Economic analysis of ethanol and biogas production in Sri Lanka using waste as feedstock

Abstract: The purpose of the report is divided into two parts. The first part is to make an economic analysis for a potential ethanol and biogas plant that uses waste as its raw material instead of the conventional method of planting and cultivating raw materials for production. The second part is to build an understanding of Sri Lanka’s current waste management, what can be used for the production facility, and what changes in the infrastructure are required to enable the facility. The investigation of current waste management was done through a field study in the city of Kandy. Interviews were conducted with municipal employees, professors at the local university, and employees at a dumping site. The economic analysis was made based on a report written by the National Renewable Energy Laboratory (NREL) and supplemented with a literature study and an interview with staff at a company that produces ethanol and biogas. The result of Sri Lanka’s infrastructure is that much is missing to be able to use the waste efficiently. The only sorting takes place at the dumping site, which makes it difficult to get the desired waste. There is also a lot of waste that is not collected but burned at the place of origin, which would need to be collected to contribute to the facility. The result of the economic analysis is that a lot of waste is required to reach a competitive level. Two different models are used to calculate a minimum selling price to go plus-minus zero. The waste produced in the city of Kandy is too little, to be competitive the amount of waste collected would need to be tenfold. Because costs are exponentially declining, they do not fall enough for the models used in this report. Either a new model would need to be used to take more advantage of the fact that the plant is much smaller than others, that the collection level increases to make the plant larger, or that waste as raw materials is combined with cultivation of feedstock.