Economic viability of biomass cofiring in new hard-coal power plants in Germany

Biomass cofiring in coal power plants (with thermal contributions of typically 5–20%) is an interesting option to mitigate CO2 emissions, since the additional costs are relatively minor and a secondary benefit is provided by the increased fuel flexibility. Worldwide, about 150 cofiring plants are in operation. In Germany, the electrical power potential for biomass cofiring in coal plants is about 28 TWh per annum, assuming a 10% replacement of coal combustion by biomass. In this paper, we study the economic potential of biomass cofiring in hard coal power plants in Germany. To this end, we identify suitable biomass input fuels, investment and operating costs, and the profitability of cofiring investments. In a sensitivity analysis, we check for the robustness of the results gained, and in a Monte Carlo simulation (MCS) uncertainties are explicitly taken into account. We find that both regional and international biomass supplies are relevant, and that the cost effectiveness of cofiring is strongly affected by the prices for biomass, coal and CO2 permits, while investment and operating costs only have a modest influence. According to our calculations, electrical power generation costs attributable to biomass combustion for a plant put into operation in 2020 are between 70 and 75 € MWh−1, while the average costs of biomass fuel from various sources and markets are calculated to be around 4.1 € GJ−1.

► The potential for biomass cofiring in coal plants in Germany is about 28 TWh p.a..
► We perform a sensitivity analysis and a Monte Carlo simulation to deal with uncertainty.
► Regional and international biomass supplies are found to be relevant.
►  Cost-effectiveness is strongly influenced by prices for biomass, coal and CO2 permits.
► Investment and operating costs only have a minor influence.