Excerpt from article by Rich Donnell and Dan Shell, Wood Bioenergy magazine –
The event, hosted by Wood Bioenergy magazine and Georgia Research Institute, featured a diverse range of presentations, including talks from Scott Bax, chief operating officer of Pinnacle Renewable Energy; John Keppler, chairman and CEO of Enviva; Jose Gonzalez, senior principal with AFRY; and Bill Strauss, president of FutureMetrics.
In his talk Partnering for Growth, Scott Bax provided an overview of Pinnacle’s aggressive expansion into industrial wood pellets, noting its nine existing pellet production facilities in North America, and two others under construction—one in High Level, Alberta, Canada and the other in Demopolis, Ala. in the Southeast U.S.
Bax focused on Pinnacle’s approach to its partnerships, citing common goals, honesty and transparency, clear expectations, room to grow, “owning safety,” and the importance of leveraging each other’s strengths. And along with wood products companies, partnership also includes logistics firms, equipment suppliers, engineering and construction groups, fiber haulage companies and end-use customers.
Enviva Chairman and CEO John Keppler provided a video presentation entitled How Renewable Wood Energy Can Help Solve the Climate Crisis. “As climate change and global warming become more urgent, leaders around the globe are exploring ways to solve the challenge of delivering secure, affordable and sustainable energy,” Keppler said, adding, “We need solutions available today, not decades from now, like sustainable wood bioenergy. The last time I spoke at this conference, the topic wasn’t different, but the data that we have and the progress we have made since that time is pretty remarkable.”
Keppler noted that renewable energy with biomass began with a strong belief and vision, but that in the past 10 years it has accumulated the data that endorses it as a viable and vibrant industry. “Ten years ago, we said given the opportunity to displace coal on a very cost effective solution, biomass can be part of the all-in [solution], with wind, solar and batteries, with combined heat and power.” Today in markets Enviva serves, such as Belgium, Denmark, the Netherlands and the UK, “We’ve been able to reduce coal consumption by more than 60% just through 2018. Biomass didn’t do it alone, but as the adoption rates of wind and solar get even higher, the costs of intermittency become more challenging, and therefore the ability for biomass to provide 3, 8, 12, 15% on a baseload basis but as much as 100% when the wind isn’t blowing and the sun isn’t shining, means you can increase penetration rates into wind and solar even further.
Speaker Jose Gonzalez, senior principal at AFRY (formerly Pöyry), spoke on the Dynamics of the Global Pellet Market and Impact to North American Supply.
According to Gonzalez, a big competitive edge for North America is its stability and reliability as an industrial wood pellet supplier thanks to plentiful fiber sources and excellent infrastructure for timber harvest, processing and shipping. “North America produces 54% of global pellet supply,” Gonzalez said. “Reliability is a big plus and should be a selling point, plus there’s lots of excess biomass available.”
Gonzalez noted that 2027 is when some of the major UK support for coal-to-biomass conversions ends, and currently there’s no way to tell what the government might do.
“Will the government extend support, or is it possible to see a big drop in demand post-2027?” Gonzalez asked.
While he said he believed incentives wouldn’t be completely withdrawn, Gonzalez noted that with existing European market opportunities set to decrease, there could be new demand developing elsewhere. Ongoing coal phase-out in countries such as Germany, the Nordics, and Iberia may produce opportunities for future demand.
Another potential future development, Gonzalez said, is increased use of Carbon Capture and Storage (CCS) technology that could help reposition biomass and wood pellets as a carbon negative solution. Carbon storage is seen by some as a big part of the emissions reduction effort, due to the amount of carbon that needs to be removed from the system. The largest barrier is cost, as CCS technologies are not economical without revenue from high carbon prices or dedicated incentives, he said.
Dr. William Strauss, president of wood pellet and biomass consulting group FutureMetrics, delivered an excellent presentation on The Future of the Industrial Wood Pellet Sector. He said global wood pellet production (including industrial and heating pellets) continues to escalate, approaching 36 million metric tons through 2018, including more than 10 million in North America, and that in 2019 North America exported 8.4 million tonnes. The biggest exporters in 2019 were the U.S., Vietnam, Canada, Russia, Latvia and Estonia. The biggest importers were the UK, South Korea, Denmark, Italy (heating pellets), Japan and Belgium. He speculates global industrial wood pellet demand will increase from 15.6 million metric tons in 2019 to 31.8 million in 2025.
Strauss noted the focus on new growth will shift increasingly to Asia. He said he expects no more growth out of the UK come 2022 unless current policies are renewed.
Strauss noted that there are potential new markets where coal-fueled plants could co-fire or full-fire pellets if policies evolve, including in Germany, the U.S., China and Australia, but he believes the major growth under existing policy for the near future is in Japan and perhaps South Korea
In The Woods
Danny Dructor, executive vice president of the American Loggers Council, spoke on the Health of the Logging Ranks and Staying Ahead of Environmental Encroachment. Dructor said ALC and its members appreciate the promotion of wood for bioenergy, whether in the form of a pellet, biochar, cogeneration or biofuels, because it provides new markets to participate in.
Environmentally, he said most loggers just keep doing what they have been doing for most of their careers, practicing sustainable harvesting practices that includes caring for the land, the flora and fauna on the landscape, and taking pride in their professionalism and ability to overcome change.
He noted that environmentalists have taken well intentioned laws such as the National Environmental Policy Act, the Endangered Species Act and the Clean Water Act and have abused them in liberal courtrooms and negotiated settlements with federal agencies as a means to paralyze the industry, especially on federal lands.
“We have also seen attempts by those such as the Dogwood Alliance to stymie operations of private lands through a host of misinformation meant to stop the wood energy markets from developing,” Dructor said.
Devon Dartnell, director, market analysis and research, Georgia Forestry Commission, spoke on Hurricane Michael’s Impact on the Forest Resource. He noted several things that worked in favor of the post-storm salvage effort, including that GFC organized an immediate meeting with mills, timber producers and the Florida Forest Service. He said wet storage capacity was added at some mills such as Rex Lumber and Canfor; producers focused on high value timber first and pulpwood tracts were postponed; log truck weights increased to 95,000 lbs.
GVW and permits were issued for wet decks; logs were barged to south Alabama for additional sawmill capacity; producers came in from the north and west to add logging capacity; the wet winter made salvage difficult but extended utilization lifespan and it prevented mill quotas; and loggers gave it their all in the most difficult conditions during the salvage effort.
Affordable Clean Energy
Detailing some of the differences between the EPA’s recent Affordable Clean Energy (ACE) Rule now being finalized, and the Obama Administration’s Clean Power Plan it replaced, Scott Osbourn, principal with Trinity Consultants, covered EPA’s Final ACE Rule and Its Bioenergy Implications.
The previous Clean Power Plan had over-reached, he said, as a program that sought to regulate the energy sector through the Clean Air Act and inserted EPA into energy policy. The new ACE rule allows states to set their own standards that meet federal guidelines consistent with current law.
The former plan had also determined the best system of emission reduction (BSER) for power plants based on reductions achievable not only through inside-the-fence measures such as technical and process improvements but also through shifting of generation from higher-emitting to lower-emitting plants and fuel conversions.
Alternative fiber sources have a definite place in the supply chain, said Wendy Owens, CEO of Hexas Biomass, during her talk entitled Non-Wood Bioenergy Crops + Wood for Sustainable Energy Production. Owens noted 30-40% potential U.S. wood cost increases by 2050. Non-woody biomass sources have a role to play in the market, but also come with a set of disadvantages and benefits, she said.
Some of the negatives include low energy density and high variation of physical and chemical characteristics. Availability and affordability are issues depending on location, and there’s always a risk when relying too much on one feedstock source, she said.
In My Backyard
Cornelis De Hoop, associate professor of the Louisiana Forest Products Development Center at Louisiana Sate University, presented The Wood Pellet Industry in the U.S. South: Urban vs. Rural Resident—Environmental, Social and Economic Perceptions. De Hoop spoke for the authors of the study, Dr. Rich Vlosky, director of the LFPDC, and Mason LeBlanc, procurement analyst with Drax Biomass.
De Hoop said the study was conducted because there is a significant gap in the knowledge-base regarding the relationship between the U.S. industrial wood pellet manufacturing industry and the general public, and more specifically with regard to rural and urban perceptions. The study survey focused on population in a 50-mile radius of six pellet mills (rural) and on the two largest metropolitan areas in each state with mills selected for the survey (urban).
Not surprisingly, 46% of the urban respondents were not aware of the pellet industry, while only 18% of rural had no awareness.
Andrew Copley, senior analyst with Forisk Consulting, spoke on North American Timberland and Forest Industry Capital Investment Trends. He noted that the rapid rise of TIMOs (Timber Investment Management Organization) and REITs (Real Estate Investment Trust) as a major component of the private corporate landowner class in North America is mirrored by the decline of the vertically integrated forest products company.
Focusing on southern pine timberlands, Copley said the average southern yellow pine plantation accumulated 2.4 tons of volume per acre per year in the late 1980s, and by 2016 that number had more than doubled to five tons per acre per year. “As a whole, we are growing much more wood on an acre of land today than we were 30 years ago,” he said. “There is still room for improvement; a well-managed SYP plantation can produce six to eight tons per acre per year.”
Dr. Dick Baldwin, managing partner of Oak Creek Investments, spoke on Forest Utilization within a Circular Bioeconomy.
“It’s a clever term that describes a process that yields the greatest benefits from the forest over time. When it is done well, greater benefits are realized by all,” Baldwin said.
The solution, if you agree with the premise, Baldwin said, is to consume less CO2 generating substances, extract CO2 out of the atmosphere, and sequester whatever CO2 you can in long-lived repositories. “Nothing can do it as effectively as trees within a working forest,” Baldwin said. “Using the regenerative approach is even more effective.”
And the resulting solid wood products can store nearly half the carbon that is captured in a growing tree, Baldwin said.
Determining the most carbon friendly and lowest cost feedstock for electricity generation in Georgia was the goal of a study presented by Dr. Puneet Dwivedi, Associate Professor of Forest Sustainability at the University of Georgia’s Warnell School of Forestry and Natural Resources. His presentation was entitled Wood Is the Most Carbon Friendly and Least Expensive Feedstock for Electricity Generation.
Dwivedi noted the nature of coal consumption and electricity generation in Georgia across four production areas (consuming 13.6 million tons of coal a year). Land use patterns across the state were noted in relation to coal production, and the potential of various feedstocks in each area was analyzed.
Georgia’s 38 million acres include 25 million acres of forested land, 4 million acres of agricultural land and 2.5 million acres in pasture, Dwivedi said, and a wide variety of feedstocks can be grown, the most common being various grasses, corn stover and cotton stalks, and pine timber.
Dwivedi sought to find the most cost-effective and carbon friendly bioenergy feedstocks for coal-based power plants located in Georgia. In doing so, his study compared the unit cost of electricity and the unit carbon intensity of electricity generated from bioenergy feedstocks in the state.
While admitting that his labor market insights came with a big coronavirus impact question mark, George Meek, owner of Top Wood Jobs, said older age groups are projected to have faster rates of labor force growth, continuing a trend. Meek spoke on the Current Employee Market: Where Are All the Available Workers? A Recruiter’s Perspective.
Meek noted that the most recent labor reports showed turnover rates close to an all-time low at 44% with wood products at 35%. In such an environment, Meek told Wood Bioenergy Conferences attendees, “Recruiters are actively going after your employees.”
Adding that he should know, Meek said, “More of the candidates I contact are now employed and not looking for a job.” The longtime industry recruiter added, “The best people are already working.”
Pellet producers and others in the wood bioenergy supply chain can use data mining and “big data” information to better assess risk when it comes to feedstock issues and plant locations, according to Tim Young, Ph.D., Professor at the University of Tennessee’s Center for Renewable Carbon. Young spoke on Using Data Mining and Big Data to Assess Risk in the Biomass Supply Chain.
He noted that increasing computing power and access to more streams of data and better ways of analyzing and acting upon it have the potential to move the industry to a new technical level, yet issues remain.