The Business Case

There are a number of factors which need to be considered when establishing whether a biomass scheme will be economically viable. In many instances, the business case can be compelling with projects achieving payback at the investment term and then generating a profit for the duration of the scheme’s design life.

Business Considerations

It is essential that when bringing a biomass project to market that there is a robust, detailed business case which accurately takes into account the whole-life costs associated with the project.

Financial considerations fall into 3 main categories:

  • Capital Expenditure – This covers the cost of building the biomass scheme and making it operational.  This can range from tens of thousands of pounds up to tens of millions, depending on the size of the scheme.
  • Operating Expenditure – This includes biomass fuel handling and delivery costs, staff, training and maintenance costs.
  • Revenue Generation – Non Domestic Renewable Heat Incentives (RHI) are still available in the UK (with the exception of Northern Ireland) which pay the scheme’s owners a subsidy for the amount of heat they generate.  This can generate significant income for the owners.