WOOD PELLET NEWSLETTER
June 2011
Gerald W brown * 7202 County Road U * Danbury, WI 54830 Phone 715-866-8535
Gerald Brown is solely responsible for the content in this newsletter
• NEW ASSOCIATION TO ADDRESS U.S. INDUSTRIAL PELLET EXPORT ISSUES
• NO SILICON VALLEY VENTURE CAPITALIST HAS INVESTED IN IT.
• WHAT HIGH GAS PRICES MEAN FOR RENEWABLE ENERGY
• PELLET TECHNOLOGY TARGETS CELLULOSIC ETHANOL PRODUCERS
• REPORT ON MINNESOTA’S $17.1 BILLION FOREST PRODUCTS INDUSTRY NOW AVAILABLE
• FOUR N.H. WOOD-BURNING PLANTS WARN THEY’LL SHUT DOWN WITHOUT PURCHASE DEAL
• HISTORIC R.I. MILL DESTROYED IN FIRE
• FIRST ORDERS CLOSE; MACHINERY WILL FOLLOW: ATIKOKAN RENEWABLE FUELS
• FIRST ORDERS CLOSE; MACHINERY WILL FOLLOW: ATIKOKAN RENEWABLE FUELS
• ITALY FORECASTS INDUSTRIAL BIOMASS GROWTH
• POLLUTION PREVENTION PLAN COULD GROW UNDER RETOOLED BOROUGH MEASURE
• EXPLOSION DAMAGES WAYCROSS PLANT; NO INJURIES REPORTED
• BIOMASS SECURE POWER TO BUILD FIRST PELLET PLANT
• ONTARIO WOOD ALLOCATIONS SUPPORT PELLETS, LUMBER
• WOOD: THE NEXT GLOBAL COMMODITY?
• BIOMASS SECURE POWER PLANS TORREFIED WOOD PELLET PLANT IN CANADIAN PROVINCE
• US INDUSTRIAL PELLET MARKET PREPARES FOR EUROPE’S 20 X 2020 RENEWABLE ENERGY MANDATE
• THE NATURE CONSERVANCY AND THE SUSTAINABLE FORESTRY INITIATIVE EXPLORE RESPONSIBLE SOURCING FOR BIOENERGY FEEDSTOCKS
• DOMTAR TO PARTICIPATE IN THE BIOMASS-FUELED POWER PLANT PROJECT IN WISCONSIN
• RESEARCHERS DISCOVER NEW ALLOY THAT CONVERTS HEAT DIRECTLY INTO ELECTRICITY
• BURNING PELLETS IN THE GRILL
• CO-FIRING OF BIOMASS WILL BE MANDATORY FOR DUTCH POWERPLANTS
• DEMAND FOR WOOD PELLETS GROWS
• TIGHT CREDIT STILL MAJOR CONCERN FOR AGRIBUSINESS
• TAXPAYERS ALLIANCE: WISCONSIN ELECTRICITY PRICES INCREASING
• OVERHEATED ASSEMBLY CAUSED GEORGIA BIOMASS EXPLOSION
• PGI ENERGY SHAREHOLDER LETTER
• PELLET MILLS SAY PRICES SUPPORT MORE SPOT TRADES
• SOUTH KOREA POLICY SET TO DRIVE BIOMASS UPTAKE
• UPDATE ON THE FORESTY INDUSTRY
• COULD SWITCHGRASS OFFER A CO2 SOLUTION?
• GOLDMAN SACHS FORECASTS HIGHER CRUDE AND HEATING OIL PRICES
• WOOD HEAT FIGHTS TO BE A BIGGER PLAYER
• LOCAL FORESTS CAN SUPPORT PELLET MILLS
• BRAZILIAN ASSOCIATION INDUSTRY BIOMASS RENEWABLE ENERGY
• WOOD HEAT FIGHTS TO BE A BIGGER PLAYER
• CONSTRUCTION UNDERWAY AT ROTHSCHILD BIOMASS PLANT
• WALKER ADMINISTRATION SCALES BACK UW-MADISON POWER PROJECT AGAIN
• PULP PRICES HAVE REBOUNDED SIGNIFICANTLY OVER THE LAST 24 MONTHS.
• GERMANY PASSES MORE AGGRESSIVE RENEWABLE ENERGY LAW
• SAD (DISTRICT) 74 SCHOOLS CONVERTING TO WOOD-PELLET BOILERS
NEW ASSOCIATION TO ADDRESS U.S. INDUSTRIAL PELLET EXPORT ISSUES
April 24, 2011 - 1 Comment
By Anna Austin – Biomass Magazine
A new trade group has formed to address specific industry issues faced by U.S. manufacturers of industrial grade wood pellets that are being exported to Europe.
According to Executive Director Seth Ginther, the U.S. Industrial Pellet Association will focus on three main issues: certification standards for industrial wood pellets, sustainability and uniformity of contracts. There are other pellet trade groups in the U.S., he said, but none that address those specific issues.
The group was officially formed in February by Enviva Biomass, Fram Renewable Fuels, Green Circle Bio Energy Inc. and the Westervelt Company, according to Ginther, and interest has been extremely high. “We’re looking for other producers to become members, or anybody who is involved in the value chain or supply chain of industrial wood grade pellets. That includes landowners, transporters, equipment manufacturers, ports, European utilities and trading groups.”
On U.S. pellet export activity right now, Ginther said it’s not just talk. “It’s happening, and during the next five years, pellet demand in Europe will continue to rise dramatically. There’s an enormous demand for this product and that will continue.”
Though in the future the largely residential-based U.S. pellet market may begin to expand more to industrial-scale use, Ginther said the domestic wood pellet market as a whole is very small right now compared to Europe’s.
The USIPA plans to work with Canada on policy issues, he added, as Canada currently exports the vast majority of wood pellets imported to Europe.
NO SILICON VALLEY VENTURE CAPITALIST HAS INVESTED IN IT.
Government subsidies for it are skimpy, at best.
It lacks clout in Washington.
And it’s been around forever.
Yet it’s by far the most popular form of renewable energy used at home, dwarfing the impact of rooftop olar panels and appealing not just to well-to-do greens but to poor people, African-Americans and, we’d bet, climate change deniers, too.
Yep, I’m talking about–as Popular Mechanics put it recently-the “high-tech, cutting-edge, carbon-neutral alternative fuel of the future: wood.”
About 80% of residential renewable energy is created by wood heat appliances (not including fireplaces), while just 15% comes from solar and 5% from geothermal, according to Energy Information Administration statistics provided by the Alliance for Green Heat, a small nonprofit created two years ago to promote environmentally-friendly wood heat. Some 15 million American homes use wood as a primary or secondary heat source.
Of course, there’s nothing new about wood heat. Wood supplied more energy than fossil fuels in the U.S. until the 1880s, when it was displaced by coal and, more recently, natural gas, oil and electricity.
What’s new are the arrival of modern high-efficiency wood stoves, as well as a fast-growing wood pellet industry, that enable either cordwood or wood pellets to be burned more cleanly that before, dramatically reducing emissions of soot. Here’s a look at one:
Provided the wood burned in these stoves comes from waste or from well-managed forests, it can then be deemed an environmentally friendly fuel. Wood is already seen that way in much of western Europe, according to this 2009 article in Science [subscription req'd] which argued that “sustainable wood energy offers recurring economic, social, and environmental benefits.”
“We’re the only modern, industrialized country that hasn’t looked at wood as a serious way to reduce fossil fuels,” says John Ackerly, who started the Alliance for Wood Heat two years ago.
Last week, I met with John, a lawyer and former human rights activist. (He worked for the International Campaign for Tibet for 21 years, including 10 years as its president.) Wood heat, he argues, is social justice and jobs issue, as well as an environmental solution. It’s a low-cost and low-carbon way to heat homes. It’s a “green” technology that appeals to poor and working class people. And, because gathering and distributing wood is labor intensive, it’s generates economic activity.
So why haven’t you heard much about wood heat? One reason, surely, is that the industry is very fragmented–there’s no association of the guys who deliver firewood–and therefore not organized to make its voice heard in Washington. Wood stove manufacturers are part of a trade group called the Hearth, Patio and Barbecue Association, which pretty much tells you all you need to know about its influence inside the Beltway.
Yet the wood heat industry, John estimates, is substantial, with about $3 billion in revenues. “It’s about the size of the U.S. wine industry,” he told me. “It’s probably the only $3 billion industry that doesn’t have a lobbyist in town.”
John, who is 53 and lives in Takoma Park, MD, practices what he preaches. He’s got an efficient wood stove, and he fuels it by gathering waste wood from trees cut down in his neighborhood. “I haven’t bought wood in 15 years,” he says. But he admits that keeping the fire burning requires some effort. “You have to split the wood, and stack it,” he says.” You have to either enjoy it–or have no other choice.”
Popular Mechanics calculated the annual costs of heating a house using various fuels and estimated wood at $1,299, just below natural gas, which is a historically low levels, and well below fuel oil, propane gas and electricity. Stoves costs $3,000 to $4,200, including installation.
Wood stoves are most popular (obviously) in colder climates and (not so obviously) among poor people. Arkansas and West Virginia, for example, are big wood burning states. John says: “It’s actually poor people in this country who are at the forefront of not using fossil fuels, and they’re doing it without getting any money back.”
One of John’s goals at the Alliance for Green Heat is to get wood heat recognized as a form of renewable energy deserving of government support. Homeowners installing solar panels are eligible for 30% tax credits, which are often coupled with state incentives. The buyer of an electric car gets a $7500 tax credit. Whatever you think of those incentives, they flow mostly to the well-to-do. By contrast, wood stoves get a maximum tax credit of $300.
“Basically, low and middle income people are excluded (from renewable energy subsidies) because they can’t afford solar or geothermal,” he said. If the goal is to reduce CO2 emissions, a dollar spent on wood buys more GHG reductions than competing clean technologies, he said. It’s way more effective than turning biomass in the form of corn into ethanol. The drawback of burning wood is that even efficient stoves produce some particular pollution, so they should be used in places like Los Angeles or Denver where smog remains a problem. “It’s not for everyone and it’s not for everywhere,” John said.
But as is so often the case with environmental or health problems–think about excessive packaging, or overly-processed foods–solutions lie not in some futuristic technology but in the past.
WHAT HIGH GAS PRICES MEAN FOR RENEWABLE ENERGY
By Jennifer Kho, Contributor
May 31, 2011 |
While high energy prices in 2008 pushed investors towards renewables, the story is very different this time around.
California, USA -- Gasoline prices have been falling in the last few weeks, but – for most U.S. drivers – they remain painfully high. With regular unleaded costing a national average of $3.78 per gallon Tuesday, and more than $4 a gallon in six states and the District of Columbia, prices are more than $1 higher than they were a year ago. "When you fill your tank and you're putting $60, $70 or $80 into your vehicle at a shot, you start to wonder if there's an alternative to this madness," said Scott Doggett, associate editor for Edmunds.com.
In 2008, the last time gasoline approached $4 a gallon, the sticker shock prompted many drivers to trade in their gas-guzzlers – often at enormous losses – and buy more efficient cars and hybrids, he said. Investors pumped money into new fuel and vehicle technologies, including biofuels and electric cars, which seemed more competitive compared to higher gas prices. And analysts began considering $4 gas the tipping point for change.
So you might think that the return of high gasoline prices would be great news for alternative fuels and electric-vehicle technologies. But this time around, analysts say, they're not seeing the same dramatic response from consumers and investors. Drivers aren't flocking to car dealerships to trade in their cars. Investors aren't spending hundreds of millions on algae-based biofuels or electric-vehicle batteries. And there's no sign that the prices will spark the kind of government spending that the stimulus brought soon after the prices breached $4 a gallon last time.
Why It's Different This Time
What's different? For one thing, today's economy is very different than it was three years ago. Even though the economy had already begun to slump in 2008, far more people find themselves caught in challenging conditions today, Doggett said. Drivers don't have the discretionary income to switch cars and they're holding on to their old cars longer, he added. In other words, drivers don't have much of a choice. "They see themselves putting $60 or $70 into their gas tanks and they aren't happy about it, but there's not much they can do about it either," he said. "They don't see another viable option."
Even if they want to spend the money on a new car, many would-be car buyers just can't get the financing they'd need now that banks have become more cautious about lending and home values have dropped. "People's buying habits are totally different than they were two or three years ago because of what people have lived through and uncertainty about what's going to happen in the future," said Rick Kment, a biofuels analyst at DTN. "With more uncertainty about jobs and a challenging economy, are you going to lock yourself into a 5- to 6-year car purchase now?"
Most Americans who are buying new cars aren't buying the plug-in hybrid Chevy Volt or the all-electric Nissan Leaf, or even a regular hybrid like the Toyota Prius. With General Motors targeting sales of a mere 10,000 Volts in its first year and Nissan aiming to sell 10,000 Leafs by the end of this year, these cars will make up a tiny part of the U.S. sales that automakers predict could top 13 million in 2011. And while more hybrid models are available today than there were two years ago, the percentage of hybrids in the U.S. market shrank to 2.4 percent in 2010 from 2.7 percent in 2009, even as gasoline prices grew, Doggett said. "Even with more hybrid choices available, Americans are purchasing fewer of them on a percentage basis," he said.
At $40,000, the Volt – which drivers can charge with electricity or fill with gas – is simply beyond the means of many Americans, Doggett said. And the Leaf doesn't have the range that many drivers would like, in many cases topping out at around 80 to 100 miles per charge, he added. "For a lot of people, that's just not enough," he said. "It may be true that the average American drives 40 miles a day, but there are many times when that average American is going to want to drive 120 or 150 miles. The Leaf just doesn't meet a lot of people's expectations of what an automobile is supposed to do."
Other hybrids cost less, but still can be expensive. Many models, including the Toyota Prius, have price tags $3,000 higher than their comparable nonhybrid counterparts. They're facing increased competition from more fuel-efficient internal-combustion-engine vehicles. Because while the gas prices are beginning to make consumers look more closely at alternative vehicles, many are finding that the most convenient choice – aside from driving less – is a smaller, more fuel-efficient car with traditional technology, said Thilo Koslowski, lead automotive analyst at Gartner.
So while car buyers are paying more attention to fuel efficiency nowadays, traditional – albeit higher-MPG – vehicles seem to be winning out over new technologies, analysts say. One reason is that internal-combustion-engine cars have gained fuel efficiency since 2008. "The 40-MPG club is growing, and it offers a lot of competition to hybrids," Doggett said. "Almost every major automakers feels pressure to have at least one model that gets 40 MPG on the highway. There's the thinking that you need to have a place at that table."
Those conventional cars haven't gained their fuel efficiency for free. Prices are going up as automakers pass research costs to consumers, Doggett said. But the fuel-efficient ICE vehicles remain cheaper than hybrids, and -- as the MPG gap between hybrids and conventional cars narrows -- buyers seem to be growing less willing to pay those premiums for smaller fuel-efficiency gains. Meanwhile, many of those early adopters inclined to buy hybrids at the sight of $4 gas probably already did so in 2008, and aren't likely to switch out their green cars for newer ones only three years later, Kment said.
Changing the Fuel Instead of the Car
Another option that drivers have is to fill their regular cars with ethanol or biodiesel. Biofuel retailer Propel Fuels has seen its customer ranks grow steadily amid the higher gas prices, with a double-digit monthly growth rate for the last six months, according to CEO Matt Horton. The company just opened its 24th station in Redwood City, Calif., in May. Horton estimates that Propel probably has nearly 10,000 customers now, with a much larger potential market. After all, more than 65 percent of drivers with flexible-fuel vehicles, which can run on a blend of 85 percent ethanol and 15 percent gasoline called E85, aren't aware they have such vehicles, he says.
"Most American consumers are absolutely sleepwalking when it comes to fuel," CEO Matt Horton said. "It's a mindless process – you go to the gas station, grumble a bit and fill up. But gas prices like these shake people out of their sleep and make them think about what they're doing. They look for alternatives, and because of that, our business has been doing very well in this environment. Whenever people think about their fueling choices, it's good for our business."
It's interesting to hear that E85 sales have grown considering that ethanol prices actually have outpaced gasoline prices lately. Ethanol is still cheaper than gasoline, but a gallon of ethanol contains 25 to 30 percent less energy than a gallon of gasoline, so if isn't 25 to 30 percent cheaper – or $3 a gallon when gas is at $4 -- it's not a good deal for drivers, Kment said. The average price of E85 nationwide is $3.23 per gallon, which – because of the lower energy content – would equate to a price of $4.25 per gallon for regular gasoline, according to AAA. The gap between the price of gasoline futures and ethanol futures for June – the so-called gas-to-ethanol spread – has shrunk from almost 81 cents per gallon on May 10 to 52 cents on Tuesday, Kment said, meaning that ethanol futures cost only 16.5 percent less than gasoline futures.
Why? Well, corn prices have been soaring, with flooding and planting delays exacerbating higher food prices overall. Horton calls the oil price the No. 1 contributor to the rise in corn prices, pointing out that food and other commodity prices tend to rise whenever oil prices do. Fertilizer is petroleum-based, for one thing, and transportation is needed to produce and distribute corn. Oddly enough, while oil and gas prices have boosted ethanol prices, ethanol has actually helped keep gas prices down, according to a Center for Agricultural and Rural Development study in May. The report concluded that ethanol had reduced wholesale gas prices by an average of 82 cents per gallon in 2010 and that gas could cost up to 92 percent more today if it weren't for ethanol.
In any case, the shrinking gas-to-ethanol gap hasn't trickled down to Propel's stations. The company has cut its margins to keep ethanol competitive, Horton said. At its new station in Redwood City, Calif., Propel sells E85 for 76 cents per gallon less than gasoline. That's a bigger discount than the nationwide average, which prices E85 at 55 cents, or 14.5 percent, less than gasoline. And Horton claims that customers haven't been seeing big mileage reductions, in spite of ethanol's lower energy content. Of course, customers aren't using 100 percent ethanol, but a blend, which tempers the mileage reduction. Most Propel customers report a loss of only 1 to 2 fewer miles per gallon, Horton said.
Still, sales of E85 still make up a small fraction of the U.S. ethanol market today. Most of the ethanol is blended with gasoline, and that market seems to be stuck where it is for now, analysts say. Ethanol is cheaper than gasoline, so blenders have an incentive to add as much as most cars can use. But a blend of up to 10 percent ethanol and 90 percent gasoline, E10, is the practical limit for the majority of U.S. pumps because it’s the maximum blend that all gas vehicles can use today.
The Environmental Protection Agency in January approved the use of E15 for cars released in 2001 and later, but most retailers are unlikely to add expensive E15 pumps when only about half of the cars on the road could use the fuel, Kment said. Adding to the reluctance is the fact that retailers aren't guaranteed any protection against lawsuits if drivers with older cars use the fuel, according to oil and ethanol refiner Valero spokesman Bill Day. "Until and unless E15 gets some product-liability protection and until and unless it's approved for all vehicles, it's not going anywhere," he said, adding that Valero doesn't plan to sell E15 at any of its company-owned stores. "EPA's approval of E15 made for good politics, but it was – for all practical matters – useless."
Valero's Renewable Plans
Valero plans to continue to blend E10, which meets the federal renewable fuel standard (RFS), as well as E85 for flex-fuel vehicles. It also plans to add E85 dispensers any time it opens a new store or significantly renovates an old store. So far, the high gasoline prices and low margins for ethanol haven't altered Valero's interest or activities in renewables, Day said.
The company has been running its ethanol factories, which it bought from VeraSun in 2009, at full capacity – and at a profit – and intends to continue to do so, he said. "The price of corn has gone up and margins for ethanol have been squeezed a little bit, but our plants are large, low-cost operations, so it's still viable for us to operate them at capacity."
While Valero got permits to slightly increase the capacity at its Minnesota ethanol plant, it doesn't have any firm ethanol expansion plans, Day added. It has considered buying more factories, but the valuations have gone up and Valero hasn't been able to find the same kind of bargain that it got for the VeraSun plants, he said. It also hasn't seen much of change in the ethanol market as a result of the high gas prices, he added. "We haven't said we've seen an increase, but it's stayed at elevated levels."
Meanwhile, gas prices could be heading downward, even as summer – traditionally a time of heavy driving and higher demand for fuel – approaches, Kment said. "In the last three weeks, we have seen a significant pullback in expected demand, a significant selloff in the gasoline market," he said. Gasoline futures for June delivery fell from $3.38 per gallon on May 10 to $2.95 per gallon on May 18, indicating expectations of sluggish demand, he added. By Tuesday, the price had recovered somewhat to $3.15 per gallon, but that's still below previous expectations for this time of the year, and Kment predicts that demand will remain slower than usual.
If gasoline prices drop significantly, as futures traders expect, and corn prices remain high, ethanol prices could actually meet or exceed gasoline prices, Kment said. (Horton believes that gas prices will remain high this summer – and will continue to grow in the long term, even if they fluctuate in the short term – while corn prices come down. Ethanol futures are now priced at $2.63 per gallon for June delivery.) If ethanol prices do top gas prices, E85 sales could drop, but the market for ethanol blended into gasoline is unlikely to see much of an impact, Kment added.
That's because the federal RFS calls for about 13.95 billion gallons of biofuel this year, increasing to 36 billion gallons in 2022. Corn-based ethanol could make up about 13 billion gallons of that requirement, an amount equal to more than 9 percent of the country's annual gasoline consumption. So for all practical purposes, most of the ethanol blending is stuck in the narrow window between 9 percent and 10 percent, Kment said. That means that when the gas-to-ethanol spread grows or shrinks, it ends up having a limited effect on the market, he added.
Day disagrees that there's little room for discretionary blending. Not everybody is blending at the 10 percent level now, he said, adding that ethanol blending is not required in some parts of the country. But he acknowledged that the discretionary-blending window will keep shrinking as the RFS requirement grows to 36 billion gallons in 2022. "That's why we're interested in increasing the amount of E85 that we sell," he said.
Back in 2008, the RFS required only 9 billion gallons of biofuel in 2008, which gave blenders more discretion to react to fuel prices by adding more or less ethanol to their gasoline. And, unlike in 2008, investment in advanced biofuels, such as algae-based biodiesel or cellulosic ethanol, hasn't seen a big jump either. Those second-generation fuels could deliver more environmental benefits than corn-based ethanol or soybean-based biodiesel and could potentially cut costs in the long run, analysts say. The fuel standard calls for 1.35 billion gallons of advanced biofuels this year. But those fuels are "still economically unfeasible" in spite of sky-high corn prices, Kment said.
Is $5 Gas the New $4 Gas?
The question remains: Why is this spike above $4-a-gallon gas bringing less change than the last one? Have drivers become more tolerant of higher prices now that $4 gas is nothing new? Listening to consumers' comments, Day doubts it. But this time around, customers realize the price spike is the result of temporary disruptions in the market and already have seen prices start to slide, he said.
What would it take to bring those technologies the same momentum they saw back in 2008? For the last three years, analysts have confidently called $4 gas a tipping point because of the flurry of renewable support they saw in 2008. But just because it happened before doesn't mean it will happen again. Maybe it takes higher and higher gas prices to cause the same type of sticker shock. Back in 2004, after all, gas prices above $2 a gallon were enough to shine a spotlight on renewables.
Now, it looks like $4 gas might not be enough, Doggett said. "A lot of people were saying – and people are saying it now – that $4 gas is a tipping point, but the fact is that we do have $4 gas nationwide and we're not seeing anywhere near the selloff of gas guzzlers and demand for fuel-efficient vehicles that we saw three years ago," he said. "It'll be interesting to see, if we get to $5 gas, if people will say 'Enough is enough.'" Koslowski predicts that it could take $10-a-gallon gas to drive consumers toward big changes, like electric vehicles, a price we're unlikely to see soon. Companies developing new vehicle technologies likely hope to prove him wrong.
PELLET TECHNOLOGY TARGETS CELLULOSIC ETHANOL PRODUCERS
By Kris Bevill | June 02, 2011
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Nebraska-based Pellet Technology LLC is teaming up with CPM to offer second-generation biofuels producers a solution to the logistical issues surrounding the use of bulky biomass as feedstocks. Pellet Technology, which became commercially active just a few months ago, has developed a patented technology to produce pellets from corn stover and other energy crops. The pellets can be used to co-fire industrial boilers, but they can also be used as a feedstock for cellulosic ethanol production, according to Russ Zeeck, chief operating officer of Pellet Technology. This application has been tested commercially and will be used in several U.S. DOE-funded projects, including the EdeniQ Inc. pilot plant in California, he said. It’s also ready for use at commercial pellet mills, and the company is in talks with several liquid biofuels groups to construct mills in rural locations to service biofuels facilities, he said.
CPM, which is a major process equipment supplier to the biofuels industry already, has signed on to be the exclusive provider of equipment for the technology process. Jim Hughes, CPM general manager, said Pellet Technology is on the “cutting edge” of process development for renewable energy. Zeeck said CPM’s hammermills and pellet mills are the only pieces of equipment that have met his company’s quality standards, which is why it has the exclusive equipment rights. “No other pellet mills and no other grinders have been able to meet our quality parameters necessary for biomass customers,” he said.
About $12.5 million should cover the construction costs to build a pellet mill capable of processing 175,000 tons of corn stover annually, according to Zeeck. Pellet Technology’s business model includes licensing its technology to companies and cooperatives that will construct the mills in rural areas, similar to the model used currently for grain elevators. Each centrally-located pellet mill could then service multiple biofuel production facilities, Zeeck said. Approximately 75 gallons of ethanol can be produced from each ton of Pellet Technology’s pellets, which means a 20 MMgy ethanol plant would need access to about 265,000 tons of pellets.
Sustainability is a primary focus for Pellet Technology and Zeeck said they are willing to turn down farmers who offer to provide corn stover but may not be able to do so in the most sustainable fashion. Iowa would seem an obvious choice for any corn stover-related business, but Zeeck said that is not necessarily the case when sustainability is the first objective. “While Iowa is the largest corn-growing state, it’s not necessarily the largest sustainable harvester of biomass,” he said, adding that the pitch of fields contributes substantially to the amount of biomass that can be sustainably harvested. Pellet Technology is working on projects in Iowa, but it also working with groups in Nebraska, Indiana, Illinois, Michigan and Ohio.
Confidentiality agreements prevented Zeeck from sharing details regarding its pending commercial projects, but he said the first commercial mill should become operational next August. Pellet Technology is also constructing a research and development facility in Omaha, Neb., that will come online in December. There, the company will run trials to examine the use of corn stover pellets as a supplemental animal feed and will continue to tweak its design basis for liquid fuels and utility combustion groups use. Zeeck said the company will also experiment with enzyme additions to the biomass.
Many of the logistical issues related to the use of agricultural residues are related to the transport, storage and pre-processing of the biomass. Zeeck said those issues become non-issues when pelletized biomass is used. “The primary issue we’re dealing with is a lot of the groups we’re working with currently who are building numerous pilot plants have run into permitting issues and long-term storage of bales, bale handling and management,” he said. “Essentially it means you have to run a bale a minute for a lot of these facilities to run seven days a week, 365 days a year. With our pellets, that eliminates that problem.” Financial concerns from investors and banking institutions can also be alleviated through the use of the pellet technology, he said, adding that the biofuels groups working with Pellet Technology now were attracted to the projects in part because they are able to lock in a seven-year feedstock contract.
REPORT ON MINNESOTA’S $17.1 BILLION FOREST PRODUCTS INDUSTRY NOW AVAILABLE
June 1, 2011 - 0 Comments
Source – Minnesota’s Department of Natural Resources
The Minnesota Department of Natural Resources (DNR) has rolled out a new report on the important economic contribution of the state’s forest products industry (link opens a PDF).
Minnesota’s native forests, plantation forests, community forests and urban trees not only help maintain a healthy environment, provide clean water and enhance our quality of life, they also played a critical role in our state’s development. They have served as a cornerstone of the state’s economy for years.
“Economic Contribution of Minnesota’s Forest Products Industry – 2011 Edition” shows how Minnesota’s forestry-related business sectors annually contribute $17.1 billion to the state’s economy and provide 86,775 jobs,” said Dave Epperly, DNR director of Forestry.
Epperly noted, however, that housing-related wood products manufacturing sectors have been negatively impacted by the recession over the past decade. During this time, four of the state’s primary manufacturing facilities were permanently closed, resulting in an estimated cumulative loss of more than 1,500 jobs and 1 million cords of annual timber consumption. The DNR and other land management agencies are working hard to keep the existing industry competitive and attract new wood-using sectors, including heat, power, biofuels and chemicals.
“Timber harvesting and forest products manufacturing are critical to maintaining healthy and productive forests, and healthy forests provide a backdrop for outdoor recreation and tourism,” Epperly said. “Minnesota’s resilient forests are also pivotal for developing sustainable, renewable alternatives to fossil fuels.”
Other highlights from the report:
• about 40 percent of all forest products manufactured in Minnesota are used locally; the balance is shipped to other states and countries
• Minnesota annually exports $707 million worth of pulp, paper and paperboard products to other countries, with China and Canada as the biggest customers
• Minnesota’s forest products industry annually generates $493 million in state and local sales, property and income tax receipts
• Minnesota’s forest landowners annually receive about $80 million in timber revenue
• timber harvested from DNR-administered land generates $1.3 billion industry output on a yearly basis and supports 5,050 jobs through primary forest products manufacturing.
The report is a collaborative effort between the University of Minnesota-Duluth’s Bureau of Business and Economic Research and DNR Division of Forestry.
FOUR N.H. WOOD-BURNING PLANTS WARN THEY’LL SHUT DOWN WITHOUT PURCHASE DEAL
June 6, 2011 - 0 Comments
By Kathleen Callahan – New Hampshire Business Review
Operators of four New Hampshire biomass plants that employ nearly 100 workers say they could face imminent closure if they’re not able to secure short-term energy contracts with Public Service of New Hampshire.
The four wood-fired biomass plants – in Bridgewater, Bethlehem, Tamworth and Alexandria – have teamed up in an attempt to secure power-purchase agreements with the state’s largest electric utility, which has held firm against entering agreements with the plants.
Plant operators say they cannot survive on the open market and will be forced to shut down operations if they cannot sell their energy, at least in the short term, to PSNH.
“We’re not asking for much, we’re not asking for the world – we just need to get by for the next few years until the economy turns around,” said Mark Driscoll, manager of the Pinetree Power plant in Bethlehem.
The plants have joined together in a grassroots lobbying effort with representatives from the state’s related industries – logging, forestry and farming – who they say would be affected if the plants were to close. Supporters have launched a website, called and written letters to state officials and held meetings across the state to raise awareness.
“There’s a lot of interconnectedness within this industry,” said Shelagh Connelly, president of Holderness-based Resource Management Inc., which recycles about 20,000 tons of wood ash each year from the biomass plants. The ash is then sold to about 150 New Hampshire farmers a year, who use it as a low-cost and locally sourced fertilizer, she said.
“You don’t realize how many people are involved and dependent on these plants,” said Connelly, who founded her company when the plants were built in the late 1980s. If the plants close, she would be forced to eliminate three equivalent full-time positions and sell one truck from a fleet of six, she said.
“It will have a profound impact on forestry in the state and how the integrated forest products companies conduct forest operations,” said Bridgewater plant manager Mike O’Leary.
According to supporters, the four plants directly and indirectly support about 400 jobs, including plant workers, loggers, distributors, farmers, ash recyclers and others.
“They’re good jobs – they’re full benefits,” said O’Leary of Bridgewater’s 19 positions. “It’s an area of the state where the quality of the jobs we’re talking about are not easily replaced.”
Supporters also estimate the four plants’ impact on the local and state economy to be at least $40 million annually, from the loggers who pay vehicle registration fees and buy supplies at area auto part stores to local farmers who purchase the recycled ash for fertilizer.
Rising costs
The four biomass plants were built in the mid-to-late ’80s, when – in a push to promote home-grown and renewable energy – the state required PSNH to enter a 20-year rate order with them.
But that was a loss for PSNH, because the long-term rate was significantly higher than the market value of the energy, said Martin Murray, spokesman for the utility. “Our customers suffered because they were forced to pay very high prices for the energy from these plants.”
After the 20-year period was up, most of the plants were able to secure short-term contracts with other providers, which have since expired.
Now the plants are attempting to sell energy on the open market, where they are essentially bleeding out. O’Leary said the Bridgewater plant has been operating at a loss nearly every month since its short-term contract expired last August.
One reason for this is the rising cost of diesel fuel, which has driven up the cost of wood, he said. This is on top of the recession, which caused an overall drop in demand for energy.
Another major impact on the industry has been the huge drop in energy prices, particularly the downturn in the cost of natural gas. In the Renewable Energy Credit market, natural gas is considered a Class III REC. (RECs can be traded like commodities and exist to encourage the use of renewable energy.)
Because they use older technologies, most of the wood-burning plants also qualify for Class III RECs. Facilities with more updated and cleaner technology qualify for higher-class RECs.
The relatively low cost and large supply of natural gas has outstripped the demand for Class III RECs. A small player when it first emerged, natural gas has become so ubiquitous it dominates about 50 percent of New England’s energy portfolio, said PSNH’s Murray.
“The landfill gases have now jumped into the Class III REC market, and the price just continues to drop,” said Driscoll.
The state Public Utilities Commission is currently reviewing the state’s Renewable Portfolio Standards, with a report of its findings to go to the Legislature in November and new standards to go into effect by July 2012. The current standards do allow for the four wood-burning plants to move up to the Class I REC market, but in order to qualify they would have to undergo significant capital upgrades.
So to remain viable, the plants hope to see an increase in the percentage of Class III RECs utilities are required to obtain.
However, said Driscoll, “we can’t make it through next July on the open market. That’s why we need a short-term contract from PSNH, or we won’t even be around to take advantage of any changes to the RPS.”
O’Leary said the plants have offered PSNH rates at or below its default service rate, which is 8.7 cents per kilowatt-hour. But since the utility can purchase the energy for less on the spot market, it hasn’t bitten.
“We are obligated to serve our customers at the lowest possible price,” said Murray. “Today, we cannot justify paying more for energy from the biomass plants than we would if we purchased the energy from the marketplace.”
Plus, he pointed out, it’s not only PSNH that is not purchasing power from the plants, since they can sell their power and RECs to buyers throughout New England.
“It’s very telling that they can’t find a buyer,” said Murray. “The question is not, ‘Why can’t they sell to PSNH?’ – the question is, ‘Why can’t they sell to anyone?’ At the moment, they can’t compete in the marketplace because their commodity is priced too high.”
Murray also pointed to the fact that none of the plants are owned by New Hampshire entities. The Pinetree plants in Tamworth and Bethlehem are owned by GDF Suez, a multinational energy conglomerate based in France; the Bridgewater plant is majority owned by Public Service Enterprise Group of New Jersey; and the Alexandria plant is owned by Indeck Energy Services Inc. of Illinois.
“The corporations that own these plants have large purse strings, but they don’t appear willing to help these guys get over the hump,” said Murray.
“PSNH uses that – ‘Oh, you’re owned by a multimillion-dollar corporation’ – but people aren’t in business to lose money,” said Driscoll. “These jobs are in New Hampshire, these plants pay New Hampshire taxes.”
O’Leary said that as long as there’s light at the end of the tunnel – in the form of a short-term contract to tough out the current market – the owners will keep the plant in business “to preserve that infrastructure.”
For now, the plants are hoping for a hot summer, which would help market prices rebound while they continue to lobby the state and PSNH for short-term contracts.
“We do have sympathy for the position they find themselves in,” said Murray. “We have always been open to discussions of how we can help if possible, but what we are looking for is fairness for our customers.”
HISTORIC R.I. MILL DESTROYED IN FIRE
Published: June 8, 2011 at 1:45 AM
WOONSOCKET, R.I., June 8 (UPI) -- A fire gutted a "very historic" factory that once made World War II tanks and Keds sneakers Tuesday in the old Rhode Island manufacturing town of Woonsocket.
The former Woonsocket Rubber mill had been closed for some time. Mayor Leo Fontaine told The Providence Journal the American Wood Pellet Corp. recently acquired the building.
"This is a very historic building and represents a great loss to Woonsocket," Fontaine said.
Fire officials said the blaze appeared to be a small one but it spread quickly. Fire Chief Gary Lataille said he made the decision to allow the building to burn while trying to contain the fire.
Firefighters from at least 10 departments in Rhode Island and Massachusetts assisted in the effort. One firefighter was reported injured.
Fontaine said tanks made at the mill came ashore on the Normandy beaches on D-Day.
The building dates back to 1857 and was listed on the National Register of Historic Places in 1989.
Read more: http://www.upi.com/Top_News/US/2011/06/08/Historic-RI-mill-destroyed-in-fire/UPI-67511307511928/#ixzz1OhITH3tZ
FIRST ORDERS CLOSE; MACHINERY WILL FOLLOW: ATIKOKAN RENEWABLE FUELS
by Atikokan Progress on June 8, 2011
M. McKinnon
Atikokan Renewable Fuels (ARF) is ready for the installation of pellet-making machinery. All that’s needed now is fuel pellet buyers, and Ed Fukushima believes the company is close.
“We’re hoping to land orders in the next 30 to 60 days. Depending on how fast they want product, we’ll start installing the machines.”
Fukushima added that the orders will determine the type and number of production machines that will be installed. The ARF plant will eventually have five machines – four running and one serving as a ‘hot spare’ to ensure uninterrupted production – but installation will be staggered according to demand.
“We’re not going to dump money – the machinery will go in when the market tells us [it’s ready for the product].”
The Atikokan operation will employ 40; the company has been in discussions with Confederation College about offering a forest product manufacturing certificate course in Atikokan. The Atikokan plant will be the hub of the three Great North plants.
“It’s an identical process and product at all three facilities,” said Fukushima, referring to the company’s basic wood pellet. “We will share technical expertise at all the sites, with Atikokan [serving as] the training base for all the technical trades and operations. We will have fully trained technicians at each site.”
Plans are for the company to manufacture its densified fuel pellet (that’s the one containing about 10% polyethylene) exclusively in Atikokan. Great North will build the machinery for that operation itself.
Fukushima will establish a branch operation of MGM Electric in Atikokan as part of operations. MGM, an electrical distributor, employs 30 now in Thunder Bay and Dryden. Great North also has the advantage of at least two more sister companies – Automation Now, which employs 15 and specializes in design and automation for the wood industry, and Mahon Electric, which employs 10 and specializes in industrial motor, welder and pump repair.
ARF is one piece of the new bio-fuel industry in the Northwest
M. McKinnon
Great North Bio-Energy is in it for the long haul.
Great North is the parent company of Atikokan Renewable Fuels, and is working now to establish itself as a major player internationally. Ed Fukushima believes the key to success in the emerging bio-fuel markets will be the ability to offer a consistent, high quality product in reliable quantities.
In a presentation at the Chamber of Commerce annual meeting last month, and during visits to town since, Fukushima detailed how the company is committed to becoming a reliable, multi-site producer of wood fuel pellets, so that it can take advantage of these opportunities with large retailers and international users.
It currently has three plant projects on the go – in Atikokan, Whitesands First Nation (just northwest of Lake Nipigon) and Sandpoint FN (just southeast of Lake Nipigon). The Atikokan plant, which will eventually have five pellet production machines, will be the largest of the operations, capable of producing 140,000 tonnes of fuel pellets annually. Whitesands, which will also include a co-gen project that will enable that community to turn off its diesel-fired generators, and Sandpoint will each have a 60,000 tonnes per year capacity.
That total production capability – over 250,000 tonnes per year – will give Great North the ability to market its product in Europe as well as North America.
“The market is coming our way,” said Fukushima. “There is a perfect scenario developing.”
The use of biomass is growing in Europe, and rising pressure there to move away from nuclear energy (particularly in Germany), is adding to the demand for biomass fuels. Much of the biomass in use in Europe now is coming from B.C.
“Japan and China are becoming huge consumers, and they are much more the natural market for B.C. product,” said Fukushima. Great North will have a significant shipping advantage in dealing with Europe, and is working to land supply contracts there. A Swedish company will have representatives here later this month to check out the Great North operation.
Fukushima believes there is also good potential for Great North’s patented densified pellet (containing about 10% polyethylene) in Europe, and hopes to land a long-term supply contract for it there. The pellet has been approved for use by the American Environmental Protection Agency, can be co-fired with coal, offers a higher energy content and is extremely weather resistant.
The company is also working with researchers at Lakehead University and the University of Western Ontario on the next generation of wood pellet fuels. Torrifaction (special ‘cooking’ of wood bio-mass to create ‘bio-coal’) and the use of natural additives and binding agents offer hope for a higher energy, more weather-resistant fuel pellet. The company that first develops this technology will obviously have a major advantage in the market.
Great North has formed a wide range of partnerships with First Nations across the region. Rainy Lake Tribal Contracting will handle all wood harvesting, shipping, scaling and handling (including debarking and grinding), which will mean work for about 60 people. In addition to its projects at Whitesands (60 employees including wood harvest workers) and Sandpoint (25 employees) FNs, the company has agreements in place with Couchiching, Nigigoosiminikaaning, Lake Nipigon Ojibway, Seine River, Stanjikoming, Manitou Rapids and Naecatchewenin.
FIRST ORDERS CLOSE; MACHINERY WILL FOLLOW: ATIKOKAN RENEWABLE FUELS
by Atikokan Progress on June 8, 2011
M. McKinnon
Atikokan Renewable Fuels (ARF) is ready for the installation of pellet-making machinery. All that’s needed now is fuel pellet buyers, and Ed Fukushima believes the company is close.
“We’re hoping to land orders in the next 30 to 60 days. Depending on how fast they want product, we’ll start installing the machines.”
Fukushima added that the orders will determine the type and number of production machines that will be installed. The ARF plant will eventually have five machines – four running and one serving as a ‘hot spare’ to ensure uninterrupted production – but installation will be staggered according to demand.
“We’re not going to dump money – the machinery will go in when the market tells us [it’s ready for the product].”
The Atikokan operation will employ 40; the company has been in discussions with Confederation College about offering a forest product manufacturing certificate course in Atikokan. The Atikokan plant will be the hub of the three Great North plants.
“It’s an identical process and product at all three facilities,” said Fukushima, referring to the company’s basic wood pellet. “We will share technical expertise at all the sites, with Atikokan [serving as] the training base for all the technical trades and operations. We will have fully trained technicians at each site.”
Plans are for the company to manufacture its densified fuel pellet (that’s the one containing about 10% polyethylene) exclusively in Atikokan. Great North will build the machinery for that operation itself.
Fukushima will establish a branch operation of MGM Electric in Atikokan as part of operations. MGM, an electrical distributor, employs 30 now in Thunder Bay and Dryden. Great North also has the advantage of at least two more sister companies – Automation Now, which employs 15 and specializes in design and automation for the wood industry, and Mahon Electric, which employs 10 and specializes in industrial motor, welder and pump repair.
ARF is one piece of the new bio-fuel industry in the Northwest
M. McKinnon
Great North Bio-Energy is in it for the long haul.
Great North is the parent company of Atikokan Renewable Fuels, and is working now to establish itself as a major player internationally. Ed Fukushima believes the key to success in the emerging bio-fuel markets will be the ability to offer a consistent, high quality product in reliable quantities.
In a presentation at the Chamber of Commerce annual meeting last month, and during visits to town since, Fukushima detailed how the company is committed to becoming a reliable, multi-site producer of wood fuel pellets, so that it can take advantage of these opportunities with large retailers and international users.
It currently has three plant projects on the go – in Atikokan, Whitesands First Nation (just northwest of Lake Nipigon) and Sandpoint FN (just southeast of Lake Nipigon). The Atikokan plant, which will eventually have five pellet production machines, will be the largest of the operations, capable of producing 140,000 tonnes of fuel pellets annually. Whitesands, which will also include a co-gen project that will enable that community to turn off its diesel-fired generators, and Sandpoint will each have a 60,000 tonnes per year capacity.
That total production capability – over 250,000 tonnes per year – will give Great North the ability to market its product in Europe as well as North America.
“The market is coming our way,” said Fukushima. “There is a perfect scenario developing.”
The use of biomass is growing in Europe, and rising pressure there to move away from nuclear energy (particularly in Germany), is adding to the demand for biomass fuels. Much of the biomass in use in Europe now is coming from B.C.
“Japan and China are becoming huge consumers, and they are much more the natural market for B.C. product,” said Fukushima. Great North will have a significant shipping advantage in dealing with Europe, and is working to land supply contracts there. A Swedish company will have representatives here later this month to check out the Great North operation.
Fukushima believes there is also good potential for Great North’s patented densified pellet (containing about 10% polyethylene) in Europe, and hopes to land a long-term supply contract for it there. The pellet has been approved for use by the American Environmental Protection Agency, can be co-fired with coal, offers a higher energy content and is extremely weather resistant.
The company is also working with researchers at Lakehead University and the University of Western Ontario on the next generation of wood pellet fuels. Torrifaction (special ‘cooking’ of wood bio-mass to create ‘bio-coal’) and the use of natural additives and binding agents offer hope for a higher energy, more weather-resistant fuel pellet. The company that first develops this technology will obviously have a major advantage in the market.
Great North has formed a wide range of partnerships with First Nations across the region. Rainy Lake Tribal Contracting will handle all wood harvesting, shipping, scaling and handling (including debarking and grinding), which will mean work for about 60 people. In addition to its projects at Whitesands (60 employees including wood harvest workers) and Sandpoint (25 employees) FNs, the company has agreements in place with Couchiching, Nigigoosiminikaaning, Lake Nipigon Ojibway, Seine River, Stanjikoming, Manitou Rapids and Naecatchewenin.
ITALY FORECASTS INDUSTRIAL BIOMASS GROWTH
Written by Argus Media
June 15, 2011, London, UK – Italy's use of biomass for power production should reach 19% of all power produced from renewable resources in 2020 compared with 8.3% in 2005. Power generation from solid biomass in Italy in 2020 will amount to 7.9 TWh, according to the country's national renewable energy action plan. The country generated 4.4 TWh in 2009 and 3.5 TWh in 2005. The main feedstock sources are agricultural and forestry residues, according to the European Commission joint research centre's institute for energy.
“Italy's domestic biomass resources are sufficient for 2020 demand, but the issue is mobilization of these resources,” said Nicolae Scarlat, the institute for energy's technical support officer, at the 19th European Biomass Conference in Berlin, Germany, on June 8, 2011. “The country currently imports 450,000 tonnes/year of wood pellets, which is one of the biggest markets, but it is mainly for residential heating.”
The institute forecasts that total biomass consumption in Italy is set to rise to 34.7% of renewable energy use in 2020, from 31.4% in 2005.
POLLUTION PREVENTION PLAN COULD GROW UNDER RETOOLED BOROUGH MEASURE
by Christopher Eshleman / ceshleman@newsminer.com
Jun 15, 2011 | 239 views | 2 | 1 | |
FAIRBANKS — The Fairbanks North Star Borough Assembly will in one week consider broadening a year-old, home heater trade-in program that is part of the community’s pollution prevention program.
Mayor Luke Hopkins has said the ordinance should address public critique of the program, which seeks to nudge residents toward cleaner-burning heating systems.
The program leans heavily on incentives — a blend of cash rebates and tax breaks for people who swap older, less-efficient heating systems for cleaner models. Hopkins’ proposal would open those incentives to landlords who upgrade rentals and commercial properties. It would also let all participants take their entire reimbursement in cash; current rules require some must come through property tax breaks.
Air quality specialists at the borough said the changes serve two ends — responding to criticism heard during the program’s first year and preparing for a $3 million grant from the state Legislature to expand things.
“People aren’t running to fuel oil, because that’s over $4 a gallon right now,” Hopkins said Wednesday of expectations wood-fed home heating will remain popular.
The assembly has scheduled an evening public hearing tonight on the proposed expansion. The update would also do the following:
• Offer vouchers to help residents buy wood pellets, a change aimed at encouraging homeowners to switch to pellet-fed heaters.
• Extend incentives to those who retrofit inefficient heaters — instead of trading them in — with devices that clean emissions within a smokestack. Borough air quality specialists are still testing options.
The changes would also allow someone, when applicable, to secure incentives for upgrading both an outdoor boiler and an indoor heater at once. Hopkins said one of the program’s largest incentives would apply to residents who traded a hydronic heater — outdoor boiler — fed with stick wood for one that runs on wood pellets, which pollute far less.
The Legislature’s proposed $3 million grant is before Gov. Sean Parnell for review and is included in the $3 billion statewide capital budget.
Public air quality specialists approve incentives only after borough employees verify the changes to a given home’s heating system.
The measure comes to the assembly as a group of residents circle petitions aimed at smothering air pollution from another angle: Through bans, backed by the threat of a fine, on wood-fired outdoor boilers and coal-fed heaters and emission limits for other systems. It would also prohibit someone from polluting the air to such an extent that it blocks visibility or significantly impacts the lives of neighbors.
Sponsors say they need 2,457 signatures by July 25 to get it on the Oct. 4 ballot. It was unclear late Wednesday how many they had received.
Read more: Fairbanks Daily News-Miner - Pollution prevention plan could grow under retooled borough measure
EXPLOSION DAMAGES WAYCROSS PLANT; NO INJURIES REPORTED
Posted: June 21, 2011 - 12:00am
Advertisement
By Teresa Stepzinski
An explosion damaged the Georgia Biomass wood pellet processing plant near Waycross early Monday, crippling production at the factory that began operations a little more than a month ago.
No injuries were reported in the blast that occurred about 8 a.m. at the plant in the Waycross-Ware County Industrial Park about five miles west of Waycross off U.S. 82 and U.S. 1.
"It did extensive damage to the processing end. ... They'll probably be down an extended period of time," Ware County Fire Chief Dennis Keen told the Times-Union.
Georgia Biomass is a subsidiary of RWE Innogy of Germany, one of the top five electricity and gas companies in Europe. An estimated $175 million investment, the factory is deemed "the world's largest wood pellet plant."
Plant manager Ken Ciarletta, however, said the damage looks worse than it actually is.
"I wouldn't say the damage is extensive. It's in a very small portion of our facility," said Ciarletta, who described the incident as "a small fire."
Plant operations, however, have been suspended.
"We're off line because of it," Ciarletta said "We haven't determined how long we'll be off line. We're still in the assessment mode."
As they assess the damage, company officials are searching for the "root cause" of the problem, so they can resolve it and prevent future mishaps, Ciarletta said.
Employing about 80 people, the plant began operating May 12. Using yellow pine timber from throughout Southeast Georgia, its goal is to produce about 750,000 tons of wood pellets annually. Wood pellets are used as fuel — a cleaner-burning substitute for coal — primarily in Europe.
"Fortunately, no one was in the area of the explosion when it occurred," said Keen, who praised the company's fire suppression system and emergency procedures.
Ciarletta said the plant was evacuated "to ensure proper control of the situation."
"They made sure everyone got out all right and were accounted for." Keen said.
Keen stationed a fire truck at the plant Monday as a precaution against flare-ups or other problems as authorities and company officials searched for the blast's cause.
It's possible, Keen said, that dust might have caused the explosion.
"It may take several days to figure out what caused it," Keen said.
Describing it as a "flash-type explosion," Keen said the blast damaged equipment included a cooler, a section of the conveyor belt system and a storage hopper for the pellets.
Firefighters arrived in less than five minutes after the blast, which some residents said rattled windows in homes about five miles away near the Okefenokee Heritage Center.
Because it was early in the investigation, a dollar estimate of the damage wasn't available, Keen said.
"The most important thing is, nobody got hurt. Thank God," Ciarletta said.
teresa.stepzinski@jacksonville.com, (912) 264-0405
Read more at Jacksonville.com: http://jacksonville.com/news/georgia/2011-06-21/story/explosion-damages-waycross-plant-no-injuries-reported#ixzz1Puz5YqRo
BIOMASS SECURE POWER TO BUILD FIRST PELLET PLANT
June 16, 2011, Abbotsford, BC – Biomass Secure Power plans to break ground on its first wood pellet plant on October 1, 2011. Start-up and commissioning of the 500,000-tonne/year plant would begin in September 2012.
The company has also been pursuing the purchase of two additional plots of land for future pellet plants. Negotiations are expected to be finalized within the next 30 days, pending counteroffers. Once purchases are finalized and financing closed, construction on both plants will commence immediately, the company says.
Key plant features will be the ability to fire hog fuel for plant-wide energy requirements, and a distributed control system that will enable all plant operations to be monitored from any location via a broadband connection. The construction plan will commence with the building of Line 1 at Plant 1. The first line will produce up to 250,000 tonnes/year of whitewood pellets. The storage buildings for feedstock and pellets will feature programmable stackers and reclaimers and will provide flexible storage options. The construction for Line 2 will commence February 1, 2012, and will include a 50,000-tonne/year torrefaction furnace to be operated as a pilot facility for a projected 250,000-tonne/year furnace. The pilot line will also be used to establish the market for torrefied pellets. Space will be allocated at Plant 1 for the full-scale torrefaction furnace to be installed at a future date.
ONTARIO WOOD ALLOCATIONS SUPPORT PELLETS, LUMBER
June 20, 2011 – Three companies in the Thunder Bay area have accepted four Ontario wood supply offers.
AbitibiBowater in Thunder Bay has accepted two offers totalling 621,600 cubic metres/year of merchantable and unmerchantable spruce, pine, fir, white birch, and poplar. It will use the fibre in a wood pellet facility that it will construct in the Fort William First Nation Industrial Park as well as to fire a condensing turbine to increase clean electrical generation at its pulp and paper manufacturing operation.
Giishtoon Cedar Products in Murillo, just west of Thunder Bay, has accepted an offer of 11,000 cubic metres/year of merchantable white birch. It will construct a sawmill to produce white birch and cedar lumber. "This little mill should help boost the local economy, while at the same time getting tremendous value-added products from underutilized wood," says Paul Buckley of Giishtoon Cedar Products.
Precision Wood Design in Murillo has accepted an offer of 33,000 cubic metres/year of merchantable white birch. It will modernize and expand its sawmill and remanufacturing facility to produce framing stock, panelling, dimensional lumber, trim, and mouldings. "With our new allocation, this will allow us to become fully integrated, controlling our costs from the standing tree to custom baseboards in your home," says John Hockenhull of Precision Wood Design.
WOOD: THE NEXT GLOBAL COMMODITY?
As demand increases, wood pellets could be the next global commodity.
By Lisa Gibson | June 22, 2011
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Cormac O'Carroll, president of Pöyry Management Consulting, believes that woody biomass will become a global commodity within the next few years.
In light of the increase in demand for wood pellets, it is no surprise that predictions are outlining woody biomass as the next commodity to be traded on the open market.
Biomass demand for bioenergy applications is expected to increase, especially in Europe and particularly for wood pellets. “It’s clear that with incentives in place and the policies in play, that bioenergy is going to be an increasingly important part of the renewable portfolio in many European countries, especially U.K.,” says Cormac O’Carroll, president of Pöyry Management Consulting in London.
O’Carroll emphasizes that for woody biomass to become a commodity, demand needs to be big enough to support a commodity trading platform. And it looks as though the hundreds of megawatts proposed in the U.K. will help that along. The country can only provide itself with 10 million to 12 million metric tons of sustainable biomass each year, falling short of the 50 million metric tons that will be necessary if the multiple proposed biomass plants are developed there. O’Carroll predicts, however, that only a portion of those proposed projects will come to fruition. “Clearly, if even a substantial portion of them goes ahead, there will need to be significant imports of biomass to supply these plants,” he says. “Then they can come from North and South America, certainly, and I think quite a few pellet plants being developed in America are focusing on Europe and in particular the U.K.”
Demand is one important driver of commodity derivative market development, but other factors come into play also, such as volatile market pricing that allows hedging. “When we look at pellet pricing, we see that it is quite volatile,” O’Carroll says. Liquidity is another important element, as well as the number of people trading the material. “There are a lot of pellet plants out there and a lot more planned,” he says. “There are also a lot of pellet consumers on the bioenergy side and more and more entering the business.”
If wood pellets were to become a commodity, it would make the market more efficient and would make moving forward with bioenergy investments much easier, especially from the perspective of power utilities, O’Carroll explains. “They’re used to having a working commodities market for their feedstocks, be it gas, oil, coal.”
For the forestry industry, it could shift the environment surrounding biomass agreements from its traditional bilateral focus. “With the emergence of bioenergy, certainly, we see a lot of the forest industry players and forest owners starting to rethink their approach a little bit and starting to think about longer-term contracts and even starting to think about how they might take advantage of the increasing commoditization of biomass,” O’Carroll says. For forest owners, commodity status for wood would mean another market for their products, but industries using wood now, such as pulp and paper, would most likely not benefit. “They may not like to see much of a commodities market develop in biomass because that potentially makes their life more difficult,” he says.
But the scarcity of supply to satisfy growing demand points to woody biomass becoming a global commodity in the near future. O’Carroll predicts it within the next few years.
BIOMASS SECURE POWER PLANS TORREFIED WOOD PELLET PLANT IN CANADIAN PROVINCE
24 June 2011
Wood pellet manufacturer Biomass Secure Power is developing a torrefied wood pellet plant in British Columbia, Canada.
The production facility will have an annual production capacity of 500,000 tonnes of pellets, made from wood harvested by the company itself. A small portion will come local logging businesses.
One hundred per cent of the pellets produced at the site will be exported to Europe where they will be co-fired with coal to generate electricity.
Biomass Secure Power is slated to break ground on the project in July 2011, before production commences in September 2012.
According to the company's CEO Jim Carroll, Biomass Secure Power is also looking to build a further two pellet plants in the province. 'Plans are in place to build two additional plants that will bring our total production to 1.8 million tonnes per year,' he says. It is currently working to close the financing for both these additional projects.
US INDUSTRIAL PELLET MARKET PREPARES FOR EUROPE’S 20 X 2020 RENEWABLE ENERGY MANDATE
Posted on June 19, 2011 by Suz-Anne Kinney
As European countries gear up to meet renewable energy goals of 20 percent by 2020, demand for wood pellets is expected to rise. According to Argus Media, that number is expected to hit 32 million tons per year by 2016. By 2020, this number could be somewhere between 115 and 335 million tons per year, according to an article in Biofuels, Bioproducts and Biorefining. Both of these estimates eclipse the 11 million tons of pellets consumed by the EU in 2009.
European utilities are certainly making progress toward their 2020 goals. RWE’s recent announcement that it would repower its UK power station at Tilbury, is one example. The plant, which was headed for closure due to EU environmental regulations, will generate 750 MW of electricity using pellets it will import from its Georgia Biomass wood pellet facility. The conversion is scheduled for completion this winter.
RWE’s decision to construct its own pellet manufacturing facility in the United States may be the beginning of a trend in vertical integration. Georgia Biomass Chief Financial Officer Sam Kang told Biomass Power and Thermal magazine’s Lisa Gibson that there were three reasons the company made this decision:
• Security of supply. RWE wanted to avoid the experiences of Dutch utility Essent (which it had recently acquired). According to Kang, Essent “had instances when people don’t deliver because the price of sawdust or shipping went up. Little things like that happen and we just don’t want to be open to that.”
• Quality. Essent found that pellets shipped from the US weren’t always high quality enough to allow them to receive the subsidies provided by EU governments, a key element of their profitability.
• Price risk. Through vertical integration, many causes of price volatility are removed from the supply chain, leading to greater price stabilization and improved profitability.
At the same time, independent commercial scale pellet manufacturing is growing quickly, especially in the Southeast. Among those well established in the field are Green Circle, Fram Renewables, and Enviva.
Enviva continues to grow. The company already operates two facilities in Mississippi, and they are now in the process of building a new wood pellet manufacturing facility in Hertford County, North Carolina. Once fully operational, the new Ahoskie facility is expected to reach a production capacity of 330,000 tons, most of which will be exported to Europe.
Westervelt Company recently announced it will be joining the fray. Its first large wood pellet production facility, near Aliceville, Alabama will initially produce about 275,000 tons of pellets from southern yellow pine residue. Production is expected to rise to 550,000 tons per year. Company owned and third party wood will make up the raw material for the facility. Construction is expected to begin later this year and products will be ready for market in early 2012.
Point Bio Energy LLC proposed pellet facility at the Port of Greater Baton Rouge, La. will produce 500,000 tons annually of wood pellets from local sources of woody biomass. The timeline for the project has yet to be solidified. Some reports indicated construction will begin this summer and production will begin by the last quarter of 2011. The company’s website, however, says production will start June 2012. Most of the output will be exported to Europe.
Industry watchers are following the acquisition of Dixie Pellets’ assets by Zilkha Biomass Energy. Zilkha hasn’t yet disclosed its plans for the acquisition.
Will these companies experience some of the problems that Dixie Pellets did, the problems that RWE’s Zang outlined? A new organization of commercial pellet producers has been started to make sure this doesn’t happen. The U.S. Industrial Pellet Association (USIPA) was formed by Enviva, Fram, Green Circle and Westervelt in February. One of the goals of the organization, according to Executive Director Seth Ginther, is to develop certification standards for industrial wood pellets to ensure the quality of the pellets is consistent with European requirements. The association will also work on sustainability frameworks and consistency in contracts.
The last hurdle for large scale export of pellets to European markets will be price. Forest2Market president, Pete Stewart, points out that there is often a gap between the true cost of producing a pellet here in the US and what Europeans are willing to pay. “On one hand, European utilities say they can’t get consistent deliveries at a good price,” he says. “But on the other hand, they won’t pay the price to get a quality product over there. The current price of export pellets doesn’t take into account consistency or strict adherence to quality measures and that might be the disconnect between the markets.”
Still, the evidence is clear. Opportunities now abound in the commercial pellet manufacturing sector. In a recent presentation at the International Biomass Conference and Expo, the USIPA’s Ginther discussed the reasons that the Southeast is the ideal supplier of wood pellets to Europe:
• Shipping costs. The cost of shipping pellets to the Amsterdam-Rotterdam-Antwerp region from the Southeast US is approximately $36/ton. Compare this to $67/ton from southwestern Canada and $44/ton from Brazil.
• Climate. Supply from countries like Russia can suffer disruptions during extended winter weather. In the South, trees can be harvested year round. Trees also grow more quickly in more temperate climates.
• Robust infrastructure. Due to wood and paper products markets in the South, there is an ample infrastructure and labor force to support additional industry.
As we get closer to 2020, and demand for renewable energy grows, the US industrial pellet sector will too. Currently, the U.S. is the No. 2 producer of wood pellets in the world. According to the American Biomass Trade Cooperative, however, the U.S. exports just 20 percent of the pellets it produces. Clearly, that is on track to change.
THE NATURE CONSERVANCY AND THE SUSTAINABLE FORESTRY INITIATIVE EXPLORE RESPONSIBLE SOURCING FOR BIOENERGY FEEDSTOCKS
Wednesday, 22 June 2011 22:51 Dan Comand Biopower
The Nature Conservancy (TNC) and the Sustainable Forestry Initiative® (SFI®) launched a pilot project today to help bioenergy companies in the United States support responsible forest management through their procurement of woody biomass. The joint effort reflects the recognition by both organizations that the bioenergy industry provides new market opportunities for forest landowners and managers, but that appropriate steps should be in place for the procurement of forest fiber in order to maintain the health of the forest resource.
The project will assist facilities that produce renewable energy or transportation fuels from woody biomass to establish a responsible procurement system. SFI's Fiber Sourcing requirements will be applied for the procurement system, and analysis will be conducted to identify gaps between existing procurement and SFI Fiber Sourcing requirements.
"Woody biomass can be a great source of renewable energy and offers an excellent incentive so landowners can maintain their forests as forests - as long the forest is managed responsibly," said Glenn Prickett, Chief External Affairs Officer for The Nature Conservancy. "TNC is interested in this project with SFI to explore how the SFI Standard's unique Fiber Sourcing requirements can address the need of responsible procurement of woody biomass for bioenergy facilities while managing for important forest values."
Through the SFI program's unique fiber sourcing requirements, all SFI program participants - whether they own or manage lands or buy fiber - must take measures to ensure the raw material in their supply chain is from responsible sources. Next steps for this project entail the identification of bioenergy facilities that can be project participants and will form the basis of our shared learning.
"Working with The Nature Conservancy and project partners will be a constructive undertaking to share and learn from our collective knowledge as it relates to responsible procurement. This initiative has the potential to demonstrate to policymakers that voluntary certification has an important role to play in demonstrating the viability of voluntary measures to address emerging issues related to a growing bioenergy market," said SFI President and CEO Kathy Abusow.
DOMTAR TO PARTICIPATE IN THE BIOMASS-FUELED POWER PLANT PROJECT IN WISCONSIN
June 20, 2011 (Press Release) - Domtar Corporation today announced that its Board of Directors has authorized the signing by Domtar Paper Company, LLC (a wholly-owned subsidiary of Domtar) of the revised project agreements with Wisconsin Electric Power Company ("We Energies") to participate in the project that will see We Energies construct a biomass-fueled power plant at Domtar's Rothschild, Wisconsin paper mill site. The revised project agreements have been agreed to by the parties and reflect the order points contained in the Certificate of Authority issued on May 12, 2011 by the Wisconsin Public Service Commission ("PSC"). Under the timeline set out by the PSC, We Energies must submit a compliance filing within a 45-day period from the date of the Certificate of Authority, indicating that the order points have been addressed.
"This project is an innovative way to improve our mill's competitiveness and environmental performance while providing more green power to the State of Wisconsin," said John D. Williams, President and Chief Executive Officer of Domtar. "Wood is a renewable resource that can be used for producing pulp, paper, and electricity, and we are proud to leverage our expertise in sustainable fiber procurement."
The project is expected to create approximately 400 construction jobs and 150 permanent jobs in the surrounding community, including jobs for independent wood suppliers and haulers. Wood, waste wood and sawdust will be used to produce 50 megawatts of green electricity for the grid and to support Domtar's papermaking operations in Rothschild under a steam supply agreement. The project will result in a highly efficient use of bio-mass resources and Domtar mill's infrastructure while allowing Domtar to retire less efficient boilers, virtually eliminating its use of fossil fuels at the mill. The construction is expected to take 30 months for a start-up by the end of the third quarter of 2013.
Domtar Corporation is approximately 75% energy self-sufficient across its North American manufacturing footprint of 13 pulp and paper mills. The average Domtar pulp and paper facility draws approximately 87% of its thermal energy (energy required to make steam) from renewable fuels such as biomass and spent cooking liquor.
RESEARCHERS DISCOVER NEW ALLOY THAT CONVERTS HEAT DIRECTLY INTO ELECTRICITY
June 24, 2011
Source: University of Minnesota
University of Minnesota engineering researchers in the College of Science and Engineering have recently discovered a new alloy material that converts heat directly into electricity. This revolutionary energy conversion method is in the early stages of development, but it could have wide-sweeping impact on creating environmentally friendly electricity from waste heat sources.
Researchers say the material could potentially be used to capture waste heat from a car’s exhaust that would heat the material and produce electricity for charging the battery in a hybrid car. Other possible future uses include capturing rejected heat from industrial and power plants or temperature differences in the ocean to create electricity. The research team is looking into possible commercialization of the technology.
“This research is very promising because it presents an entirely new method for energy conversion that’s never been done before,” said University of Minnesota aerospace engineering and mechanics professor Richard James, who led the research team.“It’s also the ultimate ‘green’ way to create electricity because it uses waste heat to create electricity with no carbon dioxide.”
To create the material, the research team combined elements at the atomic level to create a new multiferroic alloy, Ni45Co5Mn40Sn10. Multiferroic materials combine unusual elastic, magnetic and electric properties. The alloy Ni45Co5Mn40Sn10 achieves multiferroism by undergoing a highly reversible phase transformation where one solid turns into another solid. During this phase transformation the alloy undergoes changes in its magnetic properties that are exploited in the energy conversion device.
During a small-scale demonstration in a University of Minnesota lab, the new material created by the researchers begins as a non-magnetic material, then suddenly becomes strongly magnetic when the temperature is raised a small amount. When this happens, the material absorbs heat and spontaneously produces electricity in a surrounding coil. Some of this heat energy is lost in a process called hysteresis. A critical discovery of the team is a systematic way to minimize hysteresis in phase transformations. The team’s research was recently published in the first issue of the new scientific journal Advanced Energy Materials.
In addition to Professor James, other members of the research team include University of Minnesota aerospace engineering and mechanics post-doctoral researchers Vijay Srivastava and Kanwal Bhatti, and Ph.D. student Yintao Song. The team is also working with University of Minnesota chemical engineering and materials science professor Christopher Leighton to create a thin film of the material that could be used, for example, to convert some of the waste heat from computers into electricity.
“This research crosses all boundaries of science and engineering,” James said. “It includes engineering, physics, materials, chemistry, mathematics and more. It has required all of us within the university’s College of Science and Engineering to work together to think in new ways.”
Funding for early research on the alloy came from a Multidisciplinary University Research Initiative (MURI) grant from the U.S. Office of Naval Research (involving other universities including the California Institute of Technology, Rutgers University, University of Washington and University of Maryland), and research grants from the U.S. Air Force and the National Science Foundation. The research is also tentatively funded by a small seed grant from the University of Minnesota’s Initiative for Renewable Energy and the Environment.
BURNING PELLETS IN THE GRILL
By LAURA JOHANNES
It's barbecue season, and there's a new type of grill that makes meat healthier and taste better, according to the makers. They say that wood-pellet-burning grills use an indirect cooking method, which reduces the formation of carcinogenic chemicals.
Dominick Reuter for The Wall Street Journal
Burning wood pellets, poured by grilling expert Brendan Burek, into a chute on the left side of a Traeger grill, doesn't necessarily make for healthier grilling.
Cooking meats with charcoal or gas grills can cause the formation of compounds called heterocyclic amines (HCAs) and polycyclic aromatic hydrocarbons (PAHs). HCAs are formed in muscle meats cooked at high temperatures. These can cause changes in the eater's genetic material that may increase the risk of cancer, according to the National Cancer Institute. PAHs are carcinogenic substances formed when fat and juices from meats drip onto a fire, causing flames that coat the food above with PAHs. PAHs can also be formed in smoke from charcoal or wood pellets, scientists say.
Wood-pellet grills, pioneered more than two decades ago by a company now called Traeger Pellet Grills LLC in Wilsonville, Ore., are growing in popularity with a number of brands, including Memphis, Mak and Louisiana, now available. They cost $300 to $2,000 or more. Pellets are made of only wood and come in flavors such as applewood, mesquite and hickory; they cost $1 a pound, which Traeger says lasts an hour. (Some people throw wood chips for flavor on their charcoal grills.)
Scientists say there is no good evidence pellet grilling is healthier than other grilling methods. As for adding flavor, an informal taste test for this article pitting a pellet grill against a charcoal grill had mixed results.
The Lil' Texas Elite from Traeger that we tested retails for $800 and uses an indirect cooking method, which Traeger's website says is "healthier for your family." The grill has a metal "heat shield" separating the grilling surface and the fire pit that directs the heat up the sides; a fan circulates heat. Fat drips onto a slanted drip pan and is drained into a bucket, which the company says keeps fat from dripping onto the heat source and creating PAH-filled smoke.
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Dominick Reuter for The Wall Street Journal
Traeger grill
Scientists say they know of no peer-reviewed studies testing the carcinogenic impact of pellet grills compared with other methods. Kristie Sullivan, a toxicologist at the Physicians Committee for Responsible Medicine, a Washington, D.C., nonprofit that includes the Cancer Project, says it is true that one source of carcinogens is eliminated if smoke doesn't come up from the heat source and onto the meat. But Ms. Sullivan says HCAs are formed by a combination of time and amount of heat, and that there's no way to know if a pellet grill forms less without doing very expensive testing. While the public's image is of charred meat as cancer causing, in fact carcinogenic chemicals can be formed without visible burning, she adds.
The National Cancer Institute, in a statement for this article, said it hasn't evaluated the differences in carcinogens formed among the different fuel types, but it doesn't expect pellet grilling to have a "substantial impact" on reducing the formation of cancer-causing chemicals. Even if the heat is indirect, the cooking surface is still hot and HCAs could be formed, the NCI says.
Researchers say there is a possibility the smoke from pellets could contain PAHs. Hardwoods, which Traeger uses for its pellets, tend to burn cleanly. But "if nobody's analyzed the smoke, it's all guesswork," says Michael Pariza, a scientist at the Food Research Institute at the University of Wisconsin in Madison.
Traeger says it is planning a test of the smoke of its pellets in conjunction with academic researchers.
As for the flavor claims, some experts have spoken: Pellet grills are gaining prestige among professional grillers. Two of the top five teams in the Kansas City Barbecue Society competitions this year exclusively used pellet grills, says Candy Weaver, president of the society, which sponsors 400 contests a year.
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Dominick Reuter for The Wall Street Journal
Pellet-cooked burgers, left, vs. charcoal-grilled
In our test, two competition grillers—Brendan Burek and Steve Farrin, owners of New England BBQ & Catering LLC of Canton, Mass.—took turns grilling foods on the Traeger and on a Weber charcoal grill. The Traeger won the chicken-breast competition in part due to the subtle applewood flavoring it imparted. The charcoal grill easily won the burger and steak tests as tasters preferred the black grill marks it left and the more intense flavor imparted by the direct flame. The Traeger left faint grill marks.
For the rib-eye test, a flame came up and enveloped the steak on the charcoal grill, which sparked concerns that a layer of PAHs was being deposited on the meat. The Traeger's drip pan did take away most of the fat, but after an hour of grilling we noticed a layer of fat on the pan was smoking slightly, and again we worried about PAHs.
The drip "usually does smoke a little bit" when cooking chicken, but that adds flavor, says Traeger's marketing director Nancy Loseke.
The majority of our tasters, a group of 13 including the grillers, said they'd happily enjoy a little flavor from the charcoal grill for what scientists say is likely to be a minuscule risk.
The risk of getting cancer from occasional grilling is "very, very low," adds Dr. Pariza. He adds there's a bigger risk of food poisoning so it's important to cook meat thoroughly to avoid poisoning from E.coli and salmonella.
Wood Pellets vs. Charcoal
We tested four kinds of meat on two grills with the help of competition grillers Brendan Burek and Steve Farrin, co-owners of New England BBQ & Catering LLC of Canton, Mass.
The grills we tested were the Traeger Lil' Texas Elite wood-pellet grill and an 18.5-inch round Weber grill. We used Traeger applewood pellets in the pellet grill and Wicked Good brand coals in the Weber. Each type of meat was grilled to the same temperature on both grills
• Burgers:
Eleven of our 13 tasters preferred the charcoal-grilled burger, which had thick, dark grill marks and tasted "like a burger should," according to one person. The pellet-grilled burger had light grill marks and reminded several of our tasters of meatloaf.
Professional tip: Both burgers would have tasted better if they were made of 80% lean meat instead of 85% lean meat, says Mr. Farrin.
• Chicken breasts:
The pellet grill won 8-1, with four tasters saying they liked them equally. The pellet-cooked breasts were just a little more moist than the charcoal-grilled ones, tasters said, with a very slight taste of applewood smoke.
Professional tip: On the charcoal grill, cook the chicken to the side of the coals with the lid closed until almost done and then "finish" it by grilling directly over coals. The wood-pellet grill, which keeps a constant temperature with heat circulating around the food, is "set it and forget it," says Mr. Farrin.
• Rib-eye steak:
The charcoal grill won by a 10-2 vote, with tasters loving the richer flavor of the charcoal-grilled steak, with its dark grill marks and the rich flavor of the spice rub caramelized over the open flame. Several tasters felt the wood-pellet steak was more moist, but still preferred the charcoal steak.
Professional tip: On the charcoal grill, sear the steaks on each side, turning 45 degrees to create crisscross grill marks. On the wood-pellet grill, the perimeter of the cooking surface, which is the hottest part, can be used to add marks to all the meats, Mr. Burek says.
• Pork baby back ribs:
Because of the time involved, there was no comparison made with the charcoal. The ribs were smoked for three hours on the pellet grill and finished by grilling at 225 degrees for 2½ more hours. They came out succulent and tender according to all tasters.
Amateur tip: The recipe on the Traeger Web site worked beautifully.
—Email aches@wsj.com
CO-FIRING OF BIOMASS WILL BE MANDATORY FOR DUTCH POWERPLANTS
By: Energeia
In the future it will be mandatory for coal-fired plants to co-fire biomass, according to minister of Economic Affairs, Agriculture and Innovation Maxime Verhagen (EL&I) in the Dutch government’s Energy Report.
Minister of Economic Affairs, Agriculture and Innovation Maxime Verhagen (EL&I)
In the future it will be mandatory for coal-fired plants to co-fire biomass, according to minister of Economic Affairs, Agriculture and Innovation Maxime Verhagen (EL&I) in the Dutch government’s Energy Report. The minister had contemplated taking measures to help speed up the sustainability process in the Dutch energy landscape. Introducing a supplier obligation and making it mandatory to co-fire biomass were contemplated as possible measures. Verhagen is keeping a supplier obligation on the backburner as an option for a later date.
Details on the terms and conditions have yet to be agreed in consultation with the energy sector. The Energy Report refers to the mandatory co-firing of biomass in coal-fired plants as an addition to the SDE+ (the transformed subsidy scheme for the generation of clean energy that is to commence on 1 July). The SDE+ scheme is aimed at achieving the most at the lowest possible cost. And mandatory co-firing of biomass fits this description. Verhagen called it "one of the cheapest renewable energy options in the Netherlands."
Up to now the co-firing of biomass (aimed at reducing the CO2 emissions of coal-fired plants) was funded through the MEP subsidy scheme. The MEP scheme is coming to an end and the government coalition does not view a new subsidy scheme as an option. Coal-fired plants emit relatively large amounts of CO2 and the Netherlands has to meet a European 14% sustainable energy target in 2020. Making it mandatory to co-fire biomass would account for 2 percentage points of the target. The government coalition bases this on 33-50 PJ in 2020. Other measures to promote sustainable energy are good for 9 percentage points, the government believes. The remainder would then have to come from imports and any future incentive measures.
Verhagen had previously been criticised by the Lower House of Parliament because his policy to date was deemed insufficient to achieve the target. The opposition parties argued he would never be able to achieve the climate targets with the SDE subsidy scheme and the Green Deal. That has changed, the minister said in a response to the report. The supplier obligation is an option which Verhagen could also use in the long-term. In that case the subsidy scheme could perhaps end altogether because the minister sees the obligation for suppliers to offer an increasing amount of green energy as an alternative stimulus.
Various obstacles would still have to be removed before it could be introduced, Verhagen said. Negative effects like windfall profits, for example, would have to be overcome. Windfall profits refer to a situation that energy companies with a relatively cheap technique make excessive profit on the green energy they generate. The minister also wants to assess whether a supplier obligation is a good fit in the European market and gauge the effects, which requires “careful consideration.”
Industry association Energie Nederland agreed. "The supplier obligation cannot be introduced just like that," said spokesman Sjoerd Marbus. According to him the idea is: make preparations during this government’s term in office and introduce it in the next term. The obligation to co-fire biomass is a good step for now. Marbus said. "We gladly accept the obligations that contribute to increasing sustainability. We will be discussing the details in the coming months." The spokesman was unable to say when he thought the obligation to co-fire biomass would commence.
Essent is in favour of co-firing biomass but at the same time welcomes the introduction of a supplier obligation. Spokesman Jeroen Brouwers was not yet able to comment on the content of the Energy Report.
© Energeia - Benelux in Brief – for more information see www.energeia.nl/beneluxinbrief
DEMAND FOR WOOD PELLETS GROWS
Published 12:04pm Saturday, July 9, 2011
FRANKLIN — With an expanding global market, the future for local wood pellet producers is burning bright.
A growing demand for fuel pellets in markets in Europe, Asia and the potential for an expanding market in the U.S. has led to a need for more producers, which could benefit local economies for years to come due to the area’s extensive wood basket and access to major ports.
Largely because of this, manufacturers have announced plans to build wood pellet production facilities in several area localities, including Franklin, Waverly and Greensville County in Virginia and Ahoskie in North Carolina.
Peter O’Keefe, a partner in Franklin Pellets, which is looking into repurposing a portion of the shuttered International Paper mill, said production of pellets in the U.S. Southeast is on track to continue expanding.
From 2008-2010 total U.S wood pellet exports to Europe alone grew from 85,000 tons to more than 600,000 tons per year. He added that the region is positioned to deliver even more than that next year.
“It’s exploding,” he said.
The increase in exports to Europe can be attributed to the European Commission’s 20-20-20 rule, O’Keefe said. This refers to a new law mandating that by the year 2020 all power generation facilities cut emissions by 20 percent and that 20 percent of power generation has to come from renewable sources.
Pellets have a higher BTU content than other renewable sources, like waste wood, which makes them better to co-fire with coal, O’Keefe said. Co-firing with pellets also cuts down on costs due to infrastructure.
“The infrastructure for coal doesn’t have to be changed dramatically for pellets because they’re almost like ground-up coal,” O’Keefe said. “That’s why it is so attractive to use to co-fire with coal.”
While Europe burned about 11 million tons of pellets last year, estimates for the coming years are much higher due to the new mandate. Estimates are that 50 to 100 million tons of pellets a year will be needed to fuel the European market in the coming years, O’Keefe said.
While the European market is growing it’s not the only continent that is seeing an expanded pellet market. Asia has also become a major player in North American exporting of wood pellets.
Stan Elliot, of Bear Mountain Forest Products in Portland, Ore., said the Asian market is growing, but few U.S. manufacturers are exporting to that market.
He said Canada, especially British Columbia, has been able to export to Asia easier. Elliot attributed this to lower transportation costs and better shipping facilities than the U.S.
Elliot also said there is a growing South American market for pellets, however they use bagasse, which is a by-product of sugar cane, rather than wood to produce their pellets.
Manufacturers, who are primarily focused on the European market, are also hoping for growth within the U.S. market, but political pressures could make the expansion of the market a long-term goal.
“We’re excited about the potential of the U.S. market and believe in the long run it is moving our way,” O’Keefe said.
While the wood pellet market is expanding globally, the use of wood pellets for home heating will remain slow, at least in this region.
John Belcher, owner of Belcher Enterprises in Courtland, said demand for wood pellet stoves for home heating is greater in markets north of this region, but the climate here makes it less cost effective to switch from electricity or gas to wood pellets.
“I wouldn’t say (the market) is good at all in this area,” Belcher said. “Up north where they use more heat it’s more beneficial.”
He said average wood stoves run cheaper than pellet stoves and produce more heat. Pellet stoves, whether freestanding or as a fireplace insert, run smaller than wood stoves.
However, Belcher said pellet stoves are supposed to be cleaner than woodstoves or fireplaces.
TIGHT CREDIT STILL MAJOR CONCERN FOR AGRIBUSINESS
Credit: PERDUE AGRIBUSINESS
Barley grown for sale to an ethanol plant is being stored at the Port of Richmond. Alternative energy crops in Virginia was one topic at the meeting Monday.
By John Reid Blackwell
Published: July 12, 2011
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About two dozen Virginia business owners and managers talked to a federal official Monday about everything from tight credit markets and government red tape to the potential for alternative energy industry in Virginia.
They told Kathleen A. Merrigan, deputy secretary of the U.S. Department of Agriculture, that tight credit markets and the paperwork associated with federal loan and grant programs are among the hurdles to business growth.
Merrigan met with representatives of Virginia businesses, mostly farms or companies associated with agriculture and forestry, as part of an Obama administration outreach effort on the economy.
The meeting at the Virginia Farm Bureau Federation headquarters in Goochland County is part of a series of forums being held around the nation on behalf of the White House Business Council and White House Rural Council.
The goal, Merrigan said, is "to figure out how we can do better and get the economy going, and what the federal government can do to facilitate job creation." Merrigan had a similar meeting in Pennsylvania three weeks ago and plans others around the nation.
The local meeting was not open to the news media, but one of the main issues discussed was the ongoing tightness of credit, said Merrigan and others who attended.
"There is just a real problem now with access to credit," Merrigan said in an interview after the meeting. "The state of the economy has made commercial banks hesitant to provide the kind of capital that businesses need."
Others attending the meeting brought up concerns about red tape surrounding government grant and loan-guarantee programs.
Merrigan said the USDA wants to streamline its application processes that include, for example, a 76-page application for a rural energy development program that supports loans for commercial renewable energy projects.
"From an overall perspective, the procedures and formality of obtaining government guarantees or grants are a tedious process," said Steve Gordon, president of Wood Fuel Developers LLC, a Chester company that is developing two wood pellet manufacturing plants in Virginia.
"A lot of businesses can't afford to do it, and it is kind of intimidating when they get a 100-page application. It is a time-consuming and expensive process."
Gordon said Wood Fuel Developers expects to employ 30 to 40 people at each of its plants in Sussex and Greensville counties. The plants will supply residential, industrial and power generation markets.
"We are excited about these projects and we are looking forward to getting people employed," Gordon said.
The meeting attracted several businesses involved in alternative fuels production, a market that has particular appeal to the agriculture and forestry industry in Virginia.
"I think there is great opportunity" in alternative fuels, Merrigan said. "From the very start of taking office in this administration we have been talking about alternative energy as one of the pillars that will really undergird an economic revitalization in rural America."
The market for alternative fuels has drawn investments in wood pellet production for industrial energy projects, and methane gas collection from dairy farms.
It also sparked a growth spurt in barley production on Virginia farms last year to supply a plant in Hopewell opened by Osage Bio Energy to make ethanol for gasoline.
However, Osage closed the plant in May, and the barley is now being stored at the Port of Richmond while Perdue AgriBusiness, which contracted with farmers to grow the barley, seeks other markets for it.
jblackwell@timesdispatch.com (804) 775-8123
TAXPAYERS ALLIANCE: WISCONSIN ELECTRICITY PRICES INCREASING
Price trend exceeds national average
Article | November 11, 2010 - 7:54pm | Ashland Current
Wisconsin’s average electricity price rose 5.6 percent annually during 2000-09, faster than the national average (4.2 percent) and that of all but five states, according to a report from the Wisconsin Taxpayers Alliance.
Wisconsin electric rates rank 20 among all U.S. states, up from 36 in 2000 and 40 in 1990, the report says.
According to Wisconsin Taxpayers Alliance President Todd A. Berry, "Rising energy costs are a concern for state leaders looking to attract new employers and workers to the state. Energy is a major cost of doing business, particularly in a manufacturing-intense economy such as Wisconsin’s, and its affordability can help or hinder job and firm creation."
In 1990, the average price of Wisconsin’s retail electricity was 5.37 cents per kilowatt hour, 18 percent below the U.S. average, the alliance reports, with prices rising only modestly throughout the 1990s. Prices were 16 percent below the national norm in 2000, the report says. By 2009, however, prices in Wisconsin were just 5.5 percent below U.S. prices, the alliance information reads.
Wisconsin had the second-lowest average electricity price in the region in 1990, with prices only slightly lower in Minnesota, the report says. In 2009, Wisconsin had the second-highest average, just behind Michigan.
From 2000 through 2009, average electricity prices in Wisconsin rose faster than in all but Delaware, Maryland, Connecticut, Nevada, and Florida, the report says.
Rising coal prices, higher shipping and rail costs, and the building of new electric generation and transmission capacity were primarily responsible for rising electricity costs, according to Wisconsin Taxpayers Alliance researchers. Since 2000, coal prices nearly doubled ($1.02 to $1.90) for Wisconsin utilities, rising an average of eight percent annually.
Coal continues to be the state’s main resource for electricity generation. Although used less frequently in recent decades, coal still accounts for more than 63 percent of the state’s power vs. 48 percent nationally, the alliance says.
The state’s second-largest source of energy to generate electricity is nuclear power; it accounts for 18 percent of electricity sales, according to the alliance. The information shows that the state continues to generate about the same amount of electricity from nuclear power now as it did in the 1970s.
Less than one percent of Wisconsin’s electricity was generated using in-state renewable resources in 2008. However, when including electricity sold here that was imported from other states, approximately five percent of electricity sales were from renewable sources. According to utility officials, Wisconsin is on track to meet the state’s energy mandate requiring that 10 percent of its electricity be generated from renewable resources by 2015.
OVERHEATED ASSEMBLY CAUSED GEORGIA BIOMASS EXPLOSION
Wood pellet production scheduled to resume at factory near Waycross.
Posted: July 13, 2011 - 12:00am | Updated: July 13, 2011 - 1:43am
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By Teresa Stepzinski
Wood pellet production should resume today at Georgia Biomass, which was crippled by a dust explosion last month. The plant is near Waycross.
"We're ramping up now ... starting the equipment and getting it all ready to go," plant manager Ken Ciarletta said about noon Tuesday.
No one was injured in the early morning explosion June 20, which damaged some of the processing equipment at the plant that employs about 80 people.
An investigation revealed that an overheated roller/bearing assembly in a pelletizer sparked the blast at the factory, Ciarletta said.
No employees were laid off while production was shut down at the plant, he said.
As equipment was repaired and modifications made to prevent a recurrence, employees went through training and worked in other areas of the plant, he said.
He wouldn't reveal the cost of the damage, saying it was proprietary information. Ciarletta did say "the capital damage was comparatively low and has been repaired."
Georgia Biomass is a subsidiary of RWE Innogy of Germany, one of the top five electricity and gas companies in Europe. An estimated $175 million investment, the plant is in the Waycross-Ware County Industrial Park about five miles west of Waycross off U.S. 82 and U.S. 1.
The plant began operating May 12. Using yellow pine timber from throughout Southeast Georgia, its goal is to produce about 750,000 tons of wood pellets annually. Wood pellets are used as fuel - a cleaner-burning substitute for coal - primarily in Europe.
teresa.stepzinski@jacksonville.com, (912) 264-0405
July 14, 2011, 5:00 a.m. EDT
PGI ENERGY SHAREHOLDER LETTER
HOUSTON, Jul 14, 2011 (BUSINESS WIRE) -- PGI Energy, Inc. PGIE -11.77% :
Dear Shareholders
PGI Energy's management team wanted to take this opportunity to address the shareholders. PGI's management team and staff are working daily and aggressively to develop its business plan. The company embarked upon an aggressive growth plan five months ago to develop in multiple markets to build the next great energy company.
Our plan included development of a logistics and transportation division, commodities trading division, alternative energy division, and other synergistic divisions. As a result of these aggressive plans we have established PGI Energy Transportation and Logistics, Inc. to facilitate transportation of commodities products for PGI and clients as a freight broker. We secured appropriate broker license with the Federal Safety Administration and became bonded and secured a line of credit for that division. We bided contracts to transport freight and won a significant contract with a major pipeline fabricator for 80 loads to transport; however our creditor would not allow the line of credit to be used for that client as they pay too slowly. Nonetheless, we continue to develop that business division.
We developed PGI Energy Trading commodities division through development of a trading desk account with Coquest as our introducing broker, FCstone as our clearing house, and Web Ice as our electronic trading platform for trading commodities futures. We admit we have been too quite to announce physical commodities trading contracts as they have developed. We have had great earnings expectations regarding the performance of those contracts based upon the terms defined therein and profit margins negotiated with refineries and other sellers regarding Diesel, Jet Fuel, and Crude Oil.
We previously underscored the complexity of these contracts and the many terms defined therein that required explicit performance by us and counterparties to close those transactions. As a result of our underestimating that any provision of a contract not complied with could result in the contract not closing resulted in contracts not performing as planned. In our rush to disclose pending contracts to shareholders we failed to anticipate non-performance by third parties. A contract failed because bankers for each party would not comply with procedures outlined and agreed to by the counter parties. The legal department of both banks advised there bankers that they bankers could not perform the requisite provisions of the contract. This resulted in a loss of profit to us, because we had a purchase and sale agreement among parties.
A sale contract in commodities can fall apart as a result of testing the commodity against the specifications for the product and if the specs are not the same as the contract then the buying party has the right to reject the purchase and cancel the agreement. We engaged in a contract negotiated by a highly reputable law firm representing the seller in a transaction where we had an exit buyer for the product. We performed upon the contract and the other party provided false proof of product documents which we are required to verify before consummating the transaction to avoid being defrauded by counterparty. We discovered in that transaction that the law firm provided us with false proof of product documents as verified by third parties. Thus, we did not consummate the transaction.
Notwithstanding the above, we are very active in the physical commodities space and have active contracts pending closing, provided all the prospective counterparties perform. We do not publish those contracts because they routinely contain non-disclosure clauses in the agreements and often contain detailed banking information for all parties. We will continue to try our best to maintain transparency for our shareholders and produce contracts where appropriate and that are consummated.
We revamped our corporate website to provide more significant details about contract provisions for our shareholders. Some contracts have to be redacted because of sensitive information. Questions have arisen regarding our contracts for JV partnerships in two previously announced oil fields. We entered into those agreements expecting we could perform upon the terms of the agreements. We still maintain a relationship with the Callahan County Regular Field operator Cynergy Partners, who offered to extend the contact. We terminated the other oil field development agreement because in our final due diligence phase we discovered they were not the actual title holders and were attempting to get us to pay for the purchase of the asset and development under the ruse they already owned the property. Thus, we saved the company from being defrauded.
Within the past five months we have developed several strategic partnerships that will grow our company organically; mostly through the alternative energy space which most major oil companies are now transitioning. We established PGI Green E & P, Inc as a viable entity to develop and distribute syn gas units to hospitals, casinos, and race ways which will produce electricity to the grid reducing their utility cost annually by approximately 20%. These units will also produce a biochar that will be sold to retailers for consumer and commercial agribusiness development. We signed that agreement with Waste to Energy Solutions which formed a consortium of vendors and feedstock providers. Our role is to provide the financing solutions for manufacture and leasing these units, operating, transporting feedstock and product to market.
We further entered into the highly competitive wood pellets market to construct and operate wood pellets facilities with our partner Ex-Factory. The construction of this facility takes approx. 9-12 months. We are actively planning strategic locations for the facilities near feedstock providers, working on warranty policies and risk insurance provisions required by our institutional investor. We entered into partnership with Esperotia Investments of Cyprus to be our on the ground sales representative in the UK as they are very active in the utilities business throughout Europe. They are aggressively seeking strategic acquisition candidates for us in Europe.
We are actively negotiating with a major synthetic crude manufacturer to become there exclusive finance arm and distributor of their technology to waste recyclers and municipalities on a commercial scale.
We have entered into partnership with J & L INSTRUMENTATION & POWER, LLC AND KNOX J & L ENERGY SOLUTIONS LIMITED to build power plants in Nigeria and targeting Southern Sudan next. We have recently entered into partnership with Structural Dynamics Engineering to construct and sale land drilling rigs, top drives and mobile drilling rigs. We bridged the gap by adding as our strategic partner BGI Contractors a top tier fabricator to construct the drilling rigs to specification as they have extensive experience in this arena having built $150 million drilling rigs for major drilling services companies. This bridge was necessary as a requirement by our institutional investor to obtain performance bonds consistent with industry standards for the contracts pending. They had the capacity, experience, and capability to mass produce these rigs as orders pour in.
We have not lightly developed these partnerships but have put in place a plan for performance and profitability. "We wish to convey our vision to our shareholders that we are a true growth company with a global strategy for building a legacy, the next major energy company." We receive calls from investors daily and emails questioning and challenging our business model. Many of the calls are from day traders trying to pressure our staff and glean inside information about the companies next moves. We have a disclosure committee which consists of our CEO and general counsel, Marcellous McZeal and Lionell Johnson, CFO and former State of Texas Banking Regulator. The integrity of our management team is very important to us.
The way to determine whether management interest is aligned with investors is their percentage of ownership in the company. We collective own the majority of the company shares and have not sold any of our interest in the company. We recently increased our authorized shares to 2 billion from 1 billion with the intent to sale shares to institutional investors who have expressed a serious interest in long term investment into the company for a significant ownership interest representing approx. 35% in exchange for operating capital and acquisition funding. We are considering all options in the growth of our company for the long term survival and future of the company including vetting acquisition targets for up listing and considering move to the Frankfurt Exchange, a more robust market place to increase shareholder value. Day traders and market makers put pressure on the stock trying to make a quick profit. We inherited approx. 500 shareholders and we get daily questions and comments from about 10 shareholders who want to make an instant stock profit daily without patience. Accordingly, they post negative blog comments. Thereafter, there are the short sellers who are motivated to drive the stock price down. We have posted our share structure on the company website. There are approx. 600 million shares in the public float and market makers are among our heaviest traders. We are confident that once we start to post solid earnings are the stock price will rebound. We are still planning to implement a new market awareness campaign, however, we are not promising an exact beginning date. However, it will be soon.
We would hope our shareholders embrace our long term vision and hold long, as we have no intentions to exit this company in the foreseeable future. The founders Robert Gandy and Marcellous McZeal plan to leave this companies' management to their children and grandchildren, through strategic succession planning.
About us
PGI Energy, Inc. is an energy holding company, headquartered in Houston, Texas. The company's purpose is to acquire assets in the proven producing oil and gas assets, refinery and pipeline sectors of the energy industry and other synergistic assets. The company will only acquire proven producing oil and gas assets.
PGI has formed several partnerships to grow its core business organically through strategic alliances diversifying its interest in green energy through biomass production, waste to energy, wood pellets production, syn gas, bio char production and plastics to synthetic crude. PGI has several core divisions which provide support to its operations and customers such as PGI Transportation & Logistics, PGI Manufacturing & Engineering and PGI Commodities Trading.
For more information visit: WWW.PGIEnergy.us or Email: ir@pgienergy.us
SOURCE: PGI Energy, Inc.
PELLET MILLS SAY PRICES SUPPORT MORE SPOT TRADES
Written by Argus Media
July 18, 2011, New York, NY – Higher prices for industrial wood pellets in northwestern Europe are boosting interest in spot sales and lifting forecasts for future pricing, according to U.S. pellet mill operators. Low prices and tight margins last year made spot sales difficult for U.S. exporters, but many mills say that the situation is beginning to brighten.
Increased demand from the Antwerp-Rotterdam-Amsterdam (ARA), Scandinavia, and UK markets so far in summer 2011 has kept prices buoyed around €127/tonne cif ARA for July. This is almost €10/tonne higher on the year, according to Argus assessments. Delivered prices into ARA in July 2010 dipped to €117/tonne and fell further to €115/tonne in August, leaving little room for profits after freight costs.
The extra margin this year allows efficient mills to capitalize on shorter-term sales opportunities, and 2012 interest is building into forward curves, a major U.S. pellet producer says. Recent spot deals for delivery later in 2011 have garnered prices closer to €130/tonne cif ARA, and 2012 tonnage is selling in the mid- to low €130s/tonne, according to the producer.
SOUTH KOREA POLICY SET TO DRIVE BIOMASS UPTAKE
Written by Argus Media
July 19, 2011, London, UK – South Korean biomass demand is forecast to reach 10 million tonnes/year by 2020, following the introduction of renewable portfolio standards (RPS) for power producers. The country is targeting a 30% reduction in CO2 emissions from projected levels by 2020 and expects biomass to play a major role in meeting those targets. South Korea emitted approximately 716 million tonnes of CO2 in 2010.
Canadian wood pellet exports to South Korea have risen from 0 to 50,000 tonnes/year in 2011, says Wood Pellet Association of Canada executive director Gordon Murray, with producers in British Columbia expecting this figure to grow considerably. Australia's largest producer, Plantation Energy, supplies the South Korean and Japanese markets on a regular basis.
The South Korean government has instructed more than 350 of the country's largest firms to reduce CO2 emissions. Each company is in the process of submitting plans to the government this quarter, with the new measures to be implemented in 2012. The RPS for power producers, which commits them to produce a minimum of 2% renewable energy in 2012, increasing by 0.5%/year until they are producing a minimum of 10% by 2020, affects 12 South Korean utilities, including Korea Southeast Power, K-Power, and GS Power.
A feed-in tariff (FIT) scheme is in place for firms that do not receive capital investment subsidies from the government of more than 30%. But the RPS will replace the FIT next year, and Canadian pellet producers have been working hard to secure market share ahead of the change.
Canadian pellet producer Biomass Secure Power announced a 10-year supply contract in May 2011 with South Korean resources and industrial firm LG International.
Vietnam, Malaysia, Thailand, Indonesia, and New Zealand are also likely to be supply regions for South Korea.
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UPDATE ON THE FORESTY INDUSTRY
Dear Editor,
At a recent meeting of Renfrew County's Forestry Committee, it was brought to our attention that local politicians were getting a lot of questions asking what was happening to help the forest industry locally. I am writing to update what County of Renfrew staff and elected officials have been doing.
Most County residents are aware that the closure of two main facilities, Smurfit-Stone in Portage du Fort and ATC Panels in Pembroke, greatly affected the forest industry in the County. These two facilities took delivery of a large amount of low-quality forest products and sawmill residues. In order for the forest industry to survive, it must market these materials; even a perfect load of logs generates about 50 per cent residues in bark, sawdust and slabs. In a logging operation, upwards of 70 per cent of the material harvested is not suitable for uses other than pulp, and it is not economically feasible (nor environmentally sound) to harvest only the higher quality logs.
Why has the market for low-end forest fibre declined? In this era of electronic communication, there is a perception that paper use is declining, but that isn't the whole story with the pulp and paper industry.
What has mainly affected the industry in Canada is our inability to compete globally; many other countries now have paper mills, and they produce fibre much more cheaply than we can.
Using wood fibre to create energy seems like a simple solution. Convert your bad wood into pellets, or burn it to create steam to turn a turbine and sell the electricity. This is actually pretty old technology and it has been use in Europe and the northern United States for decades; it is effective and carbon-neutral. The heat generated from burning the wood can be used to heat homes, greenhouses, dry lumber, etc. in what is called a co-generation or combined heat and power (CHP) system.
Over the past two and a half years, County of Renfrew Economic Development and Forestry staff and local elected officials have met with over 30 potential investor groups with the objective of establishing either a pellet plant or a wood-burning electrical generation facility. So why hasn't anybody built one?
First of all, we can't produce pellets at a price that works compared to cheap fossil fuels, especially natural gas. We cannot compete with off-shore pellet producers for many of the same reasons we can't compete in international pulp markets - they have cheaper wood, cheaper labour and other cheaper inputs.
A pellet plant, producing pellets to sell into the international market, needs to be on or near a saltwater port, or have access to efficient rail transportation. With the abandonment of the railways here in the Valley, that opportunity is now lost.
As far as electricity goes, the rate Ontario Power Authority will pay for electricity generated by woody biomass is not enough to make it pay. Under the Feed-in Tariff program (FIT) OPA will only pay a little over $0.13 per kilowatt-hour for energy produced by biomass, and the rate required by producers is in the $0.20/kwh range.
This is in sharp contrast to what OPA pays for energy produced by solar farms ($0.44- $0.80/kwh range) and wind ($0.26/kwh). In Europe, where wood energy is well developed, the FIT rates are set at levels between $0.16 and $0.30/kwh to foster the creation of green energy from wood.
Another major problem is if you do happen to produce energy, OPA can't buy it because they don't have grid capacity. This means the power lines have all the energy in them they can take; there isn't room for any more. And you can't "island"; that is, use whatever energy you need for yourself and sell the excess to OPA. You have to sell it all to OPA then buy it back. Interestingly, many people that have installed solar panels under the "Microfit" program have discovered that Ontario Hydro won't take the electricity they generate; they don't have the capacity available in their lines.
Staff met with the OPA on two occasions, and will be meeting with them again to present the findings and propose a rate that will encourage the use of wood to create energy.
For those of you who make your living in the forest industry, rest assured that your municipal politicians are aware of the issues and are doing everything in their power to help the industry. They are every bit as frustrated as you are.
Jeff Muzzi
Manager of Forestry Services, County of Renfrew
COULD SWITCHGRASS OFFER A CO2 SOLUTION?
Posted on July 21, 2011 |
By Andrew Stein
NETAKA WHITE, LEFT, and Peter Carothers stand in a field of switchgrass they have planted in a field in New Haven. White and Carothers hope their small experimental planting can demonstrate the viability of switchgrass as both an energy alternative and cash crop for local farmers. Independent photo/Trent Campbell
ADDISON COUNTY — When the American settlers first crossed the Great Plains, they encountered native species of prairie grass like switchgrass and big blue stem.
Now those same grasses — seeded deep in the American perception of a rural aesthetic — are being sown in Addison County fields in an effort to make them an affordable and viable source of local energy.
Switchgrass, which takes approximately three years to fully establish as a crop, is a net-zero carbon dioxide (CO2) source of energy. According to research conducted by Texas A&M University, switchgrass and other similar varietals sequester as much CO2 from the environment while growing as they emit while burning; some studies have found they actually capture more of the greenhouse gas than they emit.
A year ago, the Addison County Regional Planning Commission endorsed an application by Bennington-based Renewable Energy Resources Inc. (RER) for federal funds to create a mobile switchgrass briquette machine. The company’s concept is straightforward: It wants to work with Addison County farmers and larger local operations like schools, industrial buildings and towns to produce and consume a heating source — grass biofuel — within a 30-mile radius. Keeping the fuel source local reduces the costs and emissions associated with transporting fuel.
“Customers will be able to reduce their fuel bills by at least 50 percent compared to oil and know that the money they are paying for fuel will stay in the local community,” RER co-founder John Bootle claimed.
The company will pay approximately $72-$75 a ton for baled switchgrass, and it hopes to work with farmers to establish 3,000 acres on underutilized farmland and marginal swathes of land. The perennial crop, which yields three to five tons per acre, is harvestable using the same machinery that a farmer would use for hay, perhaps making it an appealing option for farmers that already have the equipment and the underused land.
Adam Lougee, executive director of the regional planning commission, wrote in his letter supporting RER that if the project is successful it would meet two goals of the regional plan:
• “To increase local energy production in an effort to move toward a less centralized and more reliable energy production system in the Addison Region.”
• “To have reliable, adequate and affordable energy that meets the needs of the region’s residents and businesses.”
Netaka White, bioenergy programs director for the Vermont Sustainable Jobs Fund, and Peter Carothers of Nash Farm started experimenting with a four-acre plot of switchgrass in New Haven last year. Since the crop needs to establish in its first year, they haven’t yielded any results, but White is highly optimistic about the energy capabilities of grass in the county.
DISPLACE FOOD CROPS?
While acknowledging the appeal of a renewable energy resources, some fear that biofuels could compete with food crops for farmland.
“There’s always a concern that biofuels and biomass will compete with prime farmland … and my own sense of it at this point is that the better soils, especially for a dairy farmer or a livestock farmer, are going to get a better return growing that forage for hay or silage versus biomass for energy,” said Sidney Bosworth, a University of Vermont professor of agronomy who has done extensive research on prairie grasses in Vermont. “So I think this (grass) fits into Vermont on that land that’s not being utilized for crops or it might fit into a rotation or just that less-than-ideal land.”
How much underutilized land does Addison County actually have?
Craig Miner, executive director of the local Farm Service Agency office, said he didn’t have a good answer for that. Bosworth said he believes there was not as much underutilized land in the county as in other parts of the state because farming is so important to the local economy.
Marie Audet of Blue Spruce Farm told the Independent that she doesn’t have room for a crop like switchgrass. She needs to use all of her land to raise feed for the Bridport dairy farm’s 1,300 cows. Still, she thought might work well for some farms.
RER’s Bootle, however, maintained that based on his company’s research, “There are thousands of acres of underutilized (Addison County) farmland that can be brought back into productive use that will generate income for farmers and other land owners, helping to stimulate the rural economy.”
ENVIRONMENTAL ADVANTAGES
Aside from local energy security, producing no net increase in CO2 and reducing transportation emissions, scientists say that local prairie grass systems offer some other environmental advantages.
Switchgrass might come in handy in Addison County for nutrient management. With long roots that stretch down about 12 feet into the soil, the grass is capable of absorbing high concentrations of nutrients like phosphorous that, if lead to massive blue-green algae blooms in Lake Champlain. The grass could thus be a profitable solution for farmers looking to contain runoff from their properties.
The long roots of switchgrass and other similar grasses also prevent soil erosion and form a strong riparian barrier along river edges as they stabilize banks. Furthermore, prairie grasses are a way to maintain open spaces. In an effort to preserve Vermont’s open swathes of land, residents might consider using these spaces for a biofuel that is aesthetically pleasing and acts as an excellent habitat for wildlife, especially birds.
Bootle also explained that switchgrass briquettes are more carbon neutral than wood chips and pellets.
“Switchgrass is truly carbon neutral since the CO2 emitted by burning in year one is absorbed when the crop is grown in year two, unlike wood since when a tree is burned it will take 30 years for a tree to re-grow and absorb the same CO2.”
THE PROCESS
RER does not recommend planting a monoculture of switchgrass, instead it recommends seeding a wide variety of prairie grasses.
“We would prefer to have lots of different types of grass because it’s more robust for preventing diseases,” said Bootle.
A stand of switchgrass can last for 15-20 years and requires minimal tending. The grass is harvested and baled once a year when the weather gets cold and the grasses’ nutrients have receded from the stems down to the roots.
Once the grass has been harvested, RER comes in. With $100,000 worth of federal funding approved by the sustainable jobs fund, RER has built a mobile briquette machine. The company’s plan is to bring the mobile unit to Addison County when there is grass to process. They will turn the switchgrass into little briquettes and sell them to larger commercial users for approximately $120-$130 per ton.
According to a USDA study, switchgrass has a net heating value of 14.4 million BTU per ton, compared with the 9 million BTU per ton that Middlebury College’s wood chips produce and the 13.6 million BTU per ton of premium wood pellets.
According to the Sustainable Jobs Fund’s White, “One of the factors that led to (RER’s) award was that they could show that they had prior success.”
In Benton, Pa., RER successfully launched a pilot project with a school that burned approximately three tons of grass a day to heat a 220,000-square-foot building during the winter. All grass used by the school was grown within a 15-mile radius, said Bootle.
But, there’s a hitch when it comes to burning grass — it has a high ash content.
“Anyone using a system strictly designed to burn wood pellets should (transfer to switchgrass) carefully and cautiously if they’re attempting to use 100 percent grass because of the high ash and the potential for minerals to fuse,” said White. “The reason that there’s a higher ash content in the grass fuels is that they have a higher mineral content than wood, such as silica and other ash-forming minerals.”
The remedy that RER has found for this problem is the use of a multi-fuel biomass boiler with an ash removal mechanism, like ones made by the company Skanden.
“The whole idea of using switchgrass is that it comes from a local area,” said Bootle. “The grass comes from a local area and is used within that local area.”
If RER can establish a network where it’s producing 8,000 tons of briquettes annually, they’ll establish a permanent briquette station.
For more information on RER, contact John Bootle at johnbootle@switchgrass-rer.org. Reporter Andrew Stein is at andrews@addisonindependent.com.
GOLDMAN SACHS FORECASTS HIGHER CRUDE AND HEATING OIL PRICES
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Posted by Lane Nichols on July 19, 2011 at 4:56 am
Goldman Sachs predicts that crude oil will hit $126.50 a barrel in a year's time amid growing world demand and supply shortages. (image: businessweek.com)
Crude and heating oil prices will rise in the next year as global demand increases amid tightening supplies, investment banking giant Goldman Sachs predicts.
Though commodity prices retreated in the second quarter following the Japanese earthquake, slowing US economic expansion and tightening Chinese monetary policy, they are tipped to rebound during the next 12 months, Bloomberg reported.
In its Commodity Watch forecast report, Goldman analysts predicted that West Texas Intermediate crude prices would hit $126.50 a barrel in a year’s time. Prices shorter term would rise to $111 a barrel in three months and $115 a barrel in six months.
Oil prices have hovered just beneath $100 a barrel in recent weeks after falling from a 30-month high of $114 a barrel in May.
Heating oil prices were also heading north, according to the powerful Wall Street investment bank. US distillate inventories had declined sharply this year and lacked the typical seasonal increase in recent weeks, platts.com reported.
“This supporting trend is driven primarily by strong export demand from Latin America and increasingly Europe rather than domestic demand, which remains well below last year’s levels,” Goldman said.
“We expect this export demand to continue this summer, likely supported by diesel-fired electricity generation demand in China and Japan.”
Internationally, demand for oil and oil products would increase as the global economy recovered, putting pressure on the spare capacity of OPEC oil-producing countries.
The forecasts are in line with the US Energy Information Administration, which expects crude oil markets to tighten through till 2012 and for heating oil prices to jump 7.4 percent.
“In our view, it is only a matter of time before inventories and OPEC spare capacity become effectively exhausted, requiring higher oil prices to restrain demand, keeping it in line with available supply,” Goldman said.
“We continue to expect that oil demand growth fueled by moderate economic growth expectations will be sufficient to draw down crude oil inventories and OPEC spare capacity by early next year, leading to considerable oil price upside on a 6- to 12-month horizon.”
Goldman predicted a short-lived impact of the International Energy Agency decision to release 60 million barrels of oil onto the market to help control global prices.
Morgan Stanley made a similar prediction and also expected prices to rise. Though world oil prices would be “pressured” in coming weeks following the IEA’s strategic crude oil release, prices would rebound later this year as inventories shrunk, New York-based analyst Hussein Allidina said.
“We remain bullish oil, particularly in the second half, and expect inventory draws will prompt OPEC to increase production, at the expense of spare capacity.”
Some analysts have already warned the release could actually force world oil prices up long-term because the cushion that oil-using countries have in reserve to use during emergency supply situations is depleted.
Posted: July 24
Updated: Today at 7:36 PM
WOOD HEAT FIGHTS TO BE A BIGGER PLAYER
Some say the industry needs tax breaks like solar gets; others say the high cost of oil will push homeowners to wood.
By Tux Turkel tturkel@mainetoday.com
Staff Writer
ReVision Energy in Portland sells a solar hot-water system that can offset roughly 250 gallons of oil a year in a typical boiler. The system goes for about $11,000, but federal and state tax breaks can knock $4,300 off the buyer's cost.
READ THE Alliance for Green Heat report.
ReVision Heat, its sister company, sells a $15,000 wood pellet boiler that can replace 1,000 gallons of oil -- four times as much as the solar panels. But there's no state tax benefit, and the federal tax credit is capped at $300.
Superior tax incentives for solar is one reason ReVision saw $8 million in solar equipment sales last year, compared with $500,000 in wood.
This government policy is being questioned in a new report from a Maryland-based nonprofit formed to promote wood heating, the Alliance for Green Heat. It calculated that a $1,000 tax incentive for a clean-burning wood or pellet stove could offset as much fossil fuel as a $10,000 solar rebate.
Wood heat, the report said, provides 80 percent of all residential renewable energy in America and is within reach of middle- and lower-income families. Solar produces 15 percent and is unaffordable to many people.
"My message," said John Ackerly, the alliance's president, "is that incentives should be technology neutral, and consumers should be given a choice."
The report's conclusions are of interest in Maine, where a sultry summer soon will turn into another expensive heating season. Maine is the country's most forested state, but also the most dependent on heating oil. Roughly seven in 10 homes burn oil, but only one in 10 uses wood as a primary heat source, according to the latest census figures.
Better renewable energy incentives aimed at the cleanest, most-efficient wood stoves and boilers could help shift that equation, the alliance's report says, as could programs to help residents switch out old, polluting wood burners.
"We really overlook huge portions of our population when we overlook wood," Ackerly said. "And we're not offsetting the amount of fossil fuels we could for the amount of incentive money."
Solar energy has many benefits. It creates no pollution in use and the fuel -- sunlight -- is free. But when it comes to government incentives, wood has lost out to solar, wind and geothermal, Ackerly and others say, because the wood-heat industry is made up of small businesses that lack corporate lobbying resources and political clout. For instance: Newer solar, wind and geothermal systems receive federal tax credits of 30 percent, with no dollar cap, and can qualify on vacation homes.
Wood also suffers from the air pollution stigma caused by older stoves and outdoor boilers. That's a major challenge, the alliance conceded. From 60 to 75 percent of the 12 million stoves in operation today are too old to meet federal standards for particle emissions.
"It's hard to say 'dirty solar,' but there is dirty wood heat," said Pat Coon, a co-founder of ReVision Energy.
An experienced solar installer, Coon takes a broad view of what he sees as the challenge of getting the state's 400,000 homes off oil. Solar panels and weatherization will help, he said, but they can't accomplish that goal.
Wood, however, could make a major contribution, especially pellets, if more-efficient delivery methods can lower the cost. Cordwood, the traditional form of wood heat, can offset a lot of oil, he said, but it involves too much effort to become a total solution for most households.
Government tax policy is part of the equation, Coon acknowledges. Solar rebates helped turn ReVision into a leading installation company.
"Government's best role is being a catalyst," he said. "We now have a solar installation industry. Government hasn't done that for wood, and we don't have a wood industry."
But others see the marketplace creating a wood industry, although slowly.
"It's a brand new industry in the United States and we're starting from zero," said Les Otten, president of Maine Energy Systems in Bethel.
Otten and two partners formed the company three years ago to import automated, high-efficiency pellet boilers. Business was slow last year, dragged down by the poor economy. This year is different, with consumers spooked by volatile oil prices. Maine Energy Systems is on track to install more than 200 boilers, Otten said, with the prospect of much stronger growth next year.
Most jobs are commercial and municipal, with 70 percent of the work out of state. Maine customers include the Blue Hill public library, SAD 74 in Anson and Gardiner Public Works. Homeowners have a harder time coming up with the capital, Otten said, even if they can save $2,000 or more a year on oil.
In Europe, where pellet boilers are common, the industry grew rapidly over the past eight years, thanks to generous financial incentives. A former Republican candidate for governor, Otten said the debt crisis makes it hard today to ask "with a straight face" for government tax breaks.
"Right now," he said, "the cost of fuel is an extraordinary incentive."
At the Alliance for Green Heat, Ackerly acknowledged that the federal debt and state budget shortfalls make new tax breaks for wood unrealistic. But to the extent that energy incentives do exist, they should help bring down the cost of equipment, create jobs and offset fossil fuels.
"Both solar and wood do all three of these," he said.
Staff Writer Tux Turkel can be contacted at 791-6462 or at:
LOCAL FORESTS CAN SUPPORT PELLET MILLS
Published 5:12am Saturday, July 23, 2011
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Editor’s Note: This is the fifth in a six-part series that focuses on the growing wood pellet industry in northeastern North Carolina and southeastern Virginia.
BY THADD WHITE/ROANOAKE-CHOWAN NEWS-HERALD
thad.white@r-cnews.com
AHOSKIE, N.C.—The southern Atlantic Seaboard has the opportunity to be part of a solution for the need for wood pellets in the European Union.
According to Peter J. Stewart, president and chief executive officer of Forest 2 Market, renewable energy standards in the European Union, specifically the northeastern part of the continent, will provide the opportunity for some facilities in the southern United States to provide wood pellets to help meet the demand for renewable energy.
“The renewable energy standards across the EU, specifically northeastern Europe, require that between 20 and up to 50 percent of electrical power be generated from renewable sources,” Stewart said. “Those sources are wind, water and biomass, and pellets would fall under the last category.”
The demand for renewable energy in Europe, and specifically for wood pellets, has led to Enviva Biomass opening a production facility in Ahoskie while others are planned for southeastern Virginia.
Wood Fuel Developers of Chester has plans for two wood pellet mills, one in Greensville County and the other in Sussex County. Franklin Pellets, a newly formed partnership between Multifuels and CMI, is eyeing the possibility of opening a wood pellet shop within a portion of the now closed International Paper mill in Franklin.
There are various reasons the southern part of the U.S. has become one of the producers of pellets for Europe.
“When you start looking at the world and ask where pellets would come from, Scandinavia, South Africa and Russia would seem logical because they are closer,” Stewart said. “In reality, Scandinavia imports a great deal of their wood. You would then have to go over Scandinavia to get to Russia and that’s not a good option.”
Stewart said Poland and Czech Republic produce pellets, but most are for their own consumption. South Africia provides difficulty for Eastern Europe as well.
Looking back toward North America, eastern Canada does not have a lot of wood resources and uses many of them themselves, leaving the Atlantic Seaboard of the United States.
“You have Maine and then a very populated Eastern Seaboard,” Stewart said. “Next is the U.S. South, which logistically is a good location.”
Brazil is another option, but Stewart said currently it is cheaper to get pellets from the United States.
Stewart said there are five large wood pellet production facilities in the Southern United States with others planned, including the one in Ahoskie and those in southeastern Virginia.
Experts estimate the EU will need 20-50 million tons of wood pellets per year by 2030, up from the current use of 10 million tons per year.
“You have a bunch of demand,” Stewart said. “Pellet producers think they will put up a pellet plant and export to Europe. It doesn’t sound all that complicated, but that’s what it is.”
He said the demand is the plus side of the economic forecast for wood pellets, but there is also a down side.
“With the pending demand, you would think the price of pellets would be increasing, but right now they are pretty flat,” Stewart explained. “At present, pellets are a break-even business. If the price increases with demand, which is what pellet producers are counting on, they will make a lot of money.”
As for the particular plants in northeastern North Carolina and southeastern Virginia, Stewart said the woodlands in the area would support the facilities.
“It certainly does have the capacity to provide for a couple of facilities,” he said. “If they are large-sized mills, they will take about a million tons a day as opposed to pulp mills, which average 2.5 million tons.”
He said, however, the U.S. South could meet only a fraction of Europe’s overall demand for renewable resources.
Retired forester Chip Burby of Ahoskie said the local Enviva plant would revitalize a dormant timber industry.
“It will be a big boom,” he said. “I thank the good Lord it happened, because it will be a big plus for this area.”
Burby said there is currently no market to support the local harvesting of hardwood, a fact causing hardship on the industry.
“Tracks of timber couldn’t be clear cut because you couldn’t get rid of the hardwood,” he said. “It is definitely a big thing.
“The hardwood pulp industry was completely dead,” he added. “This is a great thing for Ahoskie and Hertford County.”
Burby said he believes there is plenty of timber in the area to keep pellet plants producing.
“Timber is a renewable resource and we will be OK,” he said. “We can grow timber in this area because we have the resources.”
As for the United States, Stewart said it is likely to be quite some time before pellets are used in this country for electrical power.
“Unless we have a lot of renewable standards that would push us to biomass, it would be the last product line,” he said. “The first replacement for coal would be wood fuel or bark. That’s the next cheapest, whereas pellets are twice the cost of coal.”
BRAZILIAN ASSOCIATION INDUSTRY BIOMASS RENEWABLE ENERGY
BRAZILIAN ASSOCIATION INDUSTRYBIOMASS RENEWABLE ENERGY
In Europe the “RE 20/20/20" energy policy carries legally binding renewable energy targets for each member country for 2020. Plans submitted by member countries in 2010 to achieve targets will increase biomass use for production of electricity, heat, and transportation fuels by ~400 MT (million tonnes), mostly from woody material. Pellet consumption of 9 MT in 2009 is projected to reach 16-18 MT by 2013-15 and 50-80 MT by 2020.
The biomass shortfall is Europe estimated at 60 MT. Key importing countries will be UK, Netherlands, Belgium, Germany, Italy and Spain. Asia, China's new 5-year plan focuses on renewable energy. Domestic demand will increase substantially but it supports self-sufficiency and biomass trade is not yet envisioned. Korea has an ambitious target for renewable energy and a large scale import program (15 MT of pellets for co-firing). In post-tsunami Japan, massive domestic and import biomass programs are contemplated that would increase demand for imported biomass to the same magnitude as Korea.
The economics of biomass supply Brazil. A prerequisite for increasing heat and power generation from biomass is an adequate, sustainable, and cost-efficient fuel supply. There is potential to increase annual domestic supply of biomass for heat and power generation in the Brazil by 2015 by roughly 1,000 TWh, which is double today’s supply. Forestry Brazil products are the largest component of today’s biomass supply. About half is by-products from the industry (bagasse sugar cane and such as black liquor, sawdust, and bark), 360 TWh (140 million dry tons or 280 million m3) is round wood and 30 TWh (6 million dry tons) from forest residues (branches, tops, and stumps). The big bioenergy growth opportunity in forestry is to increase the capture of forest residues. In addition to the growth potential in forest residues in Brazil, there is an estimated 250 TWh potential from increasing the net harvesting of roundwood. For industry by-products such as saw-dust and black liquor, no growth potential has been assumed as almost all of these by-products are already being utilized.
Agricultural residues are by-products, such as straw and bagasse sugar cane. Boosting supplies of agricultural residues for energy applications is largely a question of creating demand at sufficiently attractive prices. Waste consists of municipal solid waste, manure, sewage, sludge, recovered wood (from demolition, for example), and other biodegradable wastes. It is the second largest source of biomass supply today, contributing approximately 210 TWh of primary energy. The Brazil estimate waste for the year 2010 was 603,393,522 (ton) (agricultural residues, cereals, fruit and vegetable extraction) and approximately 157,992,556 cubic meters of forestry sector (wood and waste) the equivalent of 246,197.85 tons equivalent oil (toe). Furthermore, 30.9 million tons (dry matter) of woody biomass from native forests, of which 8.1 million tons (dry matter) were of saw logs, 20.3 million tons (dry matter) of firewood and 2.5 million tons (dry matter) of wood for charcoal. In Brazil, the Brazilian Sugarcane Industry Association (UNICA), projected a 2011/2012 sugarcane harvest of 641.98 million tons. After squeezing out every ounce of sugary juice, as much as 28 percent of that cane weight ends up as fibrous bagasse (179,75 million tons) and residues of the straw (192, 59 million tons).
News Pellet production is concentrated in North and Northeast Brazil, where most of the country’s softwood plantations and related sawmilling industry are found.
■■ Suzano Renewable Energy -Project 2014 - WoodPellets - 1.000.000 and .3.000.000 ton. years. - Maranhão
■■ BioPellets Renewable Energy -2011- BioPellets Bagasse Sugar Cane - 120.000 and .200.000 ton. years. - São Paulo
■■ BioPellets Renewable Energy -2013- WoodPellets - 1.000.000 and .3.000.000 ton. years. - Maranhão
■■ GSW Renewable Energy -2011-2012 - WoodPellets - 120.000 and .200.000 ton. years. - Pará
■■ NaturalSul Renewable Energy -2011-2012 - WoodPellets - 120.000 and .200.000 ton. years. - Rondônia
The Brazilian Association of Industry Biomass was founded in 2009 national association and currently brings together leading 492 companies from biomass in BrazilBrazilian Association of Industry Biomass and Renewable Energy and Brazil Biomass and Renewable Energy, which has the objective of promoting the union of entrepreneurs of the sector in Brazil in search of a favorable environment for the integration of products from biomass and alternative sources of energy in the Brazilian energy matrix and for international expansion.
If your company needs new sources of supplies to our Brazilian Association of Industry Biomass or Brazil Biomass and Renewable Energy can help you. We can help you in developing business partnerships and new business in biomass, renewable energy and bioenergy in Brazil. We represent all the companies producing biomass, bioenergy, bio Woodpellets, bio wood briquettes in Brazil.
Celso Oliveira CEO Brazil Biomass and Renewable Energy and President Brazilian Association Industry Biomass and Renewable Energy
WOOD HEAT FIGHTS TO BE A BIGGER PLAYER
July 24, 2011 - 0 Comments
By Tux Turkel – Maine Sunday Telegram
Photo by Hughes Brothers Sales
ReVision Energy in Portland sells a solar hot-water system that can offset roughly 250 gallons of oil a year in a typical boiler. The system goes for about $11,000, but federal and state tax breaks can knock $4,300 off the buyer’s cost.
ReVision Heat, its sister company, sells a $15,000 wood pellet boiler that can replace 1,000 gallons of oil — four times as much as the solar panels. But there’s no state tax benefit, and the federal tax credit is capped at $300.
Superior tax incentives for solar is one reason ReVision saw $8 million in solar equipment sales last year, compared with $500,000 in wood.
This government policy is being questioned in a new report from a Maryland-based nonprofit formed to promote wood heating, the Alliance for Green Heat. It calculated that a $1,000 tax incentive for a clean-burning wood or pellet stove could offset as much fossil fuel as a $10,000 solar rebate.
Wood heat, the report said, provides 80 percent of all residential renewable energy in America and is within reach of middle- and lower-income families. Solar produces 15 percent and is unaffordable to many people.
“My message,” said John Ackerly, the alliance’s president, “is that incentives should be technology neutral, and consumers should be given a choice.”
The report’s conclusions are of interest in Maine, where a sultry summer soon will turn into another expensive heating season. Maine is the country’s most forested state, but also the most dependent on heating oil. Roughly seven in 10 homes burn oil, but only one in 10 uses wood as a primary heat source, according to the latest census figures.
Better renewable energy incentives aimed at the cleanest, most-efficient wood stoves and boilers could help shift that equation, the alliance’s report says, as could programs to help residents switch out old, polluting wood burners.
“We really overlook huge portions of our population when we overlook wood,” Ackerly said. “And we’re not offsetting the amount of fossil fuels we could for the amount of incentive money.”
Solar energy has many benefits. It creates no pollution in use and the fuel — sunlight — is free. But when it comes to government incentives, wood has lost out to solar, wind and geothermal, Ackerly and others say, because the wood-heat industry is made up of small businesses that lack corporate lobbying resources and political clout. For instance: Newer solar, wind and geothermal systems receive federal tax credits of 30 percent, with no dollar cap, and can qualify on vacation homes.
Wood also suffers from the air pollution stigma caused by older stoves and outdoor boilers. That’s a major challenge, the alliance conceded. From 60 to 75 percent of the 12 million stoves in operation today are too old to meet federal standards for particle emissions.
“It’s hard to say ‘dirty solar,’ but there is dirty wood heat,” said Pat Coon, a co-founder of ReVision Energy.
An experienced solar installer, Coon takes a broad view of what he sees as the challenge of getting the state’s 400,000 homes off oil. Solar panels and weatherization will help, he said, but they can’t accomplish that goal.
Wood, however, could make a major contribution, especially pellets, if more-efficient delivery methods can lower the cost. Cordwood, the traditional form of wood heat, can offset a lot of oil, he said, but it involves too much effort to become a total solution for most households.
Government tax policy is part of the equation, Coon acknowledges. Solar rebates helped turn ReVision into a leading installation company.
“Government’s best role is being a catalyst,” he said. “We now have a solar installation industry. Government hasn’t done that for wood, and we don’t have a wood industry.”
But others see the marketplace creating a wood industry, although slowly.
“It’s a brand new industry in the United States and we’re starting from zero,” said Les Otten, president of Maine Energy Systems in Bethel.
Otten and two partners formed the company three years ago to import automated, high-efficiency pellet boilers. Business was slow last year, dragged down by the poor economy. This year is different, with consumers spooked by volatile oil prices. Maine Energy Systems is on track to install more than 200 boilers, Otten said, with the prospect of much stronger growth next year.
Most jobs are commercial and municipal, with 70 percent of the work out of state. Maine customers include the Blue Hill public library, SAD 74 in Anson and Gardiner Public Works. Homeowners have a harder time coming up with the capital, Otten said, even if they can save $2,000 or more a year on oil.
In Europe, where pellet boilers are common, the industry grew rapidly over the past eight years, thanks to generous financial incentives. A former Republican candidate for governor, Otten said the debt crisis makes it hard today to ask “with a straight face” for government tax breaks.
“Right now,” he said, “the cost of fuel is an extraordinary incentive.”
At the Alliance for Green Heat, Ackerly acknowledged that the federal debt and state budget shortfalls make new tax breaks for wood unrealistic. But to the extent that energy incentives do exist, they should help bring down the cost of equipment, create jobs and offset fossil fuels.
“Both solar and wood do all three of these,” he said.
CONSTRUCTION UNDERWAY AT ROTHSCHILD BIOMASS PLANT
July 23, 2011 - 0 Comments
By Wausau Daily Herald
Photo – Public Domain
One month into construction of the joint We Energies-Domtar biomass power plant in Rothschild, timing already is essential. To qualify for federal tax credits, the $255 million plant that will burn the tops and limbs of trees to produce energy and steam must be operational by the end of 2013.
Bob DeKoch, president of Boldt Construction, the Appleton firm managing plant construction, said the project has an “ambitious schedule.”
As Domtar and We Energies host a “community appreciation day” at the Rothschild Pavilion this weekend, folks who drive by the paper mill might not notice much progress. But things are moving quickly, DeKoch said.
The contractor handling excavation for the plant’s foundation and a retention pond planned for the rear of the property began work about two weeks ago, and the number of workers on site gradually will grow to 400 in the next year.
The plant will burn 500,000 tons of biomass each year, producing energy for We Energies to sell and steam for use in Domtar’s paper-making process. Domtar gave approval for the project to begin in June, setting construction in motion after more than a year of state and local review.
WALKER ADMINISTRATION SCALES BACK UW-MADISON POWER PROJECT AGAIN
July 23, 2011 - 0 Comments
By Thomas Content – Journal Sentinel
Photo by The Boldt Company
A state-owned power plant that could be sold to a utility at some point won’t be expanded at this time to generate more electricity, the Walker administration announced Friday.
The state Department of Administration announced that it will not build a steam turbine generator to expand the power output of the Charter St. power plant, which provides heating and cooling to the University of Wisconsin-Madison.
The project wasn’t cost effective given the state’s surplus of power and the possibility that the state may sell or lease its power plants in the future, said Chris Schoenherr, executive assistant to Administration Secretary Michael Huebsch. The move will save about $8 million to $10 million.
“The main driver is where we are at with capacity within the state of Wisconsin,” said Schoenherr. “The issue of whether the state will continue in the heating plant business in the long-term remains open and its ability to recoup an investment in additional generation adds additional uncertainty.”
The state is considering whether to sell off state heating and cooling plants including Charter St., and Gov. Scott Walker earlier this year proposed the no-bid divestiture of the facilities in his controversial budget-repair bill.
More recently, both Madison Gas & Electric Co. and We Energies of Milwaukee have expressed interest in buying the state plants.
The move marks the second time this year that the Walker administration has made a change to bring down the cost of the $250 million project that former Gov. Jim Doyle had championed.
Doyle, a Democrat, had committed to stop burning coal in downtown Madison after a Dane County judge found the state had violated the Clean Air Act in litigation over air pollution at the plant.
The earlier version of the project would have converted the coal-fired power plant to burn natural gas and biomass, creating a Madison showcase for burning biomass at the university, where the Great Lakes Center for Bioenergy Research is based.
But the Walker administration in January announced a cost-saving move to cancel the biomass boiler, opting to burn natural gas exclusively. Following the latest change, Schoenherr said the project, scheduled to be completed by 2013, is expected to cost about $135 million.
In making the change, the state will still stop burning coal and install natural gas boilers, and use those boilers for heating and cooling university buildings. And it will install equipment that will allow for the eventual addition of power generation at a later date, Schoenherr said.
The state will apply the savings toward energy efficiency upgrades at campus buildings, which will generate a faster return for the state than adding new generation, he said.
Asked if officials from Madison Gas & Electric had requested that the state hold off on adding the electricity generation, Schoenherr said, “We’ve talked with a whole host of stakeholders. It was the decision of the scretary based on the facts we have,” he said. “It was his decision that this was the best decision to make in the interest of the state of Wisconsin.”
MG&E had been a vocal critic of the Charter St. proposal, raising concerns about adding generation – and generation that would compete against the utility’s own power plants.
Asked if MG&E had requested that the administration make the move announced Friday, utility spokesman Steve Kraus said, “MGE has always had concerns about the cost effects to other MGE customers of adding duplicative electric facilities at Charter Street. These concerns were shared with the UW, the previous administration and the current administration.”
Jennifer Feyerherm of the Sierra Club, which had sued the state in 2007 over air pollution violations from state-owned coal plants, said she was pleased the administration is living up to its commitment that it will no longer burn coal.
But she said she still questioned whether the administration’s latest move, because making both electricity and heat from burning natural gas is more efficient than burning natural gas for heating purposes alone.
“Getting off of coal is the best thing for Dane County’s air quality, but we have to take it to the next level,” Feyerherm said. “In these tight budget times, we can’t be thinking short-sighted.”
PULP PRICES HAVE REBOUNDED SIGNIFICANTLY OVER THE LAST 24 MONTHS.
Description
Pulp prices have rebounded significantly over the last 24 months. From June of 2009 through June of 2011, ForestWebs North American Pulp Index jumped almost 65%, obviously outpacing other pricing gains in the US economy (most notably, gasoline which has increased a paltry 49% over the same time frame). During the first week of July, NBSK prices were just north of USD 1,000/tonne while SBSK were just south of the USD 1,000/tonne.
Using the Pulp Index data shown below, we see that pulp prices have been above the trendline since February 2010. We can also see the significant dip below trendline from October 2008 through January 2010.
How long can we expect prices to remain above the trendline? (A disclaimer before the answer, courtesy of a professor of statistics and forecasting: Every forecast is a lie.)
Here, however, we have a more significant principle of economics at work: commodity prices generally return to the trendline, barring any material changes in the fundamental economics or business environment related to the product.
First, lets look at the basic business environment for wood pulp and whether there have been any significant changes in the fundamentals of pulp.
Are the demand drivers changing for pulp? Paper consumption per capita, worldwide, appears to be flattening out. Industry reports show that after having more than doubled in the 40 years prior to 2000 (an annual growth rate of 1.9% annual rate), consumption increased at a rate of only 0.2% between 2000 and 2009 (World Resources Institute, Swedish Forest Industries Federation). Over the time horizon of the trendline shown in the figure above, demand is essentially unchanged for Paper and Paperboard based pulp demand.
Are there new sources of demand for pulp? Because of a recent cotton shortage, cotton prices have increased signficantly, leading many manufacturers to substitute rayon. Historically, these types of demand streams have tended to be temporary. USDA crop data indicates that cotton planting has increased from the 2007 low and is in line with levels of 2002 2004. Will rayon remain a fabric of choice as cotton production ramps back up? Id bet against it.
What about supply side dynamics? Over the past several months, quite a few announcements about capacity increases for pulp have surfaced. West Fraser is increasing NBSK capacity by nearly 100,000 tons, International Paper is repurposing the shuttered Franklin, VA mill to produce fluff pulp, Buckeye is studying an expansion of its Florida mill, and there have been other announcements and rumored pending announcements in the industry and not just North American based. The real question is this, can the industry manage to add capacity in such a way that operating rates do not drop precipitously? My experience with adding capacity during the Containerboard capacity additions of the mid 1990s suggests that the industry has gotten better at this. But the jury is still out.
Now, for the answer to the question, how long will prices remain above the trendline? I do not believe we have seen any fundamental changes in the pulp environment yet. With per capita paper consumption flattening (at best), future increases in demand will be driven by population growth. If history is any measure, capacity additions come online in groups or clusters, trailing high prices and high operating rates by some months. That said, I would suggest that we will see prices back to the trendline in the next 12 to 15 months. As announced capacity additions come online, we are likely to see some shift below trendline, though the depth of the trough will depend upon the rate at which capacity comes online.
In this situation, Im betting that the principle that all things being equal, all prices return to trendline will be stronger than the observation every forecast is a lie.
GERMANY PASSES MORE AGGRESSIVE RENEWABLE ENERGY LAW
By Paul Gipe, Contributor
July 25, 2011 |
Despite widespread rumors in North America that Germany was abandoning its system of Advanced Renewable Tariffs, the country's upper chamber of parliament, the Bundesrat, approved the latest revision of its pioneering Renewable Energy Sources Act on July 8.
The action follows approval by Germany's House of Commons, the Bundestag, on June 30. The new version of the law first introduced in Germany in 2000 will go into effect January 1.
Approval of the latest revisions of the Renewable Energy Sources Act, the Erneuerbare-Energien-Gesetz (EEG) in German, is significant because it follows the nuclear accident at Fukishima, Japan and the debate in Germany about the future of nuclear power.
The 30-year debate on nuclear in Germany was settled earlier this summer when parliament decisively voted to quit nuclear power by 2022. Germany is currently ruled by a coalition of the Conservative (CDU/CSU), and the neoliberal (FDP) parties. Thus, the vote on revisions to the Renewable Energy Sources Act for 2012 follows the decision to quit nuclear power and further expand the role of renewable energy in the electricity sector.
The revisions for 2012 were part of regularly scheduled periodic revisions. Previous revisions occurred in 2004 and 2009.
The 2012 EEG sets a minimum requirement of not less than 35 percent of renewable energy in electricity supply by 2020, not less than 50 percent by 2030, not less than 65 percent by 2040 and not less than 80 percent by 2050.
However, the law actually sets a target of between 35 and 40 percent of supply within the next decade. This conforms to a decision made by the Ministry of Environment in 2010. Rather than reducing its commitment to expanding renewable energy, Germany has codified a more aggressive target than in the previous law.
Final interpretation of the complex 204-page law will be issued by the Ministry of the Environment (BMU) later this summer.
Some key provisions of the 2012 EEG include
• Raising biomass tariffs nearly 30 percent from €0.11/kWh ($0.16/kWh) to €0.14/kWh ($0.20/kWh) for plants less than 150 kW in size.
• Increasing geothermal tariffs more than 50 percent from €0.16/kWh ($0.22/kWh) for small projects to €0.25/kWh ($0.36/kWh) for all projects.
• Increasing offshore wind tariffs 15 percent from €0.13/kWh ($0.19/kWh) to €0.15/kWh ($0.21/kWh).
• Increasing the "starter" bonus for offshore wind nearly 25 percent from €0.15/kWh ($0.21/kWh) to €0.19/kWh ($0.27/kWh).
• Maintaining the 2011 degression for solar photovoltaics (solar PV) into 2012.
• Maintaining the tariffs for wind energy on land, including the repowering bonus.
Significantly, parliament again stated its support for the rapid development of solar PV in Germany. The 2012 EEG continued the current policy of regulating solar PV development within a "growth corridor" of 3,500 MW per year.
If Germany maintains growth of solar PV of 3,500 MW per year it will remain the world's largest solar market for the foreseeable future. Both the government and the industry expect solar PV capacity to exceed 50,000 MW by 2020.
Solar PV growth will be regulated by adjustments in the annual degression rate of 9 percent. If the growth exceeds the target, the degression is increased. If growth is less than the target, the degression is decreased.
In addition, the 2012 EEG continues the German reference yield system for wind energy both onshore and offshore. The system is designed to ensure that not only wind energy at windy sites can be developed but also wind energy at less windy sites as well. The system has proven successful. Today, nearly 60 percent of all wind energy in Germany is developed in the less windy interior of the country, taking development pressure off the windy North Sea cost.
See Tables of Feed-In Tariffs Worldwide for details on the 2012 EEG as well as updated feed-in tariffs on Britain's Renewable Heat Incentive.
Posted: July 30
Updated: Today at 10:18 PM
SAD (DISTRICT) 74 SCHOOLS CONVERTING TO WOOD-PELLET BOILERS
By Erin Rhoda erhoda@mainetoday.com
Staff Writer
ANSON -- Students here will no longer sit in classrooms that are warmed by heating oil. The school district is instead turning to an abundant Maine resource: wood.
The district's four schools are converting from oil-fueled boilers to wood-pellet ones, for a minimum net savings each year of $70,000, Superintendent Ken Coville said.
"The combined project will cut our facility heating costs about in half," Coville said. "At the same time, it eliminates the use of approximately 65,000 gallons a year of oil, which reduces, ultimately, in a small way, the country's dependence on foreign oil."
The conversion is also supporting jobs in Maine's forest industry, because the pellets will come from Geneva Wood Fuels in Strong. School Administrative District 74 has a guaranteed price with the hardwood pellet fuel producer but isn't bound by a contract and can switch to another company if it chooses, Coville said.
The project at Garret Schenck School, Carrabec Community School and Carrabec High School, all in Anson, and Solon Elementary School, will likely cost up to $750,000. It will be paid for in part by a 15-year qualified school construction bond at zero-percent interest, Coville said.
The school district also won a competitive grant of $250,000 came from U.S. Forest Service Recovery Act money. The district was one of 22 finalists in Maine, out of 90 applicants, to receive the money, said Tom Wood, senior planner for the Maine Forest Service at the Department of Conservation.
Coville on Friday visited Garret Schenck School to examine the self-cleaning wood-pellet boilers, which have a projected life of 25 years. He said he likes the fact the boilers have a compartment that collects wood ash, which can then be sold to farmers or people who make soap.
The district plans to have every boiler installed, and staff trained how to use them, by Sept. 30, about two weeks before the district usually turns on the heat. The boilers have a five-year warranty, while the warranty for the electronic controls is two years.
"If 100 projects of this size were done in Maine, that would be six-and-a-half million gallons of oil a year eliminated, and it would be somewhere in the neighborhood of six-and-a-half to 10 million dollars of savings to the public," Coville said.
Wood estimated at least 30 districts in Maine use wood as a source of heat, but the vast majority still use oil. Some local districts that use wood, or will soon, include Phillips-based SAD 58, Oakland-based Messalonskee School District and Unity-based Regional School Unit 3, he said.
"People are beginning to recognize the improvement in the technology -- the stability and the cost savings," he said.
And in some areas, such as SAD 58, schools are buying wood directly from their local communities. In SAD 58's case, it purchases from the mill in Strong.
"When the school cuts its heating bill by two-thirds, the school budget goes down, and it saves the mill in town tax money. Not only do the dollars that they spend on fuel stay in the community, it holds down the cost for the local mill," Wood said.
Erin Rhoda -- 612-2368
erhoda@centralmaine.com
Saturday, July 30, 2011
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