Analysing the effect of five operational factors on forest residue supply chain costs: A case study in Western Australia

• Natural drying of harvesting residues of Eucalypt plantations was studied.
• Total operating costs of the supply chain was minimised using BIOPLAN tool.
• There was no strong correlation between energy demand and supply chain cost.
• For higher interest rates, the total storage cost increased.
• Highest supply chain costs occurred for moisture mass fraction ranging 20% to 30%.

In Australia the use of forest biomass has been developing in recent years and initial efforts are built on adopting and trialling imported European technology. Using a linear programming-based tool, BIOPLAN, this study investigated the impact of five operational factors: energy demand, moisture mass fraction, interest rate, transport distance, and truck payload on total forest residues supply chain cost in Western Australia. The supply chain consisted four phases: extraction of residues from the clear felled area to roadside by forwarders, storage at roadside, chipping of materials by mobile chippers, and transport of chips to an energy plant. For an average monthly energy demand of 5 GWh, the minimum wood supply chain cost was about 29.4 $ t−1, which is lower than the maximum target supply cost of 30–40 $ t−1, reported by many industry stakeholders as the breakeven point for economically viable bioenergy production in Australia. The suggested volume available for chipping in the second year was larger than in the first year indicating that the optimisation model proposed storing more materials in the first year to be chipped in the second year. The sensitivity analysis showed no strong correlation between energy demand and supply chain cost per m3. For higher interest rates, the total storage cost increased which resulted in larger operational cost per m3. Longer transport distances and lower truck payloads resulted in higher transport cost per unit of delivered chips. In addition, the highest supply chain costs occurred when moisture mass fraction ranged between 20% and 30%.