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Abstract
The production of pellets represents the possibility of using different biomass residues in a standardized fuel. In this article, the economic feasibility of pellets production is analyzed in the Portuguese scenario according to the key indicators of biomass availability, costs, and legal framework. The potential of biomass residues in Portugal is significant and mainly from forestry. However, several limitations to its utilization for pellets production may arise since they are already put to other uses, such as biomass power plants. The combination of the biomass power plants with pellet production plants seems to be the best option for pellet production in the actual Portuguese scenario. The main constrains for the pellets market has been to convince small-scale customers that pellets are a good alternative fuel, mainly due to the investment needed and the strong competition in terms of fuel price with natural gas. These market problems need incentives at a political level bringing the value added tax for the same level of natural gas.