Electricity generation from eucalyptus and bagasse by sugar mills in Nicaragua: A comparison with fuel oil electricity generation on the basis of costs, macro-economic impacts and environmental emissions

Two sugar mills in Nicaragua plan to generate electricity from bagasse duri ng the sugarcane season and eucalyptus during the rest of the year, and to sell it to the national grid. This study compared this concept with the mos t logical alternative at the moment, which is electricity generated from fu el oil. Costs, macro-economic impacts and environmental emissions are consi dered. The low cost of land and labour means that eucalyptus can be produce d more cheaply than fuel oil (1.7 as compared to 3.2 $/GJ(LHV)). Consequent ly, it was calculated that a sugar mill can produce electricity from biomas s for 4.9 cent /kWh as compared to 5.8 cent /kWh for electricity from an oi l fired plant. About 64% of the money spent on biomass power stays within N icaragua, thus contributing to its GDP, whereas in the case of fuel oil 83% goes abroad. The employment generated by the production of electricity fro m fuel oil is 15 person.yr/MW.yr, compared to 32 person.yr/MW.yr for biomas s. Comparing biomass with fuel oil, emissions of CO2 and SO2 equivalents ar e, respectively, 67 and 18 times lower. Particulate emissions can be much h igher in the biomass case because of lack of flue gas cleaning. We can conc lude that biomass electricity generation by sugar mills in Nicaragua can co mpete with power generation from fuel oil. Moreover, it has an overall bett er environmental performance, creates double the amount of jobs, and contri butes about four times as much to the GDP of Nicaragua, (C) 2000 Elsevier S cience Ltd. All rights reserved.