Investment and Profitability of Community Heating Systems Using Bioenergy in Finland: Opportunities and Challenges

Oil heating systems are abundant in rural Finland and they need to be replaced by renewable energy as Finland aims to be carbon neutral by 2035. Bioenergy, one of the renewable energies, is a common source of energy in Finland as the country is rich in forest resources. In Finland, combined heat and...

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Autores principales:	Raghu KC, Jarno Föhr, Arun Gyawali, Tapio Ranta
Formato:	article
Lenguaje:	EN
Publicado:	MDPI AG 2021
Materias:	heating biomass bioenergy cost profitability economy Environmental effects of industries and plants TD194-195 Renewable energy sources TJ807-830 Environmental sciences GE1-350
Acceso en línea:	https://doaj.org/article/eb6c7f6b5616414d8b6093f9ceb4855e
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spelling	oai:doaj.org-article:eb6c7f6b5616414d8b6093f9ceb4855e2021-11-11T19:28:23ZInvestment and Profitability of Community Heating Systems Using Bioenergy in Finland: Opportunities and Challenges10.3390/su1321117572071-1050https://doaj.org/article/eb6c7f6b5616414d8b6093f9ceb4855e2021-10-01T00:00:00Zhttps://www.mdpi.com/2071-1050/13/21/11757https://doaj.org/toc/2071-1050Oil heating systems are abundant in rural Finland and they need to be replaced by renewable energy as Finland aims to be carbon neutral by 2035. Bioenergy, one of the renewable energies, is a common source of energy in Finland as the country is rich in forest resources. In Finland, combined heat and power plants utilize such resource to produce district heat and electricity but Finnish rural areas do not have access to the district heating network. However, there are potential scenarios where community heating could be possible using portable chip-fired heating systems (heat containers). Ultimately, the cost of heating is an important factor for the consumers and the cost of investment is likely to put off any interest from the communities. In this research, we explored the cost and profitability of heat container investments in rural Finland and examined the challenges for the energy transition away from oil heating systems, as well as the opportunities decentralized biomass-fired heating systems might bring. The results of this research indicate that the price of heat produced in heat containers is comparatively higher than district heating, which is commonly used in cities in Finland, but is cost-competitive compared to oil heating depending on the price of oil. For example, the current price of LFO (~1 EUR/l) generates costlier heat than the 300 kW heat container provides. Firing wood pellets in the heat container is not economically viable due to expensive raw material but smaller-sized heat container (110 kW) firing wood chips could provide cost-competitive heat if uptime is raised to >2700 h/year. There are socio-economic impacts and value-added effects on the rural region due to utilization of local resource instead of imported LFO but there remain challenges and barriers such as high initial investment, low investment support and lack of policies focused on decentralised energy enterprises.Raghu KCJarno FöhrArun GyawaliTapio RantaMDPI AGarticleheatingbiomassbioenergycostprofitabilityeconomyEnvironmental effects of industries and plantsTD194-195Renewable energy sourcesTJ807-830Environmental sciencesGE1-350ENSustainability, Vol 13, Iss 11757, p 11757 (2021)
institution	DOAJ
collection	DOAJ
language	EN
topic	heating biomass bioenergy cost profitability economy Environmental effects of industries and plants TD194-195 Renewable energy sources TJ807-830 Environmental sciences GE1-350
spellingShingle	heating biomass bioenergy cost profitability economy Environmental effects of industries and plants TD194-195 Renewable energy sources TJ807-830 Environmental sciences GE1-350 Raghu KC Jarno Föhr Arun Gyawali Tapio Ranta Investment and Profitability of Community Heating Systems Using Bioenergy in Finland: Opportunities and Challenges
description	Oil heating systems are abundant in rural Finland and they need to be replaced by renewable energy as Finland aims to be carbon neutral by 2035. Bioenergy, one of the renewable energies, is a common source of energy in Finland as the country is rich in forest resources. In Finland, combined heat and power plants utilize such resource to produce district heat and electricity but Finnish rural areas do not have access to the district heating network. However, there are potential scenarios where community heating could be possible using portable chip-fired heating systems (heat containers). Ultimately, the cost of heating is an important factor for the consumers and the cost of investment is likely to put off any interest from the communities. In this research, we explored the cost and profitability of heat container investments in rural Finland and examined the challenges for the energy transition away from oil heating systems, as well as the opportunities decentralized biomass-fired heating systems might bring. The results of this research indicate that the price of heat produced in heat containers is comparatively higher than district heating, which is commonly used in cities in Finland, but is cost-competitive compared to oil heating depending on the price of oil. For example, the current price of LFO (~1 EUR/l) generates costlier heat than the 300 kW heat container provides. Firing wood pellets in the heat container is not economically viable due to expensive raw material but smaller-sized heat container (110 kW) firing wood chips could provide cost-competitive heat if uptime is raised to >2700 h/year. There are socio-economic impacts and value-added effects on the rural region due to utilization of local resource instead of imported LFO but there remain challenges and barriers such as high initial investment, low investment support and lack of policies focused on decentralised energy enterprises.
format	article
author	Raghu KC Jarno Föhr Arun Gyawali Tapio Ranta
author_facet	Raghu KC Jarno Föhr Arun Gyawali Tapio Ranta
author_sort	Raghu KC
title	Investment and Profitability of Community Heating Systems Using Bioenergy in Finland: Opportunities and Challenges
title_short	Investment and Profitability of Community Heating Systems Using Bioenergy in Finland: Opportunities and Challenges
title_full	Investment and Profitability of Community Heating Systems Using Bioenergy in Finland: Opportunities and Challenges
title_fullStr	Investment and Profitability of Community Heating Systems Using Bioenergy in Finland: Opportunities and Challenges
title_full_unstemmed	Investment and Profitability of Community Heating Systems Using Bioenergy in Finland: Opportunities and Challenges
title_sort	investment and profitability of community heating systems using bioenergy in finland: opportunities and challenges
publisher	MDPI AG
publishDate	2021
url	https://doaj.org/article/eb6c7f6b5616414d8b6093f9ceb4855e
work_keys_str_mv	AT raghukc investmentandprofitabilityofcommunityheatingsystemsusingbioenergyinfinlandopportunitiesandchallenges AT jarnofohr investmentandprofitabilityofcommunityheatingsystemsusingbioenergyinfinlandopportunitiesandchallenges AT arungyawali investmentandprofitabilityofcommunityheatingsystemsusingbioenergyinfinlandopportunitiesandchallenges AT tapioranta investmentandprofitabilityofcommunityheatingsystemsusingbioenergyinfinlandopportunitiesandchallenges
_version_	1718431561627467776

Investment and Profitability of Community Heating Systems Using Bioenergy in Finland: Opportunities and Challenges

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