A comparison of cost-benefit analysis of biomass and natural gas CHP projects in Denmark and the Netherlands. (February 2016)

• Record Type: Journal Article
• Authors: Groth, Tanja; Scholtens, Bert
• Is Part Of: Renewable energy. Volume 86(2016)
• Page Start: 1095
• Page End: 1102
• Publication Date: 2016-02
• Subjects: Cost-benefit analysis -- Combined heat and power -- Net present value; Renewable energy sources -- Periodicals; Power resources -- Periodicals; Énergies renouvelables -- Périodiques; Ressources énergétiques -- Périodiques; 333.794
• DOI: 10.1016/j.renene.2015.09.032
• Languages: English
• ISSNs: 0960-1481

Abstract

Abstract: We investigate what drives differences in the project appraisal of biomass and natural gas combined heat and power (CHP) projects in two countries with very similar energy profiles. This is of importance as the European Commission is assessing the potential scope of harmonizing renewable electricity support schemes post 2020. Concurrently, it is also promoting the use of cost benefit analysis (CBA) for transnational energy infrastructure projects. We use CBA to assess the same project proposal in Denmark and the Netherlands, following the respective country's guidelines. We find that especially the fuel costs and the valuation of emissions drive the differences. Furthermore, we establish that the sensitivity of the CBA results not only from policy differences in the countries, but also from differences in the methodology used. Highlights: We compare project appraisal of biomass and natural gas CHP projects in Denmark and the Netherlands with CBA. Fuel costs and the valuation of emissions are a major driver of the differences. The inclusion or exclusion of the environmental impact of methane makes a huge difference. The results are sensitive to policy and methodology.