[Terrapreta] The economics of biochar

[Tom Miles]

Sean,

 

Realistically the economics of biochar are what the market can bear once
biochar is accepted as a product.  

 

In the US the consumer pays $1/lb for bagged charcoal (lump or briquette) in
the store. Subtract 100% markup for marketing and distribution to get a
wholesale price of $0.50/lb or $1000/ton. No charcoal producer is going to
sell the same charcoal wholesale for $100/ton ($200/ton less 100% markup). 

 

A nursery's price for peat, perlite or vermiculite is about $2.00/ft3. If
you replace it with charcoal (16 lb/ft3) the equivalent value is $0.125/lb
or $250/ton. 

 

Planting soils and soil amendments are about $200-240/unit delivered. At
200ft3/unit that's $1.00/ft3. On a weight basis it's about $100-120/ton.  

 

Bark is about $0.60/ft3 ($0.03/lb at 20 lb/ft3) or $60/ton delivered to a
nursery.  

 

If you can demonstrate that with (20% VM or less) charcoal you can a)
increase yield, b) reduce fertilizer use, c)replace a higher cost growing
medium,  d) offset drought/increase water use, e) improve long term soil
tilth and fertility or f) some other marketable value (carbon sequestration)
you can probably push charcoal or a charcoal mix to a higher value in a
local market.  

 

If you combine 20% of a higher cost charcoal ($200/ton, $1.60/ft3)with 80%
of a lower cost compost (composted digester solids, $12/yd3, $0.45/ft3) you
can make a higher value, more marketable,  product ($1/ft3, $125/ton) for
about $70/ton ($0.70/ft3). 

 

As a producer if I start with softwoods and get a 25% yield (30%-35% max) I
need 4 lbs of dry wood to make 1 lb of charcoal. If my raw material cost is
$10/dry ton then my raw material cost in the product is $40-$29/ton(25%-35%
yield). Add labor, capital, bagging and other production costs and you
probably have at least 2 times the material cost or about $80-$58/ton as a
wholesale cost ex plant ($0.04-$.03/lb, $0.48-$0.64/ft3). Wood costs here
are $30-$50/dry ton which pushes the raw material cost to from $86-$120/ton
(25%-35% yield) to $143-$200/ton respectively. Add 100% for production and
your ex plant charcoal cost is $240-$400/ton ($0.12-$.20/lb) or
$1.90-$3.20/ft3. 

 

If you can sell charcoal or charcoal enhanced products for $0.80-$2.00/ft3
($100-$250/ton) you probably have a  business. You could probably sell a
portion of the production for a higher value. 

 

Outside of existing producers we will probably see charcoal made as a
byproduct of municipal recycling where charcoal can be made from lower cost
(and lower value) wood wastes and where the materials handling for 50-100
tpd can be done with existing labor and equipment at the site. Feeding the
carbonization process is partly subsidized by handling a larger volume of
material that may come in at a negative cost -  with a tipping fee.  

 

Now, to replace 15% of the 1 billion tons of coal that we mine every year we
need . . . 

 

Tom

 

 

 

 

  

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