Elaboration of Technical Project Concept of the fuel ... · - Primary school "Desanka Maksimović" - Primary school "Vuk Karadžić" - High school Priboj - Health center ambulance

Elaboration of Technical Project Concept of the fuel switch to biomass of selected public buildings in Priboj including

economical evaluation

Prepared for:

Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH

Dag-Hammerskjöld Weg 1-5

Postfach/ P.O.Box 5180

65760 Eschborn

prepared by:

Marko Milošević

31th

October 2016

2

TABLE OF CONTENTS

1. EXECUTIVE SUMMARY ................................................................................................................. 7

2. INTRODUCTION .......................................................................................................................... 10

3. GENERAL INFORMATION ........................................................................................................... 12

3.1 PRIBOJ MUNICIPALITY ...................................................................................................... 12

3.2 TOWN PRIBOJ .................................................................................................................... 14

4. EXISTING HEATING SYSTEM ..................................................................................................... 15

5. BIOMASS MARKET ANALYSES .................................................................................................... 7

6. TECHNICAL DESIGN CONCEPT ................................................................................................. 11

6.1 TECHNICAL SOLUTIONS AND UNIT COST OF FUEL-ENERGY ...................................... 11

6.2 BOILER ROOMS, LOCATION AND FACILITIES ................................................................. 17

7. PRELIMINARY COST ESTIMATES .............................................................................................. 20

7.1 PRELIMINARY COST ESTIMATES, SCENARIO 1 ............................................................. 20

7.2 PRELIMINARY COST ESTIMATES, SCENARIO 2 ............................................................ 21

7.3 PRELIMINARY COST ESTIMATES, SCENARIO 2.1 ......................................................... 22

8. PRELIMINARY FINANCIAL ANALYSE ......................................................................................... 23

8.1 PRELIMINARY FINANCIAL ANALYSE, SCENARIO 1 ....................................................... 23

8.2 PRELIMINARY FINANCIAL ANALYSE, SCENARIO 2 ....................................................... 24

8.3 PRELIMINARY FINANCIAL ANALYSE, SCENARIO 2.1 .................................................... 25

9. PROJECT EVALUATION .............................................................................................................. 26

10. INSTITUTIONAL ANALYSES ...................................................................................................... 27

11. ENVIRONMENTAL IMPACTS ..................................................................................................... 29

12. ENERGY EFFICIENCY MEASURES AND CONCLUSION .......................................................... 32

List of tables

3

Table 1 - The structure of the territory of Priboj municipality, (Source:

http://www.priboj.rs/geografski-polozaj).............................................................. 13 Table 2 - From 1961 to 2011 Population Census data for municipality Priboj, (Source:

http://popis2011.stat.rs/?page_id=2134)............................................................ 14 Table 3 - From 1961 to 2011 Population Census data for town Priboj, (Source:

http://popis2011.stat.rs/?page_id=2134)............................................................ 15 Table 4 - Microclimate data (Source: RetScreen International & NASA Software,

updated 2014.)……………………………………………………………………….. 15 Table 5 - Facilities data (Source: data collected from the location)……………………….. 16 Table 6 - Overview of Data and consumption of facilities, (Source: Own calculations)…. 23 Table 7 - Current situation, Energy and fuel consumption, price , CO2 emission…….…. 24 Table 8 - Requirements for wood chips according to ÖNORM M 7133…………………… 25 Table 9 - The classification of wood chips based on the moisture content according to

ÖNORM M 7133……………………………………………………………………... 25 Table 10 - Requirements for wood chips according to CEN/TS 14961:2005, Part 4……… 26 Table 11 - Capacity data of forest farm “Priboj”, public company “Srbija Šume”, (Source:

http://www.srbijasume.rs/priboj.html)................................................................. 26 Table 12 - Available biomass in municipal Zlatibor district, expressed through the energy

value…………………………………………………………………………………… 28 Table 13 - Characteristics of wood chips depending on the type of primary wood………... 28 Table 14 - Characteristics of wood pellet depending on the type of primary wood………... 29 Table 15 - Requirements for wood pellet according to ÖNORM M 7135, (Source:

https://ec.europa.eu/energy/intelligent/projects/sites/iee-projects/files.pdf)........ 29 Table 16 - Overview of Data and consumption of facilities according to the scenario…….. 30 Table 17 - Unit price of wood chips and wood pellet …………………………………………. 31 Table 18 - Comparative analysis of the cost of existing fuel and biomass, (Source: Own

calculations)…………………………………………………………………………… 31 Table 19 - Calculate capacity of heating boilers for Scenario 1…………………………...… 33 Table 20 - Calculate capacity of heating boilers for Scenario 2……………………………... 34 Table 21 - Boiler rooms surface according to Scenario 2……………………………………. 37 Table 22 - Investment costs for scenario 1 (Source: Own calculations)……………………. 38 Table 23 - Operational costs for scenario 1 (Source: Own calculations)…………………… 39 Table 24 - Investment costs for scenario 2 (Source: Own calculations)……………………. 39 Table 25 - Operational costs for scenario 2 (Source: Own calculations)…………………… 40 Table 26 - Investment costs for scenario 2.1 (Source: Own calculations)…………………. 40 Table 27 - Operational costs for scenario 2.1 (Source: Own calculations)………………… 41 Table 28 - Costs of energy production, scenario 1; (Source: Own Calculations)…………. 42 Table 29 - Costs of energy production, scenario 2; (Source: Own Calculations)…………. 43 Table 30 - Costs of energy production, scenario 2.1; (Source: Own Calculations)……….. 44 Table 31 - Unit cost heat energy (Source: Own calculations)……………………………….. 45 Table 32 - Specification of the investment costs for kindergarten, solution 1……………… 51

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List of figures Figure 1 - Location of the Zlatibor District in the territory of the Republic of Serbia

(Source:http://commons.wikimedia.org/wiki/File:Zlatibor)………………………… 12 Figure 2 - Municipalities belonging to the Zlatibor district, (Source: www.381info.com)...... 12 Figure 3 - Situation plan (Source: data collected from the location)………………………… 17 Figure 4 - Forest’s area in the total area of municipalities (Source: Statistical yearbook of

Republic of Serbia 2012)…………………………………………………………….. 27 Figure 5 - State and private forest’s by ratio by administrative districts (Source: Statistical

yearbook of Republic of Serbia 2012)………………………………………………. 27 Figure 6 - Annual energy cost by scenario-fuel………………………………………………… 31 Figure 7 - Unit price of energy by scenario…………………………………………………….. 32 Figure 8 - Diagram of the annual distribution heat capacity from boilers, scenario 1……… 33 Figure 9 - Plan of new boiler roos and pre-insulated pipes, scenario 1……………………… 36 Figure 10 - Emission CO2 – Comparison to fuel………………………………………………… 50 Figure 11 - Comparative analysis of cost heat energy and saving, scenario 1………………. 54 Figure 12 - Saving from fuel switch, scenario 1…………………………………………………. 55 Figure 13 - Operational costs and depreciation, scenario 1……………………………………. 56 Figure 14 - Cash flow balance, scenario 1……………………………………………………….. 57 Figure 15 - Comparative analysis of cost heat energy and saving, scenario 2………………. 58 Figure 16 - Cash flow balance, scenario 2……………………………………………………….. 59 Figure 17 - Comparative analysis of cost heat energy and saving, scenario 2.1……………. 60 Figure 18 - Cash flow balance, scenario 2.2…………………………………………………….. 61

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List of pictures

Picture 1 - Technical school Priboj………………………………………………………………. 18 Picture 2 - Primary school “Desanka Maksimović“…………………………………………….. 18 Picture 3 - Tubular heat exchanger…………………………………………………………...... 18 Picture 4 - Manifold with more connections…………………………………………………….. 18 Picture 5 - School “Vuk Karadžić”, street view…………………………………………………. 19 Picture 6 - School “Vuk Karadžić”, yard view…………………………………………………… 19 Picture 7 - Former boiler room with three substations………………………………………… 19 Picture 8 - Manifold with more connections for school “Vuk Karadžić”……………………. 19 Picture 9 - High school, view Nemanjina street………………………………………………… 20 Picture 10 - High school, view Vuk Karadžić street……………………………………………… 20 Picture 11 - Substation for high school Priboj…………………………………………………… 20 Picture 12 - Tubular heat exchanger for high school Priboj…………………………………… 20 Picture 13 - Ambulance health center…………………………………………………………….. 21 Picture 14 - Ambulance and residential building, street view………………………………… 21 Picture 15 - Ambulance and residential building, yard view……………………………………. 21 Picture 16 - Substation for Ambulance health center and residential building at address

Limska 20……………………………………………………………………………… 21 Picture 17 - Kindergarten “Neven”, street view…………………………………………………. 22 Picture 18 - Entrance for employees from backyard…………………………………………… 22 Picture 19 - Manifold with more connections for kindergarten “Neven”……………………… 22 Picture 20 - Plant heat exchanger in kindergarten “Neven” …………………………………… 22 Picture 21 - Planned location of boiler room……………………………………………………. 35

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List of abbreviations

EUR - Euro (currency) CO2 - Carbon Monoxide

RS - Republic of Serbia CAPEX - Capital Expenditure OPEX - Operating Expenditure LUC - Leveled Unit Costs (F)IRR - (Financial) Internal Rate of Return (E)IRR - Economy Internal Rate of Return (F)NPV - (Financial) Net Present Value (E)NV - (Economy) Net Present Value

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1. EXECUTIVE SUMMARY

The assignment of the study is elaboration of technical concept for central woodchip heating system including boiler, feeding system, storage unit for:

- Mechanical and electrical technical school Priboj - Primary school "Desanka Maksimović" - Primary school "Vuk Karadžić" - High school Priboj - Health center ambulance Priboj - Kindergarten "Neven"

Objects that are the subject of these study have radiator heating systems with temperature

regime of 80 / 60C and they are supplied by thermal energy through the existing district heating system. Objects from study are connect to the district heating system over five substations with heat exchangers.

In addition to objects that are defined in the study, during data collection, it was found that the heating system of residential building with more apartments at address Limska 20 is unique with the heating system of the health center.

Overview of facilities data and heating systems:

No

Institution

Existing heating system

Address SCENARIO 1 SCENARIO 2 A Q

Building Substation

m2 kW

1

Mechanical and electrical technical school Priboj

Vuka Karadžića 27

Vuka Karadžića 27

Dis

tric

t he

atin

g b

y h

ea

vy o

il

Wood chips 800kW+1200kW

Wood pellet 2x350kW

3.798 630

2

Primary school "Desanka Maksimović"

Limska 24 Wood pellet

250kW 1.434 223

3 Primary school "Vuk Karadžić"

Nemanjina 35 Nemanjina

35 Wood pellet

2x350kW 3.900 647

4 High school Priboj


35 Wood pellet

350kW 2.143 333

5 Health center ambulance Priboj

Limska 18 Nemanjina

35

Wood pellet 100kW

591 83

6 Residential building

Limska 20 Wood pellet

40kW 221 31

7 Kindergarten "Neven"

Pionirska 2 Pionirska 2 Wood pellet

200kW Wood pellet

boiler 200kW 1.200 168

Summary 13.287 2.115

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In order to reduce costs of heating energy needed for the buildings from the study, it is necessary to perform a switch in energy source to biomass fuel. For the purpose of elaborating the best solutions according to the criterion of investment and exploitation costs, the task of this study is the creation of three scenarios replacing fuels with biomass: - Scenario 1 - All buildings from the study will be connected to the new woodchip boiler. - Scenario 2 - All buildings will have separate pellet boilers. - Scenario 2.1 - All buildings will have separate woodchip boilers

The choice of the technical concept that would be the most advantageous and analysis of investment justification, is based at two scenarios.

Scenario 1 - After analysis, solution has been found that changes the scenario 1 and it is slightly different from the originally planned. All buildings from the study, except the kindergarten, will be connected to the new wood chips boiler. Separate pellet boiler is planned for the building of kindergarten. This solution require less investment for 21.000 less then the solution with construction of hot-water pre-insulated pipes, with the length of more than 250m. Solution to connect building of kindergarten to central wood chips boiler with pre-insulated pipes, is not the best technical solution. Such a solution would lead to delays delivery of heat energy to kindergarten. The option where kindergarten building is attached to a central boiler room would cause a delay in warming the kindergarten because of its distance from other facilities and transport of heat through hot water pipes. The reason for this is the large distance of kindergarten from other connected facilities and transport of hot water through long pre-insulated pipes.

Bearing in mind that several objects are connected to one substation, observation data will be carried out in relation to the substation, which is the starting point and the place of delivery of thermal energy in buildings.

From the central boiler two pipelines have been planned. One pipeline for heating substations in the technical school Priboj and second for the substations in the primary school Vuk Karadžić have been planned. Heat substation of district heating systems are planned to remain in reserve in case there is a problem with the supply of biomass. For a central boiler room two woodchip boilers with power of 800kW and 1200kW have been planned and for kindergarten boiler wood pellet boiler with the power of 200kW. Scenario 1 presents that in the period of 8 years of the start of exploitation there will be an opportunity for positive business. The advantage of this scenario is that the municipality will have formed a sustainable heating system, which increases the quality of life and creates a positive effect on the environment. Taking into account that the additional costs of heating plants and heating system from scenario 1 are approximately the same, we can conclude that technical solution according to scenario 1 proceeds fast return on invested funds. Scenario 2 - All buildings will have separate pellet boilers. Scenario 2 shows that there will not be opportunities for positive business results. This is due to high investment costs and high maintenance costs seven of separate boiler rooms. Larger number of boilers with complex systems for combustion, required hiring more labor.

Scenario 2.1 - All buildings will have separate wood chips boilers. Scenario 2.1 shows predicts

very small opportunities for positive business results. This is due to high investment costs and

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high maintenance costs for construction of seven separate boiler rooms. Larger number of boilers

with complex systems for combustion requires hiring more labor force.

Prerequisites that must be met for the successful operation of the facility are as follows:

Selection of an appropriate financing model (from own funds, line of credit or public-private partnership); Entering into long-term contracts for the supply of the biomass; Providing autonomy to the fuel storage according to the consumption in the coldest month of the year; During the construction phase training of the personnel who would take over the management and maintenance of the boiler plant will also be required; Ensuring high quality maintenance of the specific equipment in cooperation with the supplier of the equipment.

This investment will achieve the following benefits: - Lower costs of heat energy, - Low levels of emission of harmful substances in the exhaust gas, - Reduction of CO2 emissions - burning wood biomass the CO2 released is "neutral", - Raising the level of safety and operational availability of the energy block,

Techno-economic indicators of the future energy system with wood chips are as follows:

Heat capacity of boilers

Woodchips boiler 800 + 1200 kW

Wood pellet boiler 200 kW

Fuel

Woodchips M30 according to CEN/TS 14961:2005, (1) General requirements and (4)

Wood pellet DIN 51731 or Ö-Norm M-7135

Annual production of thermal energy 2.845 MWhth /a

Annual fuel consumption

Woodchips 1077 t/a

Wood pellet 53 t/a

Efficiency on the threshold of the heat plant 0,90 x 0,94

Annual reduction in CO2 emission 677,39 t/a

CAPEX 366.000 €

OPEX (the amortization period) 1.869.033 €

LUC 39,70 EUR/MWh

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2. INTRODUCTION

The program ‘Development of a Sustainable Bioenergy Market in Serbia’ (GIZ DKTI) is implemented

jointly by the KfW (financing component) and GIZ (technical assistance component). It is funded by

the German Federal Ministry for Economic Cooperation and Development (BMZ) under the German

Climate Technology Initiative (DKTI). The main implementing partner and beneficiary of the technical

assistance (TA) component is the Serbian Ministry of Agriculture, Forestry and Water Management

(MAFWM). The general objective of the project is to strengthen capacities and create an enabling

environment for the sustainable use of bioenergy in Serbia. The TA component includes the following

five activity areas:

1) Policy advice: Assessment of bioenergy potentials and regulatory framework for creating and

enabling environment for private sector investment in bioenergy projects etc.

2) Biomass supply: Accompany investments in biomass-fired district heating plants in up to three

pilot regions with TA to secure a reliable and cost-effective supply of biomass in a sustainable

manner.

3) Efficient firewood utilization at household level: Increase the efficiency of firewood

consumption for heating at household level through the promotion of firewood drying and efficient

stoves/ovens.

4) Project development: Support in cooperation with the national and international private sector

the development and the implementation of feasible bioenergy projects – from biogas or straw

combustion plants in the industry sector to wood based heating boilers in private and public

buildings.

5) EU-Project BioRES – Regional Supply Chains for Woody Bioenergy: BioRES aims at

introducing the innovative concept of Biomass Logistic and Trade Centers (BLTCs) in Serbia,

Croatia, and Bulgaria based on cooperation with technology leaders from Austria, Slovenia,

Germany, and Finland. The BLTCs as regional hubs will help increasing local supply and demand

for wood bioenergy products in these countries.

6)

The development of a biomass supply is required only if there are liable regional consumers of

biomass. In the future, as a regional consumer of biomass, the municipality of Priboj decided to switch

to biomass in stages. As a supporting institution, GIZ DKTI has received a Letter of Expression of

Interest from municipality Priboj to declare their demand for guidance, legal and technical assistance

in the process of the development of a fuel switch of public buildings in Priboj to biomass.

It is planned that in the first stage perform switching of selected public buildings, is the point of

interest for this assignment. The objective of the assignment is also to establish a technical concept

for fuel switch to biomass heating, the installation of a wood chip heating plant including storage for

centrally heating of 4 schools, kindergarten and health center ambulance in Priboj.

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This fuel switch, with disconnect from existing district heating system on heavy oil and

construction the new local heating system on biomass, should provide savings in the budget of the

municipality by strengthening local incomes with local produced wood fuel and should also reduce

emissions of the renewed heating system.

The aim of this study is to establish technical concept for switching to biomass heating, the

installation of a wood chip heating plant including storage recipient and design of the distribution

system including grid and substations.

In addition, it is necessary to estimate the investment costs of the plant, distribution system,

perform Financial evaluation of savings from woodchip heating system (compared to current situation)

regarding fuel costs, efficiency, investment and operation costs, cash-flow analysis through savings

and sensitivity analysis regarding fuel prices, investment cost and boiler efficiency.

The study includes the following:

- Assessment of the current energy situation in public buildings in Priboj regarding heated

area, heating substations capacity and current performance, energy consumption and cost

efficiency, condition of distribution system and connections.

- Techno-economic analysis of the proposed system for the production of thermal energy by

burning biomass (wood chips), and distribution system with heating grid which should

include:

Proposal of a technical concept for central woodchip heating system including boiler, feeding system, storage unit and grid installation taking into consideration future efficiency measures in the buildings.

Financial evaluation of savings from woodchip heating system (compared to current situation) regarding fuel costs, efficiency, investment and operation costs, cash-flow analysis through savings and sensitivity analysis regarding fuel prices, investment cost and boiler efficiency.

An assessment of CO2 emissions reduction. The recommendation concerning the quality and availability of wood chips to

supply the plant in the future, taking into account the prices and local suppliers of wood chips.

Technical concept and preliminary design for heating grid in Priboj and further necessary equipment, including losses, connected to planned biomass CHP.

Estimation of overall investment costs for the heating grid and further necessary equipment.

Financial evaluation of heat prices compared to current situation taking into account fuel

costs, efficiency, investment and operation costs.

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3. GENERAL INFORMATION

3.1 PRIBOJ MUNICIPALITY

Zlatibor district covers the western part of Serbia, and covers an area of 6142km2 (Source: https://sr.wikipedia.org/sr/Златиборски_управни_округ). According to the criteria of surface Zlatibor district is the largest district in Serbia. The administrative center of the district is the city of Užice Zlatibor district includes:

1. City Užice 2. Municipality Bajna Bašta 3. Municipality Kosjerić 4. Municipality Pošega 5. Municipality Čajetina 6. Municipality Arilje 7. Municipality Priboj 8. Municipality Nova Varoš 9. Municipality Prijepolje 10. Municipality Sjenica

Figure 1- Location of the Zlatibor District in the territory of the Republic of Serbia

Figure 2 – Municipalities belonging to the Zlatibor district

(http://commons.wikimedia.org/wiki/File:Zlatibor_district.png) (Source: www.381info.com)

13

Priboj is located in the southwestern part of the Republic of Serbia on the border between Serbia, Montenegro, Bosnia and Herzegovina. In the north it borders with the Municipality of Čajetina (length 23 km) to the east with the municipality of Nova Varos (15.6 km), and to the southeast with the municipality of Prijepolje (28 km).

In the south, municipalities Priboj has a state border with the Republic of Montenegro (Pljevlja Municipality) at a distance of 27km. In the West, Priboj municipality has the state border with the Republic of Bosnia and Herzegovina (Rudo and Čajnić municipalities), at a distance of 51 km. The total length of the border municipalities Priboj is about 145 kilometers.

In administrative terms Priboj is municipal center with 14 local communities, the settlement of 33 and 24 cadastral municipalities. City Priboj is from the administrative center of the district Zlatibor city of Užice, away about 70km. Municipality of Priboj covers an area of 552km2.

From the capital city Belgrade, municipality Priboj is located 280km to the south and it is

bounded from the south by mountains Pobijenik and Javorje, from the west by mountain Later. In the

municipality there are river flows of rivers Lim and Uvac. Municipality Priboj is connected to the main

road Belgrade-Podgorica, Višegrad-Nova Varoš and railroad Belgrade-Bar.

The total area of forests and forest land in municipality Priboj is 36.039 ha. The forest

coverage of the municipality is 65% and it is significantly higher than the percentage of forest cover in

Serbia which is 27.4%.

Surface area of Fertile land ha 55.200

Arable land ha 18.400

Forest land ha 36.039

Other ha 761

Table 1 - The structure of the territory of Priboj municipality

(Source: http://www.priboj.rs/geografski-polozaj)

Climate zone in the municipality of Priboj are moderately continental and mountain. This

distinctive climatic diversity results from the large dissection of relief (mountain mass effect,

hypsometric, slope and exposure) and regional winds.

The basic meteorological data (average annual values) of Zlatibor district (Source: RetScreen

International & NASA Software, updated 2014.):

- Insulation: 164.7 hours/month, i.e. 1.976,5 hours/year,

- The amount of rainfall: 990 mm/year,

- Air temperature: 7,8°C, Relative humidity: 75,8 %,

- Daily solar radiation on a horizontal surface: 3,76 kWh/m2 day,

- Atmospheric pressure: 93,6 kPa,

- Wind speed: 2,2 m/s (measured at 10 m from the ground),

- Ground temperature: 9,9°C

- Degree day heating: 3728

- Heating days: 239

- Average temperature during heating days: 4,4°C

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• The population of the municipality Priboj

Number Census year

of 1961 1971 1981 1991 2002 2011

Inhabitants: 26.147 32.548 35.200 35.951 30.377 27.133

Households: 1.948 3.187 4.216 5.137 5.159 5.009

Table 2 – From 1961 to 2011 Population Census data for municipality Priboj

(Source: http://popis2011.stat.rs/?page_id=2134)

3.2 TOWN PRIBOJ

Town Priboj is located on the river Lim and is the administrative center. Economic

development of Priboj was created after World War II, when large number of factories were built.

Factories established during that period were wood-industrial company "Lim", transportation company

"Raketa", industry "Polyester", a construction company "Construction", synthetic resins factory

"EPOXID" and Priboj car factory “FAP”.

Industrial development has led to an increase in the number of population in the period 1970-

1990 year. New part Priboj – Varoš has been built during the period of development and it contains

residential, educational, health and sports facilities. The district heating system in Priboj-Varoš is

connected to the heavy fuel boilers, which are positioned in the factory “FAP”. Plant in the factory FAP

has two heavy fuel boilers with 26 and 29 MW of power. Boiler with the power of 29 MW is out of

operation.

In the period prior to 2012, the supply of the city with the thermal energy was conducted by the

company "FAP-Stan" which was within the company “FAP”. The company "FAP-Stan" supplies the

city with heat energy and maintenance of residential buildings.

After the shutdown of the company “FAP”, the municipality in 2012 formed a public company

"Toplana-Priboj", with the aim to take over the supply of town with heating energy from company

"FAP-Stan".

Based on the agreement, public company "Plant-Priboj" supplies the city with thermal energy

using the resources and assets of the company "FAP-Stan".

Public company "Plant Priboj" supplies thermal energy 1.390 households in Priboj with

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81.720m2 heated area, and about 36,780m2 of office space, with a total installed capacity of the

district heating of 29.000 kW. (Source: http://www.priboj.rs/lokalna-samouprava/javna-

preduzeca/toplana-priboj).

• The population of the town Priboj

Number Census year

of 1961 1971 1981 1991 2002 2011

Inhabitants: 5.758 10.699 14.917 18.083 16.209 14.920

Table 3 – From 1961 to 2011 Population Census data for town Priboj

(Source: http://popis2011.stat.rs/?page_id=2134)

Microclimate data of Zlatibor district:

Air temperature

Relative humidity

Daily insulation

Atmospheric pressure

Wind speed

Soil temperature

Degree days heating

(°C) (%) (kWh/m2) (kPa) (m/s) (°C) (°Cd)

January -2,2 82,9 1,68 93,7 2,3 -1,8 626

February -1,0 77,8 2,48 93,6 2,3 -0,4 532

March 2,7 72,4 3,49 93,5 2,3 4,4 474

April 6,9 71,1 4,40 93,2 2,4 9,3 333

May 12,1 71,2 5,29 93,4 2,1 14,8 183

June 15,6 72,8 5,79 93,5 1,9 18,8 72

July 17,8 70,9 6,00 93,5 1,8 21,6 6

August 17,7 70,0 5,42 93,5 1,8 21,5 9

September 13,0 76,6 4,22 93,6 2,0 16,2 150

October 9,1 78,1 3,04 93,8 2,1 10,6 276

November 3,3 80,7 1,88 93,7 2,4 4,2 441

December -1,5 85,3 1,39 93,7 2,5 -0,8 605

Year 7,8 75,8 3,76 93,6 2,2 9,9 3.707

Table 4 - Microclimate data (Source: RetScreen International & NASA Software, updated 2014.)

4. EXISTING HEATING SYSTEM

The assignment of the study is elaboration of technical concept for central woodchip heating

system including boiler, feeding system, storage unit for 4 schools, kindergarten and health center

ambulance taking into consideration future efficiency measures in the buildings.

Objects that are the subject of these study are supplied by thermal energy through the existing

district heating system. Objects contain heating substations with exchangers and radiator heating

systems with temperature regime of 80 / 60C.

During data collection, in addition to the objects that are defined in the study, it was found that

http://popis2011.stat.rs/?page_id=2134

16

the heating system of residential building with more flats at address Limska 20 is unique with the

heating system of the health center.

Institution

Address Type

of energy

Time of Users

Building Heating

substation

system users heated room

operat. needs area height capacity

h h m2 m kW

1

Mechanical and electrical technical school Priboj

Vuka Karadžića

27 Vuka Karadžića

27

Dis

tric

t he

atin

g b

y h

ea

vy o

il 05-22

06-15 3.798 3,2 630

2

Primary school "Desanka Maksimović"

Limska 24 06-20 1.434 3 223


Nemanjina 35

Nemanjina 35

06-20 3.900 3,2 647

4 High school Priboj

Nemanjina 37

Nemanjina 35

06-15 2.143 3 333


Limska 18 Nemanjina

35

06-22 591 2,7 83

6 Residential building

Limska 20 05-22 221 2,7 31


Pionirska 2 Pionirska 2 06-16 1.200 2,7 168

Summary 13.287 2.115

Table 5 – Facilities data, (Source: data collected from the location)

Bearing in mind that the more objects are connected to one substation, observation data will

be carried out in relation to the substation, which is the starting point and the place of delivery of

thermal energy in buildings.

17

Figure 3 – Situation plan (Source: data collected from the location)

Observation of existing heating system in “Mechanical and electrical technical school Priboj”

and primary school „Desanka Maksimović“

Facilities of “Mechanical and electrical technical school Priboj” and primary school „Desanka

Maksimović“ are connected to the district heating system via the substation located in the basement

at address Vuk Karadzic 27.

The substation contains tubular heat exchanger, manifold with more connections and

circulation pumps. Substation is not equipped with an automatic temperature control and heat meters

for measuring heat consumption. Thermostatic valves on radiators do not exist.

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Picture 1– Technical school Priboj

Picture 2– Primary school “Desanka Maksimović“

Picture 3– Tubular heat excanger

The valves do not close the flow of water and the

thermal insulation fell off the equipment. Equipment and

installations in the boiler room are in poor condition. In the

basement floor there is the water of unknown origin. Rooms

in the basement are not safe for work.

Picture 4– Manifold with more connections

19

Observation of existing heating system for primary school „Vuk Karadžić“

Facility of primary school „Vuk Karadžić“ is connected to the district heating system via the

substation located in the basement of the building at address Nemanjina 35. Inside the room where

heating substation for primary school “Vuk Karadžić” is located , there are also heating substation for

high school Priboj and unique heating substation for residential building at address Limska 20 and

ambulance health center. Equipment and installations in a room with three substations are in good

and functional condition. The room with three heating substations was used as boiler room for primary

school “Vuk Karadžić”.

The substation for primary school “Vuk Karadžić” contains two tubular heat exchangers,

manifold with more connections and circulation pumps. Substation is not equipped with an automatic

temperature control and heat meters for measuring heat consumption. Radiators in school “Vuk

Karadžić” are equipped with thermostatic valves.

Picture 5 – School “Vuk Karadžić”, street view Picture 6–School “Vuk Karadžić”, yard view

Picture 7–Former boiler room with three

substations

Picture 8– Manifold with more connections for

school “Vuk Karadžić”

2

Observation of existing heating system for high school Priboj

Facility of high school Priboj at address Nemanjina 37 is connected to the district heating

system via secondary pipes and the substation located in the basement of the building at address

Nemanjina 35. The substation for high school Priboj contains tubular heat exchanger, manifold with

one connection and circulation pump. Substation is not equipped with an automatic temperature

control and heat meters for measuring heat consumption. Radiators in high school Priboj are not

equipped with thermostatic valves.

Picture 9 – High school, view Nemanjina street

Picture 10–High school, view Vuk Karadžić street

Picture 11–Substation for high school Priboj

Picture 12–Tubular heat exchanger for high school Priboj

3

Observation of existing heating system for ambulance health center and residential building at

address Limska 20

Ambulance health center building and residential building with several apartments at address

Limska 20 are connected to the district heating system via unique secondary pipe system and the

substation located in the basement of the building at address Nemanjina 35. The substation for health

ambulance and residential building contains plant heat exchanger, manifold with one connection and

circulation pump. Substation is equipped with an automatic temperature control but without heat

meters for measuring heat consumption. Radiators in ambulance health center are not equipped with

thermostatic valves.

Picture 13 – Ambulance health center Picture 14– Ambulance and residential building,

street view

Picture 15 – Ambulance and residential building,

yard view

Picture 16 – Substation for Ambulance health

center and residential building at address Limska

20

4

Observation of existing heating system for kindergarten “Neven”

Facility of kindergarten “Neven” is connected to the district heating system via substation

located in the substation-room of the building. The substation for kindergarten “Neven” contain plant

heat exchanger, manifold with more connection and circulation pump. Substation is equipped with an

automatic temperature control but without heat meters for measuring heat consumption. Radiators in

kindergarten “Neven” are not equipped with thermostatic valves.

Picture 17–Kindergarten “Neven”, street view Picture 18 – Entrance for employees from backyard

Picture 20-Plant heat exchanger in kindergarten “Neven”

Picture 19– Manifold with more

connections for kindergarten “Neven”

5

Complete Observation

Based on the displayed, heating systems differ by work time and number of users. Due the substations do not equipped with calorimeters, it cannot be possible to collect data of energy consumption, so that energy consumption is calculated according to the following:

yeHDDtt

QH

epi

C

24

Based on these equations calculated values are presented in the table below:

No

Institution

Using

Op

era

t.

da

ys Calculate

Address time A Q consum.

Building Substation from to

h h m2 kW kWh/a

1 Mechanical and electrical technical school Priboj

Vuka Karadžića 27 Vuka

Karadžića 27

6 15 185 3.798 630 834.455

2 Primary school "Desanka Maksimović"

Limska 24 6 20 185 1.434 223 295.371



35 6 20 185 3.900 647 856.972

4 High school Priboj Nemanjina 37 Nemanjina

35 6 15 185 2.143 333 441.069


Limska 18 Nemanjina

35

5 22 239 591 83 142.026

6 Residential building Limska 20 5 22 239 221 31 53.046


Pionirska 2 Pionirska 2 6 16 185 1.200 168 222.521

Summary 13.287 2.115 2.845.460

Table 6 – Overview of Data and consumption of facilities, (Source: Own calculations)

H - Estimated consumption

QC - Capacity of heating installation

ti - internal temperature (20°C)

tep - external project temperature (-20°C)

HDD - Degree days of heating (3728)

e - correction for the effect of wind and heating switch 0,9

y - correction for the effect of daily consumption profile 0,85

6

Current situation Unit District heating by

Crude oil

Consumption of energy (kWh) 2.845.460

Emission CO2 (kg) 796.729

Efficiency of system (%) 82%

Consumption of fuel (t) 315

Heated area (m2) 13.287

Unit fuel price (€/t), (€/kWh) 410

Annual energy cost (€) 126.184

Unit price of energy (€/m2) 9,50

Unit price of energy (€/MWh) 45,45

Table 7 – Current situation, Energy and fuel consumption, price , CO2 emission, (Source: Own

calculations)

Primary and secondary schools have limited heating during the winter holidays. On that way

schools are reducing the consumption of energy for heating.

The conclusion is that the presented annual energy of the facilities is 179kWh/m2, which is

much greater than the recommendations of the Government of the Republic of Serbia of 140kWh/m2 .

Based on the energy efficiency indicators district heating system for public facilities in town Priboj is

very inefficient. The energy efficiency of the heating system depends on the efficiency of the following

systems:

- System for the production of thermal energy - heat source

- Piping systems for hot water distribution

- The heating system in the buildings connected to the heating system, as well as

energy efficiency of buildings.

Use the heavy oil boilers in the city area, is unacceptable due to environmental pollution and

high CO2 emissions.

Increase in energetic, economic and environmental efficiency of heating systems in public

buildings (schools, kindergarten and ambulance health center) of the city Priboj, could be achieved by

forming the central boiler that will use cheaper fuel with low CO2 emissions.

Using biomass as fuel instead of heavy oil will lead to higher economic efficiency and to

decrease of environmental pollution.

7

5. BIOMASS MARKET ANALYSES

Biomass represents a renewable energy source, which is defined as the organic matter of

vegetable or animal origin (wood, straw, vegetable residues from agricultural production, manure,

organic fraction of communal solid waste). Biomass is used in combustion processes and converted

in power plants into the heat, electricity or both heat and electricity. Biomass is used for the

production of liquid and gaseous fuels. Only the biomass of wood origin in the form of wood chips will

be considered as a part of this study.

Biomass is one of the renewable sources of energy and as such is considered to be CO2

neutral. Since biomass combustion emits exact amount of carbon dioxide as the plant binds during

the process of photosynthesis during growth, in that sense coefficient of carbon dioxide emissions of

biomass equals zero. However, this information is valid only when it’s accompanied by a forestation,

otherwise CO2 emissions should be taken into account.

Biomass as fuel in modern systems used in the form of pellets and woodchips.

Wood chips are intended as the biomass for combustion in boiler plants. The quality of wood

chips was defined by the standard for solid fuel CEN / TS 14961: 2005 (1) General Requirements,

and (4) Wood chips for non-industrial use. In addition to that, the national standards are applied too.

The following table shows the requirements defined by the standards in Austria:

Table 8 - Requirements for wood chips according to ÖNORM M 7133

W20 W30 W35 W40 W50

Moisture content

W< 20%

20% ≤ W<30%

30% ≤ W<35%

35% ≤ W<40%

40% ≤ W<50%

Table 9-The classification of wood chips based on the moisture content according to ÖNORM M 7133

Wood chips

Standard ÖNORM M 7133

Particles size

Amax = 5 cm2

L = 12 cm (max 5% - 16 cm)

Moisture content

W10 – W50

50% max

Bulk density < 350 kg/m3

Calorific value 2,81-3,89 kWh/kg

8

Dimensions (mm)

The fracture> 80% by weight

Fine fracture <5% Rough fracture <1%

P16 3,15 ≤ P ≤ 16 mm < 1 mm >45 mm, and < 85mm

P45 3,15 ≤ P ≤ 45 mm < 1 mm > 63 mm P63 3,15 mm ≤ P ≤ 63 mm < 1 mm > 100 mm

P100 3,15 mm ≤ P ≤ 100 mm < 1 mm > 200 mm

Moisture (%)

M20 ≤ 20% Dried

M30 ≤ 30% Suitable for storage

M40 ≤ 40% Limited for storage M55 ≤ 55% Unsuitable for storage

M60 ≤ 60% Wet

Ash content (%)

A 0.7 ≤ 0,7% A 1.5 ≤ 1,5% A 3.0 ≤ 3,0% A 6.0 ≤ 6,0%

A 10.0 ≤ 10,0%

Table 10 – Requirements for wood chips according to CEN/TS 14961:2005, Part 4

The total area of forests and forest land in municipality Priboj is 36.039 ha. The forest coverage of the municipality is 65% and it is significantly higher than the percentage of forest cover in Serbia which is 27.4%. Half of the forest within the district of Zlatibor is owned by the state and the rest is privately owned.

According to a public company "Srbija Šume" forest farm "Prijepolje" consists of forest

administration areas Prijepolje, Nova Varoš, Priboj, with the total forest area of 54.435ha.

Forest farm Forest area

Total volume of

wood annual growth

annual return

Prijepolje ha m3 m

3/ha m

3

Prijepolje 22.381 2.859.757 3,4 350.162

Nova Varoš 12.403 2.440.821 4,8 251.691

Priboj 19.651 2.720.368 3,6 323.896

Total 54.435 8.020.946 11,8 925.749

Table 11 – Capacity data of forest farm “Priboj”, public company “Srbija Šume”, Source: http://www.srbijasume.rs/priboj.html

9

Figure 4 – Forest’s area in the total area Figure 5 – State and private forest’s by ratio

of municipalities by administrative districts

(Source: Statistical yearbook of Republic of Serbia 2012)

On the territory of the Zlatibor District in the study "Potentials and Possibilities of Commercial Use of Wood Biomass for Energy Production and Economic Development of the Municipalities Nova Varoš, Priboj and Prijepolje", 2009, author: prof. dr Branko Glavonjić, was conducted to establish the availability of wood waste from the sawmill industry and forestry in the neighboring municipalities of Nova Varoš, Priboj and Prijepolje. Results of the study showed that the following quantities are available to meet energy needs:

10

Municipalities

Available energy value of biomass

annuity

MWh/a toe/a

Nova Varoš 19.904,8 1.715,9

Priboj 8.840,4 762,1

Prijepolje 26.882,6 2.317,4

Total 55.627,8 4.795,4

Table 12 - Available biomass in municipal Zlatibor district, expressed through the energy value (Source: The study "Potentials and Possibilities of Commercial Use of Wood Biomass for Energy Production and Economic

Development of the Municipalities Nova Varoš, Priboj and Prijepolje", 2009., author: prof. dr Branko Glavonjić, is a

publication issued by the Faculty of Forestry of the University of Belgrade, Ministry of Agriculture, Forestry and Water

Management of the Republic of Serbia, Directorate of Forests and UNDP).

Biomass of wood origin in the form of pellets placed on the market was not acceptable for

analysis due to the high purchase price. Domestic market transactions are performed on a small scale

between manufacturers and wholesale where price reaches 160 EUR/t. Depending on the time of

purchase, end customers pay between 180 and 200 EUR / t. The advantage of pellets is higher bulk

density, which means lower transportation costs and smaller storage for the same amount of fuel in

terms of energy produced.

Some of the benefits of wood chips compared to wood pellets are lower prices and a lower

level of wood processing.

Wood chips

Moisture Energy value Bulk density Cost

(%) (kWh/m3) (bulk-kg/m

3) (€/t)

40 754 260 48

Table 13 - Characteristics of wood chips depending on the type of primary wood

Wood pellet

Wood pellets are the most common type of pellet fuel and are generally made from compacted

sawdust and related industrial wastes from the milling of lumber, manufacture of wood products and

furniture, and construction. Other industrial waste sources include empty fruit bunches, palm kernel

shells, coconut shells, tree tops and branches discarded during logging operations

Table 14 - Characteristics of wood pellet depending on the type of primary wood (Source:

https://en.wikipedia.org/wiki/Pellet_fuel)

Wood pellet

Moisture Energy value Bulk density Cost

(%) (kWh/t) (bulk-kg/m3) (€/t)

4-10 4.700-5.200 650 150-170

11

Pellets conforming to the norms commonly used in Europe (DIN 51731 or Ö-Norm M-7135)

have less than 10% water content, are uniform in density (higher than 1 ton per cubic meter, thus it

sinks in water) (bulk density about 0.6-0.7 ton per cubic meter), have good structural strength, and

low dust and ash content. Pellets can be made from nearly any wood variety.

The energy content of wood pellets is approximately 4.7 – 5.2 MWh/t. High-efficiency wood

pellet stoves and boilers have been developed in recent years, typically offering combustion

efficiencies of over 85%.

The quality of wood chips was defined by the Austrian standard Ö NORM M 7135:

Wood pellet

Standard Ö NORM M 7135

Diameter mm 4 - 10

Length mm < 5 x D

Density kg / dm3 > 1.12

Water content % < 10

Abrasion % < 2.3

Ash content % < 0.5

Energy content kWh/kg >5

Table 15 - Requirements for wood pellet according to ÖNORM M 7135

(Source: https://ec.europa.eu/energy/intelligent/projects/sites/iee-

projects/files/projects/documents/pelletslas_pellet_standards.pdf)

The advantage of wood pellets in relation to the wood chip is increased density. Due to the

higher density requires less storage space for pellets and transport is cheaper. This advantage is

demonstrated in the implementation of heating systems of family and small business establishments

where it is not possible to provide a large space for storing fuel.

6. TECHNICAL DESIGN CONCEPT

6.1 TECHNICAL SOLUTIONS AND UNIT COST OF FUEL-ENERGY

In order to reduce costs of heating energy the buildings from the study, it is necessary to

switch energy source to biomass fuel. For the purpose of elaborating the best solutions according to

the criterion of investment and exploitation costs, the task of this study is the creation of two scenarios

replacing fuels with biomass:

- Scenario 1 - All buildings from the study will be connected to the new woodchip boiler.

- Scenario 2 - All buildings will have separate boilers with woodchips or wood pellet.

12

After collecting data in order to find the most optimal solution, for the purpose of this study, two

scenarios were developed:

- Scenario 1 - All buildings from the study, except kindergarten, will be connected to the new

wood chips boiler. For the building of kindergarten, separate pellet boiler is planned to be built.

This solution does not require large investment for the construction of hot-water pre-insulated

pipes, with the length of more than 250m. Solution to connect building of kindergarten to

central wood chips boiler with pre-insulated pipes, is not the best technical solution. Such a

solution would lead to delays in delivery of heat energy to kindergarten. The option where the

kindergarten would be attached to a central boiler room is also not acceptable since there

would be a delay in warming of kindergarten because of its distance from other facilities and

transportation of heat through hot water pipes. The reason for this is the large distance

between kindergarten and other connected facilities and transportation of hot water through a

long pre-insulated pipes.

- Scenario 2 - All buildings will have separate boilers with woodchips or wood pellet.

Table 16 - Overview of Data and consumption of facilities according to the scenario,

In order to analyze the reduction in the cost of energy, it is present a comparative analysis of

the cost of energy, if the facilities, using biomass as a fuel, according to the scenarios.

Biomass Moisture

Caloric value

Unit price

(%) (kWh/t) (€/t) (€/kWh)

Wood chips 40 2.900 48 0,017

Wood pellet <5 5.200

160 0,031

<10 4.700 0,034

Table 17 – Unit price of wood chips and wood pellet

Address

Buildingm

2kW kWh/a m

2kW kWh/a m

2kW kWh/a

1Mechanical and electrical

techical school PribojVuka Karadžića 27 3.798 630 834.455 3.798 630 834.455

2Primary school "Desanka

Maksimović"Limska 24 1.434 223 295.371 1.434 223 295.371

3Primary school "Vuk

Karadžić"Nemanjina 35 3.900 647 856.972 3.900 647 856.972

4 High school Priboj Nemanjina 37 2.143 333 441.069 2.143 333 441.069

5Health center ambulance

PribojLimska 18 591 83 142.026 591 83 142.026

6 Residental building Limska 20 221 31 53.046 221 31 53.046

7 Kindregarden "Neven" Pionirska 2 1.200 168 222.521 1.200 168 222.521

12.087 1.947 2.622.938 1.200 168 222.521 13.287 2.115 2.845.460

consum. A QA Q consum.

SCENARIO 2SCENARIO 1

consum.Q

No Institution

Summary

A

Wood chips Wood pellet

13

Energy produce by Liquid Wood Scenario 1 Scenario 2

Unit Crude oil Chips Pellet Chips pellet

Consumption of energy (MWh) 2.845 2.623 223 2.845 2.845 2.845

Emission CO2 (t) 797 0 0 0 0 0

Efficiency of system (%) 82% 84% 84% 84% 84%

Consumption of fuel (t) 315 1.077 53 1.168 677

Heated area (m2) 13.287 12.087 1.200 13.287 13.287 13.287

Unit fuel price (€/t) 410 48 160 48 160

Anual energy cost (€) 129.339 51.684 8.477 60.161 56.068 108.398

Unit price of energy (€/m2) 9,73 4,28 7,06 4,53 4,22 8,16

Unit price of energy (€/MWh) 45,45 19,70 38,10 21,14 19,70 38,10

Table 18 – Comparative analysis of the cost of existing fuel and biomass, (Source: Own calculations)

Figure 6 – Annual energy cost by scenario-fuel

Annual costs of heavy oil for heating the buildings from the study is more than 130.000 €. If we

use scenario 1, annual fuel costs would amount to 60.000 €. If we use scenario 2, annual fuel costs

would amount to 56.000€ for wood chips and amount to 110.000€ for wood pellet. The use of

biomass as a fuel significantly reduces the costs for the production of heat energy.

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

Liquid Scenario 1 Scenario 2-Chips

Scenario 2-Pellet

129,339

60,161 56,068

108,398

Annual energy cost (€)

Annual energy cost (€)

14

Figure 7 – Unit price of energy by scenario

The required installed capacity of the boiler according to the scenario and level of efficiency of

the heating system is calculated using the formula:

C

B

QQ

QB (kW) Installed boiler capacity

QC (kW) Net consume (capacity)

η System efficiency

η = ηB · ηC

ηB Boiler efficiency

ηC Efficiency of district heating system

τ Simultaneity factor

For scenario 1, the calculated heat demand would be covered by installing heating boilers of

nominal heat output presented in following table:

Scenario 1 Capacity - Qc ηB ηC τ Calculate - QB Sizing of the

boiler

(kW) (kW) (kW)

Wood chips 1.947 0,9 0,95

0,85 1.936 2.000

Wood pellet 168 0,90 177 200

Table 19 – Calculate capacity of heating boilers for Scenario 1, (Source: Own calculations)

0.00

10.00

20.00

30.00

40.00

50.00

Liquid Scenario 1 Scenario 2-Chips Scenario 2-Pellet

9.73 4.53 4.22

8.16

45.45

21.14 19.70

38.10

Unit price of energy (€/m2),(€/MWh)

(€/m2) (€/MWh)

15

Figure 8 – Diagram of the annual distribution heat capacity from boilers, Scenario 1

The number of hours of boiler operation can be determined using Sochinsky formula:

max

1

0

0

0

11 QQ

m

b

max

min0

Q

Q

maxQ

Qmm

Q - heating capacity at the time,

- time,

minQ - minimum heating capacity of boiler

maxQ - maximum heating capacity of boiler

mQ - required capacity

0

500

1000

1500

2000

2500

0 1000 2000 3000 4000 5000

Heating Capacity (kW) - Heat Load Curve

Wood chips Boiler Wood pellet Boiler

16

During winter, every heating system is subject to great fluctuations that depend on the weather

and user’s habits. The maximum output is only utilized very briefly during periods of very cold

weather. In contrast, the boiler is operating for long intervals of time at low load. Therefore, it is

important for the boiler to be operated efficiently during off-peak periods. This can be achieved in one

of the following ways:

1. The biomass boiler can provide the maximum capacity, while a buffer (a hot water tank)

covers short-term load fluctuations and ensures that the boiler can be operated efficiently

during off-peak periods. This solution has the advantage that only one fuel is required.

2. Combination of two biomass boilers. The second boiler increases the reliability of supply (for

this reason it should have a separate fuel supply system) and ensures that the heating

operates efficiently, even in off-peak periods.

Review of solutions offered in the analysis shows that the optimal model for central boiler room is two wood chips boilers with hot water tank. The optimal model for kindergarten is wood pellet boiler with hot water tank. Existing substations would serve as a backup in case of problems with supplying the fuel for biomass boiler.

For scenario 2, the calculated heat demand would be covered by installing heating boilers of

nominal heat output presented in next table:

Table 20 – Calculate capacity of heating boilers for scenario 2, (Source: Own calculations)

Comparison of biomass and heavy oil is based on an average annual energy consumption of

1345 kWh / kW. This consumption predict that during the winter holidays, heating in schools is in low

mode. According to this data, it is necessary to produce yearly consumption of 2.846 MWh. The unit

production costs of the heat energy according to the scenario 1 is up to 21,14 EUR/MWh, and the unit

production costs according to the scenario 2 are up to 19,70 EUR/MWh for wood chips and up to

38,10 EUR/MWh for wood pellet. Current unit costs for buildings from the study, with heavy oil district

heating system, are up to 45,45 EUR/MWh.

Based on the present lowest fuel costs for thermal energy this is achieved according to the

scenario 2 with wood chips as a fuel.

Capacity - Qc ηB ηC τ Calculate - QB Sizing of the boiler

(kW) (kW) (kW)

Mechanical and electrical techical school Priboj 630 663 700

Primary school "Desanka Maksimović" 223 235 250

Primary school "Vuk Karadžić" 647 681 700

High school Priboj 333 351 350

Health center ambulance Priboj 83 87 100

Residental building 31 33 40

Kindregarden "Neven" 168 177 200

0,9 0,95 0,9

Scenario 2

17

6.2 BOILER ROOMS, LOCATION AND FACILITIES

Construction of a biomass boiler depends on the choice of scenarios and technical solutions.

Scenario 1.

Construction of the facility for wood chip boiler is planned. New boiler will supply all the

buildings from the study with heat energy, except the kindergarten “Neven“. New woodchip boiler will

connect existing substations, located at Vuk Karadzic's 27 and Nemanjina 35. Connecting the boiler

to the substation, located at Vuk Karadžić 27, is planned to be done with pre-insulated pipes

dimension DN125 and length of 40 m. Connecting the boiler to the substation located at Nemanjina

35 is planned to be done with pre-insulated pipes dimension DN125 and length of 60 m. During the

construction of the boiler room it will be necessary to relocate the existing pipeline of primary school

Desanka Maksimović and carry out new dimensions DN80 and length 55 m. Existing distribution line

of pre-insulated pipes from substations to buildings can be used with such solution.

Hot water from the boiler is circulated to a

substation via a new circulation pump planed in the

boiler room. The circulation of water from the

substation to the facilities would take over the

existing circulation pumps. The location for the

construction of a new boiler room is a space

between the machine schoolyards technical and

elementary school "Desanka Maksimovic". The

building boiler room should contain:

Picture 21-Planned location of boiler room - Space to accommodate biomass boiler 150m2

- Space to accommodate daily tank of woodchips 40m2

- The area of mechanical processing equipment sale 50m2

- For the stock building , to accommodate wood chip, it is needed surface of 160m2 and useful

height of 7m. The total area of buildings on the woodchip boiler is 400m2.

-

It is planned to install a buffer tank with volume of 10 m3 in order to optimize the operation of

the heat source. Circulator pumps are located between the boiler and the buffer tank, as well as three

way mixing valve in order to provide protection for the cold parts of boilers.

18

Technical calculation have been made by using boiler documentation series TTP by "Topling-

heating Beograd", including additional mechanisms for feeding fuel, extracting exhaust gases and

ash. Room woodchip boilers need the usable area of 150 m2. Storage facility for woodchip is planned

right next to the building with the boilers. Storage of sufficient capacity to ensure the operation in the

coldest month of the winter season should be placed in the plant. Storage should be of sufficient

capacity to ensure the operation for period of three weeks in the coldest month of the winter season.

Figure 9 – Plan of new boiler rooms and pre-insulated pipes, scenario 1

19

Due to limited space, it is not possible to provide a larger stock of woodchip than for a period of two weeks. Because of this it is needed to ensure a constant supply of woodchip or provide other location with larger space for the storage of large quantities of wood chips. The warehouse has a capacity of woodchip 300m3 of M40 moisture. The storage volume is 450m3 (gross volume 15 m x 10 m x 5 m). Position boilers and buildings for storage of wood chips is shown in the drawing.

For pellet boiler room for kindergarten “Neven” is necessary to predict the room of 100m2. Boiler room should contain:

- Space to accommodate wood pellet boiler 50m2

- The area of mechanical processing equipment sale 15 m2

- Space to accommodate wood pellet 35 m2

The total area of the wood pellet boiler for kindergarten is 100m2. The space for the boiler

room can be provided in the back yard. Connecting the boiler to the kindergarten’s substation, is planned by the pre-insulated pipes dimension DN80 and length of 30m. The circulation of the boiler to the substation will be via a new circulation pump. From the substation to the radiator circulation is realized the existing pumps. Storage area for pellet should provide a reserve for a period of two months.

For kindergarten is planned boiler wood pellet BIOTERM 350 produce by Termomont Šimanovci. Power of boiler is 150-350kW, with regime 90 / 70C.

Scenario 2

Construction of seven separated new boiler rooms for each building is planned by this

scenario. According to the calculation, total power of pellet boilers is 2430 kW. To provide

accommodation for seven boiler plants, it is necessary to build seven boiler rooms with a total useful

area of 1625m2 for wood pellet or 2937m2 for wood chips as a fuel. Inside the boiler rooms there will

be space for storing wood pellets for a period of at least two months. New pipeline to the house

heating system is planned each boiler. The obligation of the owner of the object is to provide

adequate room for the boiler room or space to build a new one.

Scenario 2

Sizing of the boiler

Boiler room and storage area

Volume of water baffer chips pellet

(kW) (m2) (m

2) (m

3)

Mechanical and electrical techical school Priboj 700 655 460 8

Primary school "Desanka Maksimović" 250 253 125 3

Primary school "Vuk Karadžić" 700 655 460 8

High school Priboj 350 418 320 4

Health center ambulance Priboj 100 145 105 1

Residental building 40 56 55 0,5

Kindregarden "Neven" 200 756 100 2

TOTAL 2.340 2.937 1.625 26,5

Table 21 – Boiler rooms surface according to Scenario 2, (Source: Own calculations)

20

7. PRELIMINARY COST ESTIMATES

The task of this study contain two scenarios. Both scenarios have a task to perform switching

to biomass fuel but with a different technical concept. The solution of the task of the study, is a

comparative review of three different scenarios.

- Scenario 1 - All buildings from the study, except kindergarten „Neven“ will be connected to the

new woodchip boiler. For the building of kindergarten, it is planned separate pellet boiler.

- Scenario 2 - All buildings will have separate pellet boilers.

- Scenario 2.1 - All buildings will have separate woodchip boilers.

Fuel switch to biomass heating systems in buildings from the study, should provide less

heating costs, reduce CO2 emissions and enable environmental protection as well as greater

activation of the local economy with the aim of growing and processing of biomass. It is necessary

that investment at this level provide greater financial savings in the budget of the public administration

of the municipality Priboj, and thus a quick return on investment.

7.1 PRELIMINARY COST ESTIMATES, SCENARIO 1

The preliminary cost estimate includes investment and operating costs annually. Investment

expenses would include the purchase of equipment and boilers, necessary civil works, mechanical

works and electrical works on the construction of a new boiler, the heating grid, and connecting

objects to a new distribution system.

Position Investment costs - Description - SCENARIO 1 (€)

1. Access road and landscaping plots for the new building and for the route of new pipeline. 15.000

2. Construction of the fuel storage facility and new boiler room the total area 500m2 45.000

3. Energy plant, mechanical and electrical equipment works (except boilers) 20.000

4. Biomass boilers and associated equipment 200 kW + 800 kW + 1200 kW 180.000

5. Chimneys 13.000

6. Construction of heating grid for connecting the substations 35.000

7. Relocation of existing secondary pipeline to primary school "Desanka Maksimović" 8.000

8. Documentation, construction management, commissioning of the plant and heating grid 35.000

9. Unforeseen costs 15.000

CAPEX (Capital Expenditure) 366.000

Table 22 – Investment costs for scenario 1 (Source: Own calculations)

21

Table 23 – Operational costs for scenario 1 (Source: Own calculations)

7.2 PRELIMINARY COST ESTIMATES, SCENARIO 2



works and electrical works on the construction of a new boiler, the heating grid, and connect objects

to new boilers.

Position Investment costs - Description - SCENARIO 2 – Wood pellet (€)

1. Access road and landscaping plots for the new buildings and for the route of new pipeline. 5.000



4. Biomass boilers and associated equipment total power 2430 kW 220.000

5. Chimneys 15.000

6. Construction of pipelines to connecting heating systems in buildings 15.000

7. Relocation of existing secondary pipline to primary school "Desanka Maksimović" 0





Position Operational costs - Description - SCENARIO 2 Unit Cost

1. Maintenance % CAPEX / a 1,0

2. Elektricity - costs of the plant kWhel. / MWhht. 2

3. Labor costs € / a 22.000

4. Removal and disposal of ash € / t 50

5. Chemical treatment of circulating water € / MWhht. 0,80

6. Unit price of fuel, Wood pellet, quolity Ö NORM M 7135 € / MWhht. 38,10

Position Operational costs - Description - SCENARIO 1 Unit Cost






6. Unit price of fuel, Percentage share wood chips - pellet € / MWhht. 21,14

7. The costs of facilities servicing € / a 1.500

8. Insurance costs % CAPEX / a 0,5

9. Depreciation of equipment and installations % / a 3

10. Depreciation of buildings % / a 1

11. Boiler efficiency % 90

12. Efficiency of heating system % 94

22






12. Efficiency of district heating system % 94

Table 25 – Operational costs for scenario 2 (Source: Own calculations)

7.3 PRELIMINARY COST ESTIMATES, SCENARIO 2.1



works and electrical works on the construction of a new boiler, the heating grid, and connect objects

to new boilers.

Position Investment costs - Description - SCENARIO 2.1 - Wood chips (€)

1. Access road and landscaping plots for the new building and for the route of new pipeline. 5.000



4. Biomass boilers and associated equipment total power 2430 kW 225.000

5. Chimneys 15.000

6. Construction of pipelines to connecting heating systems in buildings 15.000

7. Relocation of existing secondary pipline to primary school "Desanka Maksimović" 0





Position Operational costs - Description - SCENARIO 2.1 Unit Cost






6. Unit price of fuel, Wood chips, quolity Ö NORM M 7133 € / MWhht. 19,70






12. Efficiency of district heating system % 94

Table 27 – Operational costs for scenario 2.1 (Source: Own calculations)

23

8. PRELIMINARY FINANCIAL ANALYSE Sustainability of each scenario will be analyzed for a period of 20 years. Consumption of thermal energy in the future will depend on local climate change. Reduction in thermal energy consumption per unit of installed capacity due to local climate change will be 0.1% per annum. Preliminary financial analysis is carried out for each of the two scenarios.

8.1 PRELIMINARY FINANCIAL ANALYSE, SCENARIO 1

Preliminary financial analysis for scenario 1, contains table of cost of energy production, figure

of comparative analysis of cost heat energy and savings, figure saving from fuel switch, figure

operational costs and depreciation and figure of cash flow balance. Figure of comparative analysis of

cost heat energy and savings, figure saving from fuel switch, figure operational costs and depreciation

and figure of cash flow balance are given in the Appendix.

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

Biomass - wood chips 51.557 51.505 51.454 51.402 51.351 51.300 51.248 51.197 51.146 51.095

Biomass - wood pellet 8.671 8.662 8.653 8.645 8.636 8.627 8.619 8.610 8.601 8.593

Ash 2.821 2.818 2.816 2.813 2.810 2.807 2.804 2.802 2.799 2.796

Electricity 398 398 397 397 397 396 396 395 395 395

Water 2276 2273 2271 2269 2267 2264 2262 2260 2258 2255

Summary 65.723 65.657 65.591 65.526 65.460 65.395 65.329 65.264 65.199 65.134

Employee – Labor costs 15.000 15.000 15.000 15.000 15.000 15.000 15.000 15.000 15.000 15.000

Maintenance 3.660 3.660 3.660 3.660 3.660 3.660 3.660 3.660 3.660 3.660

Insurance costs 1830 1830 1830 1830 1830 1830 1830 1830 1830 1830

Summary 20.490 20.490 20.490 20.490 20.490 20.490 20.490 20.490 20.490 20.490

Depreciation 7.870 7.870 7.870 7.870 7.870 7.870 7.870 7.870 7.870 7.870

Total costs 94.083 94.017 93.951 93.886 93.820 93.755 93.689 93.624 93.559 93.494

2028 2029 2030 2031 2032 2033 2034 2035 2036 2037

Biomass - wood chips 51.044 50.993 50.942 50.891 50.840 50.789 50.738 50.687 50.637 50.586

Biomass - wood pellet 8.584 8.576 8.567 8.559 8.550 8.541 8.533 8.524 8.516 8.507

Ash 2.793 2.790 2.788 2.785 2.782 2.779 2.777 2.774 2.771 2.768

Electricity 394 394 394 393 393 392 392 392 391 391

Water 2253 2251 2249 2246 2244 2242 2240 2237 2235 2233

Summary 65.068 65.003 64.938 64.873 64.809 64.744 64.679 64.614 64.550 64.485


Maintenance 3.660 3.660 3.660 3.660 3.660 3.660 3.660 3.660 3.660 3.660

Insurance costs 1830 1830 1830 1830 1830 1830 1830 1830 1830 1830

Summary 20.490 20.490 20.490 20.490 20.490 20.490 20.490 20.490 20.490 20.490

Depreciation 7.870 7.870 7.870 7.870 7.870 7.870 7.870 7.870 7.870 7.870

Total costs 93.428 93.363 93.298 93.233 93.169 93.104 93.039 92.974 92.910 92.845

Table 28 – Costs of energy production, scenario 1; (Source: Own Calculations)

24

Scenario 1 presents that in the period of 8 years of the start of exploitation there will be an

opportunity for positive business. The advantage of this scenario is that the municipality formed a

sustainable heating system, which increases the quality of life and a creates a positive effect on the

environment. If we assume that the costs of heating plants are approximately the same in the case of

existing fuels (heavy oil), we can conclude that technical solution according to scenario 1, proceeds

fast return on invested funds.

8.2 PRELIMINARY FINANCIAL ANALYSE, SCENARIO 2

Preliminary financial analysis for scenario 2 contains table of cost of energy production, figure

of comparative analysis of cost of heat energy and saving and figure of cash flow balance. All figures

are given in the Appendix.

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

Biomass 108.382 108.274 108.165 108.057 107.949 107.841 107.733 107.626 107.518 107.411

Ash 1.693 1.692 1.690 1.688 1.686 1.685 1.683 1.681 1.680 1.678

Electricity 398 398 397 397 397 396 396 395 395 395

Water 2276 2273 2271 2269 2267 2264 2262 2260 2258 2255

Summary 112.749 112.637 112.524 112.411 112.299 112.187 112.075 111.962 111.851 111.739


Maintenance 4.950 4.950 4.950 4.950 4.950 4.950 4.950 4.950 4.950 4.950

Insurance costs 2475 2475 2475 2475 2475 2475 2475 2475 2475 2475

Summary 29.425 29.425 29.425 29.425 29.425 29.425 29.425 29.425 29.425 29.425

Depreciation 9.600 9.600 9.600 9.600 9.600 9.600 9.600 9.600 9.600 9.600

Total costs 151.774 151.662 151.549 151.436 151.324 151.212 151.100 150.987 150.876 150.764

2028 2029 2030 2031 2032 2033 2034 2035 2036 2037

Biomass 107.303 107.196 107.089 106.982 106.875 106.768 106.661 106.554 106.448 106.341

Ash 1.676 1.675 1.673 1.671 1.670 1.668 1.666 1.665 1.663 1.661

Electricity 394 394 394 393 393 392 392 392 391 391

Water 2253 2251 2249 2246 2244 2242 2240 2237 2235 2233

Summary 111.627 111.515 111.404 111.292 111.181 111.070 110.959 110.848 110.737 110.626


Maintenance 4.950 4.950 4.950 4.950 4.950 4.950 4.950 4.950 4.950 4.950

Insurance costs 2475 2475 2475 2475 2475 2475 2475 2475 2475 2475

Summary 29.425 29.425 29.425 29.425 29.425 29.425 29.425 29.425 29.425 29.425

Depreciation 9.600 9.600 9.600 9.600 9.600 9.600 9.600 9.600 9.600 9.600

Total costs 150.652 150.540 150.429 150.317 150.206 150.095 149.984 149.873 149.762 149.651

Table 29 – Costs of energy production, scenario 2; (Source: Own Calculations)

Scenario 2 shows predicts no opportunities for positive business results. This is due to high

investment costs and high maintenance costs for construction of seven separate boiler rooms. Larger

number of boilers with complex systems for combustion requires hiring more labor force.

25

8.3 PRELIMINARY FINANCIAL ANALYSE, SCENARIO 2.1

Preliminary financial analysis for scenario 2.1 contains table of cost of energy production,

figure of comparative analysis of cost of heat energy and saving and figure of cash flow balance. All

figures are given in the Appendix.

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

Biomass 56.040 55.984 55.928 55.872 55.816 55.760 55.705 55.649 55.593 55.538

Ash 2.919 2.916 2.914 2.911 2.908 2.905 2.902 2.899 2.896 2.893

Electricity 398 398 397 397 397 396 396 395 395 395

Water 2276 2273 2271 2269 2267 2264 2262 2260 2258 2255

Summary 61.634 61.572 61.510 61.449 61.387 61.326 61.265 61.203 61.142 61.081


Maintenance 6.250 6.250 6.250 6.250 6.250 6.250 6.250 6.250 6.250 6.250

Insurance costs 3125 3125 3125 3125 3125 3125 3125 3125 3125 3125

Summary 31.375 31.375 31.375 31.375 31.375 31.375 31.375 31.375 31.375 31.375

Depreciation 11.000 11.000 11.000 11.000 11.000 11.000 11.000 11.000 11.000 11.000

Total costs 104.009 103.947 103.885 103.824 103.762 103.701 103.640 103.578 103.517 103.456

2028 2029 2030 2031 2032 2033 2034 2035 2036 2037

Biomass 55.482 55.427 55.371 55.316 55.261 55.205 55.150 55.095 55.040 54.985

Ash 2.890 2.887 2.885 2.882 2.879 2.876 2.873 2.870 2.867 2.864

Electricity 394 394 394 393 393 392 392 392 391 391

Water 2253 2251 2249 2246 2244 2242 2240 2237 2235 2233

Summary 61.020 60.959 60.898 60.837 60.776 60.715 60.655 60.594 60.533 60.473


Maintenance 6.250 6.250 6.250 6.250 6.250 6.250 6.250 6.250 6.250 6.250

Insurance costs 3125 3125 3125 3125 3125 3125 3125 3125 3125 3125

Summary 31.375 31.375 31.375 31.375 31.375 31.375 31.375 31.375 31.375 31.375

Depreciation 11.000 11.000 11.000 11.000 11.000 11.000 11.000 11.000 11.000 11.000

Total costs 103.395 103.334 103.273 103.212 103.151 103.090 103.030 102.969 102.908 102.848

Table 30 – Costs of energy production, scenario 2.1; (Source: Own Calculations)

Scenario 2.1 shows predicts very small opportunities for positive business results. This is due

to high investment costs and high maintenance costs for construction of seven separate boiler rooms.

Larger number of boilers with complex systems for combustion requires hiring more labor force.

26

9. PROJECT EVALUATION

Based on the analysis of three proposed scenarios, construction the central wood chips boiler

with construction the separate wood pellet boiler for kindergarten heating system, would be more

justified then construction seven separate wood pellet boiler rooms.

Under scenario 1, and on the basis of investment costs (table 22) and operating costs for the

period of 20 years (table 23) economic indicators are calculated an given in the table 31.

Unit cost heat energy Unit Value

The investment value - Capex € 366.000

Annual production of heat energy (first year of operation) MWh / a 2.845

Total heat production (20 years) MWh 56.356

The operation value (20 years) - Opex € 1.869.243

LUC - Levelized Unit Costs € / MWh 39,7

NPV € 98.285

DR % 6

IRR % 9,063

Sensitivity to changes in the price of fuel (biomass) IRR%

Price biomass is less 5% 10,100%

Price biomass increased 5% 7,985%



Table 31 – Unit cost heat energy (Source: Own calculations)

Economic indicators can be defined investment plan are:

- (F) IRR - (Financial) Internal Rate of Return - (E) IRR - (Economy) Internal Rate of Return - (F) NPV - (Financial) Net Present Value - (E) NPV - (Economy) Net Present Value - DR - Discount Rate

Based on the results obtained from the analysis of the techno-economic indicators, the conclusion

is that the investment in the construction of a new boiler rooms with boilers for combustion of wood

chips and wood pellet under scenario 1 is acceptable.

IRR = 9,063% > DR = 6 %

Financial indicators are sensitive to changes in fuel prices. The increase in price of fuel (wood

chips) higher than 10% influence on the profitability of investments.

It is necessary to take into account the rise in price of fossil fuels in the future. The use of

biomass for energy purposes makes users dependent of disruptions in fossil fuels market.

27

10. INSTITUTIONAL ANALYSES

Directive No. 2009/28 / EU promotes the use of energy from renewable energy

sources. It sets binding national goals for the overall share of energy from renewable sources in final

energy consumption (less than 20%), as well as the share of RES in transport (10% of energy from

renewable sources in transport by 2020).

In order to support investments in renewable energy sources, the Republic of Serbia has

passed a number of laws and bylaws relating to the use of biomass and other renewable energy

sources. These are the following acts:

- Energy Law (Official Gazette of the Republic of Serbia 57/2011, 80/2011- core, 93/2012 and

124/2013),

- Energy Sector Development Strategy of the Republic of Serbia by 2015 (Official Gazette of the

Republic of Serbia 44/2005),

- Amendments and Additions to the Energy Sector Development Strategy by 2015 for the period

2007-2012 (Official Gazette of the Republic of Serbia 99/2009),

- Law on Planning and Construction (Official Gazette of the Republic of Serbia 72/2009,

81/2009-corr, 64/2010 – Decision of the Constitutional Court, 24/2011, 121/2012, 42/2013 –

Decision of the Constitutional Court, 50/2013 – Decision of the Constitutional Court, 98/2013 –

Decision of the Constitutional Court),

- Law on Environmental Protection (Official Gazette of the Republic of Serbia 135/2004,

36/2009, 36/2009 and other law, 72/2009 and other law, 43/2011 – Decision of the

Constitutional Court),

- The Law on The Strategic Assessment of Environmental Impact (Official Gazette of the

Republic of Serbia 135/2004 and 88/2010),

- Law on the Assessment of Environmental Impact (Official Gazette of the Republic of Serbia

135/2004 and 36/2009),

- Law on Integrated Prevention and Control of Environmental Pollution (Official Gazette of the

Republic of Serbia 135/2004),

- Law on Waste Management (Official Gazette of the Republic of Serbia 36/2009 and 88/2010),

- Law on Air Protection (Official Gazette of the Republic of Serbia 36/2009),

28

- Law on the Ratification of the Kyoto Protocol to the UN Framework Convention on Climate

Change (Official Gazette of the Republic of Serbia – International Contracts, 88/2007 and

38/2009 and other laws),

Law on the Ratification of the Treaty Establishing the Energy Community between the

European Community and the Republic of Albania, Bulgaria, Bosnia and Herzegovina,

Croatia, Former Yugoslav Republic of Macedonia, Montenegro, Romania, Republic of Serbia

and the UN Mission in Kosovo in accordance with UN Security Council Resolution 1244

(Official Gazette of the Republic of Serbia 62/2006)

- National Strategy of Sustainable Development (Official Gazette of the Republic of Serbia

57/2008),

- Introduction of Cleaner Production Strategy in the Republic of Serbia (Official Gazette of the

Republic of Serbia 17/2009).

Biomass Action Plan 2010-2012 defines the following projects in the Republic of Serbia:

- Synchronization of Serbian technical standards on biomass and bio-waste with the EU,

- Biofuels market development project – assessment of biomass availability,

- Development of policy for long-term supplies of biomass,

- Feasibility Study to justify collection of wood waste from forestry in Serbia,

- Development of certification on sustainable biofuels/bioenergy in line with EU standards,

- Development of a network of sustainable cities/regions in Serbia,

- Developing communication strategies for renewable energy in Serbia,

- Training for successful project proposals for EU funds,

- Demonstration projects related to biomass in line with the best practice of the EU,

- Production of a manuals (guidelines) for applying for financial support from banks – best

experiences.

29

11. ENVIRONMENTAL IMPACTS

Zone of influence of the project is the area where the biomass is collected, prepared for transportation and transported from municipality Priboj and from the immediate surroundings, which may be registered as the environmental impact of noise, vibration, emissions of particulate matter from the exhaust gases, etc. During the construction of the plant adverse impacts on the local environment may occur as a

result of construction and installation works. Particularly negative impact would represent preparing

the area for the construction of the boiler room and storage of wood chips where it would be

necessary to clear and level the ground. Implementation of these activities involves cutting a dozen

deciduous trees and clearing of waste. Construction works will cause noise and vibration generated

by using construction machinery as well as increased dust emissions due to works on the excavation

of foundations, leveling the field and the development of access roads. All of the above effects are not

of great intensity and are relatively short in duration. The area in which the works will be carried out

will be protected by the building site fence so that all adverse environmental impacts outside of the

borders will be negligible.

Prior to the commencement of works, the Investor is required to prepare a study on the

organization of the site which will display the work areas, corridors for internal transport, temporary

storage of equipment and materials, landfill waste during construction, manner and place of storage of

flammable and hazardous materials. The study will show the connection to the outside infrastructure

and installations, usage of protective agents, the method of disposal of solid and liquid waste and

other specific measures which would to be taken to reduce risks to health and safety of the personnel

engaged, as well as environment protection actions.

During the operation of the energy block, the harmful substances contained in the exhaust

gases will exert the greatest impact on the environment. In addition to dust from the fuel, the exhaust

gas also contains solid particles. Adding a cyclone device as a part of a boiler for combustion of

biomass would have effects on the following:

- Nitrogen oxides (NOx) in the case of combusting low moisture biomass. The temperature of

combustion is high in this case and NOx content is significantly higher than in case of

combusting biomass with high percentage of moisture.

- Sulfur oxides (SOx) are low because of the low sulfur content in the biomass,

- Carbon dioxide (CO2) is considered neutral because the biomass is considered a renewable

energy source so that the entire amount of the carbon emitted in the exhaust gas has been

previously taken from the environment in which the tree grew,

- Carbon monoxide (CO) in practical terms does not occur due to the construction of the boilers

and constant monitoring of the combustion process.

30

In any case, the planned power plant should replace the existing one in which the burning

heavy fuel oil (crude oil) is extremely unfavorable for boiler installations within residential areas.

The construction itself does not require a significant amount of water. While in operation, the

power plant does not have losses and uncontrolled water runoff except in the cases of an emergency

breakdown situations. These situations are extremely rare with this kind of plants, so it is safe to say

that there is no risk of environmental pollution, as well of pollution of surface and groundwater.

The existing sewerage system is able to accept the waste water that may be of atmospheric

origin, waters from washing facilities and equipment with a negligible content of oils and fats, waste

and sanitary sewage. In the cases of discharging the installations, a coolant tank is used with a fat

separator and after the deposition water is discharged into the sewer system.

The exhaust gases contain solid particles of ash, which are retained in the cyclone device

prior to the introduction into the chimney and discharging into the atmosphere. A metal cartridge is

placed into the cyclone where the separated ash is deposited. Also, the boiler unit has a cartridge for

the disposal of ash that occurs as a solid residue of the combustion process. The total amount of ash

deposited is 100 t/a, i.e. between 300 and 500 kg per day during the heating season. The ash will be

deposited in a safe place and once a week transported to the landfill under a contract with the local

utility company. The amount of ash is relatively small and does not represent a risk to the

environment.

The operation of the boilers and electric motor drives in the boiler room is a source of constant

noise and vibration. All equipment that emits noise and vibration is located within the area of the boiler

room so that the sound is largely absorbed by the walls of the building. After commissioning the boiler

room, measures will be taken out to eliminate or bring the noise down to an acceptable level

according to the Law on the protection of environmental noise (published in the Official Gazette of the

Republic of Serbia No. 36/2009 and 88 / 2010). According to the above mentioned Act, the maximum

allowable noise level is 35 dB (A) during the day and 30 dB (A) during night.

The user of this space will adopt certain measures to minimize the negative impact on the

environment. These measures will be applied to the control of air emissions, as well as to the

management of wastewater, solid waste and noise. The thermal energy for public institutions in the

municipality of Priboj is obtained from heavy oil.

If the biomass for combustion is obtained by deforestation and without reforestation, an

emission of CO2 by biomass combustion would be six times less than from the combustion of heavy

oil. If the biomass for combustion is provided from wood waste or from forestation, then reduction of

CO2 emissions would be lower by 700 t per year.

31

Figure 10 – Emission CO2 – Comparison to fuel

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

20

18

20

19

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20

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25

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26

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Ave

rage

Emission CO2 (kg), Comparasion to fuel

Existing fuel (kg) - Heavy oil Emision CO2 (kg) - Biomass

32

12. ENERGY EFFICIENCY MEASURES AND CONCLUSION

The main task of this study is to reduce the energy costs for heating for primary schools, secondary schools, ambulance health center and kindergarten in Priboj. Objects from this study are supplied by thermal energy through the existing district heating system.

The district heating system in Priboj-Varoš is connected to the heavy fuel boilers, which are positioned in the factory “FAP”. Plant in the factory “FAP” has two heavy fuel boilers with 26 and 29MW of power. Boiler with the power of 29MW is out of operation. Pipes of district heating system are in bed condition and the substations are without automatic systems of regulations.

In order to reduce costs of heating energy the buildings from the study, it is necessary to switch energy source to biomass fuel. For the purpose of elaborating the best solutions according to the criterion of investment and exploitation costs, the task of this study is the creation of three scenarios replacing fuels with biomass:

- Scenario 1 - All buildings from the study will be connected to the new woodchip boiler. - Scenario 2 - All buildings will have separate pellet boilers. - Scenario 2.1 - All buildings will have separate woodchip boilers.

After collecting the data in order to find the most optimal solution, study will develop three

scenarios. In the analysis, solution has been found that changes the scenario 1 and which is slightly different from the originally planned.

Scenario 1 - All buildings from the study, except kindergarten, will be connected to the new wood chips boiler. For the building of kindergarten, separate pellet boiler is planned. This solution (solution 1) does not require large investment for the construction of hot-water pre-insulated pipes, with the length of more than 250m. The difference of the investment costs in table:

Solution 1 - separate wood pellet boiler for kindergraten (€)

Wood pellet boiler for kindergarten 200kW 20.000

Construction of the fuel storage facility and new boiler room the total area 100m2 10.000

Energy plant, mechanical and electrical equipment works (except boilers) 8.000

Chimneys 2.500

Documentation, construction management, commissioning of the plant and heating grid 5.000

Total od solution 1 45.500

Solution 2 - conection kindergraten to central wood chips boilet (€)

Construction of heating line 250m length from central boiler to kindergarten 62.000

Documentation, construction management, commissioning of the plant and heating grid 5.000

Total od solution 2 67.000

Difference in costs between solutions = S2-S1 21.500

Table 32 – Specification of the investment costs for kindergarten, solution 1, 2

(Source: Own calculations)

33

Solution 2 to connect building of kindergarten to central wood chips boiler with pre-insulated

pipes, is not the best technical solution. Such a solution would lead to delays delivery of heat energy to kindergarten. The option where kindergarten building is attached to a central boiler room would cause a delay in the warming the kindergarten because of the distance from other facilities and transport of heat through hot water pipes. The reason for this is the large distance of kindergarten from other connected facilities and transport of hot water through a long pre-insulated pipes.

Heating systems according to scenario 1, with central boiler to wood chip and wood pellet boiler at the kindergarten "Neven" is planned for operation within temperature regime of the radiator of 80/60 C. Boilers can operate at higher regimes because they are provided with water boiler buffers.

From the central boiler house two pipelines are planned. One pipeline leading to the heat substations in the technical school Priboj and second to the substations in the primary school Vuk Karadžić. Heat substation of district heating systems are planned to remain in reserve in case there is a problem with the supply of biomass.

Scenario 2 - All buildings will have separate pellet boilers. Analysis of the construction of the

heating system according to scenario 2 proved to be economically unviable.

Scenario 2.1 - All buildings will have separate wood chips boilers. Analysis of the construction

of the heating system according to scenario 2.1 proved very small economically unviable after long

period.

The municipality Priboj and the district Zlatibor possess a sufficient amount of forests from

which biomass needed to operate power plants can be obtained. This would enable local community to act in closed circle of producing of energy cane – creation of thermal energy - using heat energy. Construction of the system with a biomass heating represents the infrastructure system which will create benefits to the city Priboj. These benefits will be reflected in the form of: - Lower heating costs, - Reduction of fuel consumption, - Reduction of CO2 emissions, - Reduction of environmental pollution, - Increased comfort and quality of services, - Reduced costs of fuel and maintenance. The building sector in Serbia is particularly important, because it accounts for about 40% of total energy consumption, with a trend for further growth. This high-energy consumption means that the potential energy and environmental savings in the building sector are the largest. Most of the energy is consumed for space heating, although in recent years, increased consumption is recorded for cooling during summer season.

34

54

Figure 11 – Comparative analysis of cost heat energy and saving, scenario 1

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037

Existing fuels 129,29129,16129,03128,90128,77128,64128,51128,38128,26128,13128,00127,87127,74127,62127,49127,36127,23127,11126,98126,85

Wood chips 60,22760,16760,10760,04759,98759,92759,86759,80759,74759,68859,62859,56859,50959,44959,39059,33059,27159,21259,15359,093

Saving from fuel switch x103 69,06368,99468,92568,85668,78768,71868,65068,58168,51268,44468,37568,30768,23968,17168,10268,03467,96667,89867,83067,763

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000 Comparative analysis of cost heat energy and saving, SCENARIO 1 - (€)

55

Figure 12 – Saving from fuel switch, scenario 1

67,000

67,200

67,400

67,600

67,800

68,000

68,200

68,400

68,600

68,800

69,000

69,200

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037

Saving from fuel switch x103 69,0 68,9 68,9 68,8 68,7 68,7 68,6 68,5 68,5 68,4 68,3 68,3 68,2 68,1 68,1 68,0 67,9 67,8 67,8 67,7

Saving from fuel switch, SCENARIO 1 - (€)

56

Figure 13 – Operational costs and depreciation, scenario 1

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Operational costs and Depreciation, scenario 1 (€)

Biomass - wood chips Biomass - wood pellet Extra energy Employee – Labor costs Maintenance & Insurance costs Depreciation

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Figure 14 – Cash flow balance, scenario 1

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037

TotalCashFlow x103 -325,2 -284,6 -244,0 -203,5 -163,0 -122,6 -82,33 -42,07 -1,885 38,23878,294118,28158,20198,06237,85277,57317,23356,82396,35435,81

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Figure 15 - Comparative analysis of cost heat energy and saving, scenario 2

2018 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035

Existing fuels x 103 129,2129,1129,0128,9128,7128,6128,5128,3128,2128,1128,0127,8127,7127,6127,4127,3127,2127,1126,9126,8

Wood pelet x 103 108,3108,2108,1108,0107,9107,8107,7107,6107,5107,4107,3107,1107,0106,9106,8106,7106,6106,5106,4106,3

Saving x 103 20,9020,8820,8620,8420,8220,8020,7820,7620,7420,7220,7020,6820,6520,6320,6120,5920,5720,5520,5320,51

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Comparative analysis of cost heat energy and saving, SCENARIO 2-pellet - (€)

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2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037

TotalCashFlow x103 -512, -529, -546, -563, -580, -597, -614, -631, -648, -666, -683, -700, -717, -735, -752, -769, -787, -804, -821, -839,

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-50,000Cash flow balance, SCENARIO 2 - pellet - (€)

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Figure 17 - Comparative analysis of cost heat energy and saving, scenario 2.1

2018 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035

Existing fuels x 103 129,2 129,1 129,0 128,9 128,7 128,6 128,5 128,3 128,2 128,1 128,0 127,8 127,7 127,6 127,4 127,3 127,2 127,1 126,9 126,8

Wood chips x 103 56,04 55,98 55,92 55,87 55,81 55,76 55,70 55,64 55,59 55,53 55,48 55,42 55,37 55,31 55,26 55,20 55,15 55,09 55,04 54,98

Saving x 103 73,25 73,17 73,10 73,03 72,95 72,88 72,81 72,73 72,66 72,59 72,52 72,44 72,37 72,30 72,23 72,15 72,08 72,01 71,94 71,87

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Comparative analysis of cost heat energy and saving, SCENARIO 2.1- chips - (€)

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2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037

TotalCashFlow x103 -592,6 -560,3 -528,1 -495,9 -463,8 -431,8 -399,9 -368,1 -336,3 -304,6 -272,9 -241,3 -209,8 -178,4 -147,1 -115,8 -84,63 -53,49 -22,42 8,566

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100,000Cash flow balance, SCENARIO 2.1 - chips - (€)

Documents

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