WPAC Report: Desperation – the mother of creativity

Do you know it’s been 25 years since our first shipment of pellets from Canada? What might have seemed like a pipe dream is very much a reality. Today, Canada’s pellet sector is a global powerhouse not just in producing pellets but in the global fight against climate change. We’ve taken what was niche and moved mainstream. 

And so, how did we get here? While it’s the collective efforts of companies, employees, suppliers, customers and others, it all started as the brainchild of one man. John Swaan; also known as the “godfather” of the pellet sector. 

John Swaan, also known as the “godfather” of the pellet sector, was recognized for his role in the birth of the industry at the 2023 Wood Pellet Association of Canada conference in Ottawa in September. Photo: Annex Business Media.

It began with John’s idea of taking the wood waste residues from Northern B.C. sawmills and, instead of burning the shavings and sawdust in beehive burners (as was standard practice at the time), turning them into wood pellets. He planned to sell them in the growing Seattle market.

By 1994, as Pacific Bioenergy, he negotiated a partnership with the Carrier Group to build one of Canada’s first stand-alone wood pellet plants. Unfortunately, when the plant opened, the heating pellet market in Seattle crashed. John negotiated a verbal commitment from a big box store for 15,000 tons of bagged product a year, but it fell through and now he had 9,000 tons of bagged product in the plant’s yard with no home for it.  

As the saying goes, necessity may be the mother of invention, but desperation is the mother of creativity. With 9,000 tons of pellets, John began looking for options.  

He identified Sweden as a potential market for his pellets. But there were a few logistical challenges to work out … like a train, a vessel, a port … and how to get the pellets from Prince George to Sweden. 

Using his connections, John found an unused conveyance system and terminal in Prince Rupert. The company had storage at the terminal, but only 6,000-7,000 tons, so almost 10,000 tons had to be stored in rail cars. So John contacted CN Rail, who had a rail line to Prince Rupert. He negotiated a rate agreement and monthly lease with terms that were good by today’s standards. Working with a Swedish Canadian, Staffan Melin, they were able to convince an Asian shipping company to take on a bulk cargo of wood pellets. At the time, no one had moved wood pellets this way. The fact is that John risked everything to send a single shipment to Sweden.

“If it weren’t for John – his determination and his knowledge and expertise – we wouldn’t be where we are today,” says Vaughan Bassett, past president of the Wood Pellet Association of Canada (WPAC) and senior vice-president sales and logistics at Drax PLC. “He didn’t launch just a vessel, he launched a new sector, one that has gained global support as a clean, renewable and responsible source of energy and is making a positive difference in our forests, our communities and in the fight against climate change.” 

The fact is John’s expertise is hard won and a combination of many tough lessons along the way that have been forged out of determination in the face of desperation; these lessons have helped to create and support the multibillion-dollar wood pellet industry we all know today.

We recently paid tribute to John at our annual WPAC Conference, Sept. 19-20 in Ottawa. But with a conference theme of “Biomass is Mainstream: The Next 25 Years: Opportunity & Innovation,” we didn’t just look back, we looked forward.

The next generation of products will shift traditional views of wood pellets. That means giving Canadians more choices when it comes to renewable energy; in Europe it means taking the wins we’ve seen on the commercial and residential side to more industrial heat and displacing the reliance on Russian natural gas; and in the United States, it’s flying planes with sustainable aviation fuels and globally supporting the transition to green hydrogen and ammonia. In Europe and Japan, we can turn older coal plants into co-firing so they, too, can benefit from the flexibility that wood pellets provide.  

While our export markets will always be important, we are turning our focus to here at home to provide a responsible solution to local energy needs where coal, oil and other fossil fuels are still being used. Making the shift from oil and coal-based heat and electricity to wood pellets in Canada will take three simple steps: the right policies, strong incentives and effective communications. In Canada’s North and the Maritimes, there is already a shift to renewable energy for both commercial and home applications. We need to continue to support this evolution by working together with governments and agencies to encourage biomass use.

With all these opportunities, our ability to meet the growing demand for wood pellets will require stable access to fibre, ongoing investment, a strong logistics network, the right equipment, safe workplaces and the right people. Our people are the foundation of our success. WPAC is committed to being among the most inclusive and successful trade associations by actively seeking diversity across the industry. 

The Canadian wood pellet industry has a critical role to play in the global fight against climate change. I look forward to seeing what ingenuity the Canadian biomass industry brings over the next 25 years. With the planet getting hotter and climate disasters worsening, if there ever was a time to be creative, it’s now.

Check out the WPAC Fall newsletter here.

Gordon Murray is the executive director of the Wood Pellet Association of Canada.