Biomass refers to renewable energy sources and comes from biological materials such as trees, plants, manure as well as municipal solid wastes. Effective utilization of biomass as an energy resource requires the use of an optimization model to take into account biomass availability, transportation distances, and the scales and locations of power facilities within a region. In this study, we develop a new analytical tool that integrates cost, energy savings, greenhouse gas considerations, scenario analysis, and a Geographic Information System (GIS) to provide a comprehensive analysis of alternative systems for optimizing biomass energy production. The goal is to find a system that optimizes the use of biomass waste by analyzing the cost, net avoided CO2 emission, and net energy savings with the objective of profit maximization. In this paper, we describe an application of the modeling tool described above to one of the fastest growing agriculture industries in Asia, the palm oil industry, for the case of Malaysia. Five scenarios utilizing palm oil waste as energy resources are discussed. The scenario of installing of new Combined Heat and Power (CHP) plants in the region yielded a number of benefits in terms of net energy savings, net avoided CO2 emission, and profits. The results also demonstrate the benefits of utilizing excess heat for biomass pre-treatment. The choice of a suitable CHP plant scale, management strategies for biomass seasonal availability, and market price of biomass are also important factors for effective use of the biomass in a region.
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