Environmental externalities of wood pellets from fast-growing and para-rubber trees for sustainable energy production: A case in Thailand

Abstract

Wood pellets are one of biomass-based energy carriers considered important as renewable energy source. This study considers wood pellets for heat and power generation from fast-growing Leucaena and Acacia trees and para-rubber trees in a life cycle perspective. The objectives of this study are to estimate the actual cost (including environmental externalities) of heat and electricity production from wood pellets, and comparison with the external cost of fossil fuels, as well as forecasting the external cost arising from the increase in wood pellet demand. For both heat and electricity production, it was seen that when external costs are included, wood pellets are cheaper than lignite and fuel oil although the latter are cheaper when only internal costs are considered. Four recommendations for reducing the external costs of wood pellet production are: 1) to support sustainable agriculture for para-rubber trees and fast-growing trees, 2) to consider clean transportation in the supply chain, 3) wood pellet factory zoning, including good logistics, and 4) considering the external cost of wood pellets for polluter pays principle. These results and recommendations of the study can provide important information to consider towards adjusting the national energy plan and to have strict measures for avoiding problem shifting from the use of non-renewable resources (fossil fuels) to issues related to the use of biomass-based fuels (use of agro-chemicals, forest encroachment, and so on).