A program was conducted to design, construct, and operate an industrial fluidized bed combustion (FBC) boiler demonstration plant with a capacity of 50,000 lb/h steam. The following were the objectives of the program: (1) to extend the fluidized bed boiler design by employing natural circulation cooling; (2) to design, build, operate, test, and demonstrate a fluidized bed boiler that could burn high sulfur coal in an environmentally acceptable manner; and (3) to obtain sufficient data for industry to make an objective appraisal of fluidized bed coal burning boilers. Following a five-year design, development, and construction effort, the demonstration plant was first operated in June of 1981. Initial operation identified several equipment and operating problems, particularly in the areas of the fuel preparation and fuel feed systems. Unit operation and availability steadily improved, culminating in a 30-day continuous run ending in May 1982. Following shutdown, major problem areas such as bed tube failures were addressed by C-E and rectified prior to the start of the test program. Shakedown/testing operation commenced on August 12, 1983. The objectives for the test program were to establish the unit operating conditions required to optimize SO/sub 2/ removal and combustion efficiency for different operating modes, and to evaluate the long-term performance of components which are essential for reliable FBC operation. A total of 23 tests were run from February 16, 1984 to April 19, 1984. The test results demonstrated that FBC is an environmentally and commercially sound technology. Specifically, the required sulfur removal, low NO/sub x//CO emissions and high combustion efficiencies can be readily achieved. This report identifies the effects of recycle, excess air, Ca/S mole ratio, and overfire air on combustion efficiency, boiler efficiency, and emissions. 6 refs., 97 figs., 8 tabs.