Making a choice or making the right choice?

Investing in a new industrial biomass heat plant or energy centre requires owners to decide on the core equipment, primarily the biomass boiler. Given the wide variety of technologies and vendors, this can be a tall order in most markets. It’s a swamp out there. There are dozens of heat plant providers in Austria alone. With the utilisation of biomass residues gaining popularity, the number of companies manufacturing heat and boiler plants has increased accordingly. Unless you are well acquainted with fuel and technologies and have experience from previous biomass projects, doing some research or involving an experienced consultant or engineer will help decision-makers with the selection process.

Where do you start?

First, going back to our previous newsletter, define the biomass residues to be utilised in your project. Second, the boiler size, application, required performance and emission limits will need to be determined. This will help you reduce the number of possible technology providers as the initial selection criteria. Third, research the market, see who the leading vendors are regardless of location and distance from the project site, and ask for recommendations. Fourth, ask for references similar to what you need, and prioritise visiting at least two operation plants using similar biomass. Even for industry-leading vendors, it can be difficult to always focus on all markets and countries, and they will not be less qualified if they haven't installed references in your vicinity.

Work out and shortlist the leading providers for your project and ask them for budgetary offers and proposals. It’s also beneficial to ask about similar project costs as this will give you a good sense of the range of CAPEX based on the quality and performance required and expected.

To make the received offers comparable, take the necessary time to prepare a transparent and comprehensive request for quote (RFQ), clearly outlining the scope and stating the required quality, performance, guarantees and interfaces. Being overly specific will not cause any harm and will help identify termination points and potential limitations, reduce or avoid fine-print disclaimers, and specify vendor terms and conditions, which are otherwise left to the integrity of the submitting salesperson.

Questions you might want to ask before deciding on your system:

1.???? Has the received offer qualified and covered the specified needs and expectations?

2.???? Does the offered system provide you with fuel flexibility and sufficient fuel storage, and does the guaranteed performance have some merits?

3.???? How crucial are the investment costs, and what is a justifiable price?

a.?????Is the offer still trustworthy if the price is too low?

b.???? What are the potential risks?

c.????? Were CAPEX costs transferred onto OPEX costs to present a more appealing offer in hiding investment costs that would come later?

d. Does the lower price offer ensure that health and safety standards are met and that your plant can be easily serviced and maintained?

Written by: Viktor Radic, dipl.ing.