Das Biomass

The mood in Europe was positive in October as I joined over 300 attendees at the 12th Pellets Industry Forum. This annual event – formerly held in Stuttgart – made its debut this year in Berlin. The industrial pellet market for large scale installations and power stations is primarily where the industry is experiencing growth in Europe, although some also point to an upward trend in the private heating market. Participants included power utilities, trading companies, pellet producers, equipment suppliers, engineering consultants, universities/technical institutes, and government representatives.

Some of the main themes of the event included developments in the industrial and heat markets; developments in boiler and stove markets; evolving sustainability requirements in the European Union; and logistics and technology. I gave a presentation in which I discussed logistics challenges for Eastern Canadian pellet producers shipping to Europe and described opportunities for pellet buyers to take advantage of surplus pellet supply in Eastern Canada. Interested readers can find this presentation at www.pellet.org/publications.

Ekman Group is the marketing agent for Vyborgskaya Cellulose, the 900,000-tonnes-per-year pellet plant near St. Petersburg, Russia. Ekman vice-president Arnold Dale gave an update on developments in the international pellet market, noting, “Many people believe that industrial pellets are of inferior quality to domestic markets. This is simply not true.”

He went on to say, “Politically driven rapid growth is creating uncertainty. However, I expect that the global market will reach 80 million tonnes by 2020, with the U.K. alone accounting for 25-30 million tonnes.”

Dr. Martin Junginger, a professor at the University of Utrecht in the Netherlands, reviewed his recent study on the carbon payback from wood pellets sourced in the Southeast U.S. He told the audience, “The fact that bioenergy is ultimately renewable is not debated, but the time until repayment of any carbon debt is under debate.”

Junginger discussed his modelling of the life cycle of pellets made from low-grade logs from Georgia pine plantations. He accounted for harvesting, transportation, pelletizing, ocean shipping, combustion at the power plant, and subsequent forest regrowth at both the stand-level and the landscape-level. He concluded, “Stand level analysis shows a modest carbon repayment time of between five and 11 years depending on site productivity, while analysis at the landscape level shows practically no carbon repayment time at all.”

Peter-Paul Shouwenberg of RWE Essent gave a presentation on developments in sustainability certification for industrial pellets. He noted, “Sustainability is a prerequisite for the further growth of biomass use for energy. We have already been confronted with various issues such as the high price of biomass and its complex technology. However, problems around sustainability of biomass have had enormous impact, negatively influencing the bio-based reputation.”

Shouwenberg reviewed recent efforts by power utilities to demonstrate sustainability and concluded by saying, “Utilities, pellet associations, and inspection companies will be working together to develop and implement an industry-wide sustainability scheme by September 2013 to replace existing company-specific schemes.”

Harold Arnold of U.S.-based Fram Renewable Fuels was not convinced of the need for certification: “I acknowledge the good intention of sustainability certification, but believe that it could result in reduced trade and would not necessarily accomplish what was intended. In the U.S. we have many small land owners – 55,000 in the southern U.S. alone – so forest certification is not practical. The U.S. already has strong sustainability laws and many regulatory authorities enforcing these laws and there are criminal charges for non-compliance.”

Arnold explained that unintended consequences of sustainability certification could be “…more corporate owned plantations; exclusion of residuals as feedstock; and jeopardized economic sustainability – all leading to weakened industry growth.”

Hugo Du Mez outlined the Port of Rotterdam’s ambition to become the major biomass transportation hub for Europe: “The Port of Rotterdam is the number 5 port globally and number 1 in Europe. Our port handled 435 million tonnes of cargo in 2011. We have been very successful in becoming a transportation hub for the thermal coal market and would like to do the same for biomass. Rotterdam is ideally situated to serve power plants in the Netherlands, the U.K., Belgium and Denmark, and heat markets in Germany.”

Martin Bentele of the German Wood Fuel and Pellet Association described the German market: “The German forest area is 11 million hectares. Sawmills produce 10 million tonnes of sawdust and wood chips. Sixty pellet plants will produce two million tonnes of pellets in 2012.”

He went on to say, “Germany is almost 100% a heat market. Our advantage is that pellets cost 40% less than heating oil. We are happy serving the heat market and we are completely opposed to wood pellet co-firing in power utilities.”

Gordon Murray is executive director of the Wood Pellet Association of Canada. He encourages all those who want to support and benefit from the growth of the Canadian wood pellet industry to join. Gordon welcomes all comments and can be contacted by telephone at 250-837-8821 or by e-mail at gord@pellet.org.