NREL is a national laboratory of the U.S. Department of Energy, Office of Energy 

Efficiency & Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

Contract No. DE-AC36-08GO28308

Feasibility Study of Economics 

and Performance of Biopower at 

the Chanute Air Force Base in 

Rantoul, Illinois

A Study Prepared in Partnership with the 

Environmental Protection Agency for the REPowering America’s Land Initiative: Siting 

Renewable Energy on Potentially 

Contaminated Land and Mine Sites

Christopher Scarlata and Gail Mosey

Produced under direction of the U.S. Environmental Protection 

Agency (EPA) by the National Renewable Energy Laboratory (NREL) 

under Interagency Agreement IAG-09-1751 and Task No. 

WFD4.1001.

Technical Report

NREL/TP-7A30-57770

May 2013
NREL is a national laboratory of the U.S. Department of Energy, Office of Energy 

Efficiency & Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

National Renewable Energy Laboratory

15013 Denver West Parkway

Golden, Colorado 80401

303-275-3000 • www.nrel.gov

Contract No. DE-AC36-08GO28308

Feasibility Study of Economics 

and Performance of Biopower at 

the Chanute Air Force Base in 

Rantoul, Illinois 

A Study Prepared in Partnership with the 

Environmental Protection Agency for the REPowering America’s Land Initiative: Siting 

Renewable Energy on Potentially 

Contaminated Land and Mine Sites

Christopher Scarlata and Gail Mosey

Prepared under Task No. WFD4.1001

Technical Report

NREL/TP-7A30-57770

May 2013
NOTICE

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iii

Acknowledgments

The National Renewable Energy Laboratory (NREL) thanks the U.S. Environmental Protection

Agency (EPA) for its interest in securing NREL’s technical expertise. In particular, NREL and

the assessment team for this project are grateful to the former Chanute AFB facility managers,

engineers, and operators for their generous assistance and cooperation. 

Special thanks go to Greg Hazel and Peter Passarelli from the Village of Rantoul, Illinois; Shea 

Jones, Lura Matthews, and Jessica Trice from EPA; and Katie Brown, AAAS Science & 

Technology Policy fellow hosted by EPA. 
iv

Executive Summary

The U.S. Environmental Protection Agency (EPA), in accordance with the RE-Powering 

America’s Land initiative, selected the Former Chanute Air Force Base site in Rantoul, Illinois, 

for a feasibility study of renewable energy production. The National Renewable Energy

Laboratory (NREL) was contacted to provide technical assistance for this project. The purpose of 

this study was to assess the site for a possible biopower system installation and estimate the cost,

performance, and impacts of different biopower options. 

The former Chanute Air Force Base was proposed for inclusion on the National Priorities List

(EPA ID: IL1570024157). The site is approximately 2,125 acres, with contamination limited to

the relatively small Operational Unit 2 (OU2) area on the southeast corner of the base. This

leaves ample space to accommodate a renewable energy generation plant. Some of the buildings 

at OU2 contained oil-water separators, underground storage tanks, and/or sludge pits. Migration

of contaminants from OU2 into Salt Fork Creek has been a primary environmental concern. 

Biopower is the use of biomass to generate electricity. Biomass consists of plant materials used

as a source of fuel. In general, woody biomass has 10% higher energy content than agricultural

materials on a dry weight basis. Wood chips are the most common fuel for biopower production 

in the United States. Biopower system technologies include direct-firing, co-firing, gasification,

pyrolysis, and anaerobic digestion. Most biopower plants are direct-fired systems that burn 

biomass directly to produce steam.

The economic feasibility of a potential biopower system on the Chanute Air Force Base site

depends greatly on the cost of feedstock and purchase selling price of the electricity produced. 

The economics of the potential systems were analyzed with respect to the power market in

Champaign County. Given the uncertain development timeline for a biopower system at the site, 

the financial analysis did not include currently available incentives, as many are set to expire in 

the next few years. The Village of Rantoul might wish to revisit potential incentives once they

have a firmer timeline available for the construction of any renewable energy project. Therefore, 

the financial analysis is considered to be conservative, and any incentives would improve the 

returns from the project.

The results of the breakeven analysis are shown in Figure ES-1. The net present value (NPV) is 

the value in today’s dollars of future cash flows generated by a project less than the initial capital 

investment. Breakeven is defined as the point where NPV equals zero. The colored lines are the 

breakeven points for biopower plants at 10 MW, 15 MW, and 20 MW. The area above the lines

is where the NPV is positive and the project is profitable. The area below the lines indicates a 

negative NPV, where the project would operate at a loss. 

The cost per dry ton of wood chips (on the x-axis) and the price for energy produced in the 

biopower plant (on the y-axis) were varied across a range of values, as shown. This analysis is

meant to inform decision makers at the Rantoul site. For example, if after negotiating with

feedstock providers, the site believes they could enter into a contract to purchase wood chips at

$80/dry ton, then they would need to determine if consumers would purchase power at a price of 

$160/MWh to break even with a 20-MW plant. A discussion about ways to improve the process 

economics is provided in the report. 
v 

Figure ES-1. Breakeven analysis for biopower production at 10-MW, 15-MW, and 20-MW scales 

Note: Wood chips were used as a model feedstock. See text for details.

The Champaign-Urbana metropolitan area is 15 miles from Rantoul and is a potential market for 

the renewable power produced at the site. Therefore, a biopower plant of up to 20 MW could be 

built on the former Chanute Air Force Base. However, as mentioned previously, economic 

feasibility depends on the cost of feedstock and selling price of the electricity produced. 

The feasibility study produced a conservative estimate of the financial performance of biopower 

projects in Rantoul. The results suggested that the cost of electricity from these plants would 

need to be above market prices in order for the project to break even. Project economics would 

be more favorable if the site could purchase feedstock at below-market rates, secure more 

favorable debt and equity terms, or benefit from tax incentives. 

$60

$90

$120

$150

$180

$210

$0 $20 $40 $60 $80 $100

$/MWh

$/dry ton of wood chips

Breakeven Analysis for Biopower Production, Rantoul, IL

10MW

15MW

20MW

Net Present Value is Positive Above the Lines

Net Present Value is Negative Below the Lines
vi 

Table of Contents

1 Study Background................................................................................................................................ 1

1.1 Purpose of Study ........................................................................................................................... 1

1.2 Development of Biopower on Contaminated Sites ....................................................................... 1

1.3 Scope of Work ............................................................................................................................... 2

2 Site Information .................................................................................................................................... 3

2.1 General Site Considerations .......................................................................................................... 4

2.2 Site Characteristics ........................................................................................................................ 4

2.3 Federal and State Regulations Relevant to a Bioenergy installation at the Site ............................ 4

Federal Regulations ....................................................................................................................... 4

3 Bioenergy Systems .............................................................................................................................. 6

3.1 Feedstock Overview ...................................................................................................................... 6

3.2 Overview of Conversion Technologies ......................................................................................... 7

3.3 Biopower System Components ..................................................................................................... 8

Major Components ........................................................................................................................ 8

Other Equipment and Auxiliaries .................................................................................................. 8

3.3.1 Fuel Handling ................................................................................................................... 9

3.3.2 Combustion System and Steam Generator ....................................................................... 9

3.3.3 Air Pollution Control ...................................................................................................... 10

3.3.4 Condenser and Cooling Tower ....................................................................................... 11

3.4 Types of Bioenergy Systems ....................................................................................................... 11

3.4.1 Thermal Energy Only ..................................................................................................... 11

3.4.2 Power Generation Only .................................................................................................. 12

3.4.3 Combined Heat and Power ............................................................................................. 13

3.4.4 District Heating .............................................................................................................. 15

4 Biomass Resource Assessment....................................................................................................... 17

4.1 Overview of Biomass Feedstock ................................................................................................. 17

4.1.1 Woody Biomass ............................................................................................................. 17

4.1.2 Agricultural Biomass...................................................................................................... 18

4.2 Overview of Potential Feedstocks in Illinois and Champaign County ........................................ 18

4.3 Resources Assessment Results .................................................................................................... 20

5 Local Bioenergy Markets ................................................................................................................... 21

5.1 Illinois Power Market .................................................................................................................. 21

5.2 Renewable Portfolio Standard and State Incentives .................................................................... 22

5.3 Thermal Customers ..................................................................................................................... 24

6 Biopower Economics and Performance .......................................................................................... 25

6.1 Assumptions and Input Data for Analysis ................................................................................... 25

6.2 Capital and Operating Expenses.................................................................................................. 26

6.3 Breakeven Analysis ..................................................................................................................... 26

7 Feasibility Study Discussion............................................................................................................. 28

8 Conclusions ........................................................................................................................................ 30
vii 

List of Figures

Figure 1. Breakeven analysis for biopower production at 10-MW, 15-MW, and 20-MW scales .......... v

Figure 2. The location of Rantoul within the state of Illinois and a satellite image of the subject area 

including the Chanute AFB ........................................................................................................... 3

Figure 3. Direct-fired biopower system .................................................................................................. 7

Figure 4. Biomass storage options .......................................................................................................... 9

Figure 5. Thermal only biomass energy system ................................................................................... 12

Figure 6. Power generation only biomass energy system (cooling tower not shown) ......................... 12

Figure 7. CHP main steam extraction ................................................................................................... 13

Figure 8. CHP extraction turbine .......................................................................................................... 14

Figure 9. CHP backpressure turbine ..................................................................................................... 15

Figure 10. Major categories of land use in Illinois ............................................................................... 18

Figure 11. The distribution of corn, soybean, and woodland in Illinois ............................................... 19

Figure 12. Major categories of land use in Champaign County, IL ..................................................... 19

Figure 13. Breakeven analysis for biopower production at 10-MW, 15-MW, and 20-MW scale ....... 27

List of Tables

Table 1. Heat Content Ranges for Various Biomass Fuels on a Dry Weight Basis ............................... 6

Table 2. Electricity Prices by Sector in Illinois for 2011 and 2012 (cents per kilowatt hour) ............. 22

Table 3. Schedule for Illinois Renewable Energy Production .............................................................. 23

Table 4. Summary of Capital and Operating Expenses, and Fuel Requirement by Plant Size ............ 26

Table 5. Estimated Energy Prices for Future Plants based on EIA Data .............................................. 29
1 

1 Study Background

1.1 Purpose of Study

The EPA Office of Solid Waste and Emergency Response (OSWER) Center for Program

Analysis (CPA) developed the RE-Powering America’s Land initiative to re-use contaminated

sites for renewable energy generation. EPA engaged the U.S. Department of Energy’s (DOE)

National Renewable Energy Laboratory (NREL) to conduct feasibility studies to assess the 

viability of developing renewable energy-generating facilities on contaminated sites. The former 

Chanute Air Force Base (AFB) Superfund site in Rantoul, Illinois, was selected for a feasibility 

study under this initiative.

Biomass was selected as the renewable energy resource. In this case, the focus was on studying 

the feasibility of operating a bioenergy plant using woody biomass or agricultural material as 

feedstock on the site. 

1.2 Development of Biopower on Contaminated Sites

One promising use of contaminated sites is to install biomass power (also known as biopower) 

systems. Biopower systems work well on these sites where there is an adequate biomass fuel

supply and favorable power sales rates.

The cleanup and reuse of potentially contaminated properties provides many benefits,

1

 including: 

• Preserving greenfields 

• Reducing blight and improving the appearance of a community

• Raising property values and creating jobs

• Leveraging access to existing infrastructure, including electric transmission lines 

and roads 

• Enabling potentially contaminated property to be productive 

By taking advantage of these potential benefits, biopower can provide a viable, beneficial 

reuse—in many cases generating revenue on a site that might otherwise go unused.

Most states rely heavily on fossil fuels to operate their power plants. There are compelling

reasons to consider moving toward renewable energy sources for power generation instead of 

fossil fuels, including: 

• Using fossil fuels to produce power may not be sustainable 

• Burning fossil fuels can have negative effects on human health and the environment

• Depending on foreign sources, fossil fuels can be a national security concern 

 

1 U.S. Environmental Protection Agency (EPA). “Handbook on Siting Renewable Energy Projects While 

Addressing Environmental Issues,” OSWER Center for Program Analysis.
2 

• Generating energy with fewer harmful emissions can be accomplished through renewable 

energy sources

• Burning fossil fuels contributes to greenhouse gas emissions. 

1.3 Scope of Work

For the Chanute site, three sizes of bioenergy facilities producing electricity at 10 MW, 15 MW, 

and 20 MW were analyzed assuming the use of woody biomass as fuel. A brief comparison of 

corn stover as a feedstock is provided. 

This feasibility study discusses general and site-specific factors relevant to analysis of a 

bioenergy facility at the Chanute AFB site and is divided into the following sections: 

• Site information: Provides an overview of the site on which the facility would be located

• Bioenergy systems overview: Provides a general introduction to biomass energy as well 

as related equipment

• Biomass resource assessment: Reviews available biomass resource in the area and 

estimates the delivered cost of wood chips to the site

• Local bioenergy markets: Provides a brief overview of potential outlets for heat or 

power that could be produced from a bioenergy facility 

• Economic analysis: Documents the results of economic analyses performed using inputs 

from previous sections 

• Feasibility study discussion: Reviews the results of the study and proposes next steps. 
3 

2 Site Information

The Chanute AFB is located in the Village of Rantoul, Illinois, which is located in Champaign 

County, 15 miles north of the Champaign-Urbana metropolitan area. According to 2011 data, the 

population was 12,984 and occupied an area of 8.3 square miles.2 The population of ChampaignUrbana was 203,000, and it is a potential market for energy produced at the Chanute site.3

The base was proposed for inclusion on the National Priorities List (EPA ID: IL1570024157). 

The site is approximately 2,125 acres with contamination limited to the relatively small

Operational Unit 2 (OU2) area on the southeast corner of the base. This leaves ample space to

accommodate a renewable energy generation plant. Some of the buildings at OU2 contained oilwater separators, underground storage tanks, and/or sludge pits. Migration of contaminants from

OU2 into Salt Fork Creek has been a primary environmental concern.

4

Figure 1. A satellite image of the Village of Rantoul and the subject area including the

Chanute AFB

 

2 “State and County Quickfacts – Rantoul (village), Illinois.” (2013). United States Census Bureau, 

“http://quickfacts.census.gov/qfd/states/17/1762783.html. 3 “State and County Quickfacts – Champaign County, Illinois.” (2013). United States Census Bureau, 

http://quickfacts.census.gov/qfd/states/17/17019.html. 4 “National Priorities List – NPL Site Narrative for Chanute Air Force Base.” (2012). U.S. EPA, 

http://www.epa.gov/superfund/sites/npl/nar1615.htm. 
4 

2.1 General Site Considerations

The criteria for a successful bioenergy facility include many factors such as feedstock proximity, 

delivery access, and access to required utilities. Other considerations include a market for selling 

energy from the plant and proximity to an electrical substation. 

Proximity to communities is also an important consideration. Biomass will be delivered via truck 

to the site, which will result in more traffic. A route for delivery of feedstock should be 

considered when selecting a site in this area.

2.2 Site Characteristics

The former Chanute AFB site is managed by the Village of Rantoul. The site has good potential 

for installing a biomass power generation system as there is ample land available and 

infrastructure, such as access rail, roads, and utilities. The topography is relatively flat and the 

existing buildings are distant from one another. The biopower site itself would only require 

approximately 5–15 acres depending on the size and fuel storage requirements. 

The site has some desirable qualities, including being located off of a main multi-lane highway, 

as shown in Figure 1. Trucks could enter the site easily off of the highway, which has access to 

the north side of the former Chanute AFB via West Champaign Avenue. Ready access to 

transportation could enable high-volume delivery of biomass feedstock at a scale required for a 

medium-scale biopower facility. 

Rail access is available on the west side of Rantoul. Additional infrastructure would be needed to 

receive and store wood ships delivered by rail (e.g., a feedstock depot). 

There is sufficient room on the site to locate a 10- to 20-MW facility. The choice of location is 

strategic with respect to incoming fuel routes and proximity to an electrical substation. Utilizing 

existing infrastructure where possible is always of interest; this would reduce capital cost 

investments for new structures and utility improvements. 

2.3 Federal and State Regulations Relevant to a Bioenergy 

Installation at the Site

The following is a list of regulations and permits that might be required for a bioenergy plant. 

The size and design of the plant, the method of steam and power generation, and local permitting

requirements ultimately determine the requirements. State agencies generally handle permitting.

A relatively small plant (less than 20 MW) might not be subjected to all of the codes listed

below. This is not an exhaustive list, but it suggests typical requirements. 

2.3.1 Federal Regulations

The federal regulations and permits potentially required for a biopower project include: 

• National Emission Standards for Hazardous Air Pollutants addresses emission 

from boilers5

 

5 “Technology Transfer Network Air Toxics Web Site – Tools and Implementation.” (2013). U.S. EPA, 

http://www.epa.gov/ttn/atw/eparules.html. 
5 

• EPA’s National Ambient Air Quality Standards declares combustion devices must emit 

below stated levels6

• 2011 EPA Clean Air Act pollution standards require biomass boilers over 10 million 

Btu/hr for 876 or more hours per year to meet numeric emission standards7

• 40 CFR Part 89 limits emissions on non-road internal combustion engines8

• 40 CFR Part 60 limits emissions on steam-generating units over 10 million Btu/hour5

• 40 CFR Part 63 requires reciprocating internal combustion engines or generators over 

300 hp to meet specific carbon monoxide standards5 

• Resource Conservation and Recovery Act Subtitle D covers solid wastes and says the 

facility might be considered a waste processing facility9

 

• 40 CFR Part 257 sets disposal standards for owners of non-municipal non-hazardous 

wastes, which would include a facility accepting food wastes6

 

• National Pollutant Discharge Elimination System addresses wastewater discharge 10

• Prevention of Significant Deterioration and construction permits require any new major 

source of pollutants to conduct analysis and use best control technologies 11

• Risk management plan requires new facilities to develop a plan if certain chemicals 

are stored.12

2.3.2 State Permits 

State permits generally require construction, air, water, solid waste, and operating permits. 

• Air Quality Permits

• Water Quality Permits; water appropriation permits

• Highway Access Permit

• Possible Easement Rights. 

 

6 “Air and Radiation – National Ambient Air Quality Standards.” (2012). U.S. EPA, 

http://www.epa.gov/air/criteria.html. 7

 “Final Air Toxics Standards For Industrial, Commercial, and Institutional Boilers at Area Source Facilities.” 

(2011). U.S. EPA. Accessed January 8, 2013: http://www.epa.gov/airtoxics/boiler/area_final_fs.pdf. 8 “Code of Federal Regulations. Title 40. Chapter 1 – Environmental Protection Agency. Subchapter C – Air 

Programs. Parts 50-99.” U.S. Government Printing Office. Accessed January 8, 2013: 

http://www.gpo.gov/fdsys/browse/collectionCfr.action?collectionCode=CFR. 9 “Code of Federal Regulations. Title 40. Chapter 1 – Environmental Protection Agency. Subchapter I – Solid 

Wastes. Parts 239-282.” U.S. Government Printing Office. Accessed January 8, 2013: 

http://www.gpo.gov/fdsys/browse/collectionCfr.action?collectionCode=CFR. 10 “Compliance Monitoring - National Pollutant Discharge Elimination System Compliance Monitoring.” (2012). 

U.S. EPA, http://www.epa.gov/compliance/monitoring/programs/cwa/npdes.html. 11 “New Source Review – PSD - Prevention of Significant Deterioration (PSD) Basic Information.” (2011). U.S. 

EPA, http://www.epa.gov/NSR/psd.html. 12 “Emergency Management - Risk Management Plan (RMP) Rule.” (2013). U.S. EPA, 

http://www.epa.gov/oem/content/rmp/. 
6 

3 Bioenergy Systems

3.1 Feedstock Overview

Biomass consists of plant materials that can be used as a source of fuel. Biomass fuels can come

from many different sources. While many of these can be used to produce fuel, their suitability

for specific conversion technologies must be evaluated. Typically, biomass for energy generation

comes from the following sources:

• Wood, including forest residue, primary and secondary mill residues, wood pellets, 

and briquettes 

• Fast growing energy crops grown specifically for energy use 

• Agricultural residues 

• Food wastes. 

Heat contents of various biomass feedstocks are listed in Table 1. 

Table 1. Heat Content Ranges for Various Biomass Fuels on a Dry Weight Basis13

 

13 “Biomass Energy Data Book - Appendix A - Conversions.” U.S. DOE EERE, 

http://cta.ornl.gov/bedb/appendix_a.shtml. 

Fuel type & source

Btu/lb MBtu/ton

Agricultural Residues

 Corn stalks/stover 7,587 - 7,967 15.2 - 15.9

 Sugarcane bagasse 7,450 - 8,349 14.9 - 16.7

 Wheat straw 6,964 - 8,148 13.9 - 16.3

 Hulls, shells, prunings 6,811 - 8,838 13.6 - 17.7

 Fruit pits 8,950 - 10,000 17.9 - 20.0

Herbaceous Crops

 Miscanthus

 switchgrass 7,754 - 8,233 15.5 - 16.5

 Other grasses

 Bamboo

Woody Crops

 Black locust 8,409 - 8,582 16.8 - 17.2

 Eucalyptus 8,174 - 8,432 16.3 - 16.9

 Hybrid poplar 8,183 - 8,491 16.4 - 17.0

 Willow 7,983 - 8,497 16.0 - 17.0 

Forest Residues

 Hardwood wood 8,017 - 8,920 16.0 - 17.5

 Softwood wood 8,000 - 9,120 16.0 - 18.24

Urban Residues

 MSW 5,644 - 8,542 11.2 - 17.0

 RDF 6,683 - 8,563 13.4 - 17.1

 Newspaper 8,477 - 9,550 17 - 19.1

 Corrugated paper 7,428 -7,939 14.9 - 15.9

 Waxed cartons 11,727 - 11,736 23.5 - 23.5

English

Higher Heating Value
7 

3.2 Overview of Conversion Technologies

Biopower system technologies include direct-firing, co-firing, gasification, pyrolysis, and 

anaerobic digestion. Most biopower plants are direct-fired systems. 

Co-firing refers to mixing biomass with fossil fuels in conventional power plants. Coal-fired 

power plants can use co-firing systems to significantly reduce emissions, especially sulfur 

dioxide. Pyrolysis is a thermal process that occurs without oxygen with outputs of syngas, 

liquids, and charcoal, which can be used to produce heat and power or reformed into liquid fuels 

and chemical products. Anaerobic digestion is a biological degradation of organic matter without 

oxygen to produce biogas, which can be used in heat or electricity application. 

Gasification systems use elevated temperatures and an oxygen-starved environment to convert 

biomass into synthesis gas—a mixture of hydrogen and carbon monoxide. The synthesis gas, or 

syngas, can then be chemically converted into other fuels or products, burned in a conventional 

boiler, or used instead of natural gas in a gas turbine. Gas turbines are very much like jet engines, 

only they are used for turning electric generators instead of propelling a jet. Gas turbines are very 

efficient, but the overall system efficiency can be further improved by operating them in a 

combined cycle arrangement. During combined cycle operation, the exhaust gases are used to 

boil water for steam to provide additional power generation or heat. 

The amount of energy that can be produced by a biopower system depends on several factors, 

including the type of biomass used, the technology employed, and numerous economic factors. 

Biopower systems can be sized to supply internal energy needs only or sized larger to feed 

energy to the grid for sale. Figure 2 shows a typical biopower direct-fired system.

Figure 2. Direct-fired biopower system. Photo from Stephen Jolley, Wheelabrator Shasta Energy 

Co., NREL 07163
8 

These plants burn biomass feedstocks directly to produce steam. The steam drives a turbine, 

which turns a generator that converts the power into electricity. In some biomass plants, turbine 

extraction steam from the power plant is also used to provide heat for manufacturing processes 

or to heat buildings. Such combined heat and power (CHP) systems increase overall energy 

efficiency. CHP is a practical setup when a large customer requiring heat is located nearby.

Biopower systems normally operate 24 hours per day and 7 days per week, with several weeks of 

down time per year for maintenance. Plants of this type are not normally cycled with many starts 

and stops. Frequent cooling and re-heating of the components can lead to fatigue and failure. 

Therefore, it is more cost-effective to operate around the clock even though power prices are 

lower during off-peak hours. While direct-fired units are most common, the NREL biomass 

assessment team uses several tools to assess the optimal facility fuel, technology, plant size, and 

configuration for each particular location under consideration. 

In this case, the feasibility of power plants of 10 MW, 15 MW and 20 MW were analyzed. The

Illinois power market is very competitive, but small biopower plants might have a chance to

compete in niche markets where customers demand renewable energy.

3.3 Biopower System Components

A typical direct-fired biopower system has the following components. The components of 

biopower systems and large-scale biomass heating systems are described in more detail in the 

following sections. 

3.3.1 Major Components

The major components that comprise a typical biopower plant are: 

• Fuel receiving, storage, and handling 

• Combustion system and steam generator 

• Steam turbine and electrical generator

• Air pollution control 

• Condenser and cooling tower. 

3.3.2 Other Equipment and Auxiliaries

Additional equipment is needed for emissions, waste handling, and the balance of the 

biopower system:

• Stack and monitoring equipment 

• Instrumentation and controls 

• Ash handling 

• Fans and blowers 

• Water treatment
9 

• Electrical equipment

• Pumps and piping. 

3.3.3 Fuel Handling

Biomass can be delivered to the site by truck, rail, or barge. It can be delivered as chips or 

pellets; logs and brush can be processed onsite into chips. Wood chips are typically stored in a 

fuel yard (exposed or covered) or in storage silos, as shown in Figure 3. Wood pellets are often 

stored in silos and are easily handled and fed with standard equipment. 

Fuel handling may be fully automated or semi-automated requiring some labor. A fully 

automated system will typically be installed below grade. Wood chips are delivered by truck to 

the storage bin and conveyor belts automatically feed the boiler. Automated systems are used to 

serve facilities, such as the 10- to 20-MW biopower plants evaluated in this study. Semiautomated systems are less expensive but require more labor. They typically include aboveground chip storage and a hopper with capacity to supply the boiler for a few days. An operator 

moves woody biomass from the storage area to the hopper as needed; operator workload is 

estimated at 60–90 minutes per day.14 

Figure 3. Biomass storage options: fuel yard and fuel silo. Photos by (left) Warren Gretz, NREL 

04376 and (right) Gerry Harrow, NREL 15041 

3.3.4 Combustion System and Steam Generator

The most common system for converting solid biomass fuel into energy is a direct-fired 

combustion system. The fuel is typically burned on a grate or in a fluidized bed to create hot 

combustion gases that pass over a series of boiler tubes, transferring heat into water inside the 

tubes, which creates steam. The combination of the burning apparatus and the heat transfer 

surface areas are typically referred to as the boiler. 

 

14 “Woodchip Fuel Specifications in the Northeastern United States.” (2013). Biomass Energy Resource Center. 

Accessed January 8, 2013: http://www.biomasscenter.org/resources/publications.html.
10 

3.3.4.1 Boilers

Boilers are differentiated by their configuration, size, and the quality of the steam or hot water 

produced. Boiler size is most often measured by the fuel input in millions of Btu per hour 

(MMBtu/hr), but it may also be measured by output in pounds per hour of steam produced. The 

two most commonly used types of boilers for biomass firing are stoker boilers and fluidized bed 

boilers. Either of these combustion systems can be fueled entirely by biomass fuel or co-fired 

with a combination of biomass and coal or other solid fuel.15

The traveling grate stoker boiler introduces fuel at one end of the furnace. The grate slowly 

moves the fuel through the hot zone until combustion is complete and the ash falls off at the 

opposite end.16 The fuel is either dropped onto the grate and travels away from the feeder or it is 

thrown to the opposite end and comes back toward the feeder, the latter is called a spreader 

stoker. A fluidized bed boiler introduces feedstock into the bed with a heat transfer medium (e.g.,

sand).17 The bed material is fluidized using high pressure air from underneath the grate creating a 

mixing zone. 

3.3.4.2 Steam Turbine

The steam turbine is a key component and a major capital cost for the facility. Higher efficiency 

turbines are sold at premium prices but can improve plant economy over the life of the turbine. 

The operating principle of a turbine is that more energy can be extracted from the steam by 

increasing inlet pressure and decreasing the exhaust pressure. These efforts come at a cost and 

have to be balanced with the overall plant economics. Typically, smaller systems use lower 

pressure steam and larger systems can afford to operate at higher pressures, yielding more power 

production to compensate for the increased capital costs. 

3.3.5 Air Pollution Control

Biomass contains lower quantities of the pollutants commonly found in coal and other solid 

fuels. The primary pollutants of concern in biomass combustion are carbon monoxide (CO), 

nitrogen oxides (NOx), and particulate matter (PM). 

CO emissions are largely a function of combustion quality. Thorough air mixing will oxidize 

most CO into carbon dioxide (CO2), which is not a regulated pollutant. The control of nitrogen 

oxides is not always required but can be controlled by either Selective Non-Catalytic Reduction 

(SNCR) or Selective Catalytic Reduction (SCR). SNCR introduces urea or ammonia at specific 

temperatures to reduce nitrogen oxides into molecular nitrogen (i.e., N2), a reducing reaction.

SCR is a similar process but also uses a catalyst to achieve higher removal efficiencies.

For particulate matter, the small ash particles are captured in the fabric of large bags and the bags 

are pulsed occasionally to dislodge the dust into an ash hopper for removal. These systems are 

 

15 “Biomass Combined Heat and Power Catalog of Technologies.” (2007). U.S. EPA. Accessed January 8, 2013: 

http://www.epa.gov/chp/documents/biomass_chp_catalog.pdf 16 Johnson, N. (2012). “Fundamentals of Stoker Fired Boiler Design and Operation.” CIBO Emission Controls 

Technology Conference. Accessed January 10, 2013: http://www.cibo.org/emissions/2002/a1.pdf. 17 Crawford, M. (2012). “Fluidized Bed Combustors for Biomass Boilers”. ASME. Accessed January 10, 2013: 

https://www.asme.org/kb/news---articles/articles/boilers/fluidized-bed-combustors-for-biomass-boilers. 
11 

known as fabric filters or baghouses. Electrostatic precipitators (ESPs) are also commonly used 

for particulate removal.

EPA Final Air Toxics Standards for Industrial, Commercial, and Institutional Boilers at Area 

Source Facilities were released in 2011 and apply to biomass boilers. The following provisions 

apply to new biomass boilers18 as mentioned in Section 2.3: 

• Boilers with capacity above 10 MMBtu per hour must meet particulate matter limits

• Boilers with capacity below 10 MMBtu per hour must conduct a boiler tune-up every 

2 years. 

3.3.6 Condenser and Cooling Tower

As the steam exits the turbine, it is condensed for reuse in the cycle. The most common method 

is to use a steam surface condenser and a cooling tower. The surface condenser is a large vessel 

filled with tubes that circulate cool water from the cooling tower. The steam flows over the 

tubes, condensing into a hot well at the bottom of the condenser. The cooling water that leaves 

the condenser is pumped back to the cooling tower, which uses evaporative cooling to cool the 

water for reintroduction into the condenser. 

A large amount of water is lost due to evaporation from the cooling tower and that water needs to 

be replaced on a continuous basis. This creates a large operating cost in areas where water is 

scarce and expensive. Alternatively, the water can be cooled by an air-cooled system. The capital 

cost for this equipment is higher and electric power to operate the fans is needed, but no water is 

consumed with this method. 

3.4 Types of Bioenergy Systems

A biopower system should be sized based on both the availability of cost-effective biomass 

feedstock and the energy requirements of the end user. The most common installation types are 

described below. In general, these systems can be divided into thermal energy only, power 

generation only, and CHP systems. The system choice is dependent upon economics and energy 

markets. The cost of fuel, the sales price of power, and thermal energy are a few of the key 

economic parameters.

3.4.1 Thermal Energy Only 

Figure 4 illustrates a thermal energy only system. Biomass energy is converted to steam that is 

sent to a nearby business that utilizes the steam for heating, cooling, manufacturing, or any other 

number of industrial uses. The steam is condensed as the energy is extracted, and the warm 

condensate is pumped back to the biomass facility where it is reintroduced to the boiler and 

converted once again to steam. This type of system can be economical as the inefficiencies 

associated with generating electrical power on a small scale are avoided and the capital costs for 

a steam turbine, condenser, cooling tower, circulating water pumps, and other items are not 

incurred. High pressure, superheated steam is not required, making the boiler less expensive and 

easier to operate. This system is common and has been used for many decades in the 

United States. 

 

18 “Final Air Toxics Standards For Industrial, Commercial, and Institutional Boilers at Area Source Facilities.” 

(2011). U.S. EPA, http://www.epa.gov/airtoxics/boiler/area_final_fs.pdf. 
12 

Finding a business that is close enough to accept steam without lengthy piping systems is often 

challenging. In many cases where a steam host is present, it makes sense to generate both steam 

and electricity.

Figure 4. Thermal only biomass energy system

Source: Gregg Tomberlin, NREL

3.4.2 Power Generation Only

Figure 5 illustrates a power generation only system. Biomass energy is converted into high 

pressure, superheated steam for introduction into a steam turbine. The turbine generates 

electricity at the most efficient rate practical depending on the size of the system. The steam is 

condensed at near-vacuum to maximize efficiency; this is accomplished in a condenser, as 

discussed in Section 3.3.4. 

Figure 5. Power generation only biomass energy system (cooling tower not shown) 

Source: Gregg Tomberlin, NREL
13 

3.4.3 Combined Heat and Power

CHP is the concurrent generation of multiple forms of energy in a single system. CHP systems 

can include reciprocating engines, combustion or gas turbines, steam turbines, microturbines, 

and fuel cells. These systems are capable of utilizing a variety of fuels, including natural gas, 

coal, oil, and alternative fuels. While generating electric power, the thermal energy from the 

system can be used in direct applications or indirectly to produce steam, hot water, or even 

chilled water for process cooling. Over 60% of biomass power systems in use produce CHP. 

For biomass direct-fired systems, the most common CHP configuration consists of steam from a 

biomass-fired boiler directed to a steam turbine. Steam is extracted at some point in this process 

to provide heat to meet internal requirements of the facility or to produce steam for sale to a local 

customer. The steam can be taken from the power process in three primary methods: main steam 

extraction, extraction turbine, and back-pressure turbines.

Main steam extraction diverts some of the boiler outlet prior to being introduced into the turbine 

(Figure 6). This high pressure, high temperature steam would typically have to be reduced in 

pressure prior to use. This is not the most efficient method for optimizing power output, but it 

avoids the cost of a more expensive extraction turbine (described below). The remaining steam 

runs through the turbine and then discharges into a condenser (see Section 3.3.4) at vacuum 

pressure to maximize the electric power generated. Warm condensate is pumped back to the 

biomass facility where it is reintroduced to the boiler and converted once again to steam.

Figure 6. CHP main steam extraction

Source: Gregg Tomberlin, NREL
14 

Figure 7. CHP extraction turbine

Source: Gregg Tomberlin, NREL

An extraction turbine draws all boiler steam at its inlet and extracts the required process steam at 

some intermediate point along the turbine steam path (Figure 7). This allows the process steam to 

produce electric power prior to being diverted, increasing the efficiency of the overall process.

Extraction turbines are not normally used in smaller systems (i.e., less than 10 MW) and their 

cost is typically higher than other turbine designs. The remaining steam continues through the 

lower pressure stages of the turbine and then discharges into a condenser.

A backpressure turbine draws all boiler steam at the turbine inlet but discharges all of the steam 

at higher pressure as required by the steam customer (Figure 8). There are considerable cost 

savings with this approach. The steam turbine is much less expensive because the lower-pressure 

sections of a turbine are the largest and costliest. There is no need for a condenser, a cooling 

tower, or large circulating water pumps to push the cooling water through the condenser. The 

steam is typically condensed by the load, and then returns to the plant as warm condensate to be 

reheated and reintroduced to the system. 

There are two disadvantages to this arrangement. First, the amount of electric power produced is 

lower due to the geometry of the turbine and the relatively high discharge pressure. Second, if 

the steam host decreases its steam requirements to less than the full turbine capacity, the turbine 

must be turned down, or the excess steam must be condensed by way of an external 

steam condenser. 
15 

Figure 8. CHP backpressure turbine

Source: Gregg Tomberlin, NREL

3.4.4 District Heating

District heating is defined as a central unit providing heat to nearby buildings and homes through 

a series of pipes carrying hot water or steam. The inlet pipe delivers hot water at a temperature 

between 180°F and 250°F. Heat enters a building’s conventional system through a heat 

exchanger. After heat is extracted, an outlet pipe returns water (105°F–160°F) to the central 

heating plant. Pipes are typically double-walled and buried underground. District heating 

systems are most common in Scandinavia. In Denmark, district heating provides 60% of thermal 

energy with 17% derived from biomass.19 Lower-temperature district heating systems are under 

development, using hot water as low as 122°F.20 

Because of the network of piping and heat exchangers and other equipment that must installed 

for each customer, capital costs are high for district heating systems. Economics work best for 

district heating when waste heat can be obtained from a nearby power plant at minimal cost, 

when replacing electric heating systems, and in densely populated areas with high-rise 

apartments. 

Several cities and universities have district heating systems powered by traditional energy 

sources. Most were built many decades ago. 

There are only two district heating systems in the United States that use biomass as an energy 

source. District Energy St. Paul operates a biomass district heating system in St. Paul, 

Minnesota,21 which is also the largest hot water district heating system in the United States. The 

system operates from a CHP system using waste wood as a fuel source as well as a recently 

installed solar thermal system. The University of New Hampshire meets all heat and electricity 

 

19 “Renewable Heat Initial Business Case.” (2007). DEFRA and BURR, United Kingdom. Accessed January 8, 

2013: http://webarchive.nationalarchives.gov.uk/+/http://www.berr.gov.uk/files/file41432.pdf. 20 Thorson, J.; Christiansen, C.; Marek, B. (2011). “Experience on Low-Temperature District Heating in Lystrup, 

Denmark.” International Conference of District Energy. Portoroz, Slovenia.

21 “District Heating.” (2013). District Energy St. Paul. Accessed January 9, 2013: 

http://www.districtenergy.com/technologies/district-heating/. 
16 

requirements from a district system using methane from a nearby landfill.22 Many other 

universities have district heating systems powered by traditional energy sources. 

The Rantoul site is not a good candidate for district heating due to lack of customers that would 

demand steam. 

 

22 “First University In Nation To Use Landfill Gas As Primary Energy Source.” (2007). University of New 

Hampshire Media Relations. Accessed January 9, 2013: http://www.unh.edu/news/cj_nr/2007/aug/kb14landfill.cfm. 
17 

4 Biomass Resource Assessment

4.1 Overview of Biomass Feedstock

There are two choices for feedstock to provide biopower at the Rantoul site—woody biomass or 

agricultural biomass. Woody biomass is the most common feedstock used for biopower in the 

United States. While there is limited woody biomass in the region near Rantoul, the site has

access to rail, opening the possibility of sourcing wood from other regions. 

In contrast, Rantoul is located in a top agricultural production region. There is the potential to

use agricultural biomass (e.g., corn stover) for biopower production. It is important to note that

agricultural biomass presents some specific challenges for biopower production. 

First, the energy content of a feedstock like corn stover is about 10% lower than that of wood 

(Table 1, dry weight basis). Second, agricultural feedstocks tend to have higher ash content when

compared to debarked wood. The higher ash content leads to higher operations costs due to

increased disposal costs. Third, the high ash content, particularly from potassium and sodium, 

can create slag. Slag reduces boiler efficiency and requires additional down time for maintenance

to clear accumulated slag. There are boilers on the market that are optimized for using 

agricultural biomass; they are most commonly deployed in Europe where straw is used as a 

feedstock. Fourth, harvesting stover is not a common practice and no large domestic market 

exists for supplying it to potential biopower plants. 

4.1.1 Woody Biomass

4.1.1.1 Forest Residue

This category includes logging residues and other removable material left after silviculture

operations and site conversions. Logging residue comprises unused portions of trees, cut or

killed by logging and left in the woods. Other removable materials are the unutilized volume of 

trees cut or killed during logging operations.23 

4.1.1.2 Primary Mill Residues

This category includes wood materials (coarse and fine) and bark generated at manufacturing

plants (primary wood-using mills) when round wood products are processed into primary wood 

products. These residues include slabs, edgings, trimmings, sawdust, veneer clippings and cores,

and pulp screenings.24

4.1.1.3 Urban and Secondary Mill Residues

This category includes wood residues from municipal solid waste (wood chips and pallets), tree

trimming residues from utilities and private tree companies, and construction and

demolition sites.25 

 

23 USDA, Forest Service’s Timber Product Output Database, 2007. 24 USDA, Forest Service’s Timber Product Output Database, 2007. 25 U.S. Census Bureau, 2000 Population Data, BioCycle Journal, State of Garbage in America, January 2004; County

Business Patterns 2002.
18 

4.1.2 Agricultural Biomass

The agricultural biomass category can include the following crops: corn stover, wheat straw, 

soybeans, cotton waste, sorghum, rice straw, and sugarcane bagasse. The quantities of crop

residues that are potentially available in each county can be estimated considering total grain

production, crop to residue ratio, moisture content, the amount of residue left on the field for soil 

protection, or other agricultural activities.26 

4.2 Overview of Potential Feedstocks in Illinois and

Champaign County

Data from calendar year 2011 from the USDA National Agricultural Statistics Service was used

to evaluate the major categories (i.e., >25,000 acres) of land use in the state of Illinois (Figure 9).

Corn and soybean production are the dominant categories in the state (13 and 8.5 million acres, 

respectively). 

Figure 9. Major categories of land use in Illinois

Source: USDA

Illinois has 5.7 million acres of deciduous forest. Figure 10 is a visual comparison of corn, 

soybean, and woodland acreage. Corn and soybeans are widely distributed. The forestlands are

generally dispersed across the southern and western portions of the state. 

 

26 Source: USDA, National Agricultural Statistics Service; 5-year average: 2003-2007.

Dbl Crop WinWht/Soybeans

Alfalfa

Woody Wetlands

Winter Wheat

Developed/High Intensity

Herbaceous Wetlands

Barren

Fallow/Idle Cropland

Evergreen Forest

Corn

Soybeans

Deciduous Forest

Developed/Open Space

Developed/Low Intensity

Grassland Herbaceous

Other Hay/Non Alfalfa

Open Water

Developed/Medium Intensity

Category
19 

Figure 10. The distribution of corn, soybean, and woodland in Illinois27

Rantoul is located in Champaign County, Illinois. The major land use categories for the county 

are also for corn and soybean production. Forestland is negligible.

Figure 11. Major categories of land use in Champaign County, Illinois

Source: USDA

 

27 “2003 Cropland Data Layer – Illinois.” USDA National Agricultural Statistics Service (NASS), 

http://www.nass.usda.gov/research/cdl/ILall.htm. 

Other Hay/Non Alfalfa

Developed/High Intensity

Open Water

Dbl Crop WinWht/Soybeans

Woody Wetlands

Oats

Barren

Other

Corn

Soybeans

Developed/Low Intensity

Developed/Open Space

Grassland Herbaceous

Deciduous Forest

Developed/Medium Intensity

Alfalfa

Winter Wheat

Category
20 

4.3 Resources Assessment Results

A preliminary analysis of the forest and related wood-waste resources in the region indicates that

there is a marginal availability of woody biomass in the area surrounding Rantoul. Rantoul has

good access to rail, opening the opportunity to bring wood chips in from other regions. 

The spot price for wood chips delivered to eastern Illinois in the fall of 2012 was approximately

$78/bone dry ton or $47/green ton at 40% moisture.

28 A surcharge would apply to biomass prices

according to increases in the cost of transportation via the diesel fuel market.

The price for agricultural biomass like corn stover is more challenging to estimate. There is only 

a nascent market for these feedstocks and there is an absence of reliable pricing data. One source

of pricing forecasts is DOE’s Office of Biomass Program. Their 2011 Multi-Year Program Plan

has set a forecast price for the total corn stover feedstock delivered to the plant gate to be 

$65.50/dry ton.29 Local pricing in the Rantoul area will vary and will have similar fuel surcharge

costs to the woody feedstocks. The pricing and availability of agricultural feedstocks would need

to be negotiated with regional growers—typically within a 25- to 50-mile radius of the site.

Transportation costs become prohibitive beyond that distance.

 

28 Siegel, R.W. (2013). Personal communication, Center for Clean Energy Research and Education, Eastern 

Illinois University. 29 EERE. (2011). Biomass Multi-Year Program Plan. DOE/EE-0405. Table 3. 

http://www1.eere.energy.gov/biomass/pdfs/mypp_april_2011.pdf. 
21 

5 Local Bioenergy Markets

Local power market conditions, including energy demand and pricing, are another major 

consideration for bioenergy facilities.

5.1 Illinois Power Market

Illinois ranked fifth in the nation for power production behind Texas, Florida, California, and 

Pennsylvania.30 The state produced 4.5% of the total electricity share of the United States. In 

addition, the state ranked 28th in power consumed per capita. Illinois is first in the nation for 

nuclear power generation and a net exporter of electricity, as described in an Energy Information 

Agency analysis31: 

Illinois is one of the top electricity-generating States in the Nation and a leading 

net exporter of electricity to other States. Coal and nuclear account for over 95 

percent of the electricity generated in Illinois, with an even split between the two

fuels. With 11 operating reactors at six nuclear power plants, Illinois ranks first

among the States in nuclear generation, and generates more than one-tenth of all

the nuclear power in the United States.

Nuclear power provides low-cost, reliable energy production and can put downward pressure on 

energy prices. While this creates a very competitive market today for new energy production, the 

Illinois electric power market is expected to grow and change, opening opportunities for 

renewable energy production. 

The Illinois Department of Commerce & Economic Opportunity has projected that population of 

the state will grow by 14% by 2030 and that Champaign County will grow by 12% over the same 

period.32 Population growth will fuel demand for more power generation. 

In 2007, Illinois adopted a renewable energy standard requiring utilities to produce at least 25% 

of their power from renewable sources by 2025. Most of that energy must come from wind 

power, and the remainder can be produced from other qualifying sources like biopower 

(discussed further below).

Recent statewide electricity prices by sector are shown in Table 2. Illinois ranked 32nd, 9th, and 

16th for lowest residential, commercial, and industrial power prices in the United States, 

respectively. Average U.S. prices for all states are provided for comparison. 

 

30 “Illinois - Rankings: Total Net Electricity Generation, December 2012 (thousand MWh).” U.S. Energy 

Information Administration (EIA), http://www.eia.gov/beta/state/rankings/?sid=IL#series/51. 31 “Illinois – Profile Analysis.” (2009). U.S. EIA, http://www.eia.gov/beta/state/analysis.cfm?sid=IL. 32 “Population Projections.” (2011). Illinois Department of Commerce & Economic Opportunity, 

http://www.ildceo.net/dceo/Bureaus/Facts_Figures/Population_Projections/. 
22 

Table 2. Electricity Prices by Sector in Illinois for 2011 and 201233

5.2 Renewable Portfolio Standard and State Incentives 

In cases where renewable portfolio standards (RPS) exist, power may potentially be sold at

premium rates. An RPS is a regulation that requires the increased production of energy from

renewable energy sources, such as wind, solar, biomass, and geothermal. RPS regulations vary 

from state to state.

The RPS mechanism generally places an obligation on electricity supply companies to produce a 

specified fraction of their electricity from renewable energy sources. Certified renewable energy

generators earn certificates for every unit of electricity they produce and can sell these, along

with their electricity, to supply companies. Supply companies then pass the certificates to some 

form of regulatory body to demonstrate their compliance with their regulatory obligations.34 If

the fraction of renewable energy is satisfied in a particular state, implementing additional 

renewable generation sources becomes more difficult.

Illinois has an RPS that requires the increased use of renewable energy. According to the 

schedule in Table 3, The Illinois RPS contains goals to produce 25% of electric power from 

renewable energy by 2026. Under this schedule, 60% of that renewable energy must come from 

wind generation and 40% can come from other sources, including biopower. 

 

33 “Electric Power Monthly.” (2013). U.S. EIA, 

http://www.eia.gov/electricity/monthly/epm_table_grapher.cfm?t=epmt_5_6_a. 34 American Wind Energy Association, www.http://AWEA.org. 

Region

October 

2012

October 

2011

October 

2012

October 

2011

October 

2012

October 

2011

October 

2012

October 

2011

Illinois

0.1190 

$/kWh

0.1285 

$/kWh

0.0800 

$/kWh

0.0854 

$/kWh

0.0581 

$/kWh

0.0607 

$/kWh

0.0833 

$/kWh

0.0886 

$/kWh

U.S. Average

0.1203 

$/kWh

0.1208 

$/kWh

0.1011 

$/kWh

0.1025 

$/kWh

0.0665 

$/kWh

0.0677 

$/kWh

0.0976 

$/kWh

0.0983 

$/kWh

Residential Commercial Industrial All Sectors
23 

Table 3. Schedule for Illinois Renewable Energy Production35

Energy 

Year

Overall 

Standard (% 

of Retail 

Electric 

Sales to 

Come from 

Renewables

Solar 

Requirement 

(% of the 

Standard)

% of Retail 

Electric 

Sales from 

Solar

Wind 

Requirement 

(% of the 

Standard)

% of Retail 

Electric 

Sales from 

Wind

2009 -- -- -- -- --

2010 4.0% -- -- 60% 2.4%

2011 5.0% -- -- 60% 3.0%

2012 6.0% -- -- 60% 3.6%

2013 7.0% -- -- 60% 4.2%

2014 8.0% -- -- 60% 4.8%

2015 9.0% -- -- 60% 5.4%

2016 10.0% 6% 0.60% 60% 6.0%

2017 11.5% 6% 0.69% 60% 6.9%

2018 13.0% 6% 0.78% 60% 7.8%

2019 14.5% 6% 0.87% 60% 8.7%

2020 16.0% 6% 0.96% 60% 9.6%

2021 17.5% 6% 1.05% 60% 10.5%

2022 19.0% 6% 1.14% 60% 11.4%

2023 20.5% 6% 1.23% 60% 12.3%

2024 22.0% 6% 1.32% 60% 13.2%

2025 23.5% 6% 1.41% 60% 14.1%

2026 23.0% 6% 1.50% 60% 15.0%

Illinois offers grants, loans, and tax incentives for renewable energy producers. Biopower 

producers can qualify for a $500,000 grant if they produce both heat and power.36

No incentives were included in this early stage financial analysis of biopower production at 

Rantoul. Due to the changing landscape of financial incentives and their availability, the Village 

of Rantoul should consider reviewing incentives if they choose to move forward with building 

renewable energy generation.

 

35 “Illinois: Incentives/Policies for Renewables & Efficiency.” (2013). Database of State Incentives for Renewables 

& Efficiency (DSIRE), http://www.dsireusa.org/incentives/incentive.cfm?Incentive_Code=IL04R&re=0&ee=0. 36 “Renewable Energy: Biogas and Biomass to Energy Grant Program.” (2011). Illinois Department of Commerce & 

Economic Opportunity, http://www.illinoisbiz.biz/dceo/Bureaus/Energy_Recycling/Energy/Clean+Energy/02-

BiogasBioMass.htm. 
24 

5.3 Thermal Customers

Economic parameters for any biopower site would be improved if a customer were available to 

purchase steam from the plant. There are no steam customers currently located near the site. 

Having customers in close proximity is important because the cost of steam piping and

condensate return piping is generally cost prohibitive when implemented over long distances 

(i.e., greater than 1–2 miles). A thermal energy customer must be in place prior to the biomass 

facility so that financing can be based upon revenues from a long-term energy contract with the 

customer. Financing in anticipation of future tenants is impractical; therefore, this was not 

included in this assessment. 

Due to the lack of known feasible thermal customers, neither thermal-only nor CHP systems 

were further evaluated in this report. 
25 

6 Biopower Economics and Performance

6.1 Assumptions and Input Data for Analysis

The installed cost of biomass power generation systems is estimated based on several key

factors, including the equipment arrangement, plant size, and geographical factors. These costs 

include permitting, engineering, equipment, construction, commissioning, and all “soft costs” 

including development fees and the costs for financing. The economics of a biopower system

depend on incentives, plant costs, labor costs, biomass resource costs, and the sales rate for

electricity and thermal energy. 

Operational costs are a key component. These facilities offer good, quality job opportunities to

the local community. The “economy of scale” is critical with regard to operating costs; larger

plants have lower labor costs on a per-kilowatt-hour basis. That is, a 20-MW biopower facility

may only have a few more employees than a 10-MW facility. 

Techno-economic analysis for biopower production was done using RETScreen software.

RETScreen is a publicly available analysis tool for the evaluation of renewable energy projects. 

For this analysis, biopower production models were built for plants of 10 MW, 15 MW, and

20 MW net energy production. There are multiple inputs to each model; some of the principal 

inputs are listed below: 

Feedstocks37 Wood chips (higher heating value 8,470 BTU/lb) 

 Corn straw (higher heating value 7,520 MJ/kg)

Fuel Cost Escalation 1.82% (benchmarked to #2 distillate fuel oil)

Inflation Rate38 0.9% 

Discount Rate39 10.3% 

Debt Ratio 50% 

Debt Interest Rate 7% 

Equity Interest Rate 16% 

Depreciation40 20 years, straight line

Tax Rate 35% 

Feedstock cost and electricity export rate were modeled in the breakeven analysis in Section 6.3. 

No incentives were included in the analysis in order to provide a conservative estimate of the 

financial performance of the project.

 

37 RETScreen values. 38 U.S. Department of Commerce. (2010). “Energy Price Indices and Discount Factors for

Life-Cycle Cost Analysis – 2010.” FEMP data, http://www1.eere.energy.gov/femp/pdfs/ashb10.pdf. 39 Based on the analysis in Mendelsohn, M.; Kreycik, c.; Bird, L.; Schwabe, P.; Cory, K. (2012). “The Impact of 

Financial Structure on the Cost of Solar Energy.” Golden, CO: NREL/TP-6A20-53086; 

http://www.nrel.gov/docs/fy12osti/53086.pdf. 40 NREL assumptions. 
26 

6.2 Capital and Operating Expenses

Table 4 is a summary of the capital expense, operation and maintenance expense, annual fuel

expense, and fuel requirement by biopower plant size. These values were entered into the 

financial models along with the assumptions from Section 6.1 to calculate financial performance. 

Table 4. Summary of Capital and Operating Expenses and Fuel Requirement by Plant Size

6.3 Breakeven Analysis

The net present value (NPV) is a useful tool for the analysis of capital projects, such as 

constructing a biopower plant. NPV is the present value (i.e., in today’s dollars) of future cash

flows generated by a project (e.g., revenue from selling electricity) minus the initial capital

investment. Future cash flows are discounted by the cost of debt and equity dollars used to

finance the project. The cost of debt and equity is the weighted average cost of capital, or simply

the discount rate. In this case, 10.3% was used for the discount rate, derived from half of the 

project financing from equity at 16% interest and half from debt at 7%. It was adjusted for taxes

at a 35% rate. These values were based on an NREL analysis of comparably sized renewable

energy projects.

41

The breakeven point is where discounted future cash flows for a project offset the initial capital

costs. Future cash flows are dependent on a number of factors including inflation, taxes,

operating costs, changes in feedstock costs, and the value of electricity sales (as shown in

Section 6.1). Note that the NPV calculation is sensitive to the discount rate, and so the following 

breakeven analysis will change depending on the particular financing terms a particular project is

able to receive. 

 

41 Mendelsohn, M.; Kreycik, C.; Bird, L.; Schwabe, P.; Cory, K. (2012). “The Impact of Financial Structure on the 

Cost of Solar Energy.” Golden, CO: NREL/TP-6A20-53086; http://www.nrel.gov/docs/fy12osti/53086.pdf. 

Plant Size 10MW 15MW 20MW

Capital Expense $ 42,600,000 $ 58,700,000 $ 71,100,000

Annual Operation and 

Maintenance Expense $ 2,800,000 $ 3,300,000 $ 3,700,000

Annual Fuel Cost $ 6,200,000 $ 9,200,000 $ 11,800,000

Annual Amount of Fuel 

Required (Dry Tons) 79,400 117,600 151,900
27 

Figure 12. Breakeven analysis for biopower production at 10-MW, 15-MW, and 20-MW scale 

Note: Wood chips were used as the feedstock. See text for details. 

The results of the breakeven analysis are shown in Figure 12. The colored lines are the 

breakeven points for biopower plants at 10 MW, 15 MW, and 20 MW. The area above the lines

is where the NPV is positive (i.e., where the value of the discounted cash flows is greater than

the initial capital investment). The area below the lines indicates a negative NPV. 

The cost per dry ton of wood chips (on the x-axis) and the price for energy produced in the 

biopower plant (on the y-axis) were varied across a range of values as shown. This analysis is

meant to inform decision makers at the Rantoul site. For example, if after talking with feedstock

providers Rantoul believes they could contract to purchase wood chips at $80/dry ton, then they 

would need to decide if the market would purchase power at a price of at $160/MWh to break

even with a 20-MW plant.

$60

$90

$120

$150

$180

$210

$0 $20 $40 $60 $80 $100

$/MWh

$/dry ton of wood chips

Breakeven Analysis for Biopower Production, Rantoul, IL

10MW

15MW

20MW

Net Present Value is Positive Above the Lines

Net Present Value is Negative Below the Lines
28 

7 Feasibility Study Discussion

A feasibility study was undertaken for the Rantoul site as the preliminary assessment of the 

utility market, potential resources, and community goals demonstrated that a biopower facility

had potential viability. If local officials decide that such a project merits further study, additional 

work would need to be performed to verify project parameters used in the technical and

economic analyses. The key economic drivers for this type of project are the feedstock

availability and cost and the price for the sale of electric energy. 

Assessing the biomass resource in the area was done on a prospective basis utilizing software

tools. In order to verify these assumptions, further scrutiny is required that typically consists of a 

combination of site visits and phone calls to potential suppliers of the biomass. Collaboration 

with government entities like the U.S. Forest Service and The Bureau of Land Management

would be needed. Markets for biomass are always in flux and setting up the chain of supply is

very important. The chain of supply includes the long-term supplier, processing, and delivery 

and storage.

Additional work for a next-stage feasibility study would include a heat and mass balance analysis

to verify the assumptions used for actual energy production, internal energy usage, and biomass 

feedstock required. Once this is accomplished, the equipment sizing can be refined and an

equipment cost estimate can be generated. This cost would be combined with the costs for

construction, utilities, and facility operation and maintenance for inclusion into an updated 

economic pro forma to reevaluate the financial viability of the project. Other issues to be 

investigated include incentives, permitting requirements, financing options, and local issues, 

including job creation and community involvement during the project progression. 

The data in Table 5 are from EIA projections for the cost of energy from future power plants 

(assumes operation in 2017) by fuel source. The EIA data suggest prices for energy from

biomass to range from $97.80/MWh to $136.70/MWh. The breakeven values for Rantoul are

above the high end of this range once the cost of feedstock reaches $38–$58/dry ton. As

mentioned earlier (Section 4.3), the spot price for wood chips in eastern Illinois was $78/bone 

dry ton, at which the price for energy sold would need to be above $150/MWh to

reach breakeven. 
29 

Table 5. Estimated Energy Prices for Future Plants Based on EIA Data42

Several opportunities for improving the economic performance of this project are listed below: 

• Utilize federal and state incentives for renewable energy production

• Secure financing for debt and/or equity at more favorable interest rates. State or federal

loan guarantees can help to significantly lower investor risk

• Utilize the production tax credit if Congress offers an extension; it is currently

$0.011/kWh for biopower systems, but it is set to expire at the end of 2013 

• Find a customer to buy steam from the plant; selling both heat and power improves the 

economics of a biopower system significantly

• Use the 10% federal investment tax credit for CHP systems, which is available

through 2016 

• Seek federal grant opportunities on www.grants.gov, especially from USDA and DOE

• View a discussion of other options for renewable energy project financing

at http://www.mintz.com/newsletter/2012/Advisories/1573-0112-NAT-ECT/index.htm. 

 

42 “Levelized Cost of New Generation Resources in the Annual Energy Outlook 2012.” U.S. EIA, 

http://www.eia.gov/forecasts/aeo/electricity_generation.cfm 

Minimum Average Maximum

Biomass $ 97.80 $ 115.40 $ 136.70

Conventional Coal $ 90.50 $ 97.70 $ 114.30

Advanced Coal $ 102.50 $ 110.90 $ 124.00

Natural Gas-fired

Conventional Combined Cycle $ 59.50 $ 66.10 $ 81.00

Advanced Combined Cycle $ 56.80 $ 63.10 $ 76.40

Conventional Combustion Turbine $ 91.90 $ 127.90 $ 152.40

Advanced Combustion Turbine $ 77.70 $ 101.80 $ 122.60

Advanced Nuclear $ 107.20 $ 111.40 $ 118.70

Wind $ 77.00 $ 96.00 $ 112.20

Solar Photovoltaic $ 119.00 $ 152.70 $ 238.80

Solar Thermal $ 176.10 $ 242.00 $ 386.20

Geothermal $ 84.00 $ 98.20 $ 112.00

Hydroelectric $ 57.80 $ 88.90 $ 147.60

Range for Total System Levelized 

Cost (2010 $/MWh) Plant Type
30 

8 Conclusions The Champaign-Urbana metro area is 15 miles from Rantoul and is a potential market for the 

renewable power produced at the site. Therefore, a biopower plant of up to 20 MW could be 

built on the former Chanute AFB. However, economic feasibility depends greatly on the cost of 

feedstock and purchase selling price of the electricity produced. 

The results of this feasibility study produced a conservative estimate of the financial 

performance of biopower projects in Rantoul. The results suggested that the cost of electricity 

from these plants would be above market prices in order for the project to break even. Project 

economics would be more favorable if the site could purchase feedstock at below market rates, 

secure more favorable debt and equity terms, or benefit from tax incentives.