For the latest in news, visit or blog site.
Clean Power Plan Considers Biomass
The Environmental Protection Agency’s “Carbon Pollution Emission Guidelines for Existing Stationary Sources: Electric Utility Generating Units,” also called the “Clean Power Plan,” was published in the Federal Register in mid-October, which launched a 90-day and possibly longer public feedback period before a possible revision and implementation.
According to EPA, the Clean Power Plan will reduce carbon pollution from the power sector by 32% (870 million tons less) by 2030, while reducing emissions of sulfur dioxide from power plants by 90% and nitrogen oxides by 72%.
The measure is a reflection of the U.S. commitment toward addressing climate change and carbon dioxide pollutants, according to EPA. It establishes interim and final carbon dioxide emission performance rates for two subcategories of existing fossil fuel-fired EGUs: fossil fuel-fired electric utility steam generating units and stationary combustion turbines. The Plan provides guidelines for the development, submittal and implementation of state plans, allowing renewable energy standards and programs as part of those plans. It also allows for “emissions trading” between states and power plants.
“States can tailor their plans to meet their respective energy, environmental and economic needs and goals, and those of their local communities,” according to EPA.
The EPA plan cracks the door open for new forest biomass power generation as part of renewable energy considerations in the state plans, but doesn’t guarantee acceptance of biomass as carbon neutral.
Biomass power plants in operation in 2012 or earlier are exempt because only affected EGUs using fossil fuels are subject to emissions reductions requirements. Biomass is defined as a compliance strategy in the CPP.
Some industry groups are contesting the Plan’s lack of commitment toward biomass.
Generation from new or expanded facilities that combust qualified biomass to produce electricity can replace generation from affected EGUs. However the Plan states, “While the EPA believes it is reasonable to consider generation from these fuels and technologies to be forms of RE generation, the fact that they can produce stack emissions containing CO2 means that a section plan seeking to permit use of such generation to serve as the basis for issuance of ERCs (emission rate credits) must include appropriate consideration of feedstock characteristics and climate benefits. Specifically, the use of some kinds of biomass has the potential to offer a wide range of environmental benefits, including carbon benefits. However these benefits can only be realized if biomass feedstocks are sourced responsibly and attributes of the carbon cycle related to the biomass feedstock are taken into account.”
The Plan also states, “It is not scientifically valid to assume that all biogenic feedstocks are ‘carbon neutral’ and that the net biogenic CO2 atmospheric contribution of different biogenic feedstocks generally depends on various factors related to feedstock characteristics, production, processing and combustion practices.”
The Plan emphasizes the importance of the country’s forests in removing greenhouse gas emissions each year, and emphasizes EPA’s ongoing role in further scientific assessment of those measurements.
EPA says it anticipates some states considering the use of biomass-derived fuels used in electricity generation as a way to control increases in CO2 levels, but adds, “Not all forms of biomass are expected to be approvable as qualified biomass (i.e., biomass that can be considered as an approach for controlling increases of CO2 levels in the atmosphere).”
The Plan adds that state plan submissions must describe the types of biomass that are being proposed and how those feedstocks can control increases of CO2 levels. “Forest biomass feedstocks may be acceptable if the state-supplied analysis of proposed qualified feedstocks can adequately demonstrate that such feedstocks appropriately control increases of CO2 levels and can adequately monitor and verify…”
Under the Plan, states must submit implementation plans or an initial submittal with an extension request by September 6, 2016, and final complete state plans must be submitted no later than September 6, 2018. The Plan provides 15 years for full implementation of all emission reduction measures.
In late December, American Forest & Paper Assn. (AF&PA) and American Wood Council (AWC) filed a joint petition for review in the D.C. Circuit Court over the EPA’s treatment of biomass energy in the Clean Power Plan.
Robert Glowinski, president and CEO of AWC, comments, “Our industry strives to be as energy efficient as possible and is one of the leaders nationwide in the use of carbon-neutral biomass energy. Over 75% of the energy at our member companies’ wood products facilities is generated from biomass. After reviewing EPA’s Clean Power Plan, it appears that the rule may place unnecessary and inappropriate restrictions on states’ use of biomass energy as part of their plans to reduce CO2 emissions from electric power generation. This litigation seeks to protect biomass energy use as a critical component of renewable power. When biomass is used, it helps to reduce greenhouse gas emissions from fossil fuels.”
Murray Energy Corp., the largest underground coal mining company in the U.S., has filed a lawsuit against the Obama Administration, challenging the Clean Power for imposing “strict, unlawful greenhouse gas standards for existing power plants.”
Murray Energy claims the Clean Power Plan represents “an unprecedented attempt by EPA to commandeer and re-design the United States’ electrical system, essentially dictating how electricity is to be produced and how much can be used. This political power grab of America’s power grid by the Obama EPA is clearly illegal, goes far beyond any statutory authority, and is, in fact, expressly prohibited by the Clean Air Act.”
Numerous states have filed lawsuits as well citing EPA’s overreaching of its authority.
Ince Bio Power Picks Up Pace
CoGen Ltd. announced the successful financial package for the Ince Bio Power 21.5 MW biomass power generation project at Protos, formerly known as Ince Park, in Cheshire, UK, where construction has commenced.
The Ince Bio Power project will be the fourth biomass power project by developer CoGen and follows the projects of Birmingham Bio Power in the West Midlands, Welland Bio Power in Northamptonshire and Dartmoor Bio Power in Plymouth.
Ince Bio Power is the first of a pipeline of CoGen projects to be fully financed in an all-equity transaction by Bioenergy Infrastructure Group (BIG), the recently announced waste infrastructure investment platform comprising stakeholders Infracapital, Aurium Capital Markets, Foresight Group and Helios. The plant, which will qualify for 1.8 Renewable Obligation Certificates (ROCs) for the first 19 plus years of its lifespan, will implement an Advanced Conversion Technology (ACT) process to convert 170,000 tonnes per annum of recovered waste wood into clean renewable energy, enough to power around 40,000 homes.
The electricity produced will be purchased by nPower under a long-term Power Purchase Agreement (PPA), while the recovered waste wood will be supplied under a long-term contract by Ince Park Renewables Ltd.
Ince Bio Power has entered into a lease agreement on two plots totalling 7.5 hectares on the Protos Site owned by Peel Environmental.
Construction has commenced on the site, with MBV Energy, a joint venture between MWH Treatment and Black & Veatch, appointed as EPC contractor, with Outotec Energy Products being the main technology subcontractor and with MWH Treatment appointed as O&M contractor. The plant is expected to export its first power in 2017.
Anthesi’s commercial due diligence team conducted the waste wood feedstock market, anchor feedstock supplier and supply chain evaluation on behalf of the developer.
CoGen, formed in August 2014 through the merger of two leading players in the renewables sector, O-Gen UK and Carbonarius, has in construction over 50 MW of gross generation capacity from UK wood gasification plants and is currently in the process of developing a further six projects totaling 80 MW of gross generation capacity which are anticipated to reach financial close prior to the end of 2016. CoGen reports it is interested in talking to other developers about their plans with a view to offering assistance if required.
Bioenergy Infrastructure Group (“BIG”) is a new independent power producer established to invest in the greenfield construction of biomass plants in the UK.
Peel Environmental brought forward and consented to the Protos development, previously known as Ince Resource Recovery Park.
Lynemouth Project Receives Green Light
European Commission has concluded that UK support for the conversion of the Lynemouth power station from coal to biomass complies with EU state aid rules. The Commission found that the project will further EU environmental and energy goals without unduly distorting competition.
In December 2014 the UK notified of plans to subsidize the conversion of the coal-fired Lynemouth power plant to biomass. The plant would be able to generate 420 MW of electricity running exclusively on wood pellets. The UK Government intends to support the project in the form of a premium paid on top of the market price of the electricity generated (a so-called “Contract for Difference”). The project will receive aid until 2027 and, according to UK estimates, will generate about 2.3 TWh of low-carbon electricity per year. The plant is due to use approximately 1.5 million tonnes of wood pellets per year, mainly sourced from the U.S., Canada and Europe.
The Commission opened an in-depth investigation in February 2015 to assess whether the terms and conditions of the UK support, and in particular the financial calculations and estimates regarding key cost parameters, would avoid overcompensation. In light of the comments received from interested third parties as well as detailed technical information submitted by the UK, the Commission is now satisfied that the submitted parameters are robust and present no risk of overcompensation.
The Commission’s investigation also did not find any evidence of market distortion in the global wood pellets market. Finally, it is satisfied that the measures will not lead to undue distortions of competition in the market for other wood-based products.
On the basis of this analysis the Commission concluded that the project’s contribution to the European renewable energy and CO2 emissions reduction targets clearly outweighs any potential distortions of competition that could be triggered by the state support.
Lynemouth plant is one of several projects selected under the Final Investment Decision Enabling for Renewables (FIDeR), a UK support measure for renewable energy projects. In January 2015, the Commission approved construction of the Teesside combined heat and power biomass plant.
Pinnacle Pellet Plant Gears Up
Minister of Forests, Lands and Natural Resource Operations, Steve Thomson, Vernon-Monashee MLA Eric Foster, District of Coldstream Mayor Jim Garlick, and representatives from Pinnacle Renewable Energy Inc. and Tolko Industries gathered in Lavington, BC to celebrate the grand opening of Lavington Pellet Limited Partnership’s wood pellet production plant.
Employing both low temperature European belt drying and Cyclofilter technology, the plant, a $47 million investment on the part of Tolko Industries Ltd. and Pinnacle Renewable Energy Inc., is a showcase for state-of-the-art emissions control technology at a scale not previously seen in the North American wood pellet industry, according to the participants.
Following the ceremony, attendees toured the facility which began commissioning on September 28 and saw its first pellets produced on October 1.
Leroy Reitsma, president and COO of Pinnacle Renewable Energy Inc., is optimistic for the future of the plant. “When we started this project, we were looking at ways to take pellet production to a new standard of environmental stewardship,” he said. “From what we have seen of the new technology, we are right on target. We are extremely pleased with the work of the project team, suppliers and contractors who delivered this project safely, on-time and on-budget, and are happy to see this facility making a positive contribution to the local economy, the value of sawmill residuals within the region, the local environment and the global effort to address climate change. This facility represents a major forward step in the technology used in wood pellet production and we are very pleased to have been able to partner with Tolko Industries in this shared vision.”
Brad Thorlakson, president and CEO of Tolko Industries, echoed Reitsma’s comments saying: “This is a good project for the community and the Tolko mill in Lavington. In addition to creating new jobs, the pellet plant provides an environmentally compatible outlet for the sawdust and shavings that collect at the site, and other locations in the area. This, combined with our significant investment to upgrade the bag house filtration system at the Lavington mill, will help reduce fugitive dust in the area.”
Enviva Launches Conservation Fund
Enviva Holdings, the world’s largest producer of wood pellets, has established the Enviva Forest Conservation Fund, a $5 million, 10-year program designed to protect tens of thousands of acres of bottomland forests in northeast North Carolina and southeast Virginia.
The Enviva Forest Conservation Fund, administered by the U.S. Endowment for Forestry and Communities, will award matching-fund grants to nonprofit organizations to permanently protect ecologically sensitive areas and conserve working forests. The $5 million fund will focus on the Virginia-North Carolina coastal plain, an area that is home to three wood pellet production facilities and a deep-water marine terminal owned by Enviva.
“With the launch of the Enviva Forest Conservation Fund, Enviva will work with leading conservation organizations to identify areas of special concern and provide grants to permanently conserve thousands of acres of this forestland,” says John Keppler, chairman and CEO of Enviva. “Enviva has always believed there are special places in the forest that should remain so. For instance, we have never harvested nor have we accepted wood from old-growth forests.”
In addition to the sizable grant program, the Enviva Forest Conservation Fund is underpinned by two bottomland forest stewardship pillars that expand Enviva’s commitment to protecting the region’s forests and environmentally sensitive areas:
First, the Endowment has identified four specific types of sensitive bottomland forest ecosystems through consultation with leading independent academic and environmental organizations. These areas will be priority conservation targets for the Enviva Forest Conservation Fund.
Second, the Endowment will appoint a science-based review team to develop enhanced forestry practices for working bottomland forests, building on the generations-old tradition of sustainable forestry for these lands. This “blue-ribbon committee” will recommend specific additional measures to define and protect sensitive areas, which Enviva will incorporate into its wood supply practices.
“Southern forests help clean our water, shield us from storms, and serve as home to many species of wildlife, while at the same time providing jobs and economic opportunity for rural families and private landowners,” says Carlton Owen, the U.S. Endowment’s president and CEO. “The Enviva Forest Conservation Fund will permanently protect some of the most sensitive bottomland forests in Virginia and North Carolina and will improve the sustainable management of others. We are especially pleased to be working with Enviva to advance these important goals.”
The Enviva Fund will focus on about 35 North Carolina and Virginia counties that include about 6 million acres of forests of all types. Of this total, about 20% are bottomland forests.
To prioritize grant-making opportunities for the Enviva Forest Conservation Fund, the Endowment identified four distinct ecosystems worthy of conservation: cypress-tupelo swamps, Atlantic white cedar stands, pocosins and Carolina bays. In developing its recommendations, the Endowment consulted with a range of other organizations, including state forestry agencies in Virginia and North Carolina, the U.S. Forest Service, U.S. Fish & Wildlife Service, Natural Resources Conservation Service, and land trusts in both states.
Weyco, Plum Creek Form Timber Giant
Weyerhaeuser Co. and Plum Creek announced a merger that will leave nearly two-thirds majority ownership in Weyerhaeuser shareholder hands. The combined company creates a $23 billion timber REIT (Real Estate Investment Trust) with more than 13 million acres of timberland in the U.S.
Weyerhaeuser brings 6.9 million acres and Plum Creek 6.3 million acres to the deal. The combination becomes the largest private timberland owner in the U.S. and encompasses 7.3 million acres in the South (56% of company land), 3 million in the Pacific Northwest (22%) and 2.6 million in the North (20%). The new venture will also own 323,000 acres in Uruguay.
The combined company will retain the Weyerhaeuser name. As previously announced, Weyerhaeuser intends to move its headquarters to Seattle in mid-2016.
Pellet Industry Doesn't Threaten South
The U.S. export of industrial wood pellets to meet renewable energy goals in the European Union is not a threat to the sustainability of U.S. Southern forests, according to a report commissioned by the U.S. Endowment for Forestry and Communities, National Alliance of Forest Owners (NAFO) and the U.S. Industrial Pellet Assn. (USIPA), and conducted by independent forest analysts and economists using U.S. government and marketplace data.
“This report puts to rest concerns that wood pellet export markets pose threats to the sustainability of U.S. Southern forests or the viability of other forest products manufacturers,” says Carlton Owen, president and CEO, U.S. Endowment for Forestry and Communities.
The report indicates that industrial pellet exports represent a very small part of forest harvests in the U.S. South and will continue to do so into the future. The findings include:
-
- In 2014, pine removals for industrial pellet production totaled 3.7 million tons or 0.3% of the pine pulpwood inventory and 0.09% of the total pine inventory.
- In 2014, hardwood removals for industrial pellet production totaled 2.4 million tons or 0.2% of the hardwood pulpwood and 0.06% of the total hardwood inventory.
- In 2014, pellet exports from the U.S. South to Europe, which represent the vast majority of U.S. pellet exports, were 3.6 million metric tons, or 40% of Europe’s 9 million metric ton industrial pellet consumption.
- Future industrial demand for U.S. pellets overseas represents 0.3% of total forest inventory in the U.S. South.
Realistic demand and market share outlooks show that U.S. industrial exports of biomass pellets to Europe could eventually rise to 10.8 million metric tons. Annual removals to meet this demand would total 25 million tons, which represents 1.0% of pulpwood inventory and 0.3% of total forest inventory in the South.
Dave Tenny, NAFO president and CEO, comments: “This report should put any concerns about the fate of our Southern forests to rest and allow landowners to continue doing what they do best—stewarding our forests to provide forest products and renewable energy while contributing to cleaner air and water and more abundant wildlife habitat.”
The report, Wood Supply Market Trends in the US South: 1995 – 2015, is available at www.nafoalliance.org/images/issues/pellets/Forest2Market_USSouthWoodSupplyTrends.pdf
^ Top