Making Alternative Energy Credits

Utilities must purchase AECs, but who is making them? Eligible units (such as a wood boiler) create these credits by producing useful thermal energy Currently, the credits can be sold at the market price of $16 per megawatt-hour (MWTH) of net useful thermal energy, generated on a quarterly basis

This is a market driven price and fluctuates One MWTH is roughly equivalent to 3,412,000 British Thermal Units (BTUs) For woody biomass systems, the system can earn AECs for its working life Other technologies may only receive AECs for 10 years This can result in great cost savings for the thermal energy producers

For example, one ton of pellets contains approximately 16 million BTUs and costs approximately $260 If all that fuel is used, roughly four AECs will be earned and can be sold for approximately $60 Thus, participating in the APS program has reduced fuel costs by 20% The cost savings are even greater for dry wood chip systems A ton of dry wood chips contains about 3 MWTH and costs about $65

This ton of fuel earns about $45 in credit Therefore, the cost of the wood fuel per ton can be dramatically reduced by up to 70%, with wood users spending only $20 per ton of wood chips

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