Date of Award:

5-2013

Document Type:

Thesis

Degree Name:

Master of Science (MS)

Department:

Applied Economics

Committee Chair(s)

Man-Keun Kim

Committee

Man-Keun Kim

Committee

Donald L. Snyder

Committee

Ruby A. Ward

Abstract

This research examines the physical and economic feasibility of 5% biomass co-firing in the coal-fired power plants of Utah. Transportation models is used to find out the physical feasibility of 5% biomass co-firing, as well as locate the supply zone for each power plant that would minimize the transportation cost. Additional cost required for 5% biomass co-firing and the economic benefits associated with biomass co-firing are calculated. The additional cost required for 5% biomass co-firing is estimated to be $34.84 million. Previous studies on CO2 emission reduction are used to compute the economic benefit attain from CO2 reduction by selling carbon credits in the carbon trading market. Based on 2010 emission record in Utah, 5% biomass co-firing might bring the annual economic benefit of $11.37~$34.10 million assuming $16/ton of CO2 in the emission trading market. The regression model is used to find the relationship between PM emission and the human health damage. The regression results show that decreases in 1% of PM25 emission improves the human health in U.S. by 0.65%~0.67% in value and generates annual economic benefits of $6.72~$9.93 million in Utah. Altogether, the economic benefit from 5% biomass co-firing is estimated to be $38.55 million which is higher than the additional cost of biomass co-firing to generate electricity ($34.84 million). The benefit cost ratio is calculated as 1.107. Five percent biomass co-firing is economically feasible when benefits from all the positive externalities are included.

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This work made publicly available electronically on 5/2013

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