calculated net plant capacity, kW 3,100 5,600 3,300 6,200Average internal process use, kW 0 0 0 834 d e"Firm" capacity for sale to grid, kW 3,100 5,600 3,300 5,366 dAnnual energy sales to grid, GWh 23 42 25 42.5Economic AspectsEstimated total project cost, US$ mil 8.65 13.4 9.73 14.6Estimated total project cost, US$/kW net 2,800 2,400 2,950 2,350Internal rate of return (IRR), percent 4.4 13.3 7.6 11.6IRR at exchange rate of 43.5 Baht/US$ 2.1 9.8 5.1 8.4IRR at 20 percent reduced capital cost 8.5 20.1 12.6 17.9IRR for alternative study (see writeup) 25 46 13-29 13-25Notes:a After proposed facility expansion.b Includes biogas use of 3,570,000 m 3 /yr (80,682 GJ/yr).c Based on existing power facility performance information.d Average value. SPOI requires varying amounts of process steam depending on the season.e Electricity required for milling operations.January 5, 2001 10-16 Final Report

11.0 Presentation of Study Results to Facility Owners (Task 3.1and Task 3.2)Before signing MOUs, the facility owners were informed of the merits of usingbiomass as fuel for power generation and cogeneration projects including details of thesale of excess power to EGAT under the SPP program. All of the facility owners wereinterested in the potential project benefits and hence signed the MOUs.Follow-on presentations were made to facilities for which the study results werepositive in order to assist them with project implementation. The following sectionsdescribe the presentation of study results made to each of the facility owners.11.1 Sommai Rice Mill Co., Ltd.Among the rice mill facilities studied, Sommai is the largest with a millingcapacity of about 1,000 tonnes of paddy per day. The facility aggregately produces about87,000 tonnes of rice husk per year. It was determined that Sommai can install up to a 10MW (gross) plant with an investment of US$11.4 million. The financial return on thisinvestment (Internal Rate of Return, IRR) is very favorable at about 33 percent. Otherdetails of the Sommai facility are shown in Table 11-1.Table 11-1Summary Results Sommai Rice Mill FacilityItemResultGross plant capacity, MW 10Net plant capacity, MW 8.8Investment, $US million 11.424Fuel typeRice HuskFuel consumption, tonnes/yr 87,000Total fuel cost, Baht/tonne 100Operating hours per year 7446Revenue from EGAT, million Baht/yr 114Internal rate of return, percent 33Source of fuel supply, tonnes/yrSommai Rice Mill 87,000The study team went to present the study results to Mr. Sommai in September1998 in Roi Et. Mr. Sommai had expressed interest in pursuing project developmentfurther. In the meanwhile, EGCO (Electricity Generating Plc.) was interested indeveloping a project of this kind. The study team met to present details of the study toEGCO. Furthermore, the team made arrangements and escorted the EGCO projectdevelopment team several times to meet and discuss possible joint venture developmentJanuary 5, 2001 11-1 Final Report

with Sommai in Roi Et. At present, EGCO has obtained funding support for projectdevelopment from OECF of Japan. The development of this facility is proceeding well asa joint venture with Sommai, and has reached the step at which a contractor is beingselected to provide engineering, procurement, and construction (EPC) services.11.2 Sanan Muang Rice Mill Co., Ltd.Sanan Muang Rice Mill, with a rice husk supply of 13,800 tonne/yr, is smallerthan Sommai and requires additional rice husk from the surrounding area to make a newpower development viable. Three cases were studied (for details see Table 11-2). Thesecases vary in plant generating capacity depending on the quantity of rice husk supply.Case 1 is a study of a power facility with a capacity of 9.1 MW (gross) supplied by thefacility’s own rice husk and supplemental husk from other rice mills within a 25 kmradius. This case yielded an IRR of 25.5 percent, which is greater than the hurdle rate of23 percent. Case 2 used rice husk produced from three nearby facilities and resulted in a5.6 MW generating capacity. Case 3 used only the husk available at Sanan Muang andresulted in a 1.8 MW generating capacity. Due to economies of scale, Case 2 and 3 donot have attractive IRRs: 13.70 and 0.54 percent, respectively.Table 11-2Summary Results Sanan Muang Rice Mill FacilityItem Case 1 Case 2 Case 3Gross plant capacity, MW 9.0 5.6 1.8Net plant capacity, MW 8.0 5.0 1.6Investment, $US million 10.952 9.640 4.931Fuel type Rice Husk Rice Husk Rice HuskFuel consumption, tonnes/yr 79,000 50,000 13,800Total fuel cost, Baht/tonne 100-250 100-200 100Operating hours per year 7,446 7,446 7,446Revenue from EGAT, million Baht/yr 100 64 20Internal rate of return, percent 25.52 13.70 0.54Source of fuel supply, tonnes/yrSanan Muang Rice Mill 13,800 13,800 13,800Kanutanjakij Rice Mill 16,560 16,560Nitinun Supakij # 1 Rice Mill 11,040 11,040Nitinun Supakij # 2 Rice Mill 8,832 8,832Supachai Rice Mill 22,080Sawangtavorn Rice Mill 6,624Since the IRR of Case 1 is greater than the hurdle rate of 23 percent, the studyteam presented the results of Case 1 to the facility owner, Mr. Sanan. Mr. Sananexpressed interest in further project development through a joint venture with anotherJanuary 5, 2001 11-2 Final Report

interested investor. Mr. Sanan did not express much concern about the long term supplyavailability of rice husk from the other facilities in the area.11.3 Thitiporn Thanya Rice Mill Co., Ltd.Thitiporn Thanya Rice Mill, with a rice husk supply of 27,600 tonne/yr, is smallerthan Sommai and requires additional rice husk from the surrounding area to make a newpower development viable. Three cases were studied (for details see Table 11-3). Thesecases vary in plant generating capacity depending on the quantity of rice husk supply.Case 1 is a study of a power facility with a capacity of about 9.1 MW (gross) supplied bythe facility’s own rice husk and supplemental husk from all other rice mills within a25 km radius. This case yielded an IRR of 26.4 percent, which is greater then the hurdlerate of 23 percent. Case 2 used rice husk produced from three nearby facilities andresulted in a 5.6 MW generating capacity. Case 3 used only the husk available atThitiporn Thanya and resulted in a 3.2 MW generating capacity. Due to economies ofscale, Case 2 and 3 do not have attractive IRRs: 14.6 and 7.23 percent, respectively.Table 11-3Summary Results Thitiporn Thanya Rice Mill FacilityItem Case 1 Case 2 Case 3Gross plant capacity, MW 9.0 5.6 3.2Net plant capacity, MW 8.0 5.0 2.8Investment, $US million 10.947 9.680 7.476Fuel type Rice Husk Rice Husk Rice HuskFuel consumption, tonnes/yr 79,000 50,000 27,600Total fuel cost, Baht/tonne 100-250 100-250 100Operating hours per year 7,446 7,446 7,446Revenue from EGAT, million Baht/yr 100 64 36Internal rate of return, percent 26.42 14.55 7.23Source of fuel supply, tonnes/yrThitiporn Thanya Rice Mill 27,600 27,600 27,600Ruengthai Rice Mill 3,312 3,312Wangbau Rice Mill 11,040 11,040Amnaouypol Rice Mill 8,280 8,280Hnongyao Rice Mill 3,312Hnongben Rice Mill 3,312Hwangdee Rice Mill 13,800Charoenkij Rice Mill 8,280The study team presented the study results of Case 1 to the facility owner. Theowner expressed interest in further project development, but noted that his facility wouldhave to depend on rice husk from other facilities in the area in order to become a viableJanuary 5, 2001 11-3 Final Report

project for development. He was very concerned about receiving a guarantee of longterm rice husk availability from other sources. This concern highlights the importance oflong term supply contracts for biomass in development of biomass based powergeneration.11.4 Plan Creations Co., Ltd.In initial analyses, the feasibility of a new power development at the PlanCreations site was not found viable, yielding an IRR of 7.95 percent (for details see Table10-4). The results were unfavorable due to high investment cost relative to the plant sizeunder study (i.e., economies of scale) and expensive fuel costs. The latter includesopportunity, collection, transportation, and wood chipping costs.Black & Veatch investigated alternate scenarios in attempt to improve the projecteconomics. If a larger facility could be built, the project may be more viable. Black &Veatch investigated the economics at plant sizes of 18 and 28 MW and found that the IRRwould increase to 28.6 and 38.5, respectively (see Table 11-4). The owner was presentedthese new results but is interested in implementation of a small (about 2 MW) system atthe site. At present, the owner is soliciting project price information from a vendor.Table 11-4Summary Results Plan Creations FacilityTable Header Result Option 1 Option 2Gross plant capacity, MW 10 20.9 31.7Net plant capacity, MW 8.8 18.4 27.9Investment, US$ million 12.6 19.1 26.7Fuel type Wood Waste Wood Waste Wood WasteFuel consumption, tonne/yr 134,000 254,000 374,000Total fuel costs, Baht/tonne 200-450 35-350 35-350Operating hours per year 7,446 7,446 7,446Revenue from EGAT, million 114 238 360Baht/yrInternal rate of return, percent 7.95 28.6 38.5Source of fuel supply:Internal: Wood res., tonnes/yr 4,000 4,000 4,000External: Bark, tonne/yr 14,000 14,000 14,000Small log, tonne/yr 116,000 236,000 356,00011.5 Chumporn Palm Oil Industry Plc.Several modifications were proposed for the Chumporn Palm Oil Industry Plc.(CPOI) to improve the efficiency and increase power output of the existing power plant.The final configuration selected includes the following modifications:January 5, 2001 11-4 Final Report

• Combustion of additional fuel to fully utilize existing boiler and turbinegenerator capacity.• Addition of a low pressure condensing turbine to generate power from theexhaust of the existing back pressure steam turbine.• Recovery of turbine and process exhaust steam through a condenser withcooling tower.• Improvement of the makeup water treatment system by addition of a reverseosmosis system.Table 11-5 presents a summary of the study results. With the selectedmodifications, the average gross plant output would be 5.4 MW, or an increase of about3.0 MW over the existing plant output. Under this configuration, CPOI would be able tosell about 2.5 MW of power to EGAT on a “firm” basis.The proposed development would yield a base case IRR of 20.4 percent with anestimated total project cost of about US$5.8 million. The base case IRR is slightly lowerthan the hurdle rate of 23 percent. However, optimistic sensitivity analyses result in IRRsthat are higher than the hurdle rate.The study team presented and discussed the study results Mr. Suriya, who is theassistant managing director of the palm oil mill. In general, Mr. Suriya agreed with thestudy results but raised a concern on the fluctuating prices of biomass. He pointed outthat the price of oil palm shell has increased from 150 to 400 Baht/tonne since last year.Additionally, he noted that there might also be a price increase in coconut husk, whichwas considered as an inexpensive supplemental fuel in the feasibility study. The studyteam explained the sensitivity analysis and suggested to estimate the results of a fuel priceincrease through a pro forma model. Mr. Suriya was to look into the details of the studyreport and discuss with the facility owner.It should be noted that the facility would like to expand their processingcapabilities in the near future. This will likely require some sort of upgrade to the millpower and steam systems similar to that proposed for this study.January 5, 2001 11-5 Final Report

Table 11-5Summary Results Chumporn Palm Oil FacilityItemResultGross plant capacity, MW 5.40Net plant capacity, MW 4.55Net sold to grid, MW 2.52Investment, US$ million 5.767Fuel typeOil palm waste, biogas, and coconut huskTotal fuel cost, Baht/tonne 0-150Operating hours per year 7,200Revenue from EGAT, million Baht/yr 34Internal rate of return, percent 20.4Source of fuel supply:Internal: Shell, tonne/yr 18,900Fibre, tonne/yr 32,400Empty bunch, tonne/yr 37,800Biogas, cu.m/yr 6,000,000External: Shell, tonne/yr 18,000Coconut husk, tonne/yr 4,76011.6 Karnchanaburi Sugar Industry Co., Ltd.Four options for developing the Karnchanaburi Sugar Industry were proposed:1. Use existing excess boiler and turbine capacity to generate additional power forexport on-season, non-firm basis.2. Add condensing capacity so that a boiler and turbine set can generate additionalpower for export on and off-season, firm basis.3. Add new high-pressure boiler and turbo-generator equipment, using surplusbagasse for power production year round, firm basis.4. Develop an entirely new core cogeneration plant utilizing high efficiency boilersand turbines for power production year round, firm basis.However, with the owner’s concern of limited capital investment, only twopossible options (options 1 and 2) were left. Option 1, which involves selling excesspower to EGAT on a non-firm basis, is a popular option among the sugar mill facilities.This option, however, does not fit the purpose of this study, which is to sell excess poweron a firm basis. Option 2 involves adding condensing capacity to generate additionaloutput for sale to EGAT on a firm basis during the on and off-season. Under this option,a secondary fuel, corncob, would be required to supplement the bagasse supply.The results of study are summarized in Table 11-6. The IRR was found to be18.9 percent with an estimated total project cost of US$2.37 million. Additional analysisJanuary 5, 2001 11-6 Final Report

found that increases in sugar milling efficiency would allow enough bagasse to beproduced so that combustion of supplemental corncob fuel would not be required. TheIRR under this scenario increases significantly to 27.5. Study results were presented tothe facility owner who is interested and agreed to further development.Table 11-6Summary Results Karnchanaburi Sugar Industry FacilityItem Original Option 2 Increased EfficiencyGross plant capacity, MW 2.0 2.0Net plant capacity, MW 1.85 1.85Investment, US$ million 2.371 2.371Fuel type Bagasse, corncob BagasseFuel consumption, tonne/yr 34,216 43,333Total fuel cost, Baht/tonne 50-275 50Operating hours per year 4,660 4,660Revenue from EGAT, million Baht/yr 20 20Internal rate of return, percent 18.9 27.51Source of fuel supply:Internal: Bagasse, tonne/yr 20,833 43,333External: Corncob, tonne/yr 13,382 –11.7 Woodwork Creation Co., Ltd.In initial investigations, the feasibility of a new power development at theWoodwork Creations Co. Ltd. site was not found attractive, yielding a low IRR of 4.22percent (see Table 11-7). Similar to the Plan Creations site, the factors contributing to theunattractive results were: limited fuel supply and power facility size, high investment costrelative to the plant size, and relatively expensive fuel costs.Black & Veatch investigated alternate scenarios in attempt to improve the projecteconomics. If a larger facility could be built, the project may be more viable. Black &Veatch investigated the economics at a plant size of 30 MW and found that the IRRwould increase to 24.7.January 5, 2001 11-7 Final Report

Table 11-7Summary Results Woodwork Creation FacilityItem Original Analysis Larger FacilityGross plant capacity, MW 3.55 34.0Net plant capacity, MW 3.10 30.0Investment, US$ million 10.235 31.8Fuel type Wood waste Wood WasteFuel consumption, tonne/yr 54,000 354,000Total fuel cost, Baht/tonne 35-250 35-350Operating hours per year 7,446 7,446Revenue from EGAT, million Baht/yr 43.6 419Internal rate of return, percent 4.4 24.7Source of fuel supply:Internal: Bark, tonne/yr 15,552 15,552Sawdust, tonne/yr 6,048 6,048Chip and discards, tonne/yr 10,080 10,080External: Bark, tonne/yr 11,520 11,520Small log, tonne/yr 10,800 310,80011.8 Mitr Kalasin Sugar Co., Ltd.Similar to the feasibility study of the Karnchanaburi Sugar Mill, four options wereproposed for developing the Mitr Kalasin Sugar Co., Ltd.:1. Use existing excess boiler and turbine capacity to generate additional power forexport on-season, non-firm basis.2. Add condensing capacity so that a boiler and turbine set can generate additionalpower for export on and off-season, firm basis.3. Add new high-pressure boiler and turbo-generator equipment, using surplusbagasse for power production year round, firm basis.4. Develop an entirely new core cogeneration plant utilizing high efficiency boilersand turbines for power production year round, firm basis.Option 1 was not considered because of the non-firm export of power to EGAT.Option 4, which involves developing an entirely new central power plant, wasdisregarded because the existing cogeneration facility is just relocated and does not needto be replaced. The remaining two options were analyzed in more detail and the studyresults are summarized in Table 11-8. Option 2 involves adding condensing capacity sothat a boiler and turbine set can generate 3.2 MW gross power for export on and offseasonon a firm basis. This option was estimated to cost US$2.6 million. Due to timeand budget constraints, this option was only briefly researched. With a new high pressureboiler and turbine generator, option 3 could generate 6.1 MW gross power but at a largerJanuary 5, 2001 11-8 Final Report

investment of US$15.6 million. Option 2 yielded an IRR of 46 percent compared to13.3 percent for option 3.The study team presented these results to representatives (coordinators) of thefacility owner. In general, they agree with the option alternatives and the results of study.They intended to forward the study report to the facility for review and consideration ofimplementation.Table 11-8Summary Results Mitr Kalasin Sugar FacilityItem Option 2 Option 3Gross plant capacity, MW 3.2 6.1Net plant capacity, MW 2.96 5.6Investment, US$ million 2.60 15.645Fuel type Bagasse BagasseFuel consumption, tonne/yr 76,000 76,000Total fuel cost, Baht/tonne 0 0Operating hours per year 6,220 7,446Revenue from EGAT, million Baht/yr 34.3 77.7Internal rate of return, percent 46 13.311.9 Liang Hong Chai Rice Mill Co., Ltd.The initial feasibility study of building a new power facility at the Liang HongChai Rice Mill Co., Ltd. yielded an IRR of 7.6 percent, which is much lower than thehurdle rate of 23 percent. The low IRR was due to the high investment cost relative to theplant size being studied. The latter was limited by the availability of rice husk, which wasobtained only from the two Liang Hong Chai facilities. For the base case analysis, noother sources of fuel supply were identified in the vicinity of the proposed site. However,the study team did perform an alternative analysis of a larger size plant supplementedwith rice husk from the Nakorn Ratchasima province. The results of this study arefavorable (see Table 11-9) and indicate that a rice husk based power plant locatedsomewhere in the area, if not at Liang Hong Chai site, might be feasible.A summary of study results is presented in Table 10-9. The owner of the facilitywas informed of the study results and was given a copy of the report.January 5, 2001 11-9 Final Report

Table 11-9Summary Results Liang Hong Chai FacilityItem Original Option 1 Option 2Gross plant capacity, MW 3.8 9.5 15.2Net plant capacity, MW 3.3 8.4 13.4Investment, US$ million 11.480 15.0 20.8Fuel type Rice husk Rice husk Rice huskFuel consumption, tonne/yr 33,000 83,000 133,000Total fuel cost, Baht/tonne 0 0-350 0-350Operating hours per year 7,446 7,446 7,446Revenue from EGAT, million Baht/yr 45.7 116.3 185.6Internal rate of return, percent 7.6 24.88 29.24Source of fuel supply:New rice mill: Rice husk, tonne/yr 16,500 16,500 16,500Old rice mill: Rice husk, tonne/yr 16,500 16,500 16,500Nakon Ratchasima rice husks, tonne/yr – 50,000 100,00011.10 Southern Palm Oil Industry (1993) Co., Ltd.The feasibility study of building a new power facility at the Southern Palm OilIndustry (1993) Co., Ltd. yielded a low IRR of 11.6 percent as shown in Table 10-10.The low IRR is due to high investment cost relative to the plant size studied. The plantsize was restricted by the facility owner’s request of using the fuel supply of the facilityonly and by not considering empty fruit bunch as a potential fuel. The proposed plantgenerating capacity could be increased by procuring additional fuel sources from anotherpalm oil facility owned by the company and from other facilities in the area. At largersizes, the plant would likely have more favorable economics, as could be determined bypreliminary further study (see Section 9.3.10 and Table 11-10). The study team discussedthe study results with the owner of facility and a copy of the report was provided.It should be noted that the facility would like to expand their processingcapabilities in the near future. This will likely require some sort of upgrade to the millpower and steam systems similar to the configuration proposed for this study.January 5, 2001 11-10 Final Report

Table 11-10Summary Results Southern Palm Oil FacilityItem Original Study Larger FacilityGross plant capacity, MW 7.0 33.0Net plant capacity, MW 6.2 29.1Net sold to grid, MW 5.4 28.3Investment, US$ million 16.9 46.6Fuel typeFiber, shell, andbiogasFiber, shell, emptybunch, biogas, and othersTotal fuel cost, Baht/tonne 0-200 0-200Operating hours per year 7,919 7,919Revenue from EGAT, million Baht/year 77 403.5Internal rate of return, percent 11.6 25Source of fuel supply (increase overcurrent needs):Fiber, tonne/yr 38,500 64,500Shell, tonne/yr 20,000 30,000Biogas, cu.m./yr 3,570,000 3,570,000Other residues, tonne/yr 250,000January 5, 2001 11-11 Final Report

12.0 SPP Program Regulations ReviewThis section provides a review of the regulations for the Small Power Producers(SPP) program. The SPP program was initiated by the National Energy Policy Counciland implemented by the Electricity Generating Authority of Thailand (EGAT),Metropolitan Electricity Authority (MEA), and Provincial Electricity Authority (PEA).The objectives of the SPP program are to encourage the participation of SPPs inelectricity generation, promote the use of domestic and renewable energy sources,promote higher efficiency use of primary energy, and reduce the financial burden ofgovernment investment in the electricity supply industry. The national and externalbenefits of the SPP program include the conservation of fossil fuels, reduced fuel imports,conservation of foreign hard currency, and distributed generation benefits. The intent ofthe program is to realize these external benefits, yet result in a direct cost to ratepayersthat is no higher than the alternative of supplying electricity without SPP projects.Small rural industries engaged in power production from biomass may sell theirexcess energy generation back to the electrical grid through the SPP program. However,as of October 1999, only 6.8 percent of the total SPP capacity connected to the EGATsystem (1,491 MW) involved waste or renewable resources. 10 The large majority of thetotal capacity is natural gas based cogeneration. In the view of Black & Veatch, there areseveral reasons why this is the case, and these will be discussed in this section. First,however, an overview of the current SPP regulations and status of the program are given.12.1 SPP Program Regulations OverviewThe SPP program was initiated by the National Energy Policy Council andimplemented by the Electricity Generating Authority of Thailand (EGAT), MetropolitanElectricity Authority (MEA), and Provincial Electricity Authority (PEA). This sectiondiscusses the SPP program and regulations.12.1.1 Basis for the SPP ProgramThe SPP Program was initiated based on the conclusions of the National EnergyPolicy Council that:“generation from non-conventional energy, waste or residual fuels andcogeneration increases efficiency in the use of primary energy and by-productenergy sources and helps to reduce the financial burden of the public sector withrespect to investment in electricity generation and distribution.”10 Arthur Anderson, “Thailand Power Pool and Electricity Supply Industry Reform Study - Phase I FinalReport,” Volume 5, March 1, 2000.January 5, 2001 12-1 Final Report

The national and external benefits of the SPP program include the conservation offossil fuels, reduced fuel imports, conservation of foreign hard currency, and distributedgeneration benefits. The intent of the program is to realize these external benefits, yetresult in a direct cost to ratepayers that is no higher than the alternative of supplyingelectricity without SPP projects.12.1.2 Least Cost Planning and the SPP RegulationsEGAT’s planning objective is to provide safe, adequate and reliable powersupplies to consumers in the least cost manner. The least cost provision means that whenthe utility develops its system expansion plan, it plans to add capacity resources that willminimize the cumulative present worth of incremental system costs (CPWC) toratepayers. Incremental system costs consist of fuel and operating costs, plus incrementalfixed costs associated with capital investments. EGAT periodically updates its least costsystem expansion plan, the current plan is its 1997 Power Development Plan, issued inDecember, 1997.Should a biomass or other renewable generation alternative be able to displace apart of the incremental capacity and energy in the least cost expansion plan and notincrease the incremental cost of serving load once payments to the biomass facility areconsidered, then the plan including the biomass facilities would be preferred. This isbecause ratepayers would be no worse off in that their direct costs are no higher than theidentified least cost plan, yet the nation would realize the additional benefits inherent in arenewable plant. This, in essence, is the logic behind the SPP program. It encouragesbiomass and renewable technologies if they are viable at the utility’s avoided cost.Avoided cost is the cost that the utility would have incurred had it not been for thepurchase of capacity and energy from the (SPP) facility.12.1.3 SPP Regulations12.1.3.1 Definition of an SPP. Under the Regulations for the Purchase of Powerfrom Small Power Producers, an SPP must utilize one of the following as fuel or primemover:• Non-conventional energy such as wind, solar, or mini-hydro.• Waste or residues from agricultural or industrial processes.• Garbage or dendrothermal sources for fuel.• Any fuel used for cogeneration provided that certain efficiency standards aremet.Non-cogeneration use of petroleum, natural gas, coal and nuclear fuels arespecifically excluded except if the thermal energy produced by these fuels issupplementary and does not exceed 25 percent of the total thermal energy used inelectricity generation each year.January 5, 2001 12-2 Final Report

12.1.3.2 Conditions for Purchase. The SPP Regulations establish the followingconditions for purchases from SPPs:• EGAT will be the sole purchaser of electricity.• The total capacity supplied by any SPP shall not exceed 60 MW at theconnection point (90 MW in certain locations).• The SPP must obtain and provide a copy of all required permits within18 months of the SPP contract and before delivery can begin.• The utility will operate the SPP’s protective system and is able to makedecisions related to system safety. The utility can also require the SPP toinspect and improve its distribution equipment if it may affect the utility’ssystem.• A performance bond is required on the contract signing date, equal to5 percent of the present value of the total receivable capacity payments. SPPsreceiving capacity payments must also deposit security against earlytermination equal to 10 percent of the capacity payment to be received in thefirst 5 years of the contract.• SPPs are responsible for the plant interconnection costs and equipmentinspections.12.1.3.3 SPP Payments. Payments to the SPP can consist of an energy-onlypayment for electricity (kWh) delivered or may include an energy and capacity payment.No capacity payments are made for contracts with a term of less than 5 years. For termsof 5 to 25 years, capacity payments are equal to EGAT’s long-run avoided cost during thecontracted term.For SPPs receiving capacity payments, the energy payment is set equal to EGAT’slong-run avoided energy cost resulting from the SPP purchase. For other SPPs, energypayments equal EGAT’s short-run avoided energy cost resulting from the purchase.Energy payments are based on time of day rates for peak, partial peak and off-peak hours.The regulations also include a minimum take liability on behalf of EGAT, whichguarantees the purchase of power from an SPP of at least 80 percent of the SPP’savailability. If this amount is not met, it can be made up the following year or else EGATwill pay the SPP an energy payment for energy not taken.12.1.3.4 SPP Maintenance and Availability. To receive capacity payments, SPPsmust provide electricity during the months of March through June, and in September andOctober, and electricity must be supplied not less than 7,008 hours per year. For biomassand garbage-burning facilities, the annual hours must be at least 4,672 hours per year andsupply must occur from March through June. A monthly capacity factor of not less than51 percent is also a condition, with payments for the month reduced if this condition isnot met. SPPs shall be able to reduce power supply during the utility off-peak demandJanuary 5, 2001 12-3 Final Report

period to no less than 65 percent of the contracted capacity (40 percent in the eastern gulfprovinces until 2001). In case of notification of need, the facility must be able to generatewith at least 30 minutes advanced notification.The quality of electricity must also generally conform to the utility’ssynchronization requirements. The SPP regulations also include a number of restrictionson maintenance. Major overhauls must be approved by EGAT and scheduled at least6 months in advance and must occur during the off-peak period. Also, the total period ofshut-down for maintenance is limited to 35 days in a 12-month period, although a carryforward of 45 days is allowed from previous periods.12.1.3.5 Failure to Perform. Should the SPP be unable to supply at a monthlycapacity factor of at least 51 percent, capacity payments will be reduced by 50 percentduring the month. The capacity payment may also be reduced should the annualminimum hours of supply not be achieved. Should the SPP be unable to provide output atthe level in the contract, the SPP will be provided 18 months in which to rectify thesituation, thereafter, the contracted capacity will be adjusted to reflect the facilitycapability. Deductions in the capacity payment may also occur should the SPP not beable to respond to dispatch instructions within the allotted time period.In the event that the SPP wishes to reduce its contracted capacity after at least halfthe term has expired, it may do so provided adequate notice (between 1 and 3 yearsdepending on the reduction of capacity) is given.Should the SPP terminate the contract before the end of the term, the utility shallrecall the capacity payment equal to the difference between the capacity payment alreadyreceived and the capacity payment corresponding to the effective term, plus an additionalpenalty of up to 10 percent if terminated within 5 years of the start of the contract.12.1.3.6 SPP Application Procedure and Evaluation Criteria. Candidate SPPsmust submit a proposal (to the Head Office of EGAT) and be approved into the SPPprogram. The application shall include the following:• Evidence of Certificate of Incorporation as a juristic entity and theMemorandum of Association of such juristic entity.• A layout drawing showing the location of the power plant.• Installation site of the generator.• Description of the electricity generation process.• The proportional amount of thermal energy used in electricity productionwith respect to the total amount of energy used in the total thermal process.• Details of the generator(s), Name Plate Ratings and their specifications.• The Single Line Diagram and the Metering and Relaying Diagram forinterconnection to the Power Utility (PU) system.January 5, 2001 12-4 Final Report

• The electrical capacity and energy to be supplied to the PU system at theconnection point, together with the SPP’s plan for electricity generation andconsumption as well as power consumption of other nearby juristic entitiesusing power generated by the SPP.• The contracted period during which the SPP shall generate and supplyelectricity to the PU system.• The quantity of backup power required by the SPP from the PU.• The number of staff involved with operation of the generating systemtogether with details on their qualifications and their professional engineeringlicenses.• The fuel consumption per year and the average lower heating value of the fuelused in electricity production and cogeneration.The evaluation criteria used by EGAT to evaluate the application shall include thefollowing, and applications should contain this additional information to facilitate theevaluation:• Appropriateness of Project− Appropriateness of the project with respect to technical and engineeringaspects.− Experience of the SPP (the Bidder), partners, and parent companies.− Financial status and availability of income sources of the project, includingelectricity customers and steam customers.• Availability and Appropriateness of Fuels− Reliability of fuel procurement.− Suitability of fuel reservation and fuel transportation.• Appropriateness of Site Location− Appropriateness of the project site location as regards the security of thepower system and the interconnection to the PU system.− Environmental impact and the local public consent, including identifiablebenefits resulting from the project.• Appropriateness of Other Aspects− Date to commence purchasing electricity, which will be based onprecedence in time.− Modifications of the model Electricity Purchase/Sales Contract.• Technical Information− The proportional amount of thermal energy to be used in thermal processesother than electricity generation in relation to the total energy production.− The proportional amount of the sum of the electricity produced and onehalf of thermal energy to be used in thermal processes in relation to theenergy from petroleum and/or natural gas (based on lower heating value).January 5, 2001 12-5 Final Report

− Details of the power plant design and construction. For example: bywhich company is the power plant designed, and has there ever been anyconstruction resembling the proposed one before?− Schedules of the design period, the equipment delivery, the construction,and the operation startup.− The date to commence electricity purchasing, which will be part of theElectricity Purchase/Sales Contract execution.− Heat Balance Diagram.• Information on Location− Whether the SPP (the bidder) is the owner of the land where the powerplant construction will be located or the land is to be rented or furnished byother means.− Whether the land is in the area where water resources, fuels, and labor aswell as other construction and power generating facilities can be easilysupplied.− Location of the power plant is in relation to power and steam customers,and to the PU connection point. A layout drawing detailing location anddistance from the power plant should be attached.− Feasibility for future expansion of power generating capacity and plan ofthe expansion if the SPP has developed it.− Public relations plans to make known the power plant construction to thepublic in the project locality; if the bidder has prior experience in publicrelations work, details of the implementation and results accomplishedshould be submitted.• Requests for Authorization− Present evidence certifying that requests for authorization to the concernedauthorities have been made for the construction of the generation facility,and for the generation and supply of electricity, including a study ofenvironmental impact.− Indicate the period of time during which authorization for construction ofthe facility, and for generation and supply of electricity, is expected to begranted.• Finance and Income− Provide financial statements, (e.g., income statement, balance sheet andcash flow, including at least three previous annual reports of the bidderand partners). If the documents cannot be provided, reasons must be givenand other evidence of financial status must be provided so as to enable theevaluation of the bidder’s financial status and actual ability to operate theproject.January 5, 2001 12-6 Final Report

− Illustrate the project financing plan.− Provide evidence of the project sponsor’s intention to offer a loan to theproject.− Provide the name list of electricity and steam users, together with thepurchase amount of electricity and steam.• Main Fuel and Procurement of Supplementary Fuels− Provide evidence of fuel procurement, period of securing the fuels,transportation, transportation routes, and fuel storage.− Plan for the use of supplementary fuels instead of main fuels, includingdetails of such supplementary fuels procurement.− Specifications of main fuels and supplementary fuels (e.g., gross calorificvalue, ash, and sulfur content in the case of coal).− Fuel properties which have impact on the environment and proposedalleviation measures.• Byproducts and Waste from the Power Plant− Illustrate qualities and characteristics of waste created by the power plant,and the disposal plan.− If byproducts from the power plant can be of use, what is the use, to whomthey will be delivered or sold, what are the criteria of the purchasecontract, and what will the price be?• Administration and Management− Detailed plan of the administration and management. For example, willthe power plant monitoring be done by the bidder or by sub-contractinganother party to perform the work. In the latter case, who will becontracted and what will be the principles specified in the hiring contract?− Illustrate the plan for the power plant maintenance.12.2 Current Status of the SPP ProgramTable 12-1 summarizes the status (as of February 2000) of power purchases fromSPPs. Currently there are 40 SPP projects supplying power to the grid. About half (21)projects are supplying to the grid on a firm basis, and the remainder are supplying on anon-firm basis. The table also lists the fuel types for the projects accepted into theprogram. Of the 40 projects, 24 use biomass or waste as fuel. The number of projects isencouraging; however, although biomass and waste fuels represent the majority ofprojects, they are very small portion of the total SPP electrical capacity. As ofOctober 1999, only 6.8 percent (101 MW) of the total SPP capacity connected to theEGAT system (1,491 MW) involved waste or renewable resources. 11 Furthermore, only11 Arthur Anderson, “Thailand Power Pool and Electricity Supply Industry Reform Study - Phase I FinalReport,” Volume 5, March 1, 2000.January 5, 2001 12-7 Final Report

three out of the 24 biomass projects were accepted into the SPP program on a firm basis.The rest are to supply power on a non-firm basis and as such do not receive valuablecapacity payments from EGAT. An example of this are bagasse burning sugar mills,fourteen of which have signed up to supply non-firm power. The sugar mills export theirexcess power production when they are milling during the on-season, which is about fourmonths. To export firm power, the mill power systems would need to operate during theoff-season as well. This would typically require modification to mill power systems andsupplemental fuel if the excess bagasse is not available. Both investigations of sugarmills for this study recommended changes to allow for year-round export of power on afirm basis.Table 12-1Power Purchases from Small Power Producers as of February 2000Firm Non-Firm TotalProposals submittedNumber of projects 67 26 93Generating capacity, MW 7,686.81 631.36 8,318.17Sale to EGAT, MW 4,459.90 180.31 4,640.21Accepted into the program *Number of projects 30 23 53Generating capacity, MW 3,496.91 591.86 4,088.77Sale to EGAT, MW 1,958.40 175.61 2,134.01Type of fuel **Waste – 1 1Bagasse – 14 14Paddy husk, wood chips 3 3 6Natural gas 21 1 22Coal 5 2 7Oil 1 – 1Biomass – 1 1Black liquor – 1 1Contracts signedNumber of projects 30 20 50Generating capacity, MW 3,496.91 556.40 4,053.31Sale to EGAT, MW 1,958.40 149.57 2,107.97Supplying power to the gridNumber of projects 21 19 40Generating capacity, MW 2,169.43 553.90 2,723.33Sale to EGAT, MW 1,343.40 147.37 1,490.77Source: NEPO website, http//www.nepo.go.th/power/pw-spp-purch00-02-E.html.* Excluding Small Power Producers not presented in the Proposal Security and withdraw.** Some plants use more than one type of fuel.January 5, 2001 12-8 Final Report

12.3 Black & Veatch Comments on Current RegulationsAs discussed in the previous section, the percent of biomass capacity in the SPPprogram is small and mostly contracted on a non-firm basis. Black & Veatch feels thatthere are several reasons for this relating to the current SPP program regulations (datedJanuary 1998), as discussed in this section.12.3.1 Capacity and Energy PaymentsThe present SPP regulations were established for payment of capacity and energygenerated by a biomass power plant based on the long-term avoided cost of a fuel oilplant. This concept does not reflect the true nature of biomass power plant for thefollowing reasons:• The capacities of most biomass power plants are less than 10 MW because ofwide geographical distribution of the fuel. However, the fixed rate for thecapacity payment is based on fuel oil power plants which have capacities upto 100 MW. Because of the smaller capacity and the effects of economies ofscale, the cost per megawatt of a biomass power plant is normally higher thanthat for fuel oil power plants.Term of ContractGreater than 5 years but not exceeding 10 years:Greater than 10 years but not exceeding 15 years:Greater than 15 years but not exceeding 20 years:Greater than 20 years but not exceeding 25 years:Capacity Payment categorisedby type of fuel(Baht/kW/month)NaturalGas164204227302FuelOil/Others203253281374Coal229285317422• The fixed rate for the energy payment is based on the net plant heat rate for acombined cycle power plant, which is 9,070 kJ/kWh or 8,600 Btu/kWh.However, biomass power plants, which are based on the use of steam turbinethermal cycles, have higher heat rates ranging from 17,800 to 22,000Btu/kWh. This is due to the lower efficiency of this type of thermal cycle andthe high moisture content and low heating value of biomass fuels. The higherthe plant heat rate, the higher the cost to produce electricity from the plant.Thus, biomass plants are less energy efficient and more costly to operate thanpower plants operating on fossil fuels.Thus, instead of providing an incentive to power produced from biomass, the SPPregulations specify energy and capacity payment rates that are two low for biomass plantowners to obtain investment returns comparable to fossil fuel plants.January 5, 2001 12-9 Final Report

12.3.2 Contract TermOne objective of this study was to promote biomass projects that could obtainlong-term (greater than 5 years) firm contracts, which are required to receive capacitypayments. Although capacity payments provide substantial revenue to power projects,only three out of the 24 biomass projects accepted so far into the SPP program receivesuch payments. The primary reason for this is that it is difficult to maintain an assuredand constant supply of biomass for long periods of time. This is due to the following thereasons:• In general, biomass fuels are a byproduct of some higher value process. Forthis reason, the amount of biomass waste generated can fluctuate greatlydepending on such factors as market conditions, crop output, etc.• The value of biomass waste byproducts is low compared to the primaryproducts (for example, the price of rice husk compared to the price of ricepaddy). Therefore, most biomass producers are not interested in long-termsupply contracts and prefer shorter-term annual contracts.• Most agricultural businesses providing sources of biomass are familymanaged. If the second generation is not willing to continue, the businesswill be discontinued.For the above reasons, most potential biomass suppliers are uncomfortableentering into long-term supply contracts. However, power plant utilities and projectfinanciers may not be willing to build or lend to biomass facilities unless they haveassurances of adequate fuel supply for the life of the project, which would likely betwenty years or greater.12.3.3 Comments on EGAT RegulationsThe Black & Veatch study team has comments on specific regulations asdiscussed below.12.3.3.1 Minimum Take LiabilityThe SPP regulations include specifications on minimum take liability (No. 4, Item4, page 19/28):“EGAT will purchase power from the SPP in the amount of no less than 80percent of the SPP’s availability in a particular year...”Black & Veatch comment – EGAT should purchase all of the power generated bythe biomass power plants because (1) the plants are time consuming to start up and cannotvary output easily (they should be considered as base load plants as opposed to peakingplants); and (2) total biomass power plant capacity is small, and has minimal effect onthe whole grid system.January 5, 2001 12-10 Final Report

12.3.3.2 Generation Shortfall (Item K.3 page 9/28)The SPP regulations include specifications on generation shortfall (Item K.3 page9/28):“In case that the SPP is unable to increase its generation for supplying within theduration period in accordance with the PU’s instruction as specified in Item I 1.3,the PU shall pay the SPP capacity payment for that month by deducting 4 percentper day of the capacity rate specified in the PU’s announcement for every daythat the SPP is unable to follow the PU’s instruction.”Black & Veatch comment – EGAT should not penalize the biomass power plantowners if the generation shortfall is caused by fuel shortage. As discussed in the sectionon contract terms, fuel supply can be largely uncontrollable. For example, duringconstruction booms, rice husk is in high demand from brick manufacturers and the priceof rice husk may become too expensive for electricity generation. Fuel supply can also begreatly affected by hydrological factors. The difference between the maximum andminimum fuel supply can be up to 50 percent due to climatic variations (see sugarcaneproduction in Figure 12-1).Such uncontrollable factors result in investors and lenders who are unwilling toaccept the risk of fluctuating fuel supply and the loss of the capacity payments. The studyteam suggests that plant operators have the flexibility to makeup shortfalls withoutpenalty during periods in which the plant is running again.6050Sugarcane Crop Output, million tonnes4030201001993/94 1994/95 1995/96 1996/97 1997/98 1998/99Crop YearFigure 12-1. Variation in Sugarcane Output Between 1993 and 1999.January 5, 2001 12-11 Final Report

12.3.3.3 Period of SaleCertain periods of sale are required to qualify for the firm capacity payments(Item I.1 page 6/28):“For the types of generation processes defined under Item B.2, the annual hoursmust be no less than 4,672 hours per year and generation and sales must includethe period of March, April, May, and June.”Black & Veatch comment – some biomass fuels are seasonal with periods thatconflict with the present regulation requirements. For example, bagasse is available onlyfrom December through April. It is partly for this reason that none of the sugarcane millsenrolled in the SPP program have firm contracts with EGAT. In order to generate powerduring the off-season, mills would either have to conserve bagasse or buy supplementalfuels.12.4 ConclusionOwing to the existing regulations and other factors, very few biomass powerplants have sold electricity to the grid through firm contracts. Other reasons for the lackof biomass-based power generation in Thailand include:• Energy prices do not reflect external social costs such as air pollution, carbondioxide emissions, socioeconomic impacts, fuel imports, etc.• Biomass energy projects suffer from not being in regular competition withconventional energy sources. For example, power purchase agreements areoften written to favor conventional energy projects and do not consider thespecial requirements of renewable energy technologies.• Investors or lenders would like to minimize biomass fuel supply risk simplyby establishing long term supply contracts, but these are very difficult toachieve. Alternative methods of risk management are often not explored.• Host facilities are often not familiar with the power generation business andare wary of making large investments in businesses outside their coreexperience.• Biomass plants are small compared to conventional energy plants. The smallsize and the technology type results in relatively high capital costs.Furthermore, development costs for biomass plants are similar to largerplants, even though the capacities are much smaller.The combination of high up-front capital costs, unfamiliar technology, andunmanageable fuel supply risk, makes financing of biomass projects more difficult andexpensive than conventional energy plants. The result is that those plants which are builtmay not be able to produce electricity at rates as low as conventional technologies, suchas combined cycle plants burning natural gas.January 5, 2001 12-12 Final Report

To encourage biomass and other renewable energy sources, governments aroundthe world have instituted a variety of measures including investment credits, productionsubsidies, guaranteed buyback prices, and capacity mandates. Direct increases incapacity and energy prices in Thailand may not offer the total solution for renewableenergy projects; several measures should be examined:• Set a target for biomass and other renewable power plant generating capacityfor the next 10 years.• Establish a competitive subsidy scheme to encourage development of newrenewable energy power plants.• Promote marketing of biomass and other renewable energy sources as“green” energy to encourage public support of projects.• Collaborate with specific high potential industries (such as sugar canemilling) to promote higher efficiency plants and expanded biomass powergeneration.• Investigate alternative funding mechanisms to provide long-term loans withlow interest rates to biomass projects (commercial banks normally providelimited loans with high interest rates).Any incentive offered to renewables should be should cognizant of theliberalization of the electricity supply industry and flexible enough to respond to changingmarket conditions.NEPO has begun a successful campaign to promote renewable energy. This effortwill be further strengthened by the recent commissioning of an initiative to subsidize upto 300 MW of renewable energy projects through the Energy Conservation PromotionProgram (ENCON) fund. The capacity, which will be bid on a competitive basis, will bean important step to further the long-term energy policy goals of Thailand.January 5, 2001 12-13 Final Report