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INSIDE: ADVANCED BIOFUELS WORKSHOP & TRADE SHOW REVIEW December 2008
The Next Hot Commodity? The Increase in the Global Trade of Woody Biomass Has Prompted the Development of a Commodity Exchange Program
Call for Abstracts Now Open! Submission Deadline: January 9, 2009
June 15 – 18, 2009 Denver Convention Center D e n v e r , C o l o r a d o, USA
For more information or to submit an abstract visit:
www.fuelethanolworkshop.com 2 BIOMASS MAGAZINE 12|2008
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FEATURES ..................... 22 INDUSTRY Reinventing the Mill Downsizing and closures have plagued the pulp and paper industry as it contends with high energy costs, foreign competition and a weak economy. The situation has prompted some companies to install biomass boilers and gasification systems, and others to consider the biorefinery route. By Anna Austin
28 FINANCE The Next Hot Commodity? Heartland Business Consultants is coordinating an effort in the United States to create a commodity exchange program for biomass. The Biomass Commodity Exchange is expected to be in operation by the end of next year. By Ryan C. Christiansen
34 PROJECT Using Biomass to Weather Colorado Winters The town of Oak Creek, Colo., is considering establishing a biomass-powered district heating system to combat high energy costs. By Jerry W. Kram
40 EVENT Biofuels Advance
DEPARTMENTS ..................... 07 Advertiser Index
The topic of much discussion at the Advanced Biofuels Workshop & Trade Show was the Energy Independence & Security Act of 2007, which has laid the groundwork for the development of biomass-based fuels. By Bryan Sims
46 CANADA Bioenergy in Action European biomass-to-energy companies have a lot to offer their colleagues across the pond. The worldwide industry's willingness to exchange ideas was on display at the Canadian Bioenergy Association's annual event. By Crystal Luxmore
08 Editor's Note A Cautionary Tale By Rona Johnson
10 CITIES Corner Building a 'Bioshed' Analysis By Tim Portz
13 Industry Events 14 Business Briefs 16 Industry News 53 EERC Update Renewable Hydrogen: Biomass for Sustainable Hydrogen Transportation Fuel By Chris Zygarlicke
54 Marketplace
Correction from our November 2008 issue: The Industry News story on page 18 titled "Romanian power plant to utilize MSW" incorrectly stated CoFAMM's municipal-solid-waste (MSW) gasification plant had a capacity of 20 megawatts per year. It's capacity is 20 megawatts per hour. Likewise, each of the four modular gasification units will generate six megawatts of electricity per hour, not six megawatts per year.
Views from the Auto Industry, Government and Academia... Feedstock Infrastructure: Another Gathering Storm... Thinking Outside the Lunch Box: Perennial Bioenergy Feedstocks that will be Viable on Land Unsuited to Food Crops... Biofuels and Bioenergy: Can They Change Energy Access in the Developing World? These are just some of the topics to be covered at Keystone Symposia's first-ever conference on:
Speakers Frances H. Arnold, California Institute of Technology Steven Chu, Lawrence Berkeley National Laboratory Jason Clay, World Wildlife Fund Bruce E. Dale, Michigan State University James A. Dumesic, University of Wisconsin-Madison Richard B. Flavell, Ceres, Inc. Jose Goldemberg, University of São Paulo Mark Huntley, University of Hawaii at Manoa Lonnie O. Ingram, University of Florida Coleman Jones, General Motors Jay D. Keasling, UC Berkeley Melinda L. Kimble, United Nations Foundation Steven E. Koonin, BP Stephen P. Long, University of Illinois Lee Rybeck Lynd, Dartmouth College John Manners, CSIRO Plant Industry John Pierce, DuPont Applied BioSciences – Technology Scott Power, Genencor International Inc. Thomas Richard, Pennsylvania State University Chris R. Somerville, Energy Biosciences Institute
Submit an Abstract Additional short talks will be selected based on abstract submission.
Last Abstract Deadline: Jan. 7, 2009 Early Registration Deadline: Feb. 4, 2009
supported by:
The Future of Biofuels April 4-8, 2009 Snowbird, Utah A meeting bringing the best minds to bear on the key questions and offering an unparalleled opportunity to interact with leading scientists in this field. Plenary Sessions: • The Biofuels Value Chain – Needs vs. Wants • Next-Generation Advanced Biofuels • Biofuel Feedstock Choices and Modifications • Enablement of Cellulosic Fuels • Novel Fermentation-Based Strategies • Visions for the Future of Biofuels Workshops: • Current Technological Trends • Regional Challenges for Biofuels Keynote Session, Saturday, April 4, 2009 on "NGO Perspective on Biofuels" with: • Melinda L. Kimble, United Nations Foundation • Jason Clay, World Wildlife Fund Organizers: William D. Provine, DuPont Company; Doug Cameron, Piper Jaffray & Co; Chris R. Somerville, Energy Biosciences Institute; Jay D. Keasling, UC Berkeley
To register and for more information, please visit www.keystonesymposia.org/9D4 or call 1-800-253-0685 or 1-970-262-1230. Founded in 1972 as UCLA Symposia, Keystone Symposia is a Colorado, USA-based non-profit that organizes more than 50 open, international conferences per year on the latest advances around key topics in the biological sciences. Conferences are planned through a rigorous peer review process and typically feature a mix of plenary sessions, workshops, poster sessions and afternoon free time to maximize the chance for the stimulating debate and interaction that generate new ideas to catalyze scientific advances.
advertiser INDEX
2009 Canadian Renewable Energy Workshop 50
MANAGING EDITOR Jessica Sobolik firstname.lastname@example.com
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2009 International Biomass Conference
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BBI International Community Initiative To Improve Energy Sustainability (CITIES)
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NOTE A Cautionary Tale
ow that the presidential election is over, we can finally get back to business. I just hope President-elect Barack Obama understands how important biomass is to this country's energy future. Yes, gas prices are down for the time being, but we shouldn't forget the pain everyone suffered when crude oil soared to more than $100 a barrel because it will probably happen again. Speaking of pain, one of the features in this month's magazine, called "Reinventing the Mill," is about the pulp and paper industry. The story details how the pulp and paper industry has been pounded by high energy costs, low-priced imports and the weak economy. To make matters worse, wood prices have increased in response to high energy costs. This should remind all of us that the biomass industry needs to proceed with caution. I am a firm believer in making good use of all of our biomass resources, but we need to be careful not to put those resources in jeopardy or drive the prices up so high that fossil fuels look like a bargain. Although I don't have any profound ideas on how to avoid such situations, I'm sure there are intelligent people out there who have more economic sense. As I've often told people, I'm a journalist, not a rocket scientist, mathematician or economist. Although the "Reinventing the Mill" feature seems grim, there is a silver lining. Pulp and paper mills have the potential to become biorefineries, which would allow them to produce a variety of products, including biofuels, and to offset input costs by producing electricity. As you read the feature, pay particular attention to the projects that have received U.S. DOE funding. Our staff writers will be keeping track of these projects as they progress, and hopefully they will be successful and serve as a model for others.
Rona Johnson Features Editor firstname.lastname@example.com
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CITIES corner Building a 'Bioshed' Analysis
am fascinated by information and how it's presented. I have an affinity for maps, charts and graphs. Recently, I came across a collection of information that benefits communities and regions seeking to increase economic activity—the laborshed analysis. A laborshed analysis is developed to identify the makeup of the labor force in a certain jurisdiction, including the size of the local workforce, the distribution of that workforce across various industries, typical benefits offered in the area, education levels, wages, underemployment levels and much more. This information is gathered, organized and available to economic development professionals, who are tasked with attracting new industries and employers to their area. The idea is that the more potential employers know about the area's labor force, the easier it is to attract them. The most impressive aspect of the laborshed analyses is that it contains everything a prospective employer would want to know without the fluff. Cities and counties would be wise, indeed some have already begun, to make sure all of the various resources under their umbrellas are as completely understood and succinctly expressed as their labor resources, especially biomass. As we derive more energy and products from biomass, those cities, counties and regions that understand their biomass resources will be more likely to attract economic development activity. The National Renewable Energy Laboratory produced a biomass density map of the United
States in September 2005 and my home state of Iowa was identified as rich in biomass resources, as were several other areas of the country. How then do cities, counties and regions elevate themselves to attract development activity or better yet, encourage development from within? A document similar to a laborshed analysis outlining the biomass resources in a given area could help economic developers across the country to reach their goals. A document detailing crop residues, manure streams, industrial wastes, municipal solid wastes, wastewater treatment loads, existing landfills and woody biomass could equip economic development professionals with the information they need to attract development, regardless of the technologies that emerge to best harness the energy bound up in these biomass resources. Once these biomass resources are thoroughly understood and expressed, the entrepreneurial spirit of local producers and entrepreneurs can be unleashed and the wheels of commerce can begin to turn. Tim Portz is a business developer with BBI International's Community initiative to Improve Energy Sustainability. Reach him at tportz@bbiinternational .com or (651) 398-9154.
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www.EthanolProducer.com 11|2008 BIOMASS MAGAZINE 11
industry events Phase II of Renewable Energy in America National Policy Forum
Biogas 101 for Electricity and Heat
December 3-4, 2008
Ritz-Carlton Orlando, Grande Lakes Orlando, Fla. This course will provide in-depth technical and practical information for the capture and conversion of biogas into usable energy. It will examine successful landfill-gas-to-electricity projects, anaerobic digestion systems and wastewater plant projects. Attendees will also be able to tour the Orange County Solid Waste Facility. (303) 770-8800 www.euci.com/conferences/1208-biogas-101
Capitol Hill Washington, D.C. This seventh annual event will focus on the new U.S. president and Congress, and how they will affect energy policy issues, including renewable energy, energy efficiency, sustainable development, the environment and other fields. Speakers will address the state of renewable energy policy today, present a range of policy options and make recommendations for the new administration's policy framework. (202) 393-0001 www.acorephaseii.com
December 8-9, 2008
Waste to Energy: International Exhibition & Conference for Energy from Waste and Biomass
Carbon Markets North America
December 10-11, 2008
Miami Carbon emission regulations will be part of the renewable fuels standard that will regulate future advanced biofuel use in the United States. A leading panel of carbon market experts will inform attendees how to prepare for a carbon-constrained economy at this second event. It will detail how current emissions trading systems are creating business opportunities, fostering innovation and influencing global finance. + 44-20-7251-9151 www.environmental-finance.com/ conferences/2009/Miami09/intro.htm
Bremen Exhibition & Conference Centre Bremen, Germany This fourth annual event will discuss waste as a resource for the production of biogas, biofuels and more. Agenda topics will include material flow management, separation and sorting, residues, shredding and grinding, power and biogas plants, and landfill gas. +49-421-3505-347 www.wte-expo.com
January 15-16, 2009
Renewable Energy Technology Conference & Exhibition
Canadian Renewable Energy Workshop
February 25-27, 2009
Regina Inn Hotel and Conference Center Regina, Saskatchewan This second conference facilitates the continued development of Canada's renewable energy industry. More information will be available as the event approaches. (888) 501-0224 www.crew2009.com
Las Vegas Convention Center Las Vegas This event includes a business conference, a trade show and several side events. The business conference will address the status and outlook of renewable energy. Breakout sessions will focus on biomass and biofuels, among others. The biomass and biofuels sessions will address sustainability, feedstocks, financing, ethanol production technology, biobased products, biopower and biorefineries, among other topics. (805) 290-1338 www.retech2009.com
March 10-12, 2009
International Biomass Conference & Trade Show
International Fuel Ethanol Workshop & Expo
April 28-30, 2009
June 15-18, 2009
Oregon Convention Center Portland, Ore. This event, sponsored by BBI International Inc., will address the latest technologies and business considerations for bioenergy projects. Breakout session topics will include cellulosic ethanol, biopower, ag and wood waste, next-generation biofuels, anaerobic digestion and biogas, biobased chemicals and coproducts, biomass gasification, water issues, project finance, and permitting. Attendees will also be able to tour the Columbia Wastewater Treatment Plant, the Cornelius Summit Foods ethanol plant and the Beaverton Material Recovery Facility. (701) 746-8385 www.biomassconference.com
Denver Convention Center Denver This will mark the 25th anniversary of the world's largest ethanol conference, which was recently recognized by Trade Show Week magazine as one of the fastest-growing events in the United States for the second consecutive year. Abstract presentations will be accepted until Jan. 9. The event will address conventional ethanol, next-generation ethanol and biomass. More details will be available as the event approaches. (701) 746-8385 www.2009few.com
Sanimax, StormFisher partner
Mitsubishi enters pellet market
Canadian companies Sanimax and StormFisher Biogas have announced a joint venture to construct eight biogas plants in the U.S. Midwest, including an investment of more than $160 million. Each of the facilities will generate 2.6 megawatts of electricity, enough to power approximately 2,600 homes annually. A construction schedule wasn't available at press time. The plants will process food byproducts from local facilities, such as schools and restaurants, to generate the electricity, as well as natural gas. BIO
Mitsubishi Corp., Japan's largest general trading company, has acquired 45 percent interest in Vis Nova Trading GmbH, a German biopelleting business. Vis Nova Trading currently supplies 180,000 tons of wood pellets annually to electric power companies in the European Union and plans to build additional factories that would increase pellet output to 500,000 tons annually. Mitsubishi invested €5.63 million ($8.2 million) in Vis Nova Trading and intends to be actively involved in the company's management. BIO
Aviation companies form sustainable fuels group Pratt & Whitney Rocketdyne partners with Exxon Mobil Pratt & Whitney Rocketdyne Inc., a United Technologies Corp. company, has partnered with Exxon Mobil Research and Engineering Co. to develop, demonstrate and license compact coal or biomass gasification technology that results in synthesis gas. Pilot plant activities will take place at the Gas Technology Institute in Des Plaines, Ill., and feed system and dry solids pump tests will occur at the Energy & Environmental Research Center in Grand Forks, N.D. The companies will also collaborate on licensing the technology to third parties. BIO
The Boeing Co. and UOP LLC, a Honeywell company, have joined several airlines, the World Wildlife Fund and the Natural Resources Defense Council in a sustainable fuels initiative called the Sustainable Aviation Fuel Users Group. The airlines include Air France, Air New Zealand, All Nippon Airways, Cargolux Airlines International S.A., Gulf Air, Japan Airlines, KLM Royal Dutch Airlines, Scandinavian Airlines and Virgin Atlantic Airways. In addition to its members signing a sustainability pledge, the group's first projects will assess the adherence of algae and jatropha to its sustainability criteria. BIO
Auburn University selects PureVision technology The Auburn University Center for Bioenergy and Bioproducts is acquiring a rapid biomass fractionation unit developed by Colorado-based PureVision Technology Inc. to use in its research on biochemical and thermochemical conversion processes. PureVision's continuous process employs a countercurrent extraction technique that removes and recovers hemicellulose and lignin fractions in two liquid streams, leaving a solid fraction containing a relatively pure cellulose or fiber. PureVision expects its continuous pilot plant in Fort Lupton, Colo., to be operational in December. BIO
Jeffrey Rader wins contract, changes name Jeffrey Specialty Equipment Corp. and Rader Co. Inc., biomass equipment suppliers that plan to merge in January to become Jeffrey Rader Corp., will supply four identical biomass utility boiler feed systems to the 585-megawatt Virginia City Hybrid Energy Center in Virginia City, Va. Once operational, the feed systems will convey more than 195 tons of wood chips and forest waste wood per hour. Delivery of the systems components will begin in 2010. Start-up is slated for 2011. BIO
BRIEFS Green plastics from sugarcane Braskem SA in Brazil has partnered with Toyota Tsusho Corp. in Japan to produce and market renewable polyethylene made from sugarcane. Braskem will produce the plastic at a new facility built at its existing industrial site in Tuiunfo, Brazil. Toyota Tsusho will market the plastic throughout Asia. Braskem was the first company in the world to have its polyethylene certified as being 100 percent biomass-based. In October, Braskem also produced certified biomass-based polypropylene for the first time. BIO
Lignol, Weyerhaeuser sign agreement Lignol Energy Corp. in Burnaby, British Columbia, and Weyerhaeuser Co. in Federal Way, Wash., have signed a memorandum of understanding to explore the development of commercial cellulose fiber and biochemical applications, such as industrial adhesive or carbon fiber production, that would use the cellulose fiber and high-purity lignin produced in Lignol's biorefining process. Weyerhaeuser feedstocks are being tested at Lignol's pilot-scale plant in Burnaby to determine whether to build a commercial-scale biorefinery at or near a Weyerhaeuser mill site. BIO
Helius Energy picks plant site
U.K.-based Helius Energy PLC recently signed an optionto-lease agreement for an 18-acre site located at Avonmouth Dock along Great Britain's Bristol Channel for a proposed 100-megawatt biomass power plant. The agreement followed RWE Innogy's acquisition of full development and operation rights to Helius Energy's 65-megawatt biomass power plant to be built in North East Lincolnshire, U.K. BIO
Debris from Hurricane Ike is compiled at a collection center in Houston.
Green Energy Resources to utilize hurricane wood New York-based Green Energy Resources is working with the U.S. Department of Homeland Security's Federal Emergency Management Agency to acquire hurricane debris from southeast Texas, following the landfall of Hurricane Ike in September. The company will purchase waste wood with diameters of two inches or more collected by FEMA contractors, but not wood waste from other sources, such as damaged buildings. By taking the wood in log form, the company will be able to produce wood chips as clients need them. BIO
Pennsylvania awards biomass energy grants The Pennsylvania Energy Development Authority has approved more than $2.2 million in grants for statewide biomassrelated projects. Four companies and a school district received funds ranging from $150,000 to $1 million to install biomass-fed boilers, and to build facilities that will pelletize wood and convert biomass into biochar. Another project involves the construction of a 12-megawatt biomass-fed power generation facility. The funds are dependent on a $500 million state bond issue that was approved by Pennsylvania's General Assembly earlier this year. The official bond issue is expected in 2009. BIO
Wiselogel creates consulting firm Art Wiselogel, a longtime participant in the biofuels industry, has created A Wise Renewable Energy Consulting LLC. The firm will focus on biomass resource assessments, technical evaluations of biomass-based renewable energy technologies, and various business analyses and reports. Wiselogel has 30 years of experiWiselogel ence in biofuels, agronomy and forestry as a scientist, project manager and analyst. He previously worked with BBI International Inc., the U.S. DOE National Renewable Energy Laboratory, the University of Georgia and Texas A&M University. BIO 12|2008 BIOMASS MAGAZINE 15
NEWS Two recently passed pieces of legislation are poised to benefit the biomass industry. More widely known as the U.S. economic "bailout package," the Emergency Economic Stabilization Act of 2008 also extends various renewable energy and biofuels tax credits. Signed into law Oct. 3, the act extends the tax credit for producing electricity from closed-loop or open-loop biomass facilities through 2010. In addition, "cellulosic biofuels" are now included within the definition of biomass ethanol plant property for purposes of the bonus depreciation allowance. This extends bonus depreciation to property used to produce cellulosic biofuels in general, rather than just cellulosic ethanol. The bailout package also extends the alternative fuel credit and the alternative fuel mixture credit though 2009. This includes compressed or liquefied biomass gas and all types of qualifying fuels sold for use in
Bailout package benefits biomass industry
Wood waste from national forests is not currently included in the definition of "woody biomass" listed in the Energy Independence & Security Act of 2007.
aviation. Certain carbon capture requirements must be met by gasification facilities to qualify for the credit.
Another bill—the Consolidated Security, Disaster Assistance and Continuing Appropriations Act of 2009—was signed into law Sept. 30. This legislation could offer potential benefits to biomass companies working with wood waste. It includes an allowance of $175 million for the U.S. Forest Service to use in removing wood determined to be "hazardous fuel" in areas of the country that are prone to wildfires. Although woody biomass from national forests isn't currently included in the definition of "woody biomass" contained within the Energy Independence & Security Act of 2007, Sen. John Thune, R-S.D., is working to pass legislation to change the definition. This legislation failed to pass in 2008. However, Thune is expected to continue working on revising the definition of woody biomass in 2009. -Erin Voegele
EPA creates renewable energy remediation site map In an effort to promote new uses for contaminated lands throughout the United States, the U.S. EPA has created a comprehensive Web site detailing thousands of locations that could become renewable energy production sites. The interactive maps and related information can be found at www.epa.gov/renewablenergyland. EPA Environmental Scientist Penelope McDaniel said response to the project has been extremely positive. The Web site received more than 20,000 hits in its first month, and the agency has fielded a number of inquiries from interested parties. "That's the first step: getting the developers interested," she said. The Web site is the result of approximately three months of cooperative work between the EPA and the U.S. DOE National Renewable Energy Laboratory. The agencies began by compiling a database of abandoned Maps on the EPA's new Web site indicate where and what type of contaminated sites could be mine lands; Resource Conservaused for renewable energy production. tion and Recovery Act sites; and SOURCE: U.S. EPA
Superfund sites. Once the massive list was created, sites with workable acreage were extracted and then compared against a list of specific criteria to determine each site's potential for renewable energy production. Criteria for a site's biomass potential included: Distance to electric transmission lines: 10 miles or less Property size of 50 acres or more Distance to graded roads: 50 miles or less Biopower: Cumulative biomass sources of at least 150,000 tons per year, including residues from crops, forests and mills; landfills; urban wood waste; and energy crops Dry-grind corn-based ethanol: Crop biomass residue of at least 100,000 tons per year More than 9,500 sites were scrutinized for the EPA project, and nearly 9,000 of those sites were deemed "outstanding" for biopower potential. Interested parties are encouraged to visit the Web site or e-mail the EPA for more information at firstname.lastname@example.com. -Kris Bevill
NEWS Xcel Energy to switch third boiler to biomass Xcel Energy is on track to convert the last remaining coal-fired unit at its Bay Front Power Plant in Ashland, Wis., to a biomass gasification system. The conversion, estimated to cost between $55 million and $70 million, will allow the facility to use 100 percent biomass in all three boilers. Xcel Energy announced in October that it will submit an application to the Public Service Commission of Wisconsin. If approved, the company said it expects the engineering, design and construction work on the third boiler to begin in 2010 and finish in late 2012. The gasification system will convert biomass to synthesis gas to be used as fuel in the boiler. Compared with coal, the biomass boiler is expected to reduce emissions of nitrogen oxides by 50 percent, sulfur dioxides by more than 85 percent and particulate matter by 90 percent, the company said.
The Bay Front Power Plant has been burning wood waste to generate electricity since 1979, using more than 4 million tons during its lifetime. The biomass used at Bay Front is primarily wood waste from area forest harvest operations supplied by local independent contractors. According to Xcel Energy, the plant currently uses just over 200,000 tons of wood waste each year. When the project is complete, the plant will use an additional 185,000 to 250,000 tons of wood waste annually. The boilers at the Bay Front facility can burn a variety of things, including wood waste, railroad ties, discarded tires and natural gas, to produce steam to drive turbine generators that produce electricity, the company said. The power plant has a $20 million annual economic impact on a six-county region around Ashland. Xcel Energy currently generates 11 percent of its electricity in Wisconsin from
renewable resources and plans to reduce carbon dioxide by 22 percent from 2005 levels in its Midwest generation system by 2020, according to Dick Kelly, president and chief executive officer of Xcel Energy. An April 2007 report by the Energy Center of Wisconsin determined that forests within 50 miles of the plant could support additional biomass removal without adverse impacts to the local ecosystem. An estimated 860,000 tons of harvest residues are generated each year. Most forest administrators and owner representatives indicated that additional removal and chipping of residues, especially tree tops, would be a welcome activity for their forest operations, according to the report. -Susanne Retka Schill
USDA uses new technology to produce syngas from manure lated to the fact that the um-based metal catalyst wet gasification system for the technology, the is still in the research USDA said. Ruthenium and development stage. is used in platinum and Additional catalyst repalladium alloys for search might substanwear-resistance and in tially lower capital costs titanium alloys for corrofor wet gasification, the sion resistance. Under processing This wet gasification system converts USDA said. The advantages of conditions of 662 degrees wet livestock manure slurry directly into synthesis gas in as little as 15 minutes. using wet gasification Fahrenheit, wet gasificaover anaerobic digestion tion destroys pathogens, odor-generating organic compounds and are that oxygen-demanding wastes, estrohormones in as little as 15 minutes, which gens and odorous compounds are removed is exponentially quicker than the days and during gasification, and pathogens are tomonths required to process manure using tally killed, the USDA said. Most of the anaerobic digestion, the USDA said. How- nitrogen can be recovered as ammonia for ever, the USDA estimates that the annual- fertilizer, and the water byproduct can be ized costs for a wet gasification system, in- treated to provide livestock with drinking cluding both capital and operating costs, is water. $375 per animal unit compared with $85 to -Ryan C. Christiansen $95 per animal unit for an anaerobic digestion system. Most of the higher cost is rePHOTO: USDA
Researchers at the USDA Agricultural Research Service Coastal Plains Soil, Water and Plant Research Center in Florence, S.C., are developing a new technology dubbed "wet gasification� to convert wet livestock manure slurry directly into synthesis gas without pretreatment. According to the USDA, the main feedstock characteristic requirement for wet gasification is that it must be pumpable as a liquid, which means that swine and dairy manures with 85 percent to 95 percent moisture content can be fed directly into the system. Other feedstocks, such as poultry litter or municipal solid waste, would need to be pretreated with a certain amount of water before they could be gasified in this way. It's also possible to mix wet and dry waste feedstocks to increase the moisture content of the overall mixture, thus making it pumpable. The U.S. DOE Pacific Northwest National Laboratory is developing a rutheni-
NEWS DOE funds bio-oil stabilization projects In early October, the U.S. DOE announced it had awarded up to $7 million in funding to U.S. research organizations and institutions of higher education to support research and development of the stabilization of biomass fast-pyrolysis oils. The funding serves to support the goals established in the Energy Independence & Security Act of 2007 for advanced biofuels and DOE production targets. Biomass pyrolysis oil, commonly referred to as bio-oil, is made from secondgeneration feedstocks such as agricultural and forestry residuals. The DOE defined the act of stabilizing bio-oil to include removing char, lowering the oxygen content, and reducing the acidity of pyrolysis oil because it's naturally corrosive, unstable and difficult to transport. When the stabilization of bio-oil is successful, it could be used at petroleum refineries as a feedstock that is greenhouse-gas-neutral, renewable and domestically produced.
Five funding recipients have been selected to date, including Illinois-based UOP LLC, a Honeywell International Inc. subsidiary that has partnered with Ensyn Corp., the National Renewable Energy Laboratory, the Pacific Northwest National Laboratory, Pall Corp., and the USDA Agricultural Research Service's Crop Conversion Science and Engineering Research Unit. The group's project is centered on the development of a commercialized nextgeneration technology to refine bio-oil for use in power generation, as a heating fuel and eventually as a transportation fuel. North Carolina-based research institute RTI International will also receive funding for its proposal that primarily aims to develop highly active and stable catalysts for the stabilization of bio-oil, potentially resulting in a condensed bio-oil intermediate that has physical and chemical properties adequate for use as liquid transportation fuels in existing petroleum refineries
or in standalone, centralized upgrading facilities. Three universities will also receive funding. Virginia Polytechnic Institute proposed research involving the development of a pyrolysis technology that produces a stable bio-oil, including reactor modeling with computational fluid dynamics on a supercomputer and advanced kinetic analyses for the optimization of bio-oil production. Iowa State University proposed a project to develop practical, cost-effective methods of stabilizing bio-oil for storage under ambient conditions. The University of Massachusetts-Amherst proposed a project to develop economical technologies for the production of stable bio-oil with a low char content and a neutral pH by using a combination of membrane and catalytic technologies. -Erin Voegele
Siemens, USDA seek improved biomass conversion Thermochemical methods of processing solid organic matter such as biomass or coal have been around for more than 100 years, but creating a system that completes the process economically and efficiently has been a significant engineering challenge. Siemens Energy and Automation Inc., a manufacturer of electrical and electronic products, is partnering with the USDA's Agricultural Research Service to improve the conversion of lignocellulosic biomass into liquid biofuel intermediates, such as bio-oil. "This investment in the future of second-generation feedstocks is another example of Siemens' commitment to alternative fuel development and production," said Dave Hankins, vice president of Siemens Chemical and Pharmaceutical Center of Competence. "New feedstocks that can be quickly and easily processed will benefit the nation, and the biochemicals and biofuels industries." The ARS and Siemens have entered into a cooperative research and development 18 BIOMASS MAGAZINE 12|2008
agreement to explore the use of nonfoodbased materials for biofuel and biochemical production. "Siemens is a partner for technology," said Rich Chmielewski, the company's chemical and biofuels marketing manager. "What our partnership includes is providing the technology for them to do that research." As part of the agreement, Virginia-based Logical Innovations Inc., a partner of Siemens, will work with researchers at the ARS Eastern Regional Research Center in Wyndmoor, Pa. The company will install a distributed control system based on Siemens' Simatic PCS 7 Box technology on the ERRC's benchscale fluidized bed pyrolysis system. "We think distributed control will help accelerate second-generation biofuels and biochemicals development by improving the repeatability, consistency and efficiency of our research processes," said USDA ARS Research Leader Kevin Hicks. Siemens' technology will help control the reaction process by controlling variables
inside the reactor. This will allow researchers to have a repeatable environment where heat, pressure and other variables are automatically controlled. Controlling these variables will make it easier to compare the bio-oil produced from various biomass materials. "What we are really concentrating on is taking low-density biomass, having a consistent reaction and then being able to put it into this bio-oil form we can use," Chmielewski said. One goal of the research is to identify the best feedstocks suited for specific end products. The project is currently in the engineering phase. Chmielewski said it will be commissioned in January. The second step in the research agreement will involve a larger-scale fluidized bed pyrolysis system. That step is currently in the planning stages. "This larger system will have the added complexity of recycling and combusting all—or at least some—of the gases and charcoal," he said. -Jerry W. Kram
NEWS Affordable catalyst converts cellulose to ethylene glycol Researchers in the United States and China are working to develop a new catalyst that converts cellulose directly into ethylene glycol. The research team is led by Tao Zhang at the Dalian Institute of Chemical Physics in China and Jingguang Chen at the University of Delaware in Newark. The technology that the team is developing uses heat, pressure, and a catalyst made of tungsten carbide and nickel deposited on a carbon support to produce a mixture of polyalcohols from cellulosic biomass. The small amount of nickel in the catalyst improves the efficiency and selectivity of the catalyst system. According to Chen, the catalyst, which likely works through hydrolysis and hydrogenation reactions, converts 100 percent of the cellulose in biomass materials. Ethylene glycol accounts for approximately 61 percent of the polyalcohols created by the process. The chemical compound is an important intermediate in the chemical
Researchers in the United States and China are working to develop a new catalyst that will convert cellulosic biomass, such as switchgrass, directly into ethylene glycol.
C6 sugars, which can be further processed into hydrogen and chemicals. One benefit of the catalyst that Chen's team is developing is that it's affordable. To date, similar research has generally centered on precious-metal catalysts that would be too expensive to use in large-scale applications. In addition, the ability to convert cellulose directly into organic compounds is potentially faster and cheaper than splitting cellulose into individual sugar components, which can then be fermented. The research team is performing additional studies to better understand how the catalyst works. Chen said the next steps include improving the conditions of temperature and pressure, as well as identifying other promising catalysts. Several patents have been filed for the technology.
industry. It's used as an antifreeze or coolant, and is needed to produce polyester fibers and resins in the plastics industry. The remaining 39 percent of the polyalcohols are primarily
-Erin Voegele
Wood fiber: Cheaper, more available, but for how long? As cellulosic ethanol producers continue to ramp up for commercial production, careful attention is being paid to wood fiber markets, both by ethanol producers and the forest products industry. TheNorthAmericanWoodFiberReview reported third-quarter prices in the western United States had dropped 13 percent from the decade-high prices paid in the second quarter. An increase in supply after shortages earlier in the year can be attributed to the price drop, according to the report's publisher Wood Resources International. Supply remains tight in other areas of the country and is expected to be an issue in the near future. Pulp mills in Maine, for example, are reportedly importing logs from Canada and states bordering the Great Lakes due to a lack of local supply. Mills in the South are suffering from an interruption in supply due to an intensive hurricane season. It remains to be seen if lack of supply will equalize a predicted waning demand.
TheInternationalWoodFiberReport,published by forest products information provider RISI Inc., foresees demand for virgin wood fiber falling by up to 20 million green tons (a measure of undried biomass) in 2009. "With the housing market virtually dead in the water, and pulp and paper markets teetering under the weight of the general financial crisis, pulpwood demand could see unprecedented declines in most U.S. and Canadian markets," the report's Executive Editor Chris Lyddan said. The developing biomass industry might be a game-changer for wood fiber markets. RISI published a report earlier this year that explored the biomass industry's potential impact on wood fiber prices and determined that the increase in demand would most certainly lead to a rise in prices. This has caused concern among members of the forest products industry, even though many of them have begun utilizing biomass technologies themselves in order to cut operating costs.
Range Fuels Inc. Chief Executive Officer Mitch Mandich has no qualms about supply or feedstock prices for the company's future commercial-scale cellulosic ethanol facility in Georgia. "There is a huge abundance of woody biomass in the Southeast to support the existing industries that are already there," he said. Twenty paper/ pulp mills left the United States in the past decade not because of a lack of feedstock, but because labor and operating costs are cheaper elsewhere in the world, he added. Members of the forest products industry might be concerned about long-term price changes due to biomass industry demands, but Mandich thinks it's unwarranted. "I look at it over many years, and I don't see the potential impact on price," he said. "I don't understand the concern that might be out there with some of those in the industry." -Kris Bevill
NEWS New Zealand company converts wood to charcoal crop waste such as leaf the charcoal effectively and stalk byproducts keeps the carbon out from maize plantations, of the atmosphere and into charcoal. However, ocean for virtually inother biomass materials definite periods." may be utilized in the fuAccording to the ture. "Farm manure and company, the significance of its technol- Carbonscape's first sample of charcoal compost biomass are two other waste streams ogy is that in spite of created from microwaved wood debris identified as likely viable the energy used during production, the carbon captured during source materials for biochar production," the process draws down significantly more he said. "Both are currently planned for carbon dioxide from the atmosphere than it further examination by the company's reproduces; approximately one ton of carbon search team and academic partners in the dioxide can be transformed into charcoal near future. Ultimately, we're open to coneach day. The final charcoal product may be sidering any waste or byproduct source mareturned to the soil in the form of bio-char terials that are of primary sector origin, and to improve plant productivity and further demonstrated as viable in terms of energy balance and final charcoal. reduce greenhouse gases. Tyrrell-Baxter said initial considerations -Anna Austin have focused on converting wood waste from harvesting operations such as pruning and bark material, and common agricultural PHOTO: CARBONSCAPE LTD.
In a bid to produce charcoal from biomass for the sequestration of carbon dioxide, Marlborough, New Zealand-based Carbonscape Ltd. has developed a microwave technology capable of converting 40 percent to 50 percent of wood debris into charcoal. Dubbed "Black Phantom," the woodnuking process was described by Chief Science Officer Forrest Tyrrell-Baxter as an "energy-efficient, high-yielding, microwaveassisted pyrolysis." Carbonscape, established in 2006, produced its initial industrial-scale batch at its pilot plant on the South Island of New Zealand in early October. "We know from scientific studies that charcoal can store carbon for thousands of years," Company Director Chris Turney said. "Ancient fires preserved in archaeological sites show carbon can be stable for thousands of years. This is because charcoal is highly resistant to microbial breakdown. Once formed,
EPA funds Methane to Markets projects The U.S. EPA has awarded approximately $1 million to projects that seek to capture methane gas from agricultural waste, and more than $1.4 million to projects that plan to capture methane gas from landfills in foreign countries. The projects are being funded through the global Methane to Markets Partnership, an initiative to reduce global methane emissions using methane recovery and energy systems. The United States and 13 other countries launched the partnership in November 2004. It now includes 21 partners, including the European Commission. The following projects have been funded to capture methane gas from agricultural waste: The Department of Livestock and Cooperation in Thailand's Ministry of Agriculture received $700,000 to assist in reducing methane from swine farms. The Fundacion Guanajuato Produce in Mexico received $149,550 to develop technical standards for the design, construction 20 BIOMASS MAGAZINE 12|2008
and installation of anaerobic digesters. The International Institute for Energy Conservation in India received $100,062 to assess the potential of capturing methane from distillery and winery waste. The National Institute of Agricultural Science and Technology Rural Development Administration in Korea received $98,500 to capture methane from agricultural wastes. The following projects have been funded to capture methane gas from landfills: The Fundacao Promar in Brazil received $98,500 to develop a plan for landfill management in the State of Espirito Santo. The Renewable Energy Agency in Ukraine received $98,500 to conduct a landfill gas feasibility study, and to install a collection system and flare at the Rivne Landfill. The Municipality of Guayaquil in Ecuador received $192,600 for activities that advance methane recovery and its use as a clean energy source in Las Iguanas Landfill. The Environmental Sanitation Engi-
neering Technical Research Center in China received $175,000 to conduct a feasibility study for landfill gas energy recovery and utilization. The Universidad Nacional del Centro de la Provincia de Buenos Aires in Argentina received $150,000 to use landfill gas as fuel for a pyrolysis furnace. The Institute for Environmental Management Inc. in India received $150,000 to improve landfill methane energy recovery from landfills. The Oil and Gas Institute in Poland received $100,000 to study the capabilities of landfill gas as a potential energy source. The Center for People and the Environment in Nigeria received $90,000 for a prefeasibility study exploring the conversion of landfill gas to electricity from landfills. -Ryan C. Christiansen
NEWS Researchers, companies pursue biobutanol Biobutanol may be a promising alternative fuel, but it has been plagued with difficulties as organisms that produce butanol through fermentation are difficult to maintain and tend to have a low conversion efficiency. However, butanol has many properties that make it desirable as a biofuel, including a higher energy content than ethanol and good blending characteristics with conventional fuels, so it continues to attract research and corporate interest. Green Biologics Ltd. operates a 300-literper-batch pilot plant in England. The company is joining with Mumbai, India-based Laxmi Organic Industries to build a commercialscale biobutanol plant in India. The plant will produce 1,000 metric tons of butanol per year and is expected to begin production in 2010. The facility will use sugarcane as a feedstock, and will use a combination of thermophilic organisms and thermostable enzymes to break the biomass down into butanol. Cobalt Biofuels in Mountain View, Calif.,
is working at the National Center for Agricultural Utilization Research in Peoria, Ill., on ways to convert wheat straw into biobutanol. Normally, fermenting biomass such as wheat straw involves four preparatory steps: pretreatment, hydrolysis, fermentation and recovery. These steps need to be carried out separately and sequentially, and Qureshi's lab was able to combine three of the four steps. He found a way to use the enzymes that hydrolyze the wheat straw while simultaneously letting the bacteria conduct the fermentation. The lab also devised a process called gas stripping, which removes the biobutanol continually as it's produced. Early trials of the process doubled productivity over traditional glucosebased fermentation, and also produced acetone and ethanol. If the process can be scaled to commercial production, it's estimated that 99 gallons of the three chemicals could be made from one ton of wheat straw.
has raised $25 million in equity to continue pursuing its goal of commercializing biobutanol production. Investors included Cobalt's existing institutional investors Pinnacle Ventures, VantagePoint Venture Partners, The Malaysian Life Sciences Capital Fund and @Ventures, along with new players Life Sciences Partners and Harris & Harris Group. Fouad Azzam, general partner of Life Sciences Partners, will be joining the Cobalt board of directors. The company's fermentation process uses continuous fermentation to maintain peak production rates for extended periods of time. It has patented a fluid separation technology, known as vapor compression distillation, that removes alcohol from the fermentation steep using approximately onehalf the energy required in typical separation techniques. As commercial activity moves forward, research continues in government labs for ways to make butanol production more competitive with existing fuels. Nasib Qureshi
-Jerry W. Kram
Projects commissioned in Ohio, Virginia and New York in September joined the growing list of landfills tapping into the gas released by decomposing waste. A ribbon-cutting ceremony was held in mid-September in Stafford County, Va., for a landfill-gas-to-energy facility with a 2.14 megawatt generating capacity, enough to meet the annual power needs of more than 1,300 homes. The Rappahannock Regional Solid Waste Management Board has signed a 20-year agreement with energy services provider Ameresco Inc., the company that developed the landfill-gas-to-energy project. The electricity is being purchased by Constellation Energy Group Inc. Casella Waste Systems Inc., a regional solid waste, recycling and resource management services company based in Rutland, Vt., completed its fourth and fifth landfillgas-to-energy plants ahead of schedule this fall at the Hyland landfill in Angelica, N.Y., and its landfill in Clinton County, N.Y. Each
Landfill gas projects generate electricity, compressed natural gas
A ribbon-cutting ceremony was held in mid-September for a new landfill-gas-to-energy project in Stafford County, Va.
facility has the generating capacity to produce 4.8 megawatts per hour. This brings the company's total production capacity of clean energy to nearly 25 megawatts per hour. It expects to begin producing clean energy at its Southbridge landfill-gas-toenergy facility in Massachusetts during the first half of fiscal year 2010. When this new facility comes on line, the company and its
partners will be producing approximately 28 megawatts of clean electricity per hour. A landfill project in Ohio is converting landfill gas to a green compressed natural gas, which project developer FirmGreen Inc. has trademarked gCNG. In partnership with the Solid Waste Authority of Central Ohio, California-based FirmGreen built the landfill-gas processing facility and fueling station that pumps compressed natural gas. The $18 million Green Energy Center located at a landfill near Grove City, Ohio, collects and cleans raw landfill gas using Acrion Technologies' patented CO2 Wash technology. It will produce enough compressed natural gas annually to replace nearly 250,000 gallons of gasoline, plus enough gas to generate the electricity required for its own operation. -Susanne Retka Schill
page tag industry
Reinventing the Mill
page industry tag The weak U.S. economy, high-priced inputs and low-priced imports have forced many U.S. pulp and paper mills to downsize or close. At one time, transforming these mills into biorefineries looked to be a promising approach. Is the biorefinery still a viable concept that can save aging pulp and paper mills? By Anna Austin
008 was not a good year for pulp and paper mills. The news has been peppered with announcements of plant downsizing and closures in a number of communities that rely on the plants for their economic well-being. One of the most devastating closures occurred in the small town of Kimberly, Wis. NewPage Corp. announced in May that it would be forced to close its paper mill at the end of August, leaving 475 workers with no jobs. Just months before that, 125 people were released from the facility after one of its machines was shut down. The closure has left Kimberly's 6,300 residents wondering what will become of the community, where the mill had served as its heart since 1889. NewPage issued a statement attributing the closure to several factors. "Our decision to close the mill is the result of a weak economy, the continued effects of low-priced imported products and sky-rocketing costs," said NewPage chairman and chief executive officer Mark Suwyn. "The coated paper market is being hit with a slowdown in demand as the uncertain economy is reflected in a reduction in print advertising. At the same time, we are experiencing higher input costs for raw materials and transportation driven by oil and natural gas prices. To balance the somewhat reduced demand in a manner that helps us reduce costs, we are closing our mill in Kimberly, Wis." In June, Sappi Fine Paper North America in Boston, Mass., announced that it would shut down a paper machine and suspend operations at its pulp mill in Muskegon, Mich., affecting 365 workers. The situation at the NewPage and Sappi Fine Paper isn't restricted to U.S.-based paper mills. In
industry 'Expanding demand for renewable energy may potentially drive wood fiber prices even higher in many countries in the near future. Since 2002, global average prices for pulpwood have risen 67 percent for softwood and 64 percent for hardwood, in U.S. dollar terms.' mid-September, UPM-Kymmene Oyj, Europe's second-largest papermaker, announced it would close a pulp and paper mill in Finland, resulting in the loss of about 1,600 jobs in the next two years. "Demand growth for paper in traditional markets has slowed down," said a statement released by the company in September. "Overcapacity still exists in Europe and slowing economic growth imposes further challenges. Prices of wood, energy and fuels have increased significantly in the last two years." In Ontario, Canada, Thunder Bay Fine Papers announced it is in danger of closing unless $10 million in funds can be raised by early October. The closing would leave 320 people out of work. These are just some of the closings announced at the end of 2008, begging the question: What can the struggling pulp and paper mills do to ensure survival? The idea of transforming the mills into biorefineries—factories where a variety of alternative fuels and chemicals can be produced— has been talked about for some time. The problem is that many pulp and paper mills are nearly a century old and simply can't compete with companies that are equipped with more modern, cost-efficient machinery. Furthermore, developing a full-scale biorefinery could cost anywhere from $50 million to $200 million. Despite the obvious hurdles, some companies are beginning to venture down the biorefinery path by taking small steps, beginning
with cutting energy costs. "In the near term, mills seem to be taking the intermediate step of putting in biomass boilers and gasification systems to take the heat off of energy costs," says Kris Plamann, director of business development for Kaukauna, Wis.-based Baisch Engineering Inc., which serves the pulp and paper, biofuels and other industries. "If the pulp and paper industry is to survive in this country—and it will—it'll just look a lot different. They have to become innovative biorefineries, no question. Really, it comes down to two questions for the mills in regard to how they are going to respond to the rising cost of energy. What can they produce in addition to paper and how can they come up with, or who can they partner with, to raise the available capital to create a biomass-fired energy plant or biorefinery?"
Feedstock for Thought Rising energy costs are like a double-edged sword for pulp and paper mills, as they have increased the global demand for wood and pushed prices higher. "The hot new market for wood fiber is that of biomass energy; demand in Europe and North America is expected to soar over the next 10 years," says Håkan Ekström. "With the supply of wood fiber relatively inelastic, at least in the short term, this sudden new demand would normally be expected to push wood prices to unprecedented new heights." Ekström is principal of Wood Resources International LLC, a consulting firm providing forest market analysis and wood price reporting for the forest industry worldwide. For the past 22 years he has worked in various capacities related to wood products utilization, international forest products marketing and global wood supply. He isalsotheeditorof theWoodResourceQuarterlyandtheNorthAmerican Wood Fiber Review. Wood costs typically account for about 50 percent of the production costs for a pulp mill, which often determines a region or a
industry company's competitiveness, Ekström says. Wood fiber prices have been rising steadily for the past six years, reaching record levels in the second quarter of 2008. "Expanding demand for renewable energy may potentially drive wood fiber prices even higher in many countries in the near future," he says. "Since 2002, global average prices for pulpwood have risen 67 percent for softwood and 64 percent for hardwood, in U.S. dollar terms." Ekström says to date, most pulpwood has been consumed by the pulp and paper sector, with smaller amounts used to produce wood-based panels The high price of wood is exacerbated for those pulp and paper mills looking to reinvent themselves if they don't have access to a reliable source of wood. "There are already increasing challenges with getting an economical biomass supply," Plamann says. "Some have it available, and some don't. Depending on the size of the equipment they are running, some will need more biomass than they have available and have to procure it in an increasingly competitive market. The capital may not be balanced by the amount of product they can produce if they have to purchase feedstock or waste materials to run the biorefineries." Pulp and paper mills don't have to go it alone when it comes to biomass logistics though. Third-party financing companies, which fund projects outside of the traditional paper-related projects, and biomass supply and distribution companies, are working to improve the logistics and availability of feedstock sources, Plamann says. "The timber and transportation industries are becoming active in defining a path forward, even state and federal funding through grant support," she says. Plamann tells Biomass Magazine that Baisch Engineering may be working with a major paper company on a pre-feasibility study for a biomass gasifier. The company doesn't have the money to fund the project itself, and plans to work with a third-party energy supply
company that will sell them back the energy. "There are a couple of considerations for this project," Plamann says. "They know what the cost of the fuel is today, but because of the increasing demand for logging residuals and other waste products to fuel the boilers and gasification systems, they can't easily predict where the price will go in the future. Therefore, the company cannot be sure their return on investment will be accurate—as the waste product market is changing and evolving." Although it might seem like the obstacles are insurmountable, for some pulp and paper mills the benefits of reducing energy costs and evolving into a biorefinery outweigh the capital costs. "Mills have had long-term contracts—10 years—for what would today be considered very reasonable rates, such as 5 cents per kilowatt hour or $50 per megawatt hour for electricity," Plamann says. "The cost of electricity purchased from the grid and No. 6 fuel oil have gone up 20-and-a-half times in the past two years. Now, mills are experiencing reconstructed rates upwards of 12 cents in place of that original long-term contact of 5 cents." Plamann says one of the engineering firm's customers burns 9 million gallons of No. 6 fuel oil per year. "There's a lot of potential savings if you balance the capital costs of a biomass boiler and replace that oil usage—and maybe even generate enough steam to sell electricity back to the grid," Plamann says. "This company used to purchase its fuel from a neighboring paper mill, but now that mill is putting in a biomass system, which will require possibly as much as 2,500 tons of fuel products a day for a 483,000-pound-per-hour biomass-to-steam system." Although this isn't considered a full-fledged biorefinery, it is the first step in reducing energy costs.
Funding the Future Plamann says one of the biggest challenges mills face when putting together the plans for developing a biorefinery, or adding
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industry 'Full-scale active biorefineries at mills across the country may be years off, but the industry as a whole needs to embrace the concepts and work toward conversion just as the corn ethanol industry is doing.'
energy-saving biomass-fired equipment, is making third-party initial contractual arrangements. "Getting those in place takes a lot of time and work, sorting out all the energy supply agreements," she says. The beauty of working with a third party for funding is that the pulp and paper company doesn't have to come up with as much up-front capital. The third party may also be able to work with other nearby energy consumers willing to purchase biomass-created energy from the mill, securing a quicker return on investment. "There are also different resources and infrastructures each facility may bring to the table that can impact either the up-front capital required, or help feed the boilers down the road—there's the land, the utility, and the biomass or waste available." The mill may be able to lease the land from the third party and collocate the energy facility between the mill and other energy consumers. Plamann points out that there are several benefits to being in close proximity to mills—one is that the utilities are already there, the wastewater and sewage treatment facility is there, make-up water is available, and there are a lot of synergies to the capital investment needed and what the mill already has established that they can share.
Making Progress In April 2008, the U.S. DOE selected three small-scale pulp and paper mill biorefinery projects and awarded each of them $30 million. The projects, which are expected to be operational before 2011, will use a wide variety of feedstocks and test various conversion tech-
nologies to provide the data necessary to commercialize other fullscale biorefinery technologies. One of the selected sites is RSE Pulp & Chemical in Old Town, Maine. The project will be installed at an existing pulp mill and will produce cellulosic ethanol from wood extract. The DOE awarded funds to Flambeau River Biofuels to construct a biorefinery that will employ two technologies to produce clean renewable energy and biofuels. It will gasify biomass resources, such as forest residuals and agricultural wastes, into a synthesis gas, which will then be catalyzed using the Fischer-Tropsch process to generate 6 MMgy per year of renewable liquid fuels such as biodiesel and waxes. At the August 2008 TAPPI International Bioenergy and Bioproducts Conference in Portland, Ore., Doug Freeman, project manager for NewPage Corp., another $30 million recipient, gave an initial analysis of a feasibility study being conducted regarding the possibility of a biofuels project at its mill in Wisconsin Rapids. The project would produce 5.5 MMgy of renewable diesel and renewable gasoline from 175,000 tons of wood residue obtained from within a 70-mile radius. Although these projects are still a few years away from completion, they are the forerunners of what could be a revolution for pulp and paper mills. "Full-scale active biorefineries at mills across the country may be years off, but the industry as a whole needs to embrace the concepts and work toward conversion just as the corn ethanol industry is doing," Plamann says. "It's not just a question of making paper anymore, it is completely revamping a very old and wise industry into a thriving, new multidimensional one that can successfully live on for another 100 years." BIO Anna Austin is a Biomass Magazine staff writer. Reach her at aaustin @bbiinternational.com or (701) 738-4968.
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iomass is used around the world to generate heat, steam and electricity. However, coal is preferred over biomass for energy production because it generates between 7,000 and 12,500 British thermal units (Btus) per pound while woody biomass produces between 5,300 and 6,400 Btus per pound. But coal prices are rising. Meanwhile, climate change initiatives around the world are calling for greenhouse gas (GHG) reductions. Demand for cleanburning biomass for heat and power generation is increasing. Government programs in the United States and Europe are funding projects to develop a more streamlined, far-reaching system of trade for biomass. Could biomass become a commodity that is bought and sold on a trading floor?
Increasing Demand Global coal markets are tightening and the United States is exporting more coal. The average price of exported coal in the second quarter of 2008 was $97.24 per short ton, its highest value in history and an increase of more than 50 percent year-over-year, according to the Energy Information Administration, a service of the U.S. DOE. Meanwhile, the European Union and its member states, which more than six years ago ratified the Kyoto Protocol to the United Nations Framework Convention on Climate Change, have committed to reducing their collective GHG emissions by at least 8 percent by 2012. The EU's Biomass Action Plan includes a directive to promote renewable electricity generation by increasing production in member states from 14 percent in 1997 up to 21 percent by 2010. In the United States, 28 states have individually established renewable portfolio standards, specifying that electric utilities must generate a certain amount of electricity from renewable resources by specific dates, according to the Pew Center on Global Climate Change. This market environment has led electric utilities in the United States and around the world to use woody biomass from timber harvesting and sawmill operations, as well as waste wood destined for landfills, for power generation.
For example in the United States, Xcel Energy plans to spend $55 million to $70 million to convert the last remaining coal-fired unit at its Bay Front Power Plant in Ashland, Wis., to a biomass gasification system. The plant has been burning waste wood to generate electricity since 1979 and currently uses just over 200,000 tons of waste wood each year. When the project is complete, the plant will use an additional 185,000 to 250,000 tons per year. In Europe, Prenergy Power Ltd. of Switzerland is building a $788 million wood-burning power station capable of generating 350 megawatts of electricity in deep-water Port Talbot on the western side of Wales. Approximately 3 million tons of wood chips will be imported by cargo ship for the plant annually. In addition, Drax Group Plc in the U.K. is planning to build three 300-megawatt biomass-fed plants at the deep water ports of Immingham and Kingston upon Hull; the third location is to be determined. During the past five years, global trade of woody biomass has almost doubled, especially trade for wood pellets for energy generation, according to Håkan Ekström of Wood Resources International LLC. Global trade of woody biomass was just over 11 million tons in 2007, up from 5.6 million tons in 2003, Ekström says, and a record of more than 3 million tons of wood pellets was traded globally in 2007. Most of the trade has been between European countries or exports from Canada to Europe. Germany exported 1.4 million tons of biomass to neighboring countries in 2007. Canada exported 1.3 million tons
The Next Hot
Commodity? The market for biomass is getting ready to embrace exchange-traded commodities. By Ryan C. Christiansen
finance of biomass last year, including an estimated 600,000 tons of wood pellets for the European market. In response to increased demand for wood pellets, Mitsubishi Corp., Japan's largest general trading company with offices in 80 countries, has acquired a 45 percent stake in Vis Nova Trading GmbH, a manufacturer in Bremen, Germany, that produces wood pellets from waste wood. Mitsubishi invested $8.2 million in VNT, which supplies 180,000 metric tons of wood pellets per year to electric power companies in the EU. VNT plans to build additional factories and achieve 500,000 metric tons in wood pellet sales by 2010.
Biomass Commodity Exchange As global trade in woody biomass increases, is it possible that woody biomass will someday be traded as a commodity? The U.S. Forest Service Technology Marketing Unit, located at the Forest Products Laboratory in Madison, Wis., has awarded a $75,000 grant to CleanTech Partners Inc. of Middleton, Wis., to develop a plan for implementing a commodity exchange program for biomass in the United States, specifically to increase the efficiency of the existing woody biomass fuel supply chain and to support emerging biorefineries through the future trade of energy crops, such as switchgrass. Coordinated by Heartland Business Consultants, the Biomass Commodity Exchange
(BCEX) should be operational by late 2009, according to Stephen Dinehart, a principal for the consultancy. Dinehart says his experience working for the U.S. Commodity Futures Trading Commission, as well as the Chicago Board of Trade—where he looked at developing nontraditional markets—and his experience in investment banking have been helpful in developing the plan for the exchange. The project began in November 2007, Dinehart says, and the first step was to survey the marketplace to understand what large biomass users are currently doing in terms of contracting and pricing. He says the biomass industry is changing dramatically with the implementation of portfolio standards for electric utilities, continued growth in the wood pellet industry, renewable fuels standard volume requirements, and an increased push to develop cellulosic ethanol. Demand for biomass, as well as the number of market players, will increase dramatically in the near future, therefore, "rather than just doing a study, what we determined to do is actually put together a business plan for an exchange that will address the woody biomass market," he says. "But more broadly, it will incorporate nonwoody products, such as corn stover, switchgrass, wheat straw and so on. The bottom line is to encompass the biomass market on an exchange platform." Dinehart says the need for an exchange grew out of concerns expressed by com-
panies that are looking at using biomass for power generation. Because there is no way to confidently report what the cost of woody biomass feedstock will be, it is difficult for those projects to obtain financing, he says. "A very important element [of the exchange] is that we will provide publicly available prices," Dinehart says. "A major part of the problem right now is that most people don't know what the value of biomass is. The lack of pricing means that we're not eliciting as much supply as we can from the marketplace. If people don't know what the value is of what they have, they're not going to sell it." Initially, the exchange will provide indicative pricing on a monthly basis with plans for weekly and, ultimately, daily price reports, depending on the volume of trades, Dinehart says. Price reports will begin with prices for large categories of biomass across large geographic areas and will become more specific as the exchange matures, he says. To be market-traded as a commodity, a product must typically be qualitatively uniform across the market. It might be suggested that the inherent diversity of woody biomass is the main barrier preventing it from becoming a commodity. The limbs, branches and twigs derived from timber harvesting and the woodchips and sawdust derived from sawmills are as diverse as the trees they come from. While wood pellets are more uniform in size and shape, they too are made from diverse matericontinued on page 32
Biomass Trade in Europe The European Union appears to be ahead of the United States when it comes to evaluating and improving the trading market for biomass. The European Commission has identified that standards for solid biomass fuels are needed in order to facilitate trade, develop markets and increase consumer confidence and has directed the European Committee for Standardization to develop them. A technical committee identified as CEN/ TC 335 Solid Biofuels has been established to develop draft standards to describe all forms of solid biofuels within Europe, including wood chips, wood pellets, briquettes, logs, sawdust and straw bales, according to the Biomass Energy Center, a body of the U.K. Forestry Commission. According to the BEC, the standards describe the physical and chemical characteristics of the solid biofuels, including particle size, particle density, moisture content, ash content, nitrogen content, net energy content, bulk density, chlorine content, mechanical durability, and the source material and country of origin. The EU is sponsoring the development of biomass trading through its Intelligent Energy Europe fund. One of its projects is the European Bioenergy Network, dubbed EBIONET II, which examined 30 different solid biofuel supply chains to determine suitable trading models for heat and power production. The three-year project issued a report in 2007 indicating that international trade in woody biomass will increase in the future, especially trade in wood pellets, which are estimated to increase to 10 million metric tons in 2010.
The report said the global annual pellet production was 4 million metric tons in 2007. With the long-term goal of increasing the share of biomass pellets used in the EU for heat and electricity production, the Intelligent Energy Europe fund has also sponsored a project named Pellets Atlas, dubbed pellets@las, which is in the middle of a three-year study ending in 2009 to gather and share market data, including production, consumption, and price data, with pellet producers, traders and consumers in the 27-member state EU, and in nonmember states Norway and Switzerland. The project is tracking data for wood pellets, agricultural pellets, mixed biomass pellets and industrial pellets. The project has found that there are highly developed wood pellet markets in Austria, Belgium, France, Germany, Sweden, The Netherlands, Italy, and Denmark. Sweden, Germany and Austria are large producers and Sweden is a large consumer. The project also found that in most European countries, there is little demand for mixed biomass pellets, which can be produced from grains, grasses, legumes, flowers, fruit and wood. The European Commission and the Energy Agency of the Netherlands, is also supporting the development of a biomass commodity exchange. The BioXchange project, which aims to be a European-wide online biomass trading floor, is being developed by four partners, including renewable energy consultants 3E in Belgium, Ecofys GmbH in The Netherlands, ESD Ltd in Jersey, as well as Nationale Reststoffenbeurs, the Dutch Waste Exchange in The Netherlands.
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finance continued from page 30
als, including switchgrass, nut hulls, and so on. An argument can be made that before biomass can be market-traded, the various categories of biomass must be standardized and there must be broad consensus concerning which biomass is acceptable for one purpose or another. However, Dinehart says the BCEX will not pre-impose standards on the exchange. He says the BCEX will be an Internet-based electronic listing platform that will be a focal point for biomass buyers and sellers to come together and that standards will grow organically through active trading. "We are not prescribing what people can trade," he says. "They can trade whatever they want. If they want to solicit delivery of rice hulls to Savannah, Ga., they can do so." Initially, how biomass will be identified on the exchange will be up to the buyers and sellers, Dinehart says. The BCEX might supply a lexicon of suggested terminology, he says, or might also list the CEN/TC 335 Solid Biofuels standards that have been described by the European Committee for Standardization under the European Commission, which he said are being proposed as an International Organization for Standardization standard. Dinehart initially expects the largest volumes of trade on the exchange will be for forest residuals, followed by pulpwood, round wood, urban waste wood, industrial waste wood and bark. The lowest-volume trading will be for cellulosic ethanol biomass feedstocks, such as switchgrass. Whether wood pellets will be traded on the exchange is an open question, he says, because typically, wood pellet manufacturers are branding their pellets and might not be interested in commoditization. In order to become a mature exchange with futures contracts, the BCEX will need to identify actively traded spot markets. Dinehart says because there currently are no spot markets for biomass in the United States, the spot markets, too, will have to grow organically from the exchange through active trading. He says there are areas of high wood consumption in the United States and it is logical to expect that spot
markets will emerge in those areas. Currently, because of the relatively low value of biomass, the product's price is extremely transportation sensitive, which means there are relatively small markets, with most markets only 200 miles in diameter. In order for biomass markets to grow in size geographically, the base value of biomass will need to increase to push relative transportation costs down, Dinehart says. "Right now we don't think a futures market is viable," Dinehart says, "but what we do think is viable is an exchange that facilitates cash market trading." He notes that the BCEX would begin life as an exempt commercial exchange and would be free from CFTC regulation. Only if the BCEX can grow to support futures contracts will CFTC regulation be necessary, he says. "Once you allow pure speculators to go and trade on an exchange, or once it is marketed to the public, then it comes under the auspices of the CFTC as a regulated exchange," he says. "I don't see that occurring for a very, very long time." In traditional commodity exchanges, CFTC regulation protects market participants against fraud, manipulation, and abusive trading practices and ensures the financial integrity of the clearing process. Dinehart says the BCEX platform will offer trade confirmation and verification and could provide delivery notices and settlement services, as needed, as well as an audit trail. He says a beta version of the BCEX electronic listing platform will be tested in early 2009. The business plan for the exchange will be completed next year, when a decision will be made whether to move forward with BCEX. Ultimately, if BCEX is successful, the price of biomass as a commodity will be determined by the market as a whole. Futures contracts might ultimately be possible and market participants might be able to hedge themselves against price fluctuations. BIO Ryan C. Christiansen is a Biomass Magazine staff writer. Reach him at firstname.lastname@example.com or (701) 373-8042.
Tiny Oak Creek, Colo., faces harsh winters and an ever increasing fossil fuel bill to keep its 600 homes and businesses warm. A newly established wood pellet producer thinks he has a way to cut the town's fuel bill. By Jerry W. Kram
ome say paradise can be found on Colorado's Western Slope amidst the towering mountain peaks and the clear, cold, rushing mountain rivers. These people tend not to mention the bitterly cold winters and the ever more expensive fuels that have to be trucked over mountain passes to keep homes and businesses warm and cozy. This dependence on fossil fuels is ironic considering the vast biomass resource available in the mountain west. Tucked away in this slice of heaven is the town of Oak Creek, Colo., just down the road from Steamboat Springs, also known as "Ski Town, USA." Oak Creek, with a population of less than 1,000, is very different from neighboring towns, which are dependent on providing amenities for tourists. Oak Creek was a coal mining town settled in the late 1800s, says Angie Krall, former mayor pro tem of the town. Several high-quality coal veins underlie Routt County, and they drew in a diverse population of immigrants from all over the world. "The town attracted every sort of person you could imagine," she says. "Oak Creek was the 'diversity town' in the region back then and still is in a lot of ways. You have a lot of third- and fourth-generation folks still living there, which is kind of unique. It's a real bluecollar town that's proud if its coal-mining heritage." While there is still an active coal mine in the area, by and large the mining industry has been declining in the area since the 1950s. However, that coal mining heritage could play an important role in moving Oak Creek and other small communities to a future where biomass is as important as "king coal."
A Grid of Their Own Once powered by coal, Oak Creek is kept warm during the frigid mountain winters mostly with propane these days. Not only do the residents face the escalating cost of fossil fuels but also the rising cost of getting that fuel to the community. As energy prices escalate, some residents are turning back to coal. Moving back to coal would have a dramatic impact on the local air quality though as Oak Creek is cloistered in a mountain valley where winter temperature inversions trap smoke and soot in dead-still air.
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The Confluence Energy pellet mill in Kremmling, Colo., is expanding to produce up to 120,000 tons of wood pellets per year. This would be more than enough to provide the nearby town of Oak Creek with heat for 400 to 600 homes and businesses.
A turning point came when the town's school decided to replace its decades-old heating system. The coal-fired boiler was nearly 80 years old. The school district decided to replace the boiler with a biomass-based system. The dedication for the new heating system was a big event in Oak Creek and even attracted Colorado Gov. Bill Ritter, who symbolically shoveled the last scoop of coal into the old boiler. "Some of us thought if the high school could do this, why not the town?� Krall says. "The school was using a local source of energy, coal, and moved to a new local source of energy.� Early in its history, Oak Creek generated its own electricity from coal. The municipal utility that distributes power still exists, although it now purchases its electricity from a Nebraska utility, Krall says. The city-owned utility has access to credit and funding that the town itself doesn't. That opens the door for the community to explore options that might not otherwise be open to it.
Out of Crisis, Opportunity One of the driving forces behind the installation of the biomass boiler at the school was the establishment of a wood fuel pellet plant in nearby Kremmling. Confluence Energy LLC was founded by Mark Mathis and began producing in June 2008. Although the company is new, it is already
expanding, and is in the process of adding a third mill that will increase the plant's capacity to 120,000 tons of production per year. Biomass turned out to be the answer to several thorny problems on the Western Slope, not just high fossil fuel prices. The dominant tree in the region is the Lodgepole pine. These trees grow rapidly, but have a short life of only 60 to 80 years. Decades of forest fire suppression have allowed the forests around Kremmling to get to the end of the trees' natural life span. An epidemic of pine beetles has swept through the forest, turning green hillsides red and leaving behind mountains of potential fuel for catastrophic fires. "We were trying to make lemonade out lemons,� Mathis says. "We wanted to be part of the solution if we could. So we developed the first whole-log pelleting facility in the United States.� While some of the dying trees can be salvaged for lumber, smaller trees and trees that have been dead too long are better suited for wood pellet production, Mathis says. "We grade out all the usable wood for timber and house logs and then we take the rest of it and make renewable energy products out of it.� After working with Oak Creek on its school, Mathis became intrigued with the town's potential for district heating. He had visited many small communities in Germany and Austria that relied on biomass-powered district heating systems and was con-
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Colorado's forests are dominated by the relatively short-lived Lodgepole pines. Decades of fire suppression have left these forests vulnerable to pine beetle infestations that have killed millions of trees. Converting the trees into fuel pellets provides a use for the dead trees that are too small to turn into lumber, provides jobs in the logging industry and lowers the risk of catastrophic forest fires.
vinced such an approach could work in the United States. But when he first approached Oak Creek, he was just looking for people who might be interested in heating their individual homes with wood pellets. "We had a town meeting and I wanted to talk about our product and how we could save them money individually on their heating bills," he says. "For some reason I opened my mouth and said I had been to Europe and seen the district heating systems and that might be a viable alternative for them." Mathis put together some preliminary financial numbers for a follow-up meeting with the community. "They decided that it was attractive enough that we should pursue it," he adds.
Still a Dream Oak Creek has a number of advantages that lend itself toward a district heating solution. First, having its own municipal utility gives the town an operational home for the project, not to mention access to credit and grants. Second, the 400 to 600 homes and businesses in the community are clustered together tightly, reminding Krall more of a European village than an American town. Finally, it has a nearby source of reasonably priced fuel. Most of the town's streets are gravel, so no pavement would have to be torn up to install the pipes to carry hot water to peoples' homes. "There are four or five
things that make this kind of system work for Oak Creek that other areas don't have," Mathis says. These advantages may not be enough to make creating a district heating system practical, Mathis warns. Oak Creek and Confluence Energy are still conducting feasibility studies to make sure the project's price tag is within the community's reach. "We need to get a really tight focus on what it is going to cost to get five miles of pipe put into the ground," he says. "We also need to know how big the pipe will have to be, how deep it needs to go, how we would go about plumbing each individual house and how that would be handled." Even if the price isn't too high, there are other roadblocks that could derail the project. A primary concern is the level of community adoption of the project. Mathis says at least 75 percent of the homes and businesses would need to agree to switch to district heating for the project to be worthwhile. "We can lay in the biomass system, that's no problem," he says. "But how do you incentivize and put the funding together to get a big enough take on this thing? You can put in all of the infrastructure you want, but there is a cost to retrofit each house for that kind of a system. How do we get our arms around that piece of it?" Mathis says his company has some experience in the financial markets that
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project makes him believe that the local utility could create a rebate system for customers who retrofit their homes. That cost would be incorporated into the utility's debt structure. "So customers would get most of their costs paid for," he says. "There might be a little bit of cost they have to absorb, depending on how cumbersome it is to retrofit their home. Every house is different." The project isn't far enough along and no decisions have been made about what kind of technology would be used for the biomass burner. Mathis says his company will be able to provide the community pellets, sawdust or wood chips, depending on what technology is chosen. "We want to be that fuel provider at the end of the day," Mathis says. "However, we haven't gotten far enough along yet to decide what is going to make the most sustainable, long-term sense. In Europe I saw all those fuels being used, but transportation becomes an issue, sustainability becomes an issue and how much Caribbean tropics
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hassle each town wants to take on. Pellets have advantages, but they are going to be a little more costly than a dried chip." While the opportunity for Confluence Energy is speculative at this time, the company is devoting resources to work with Oak Creek. Mathis says the company has brought on a project manager to work on the system and hopes to have firmer numbers to present to the community in a few months. "At some point, it will start costing some dollars and Oak Creek will have to pay a little money to take a serious look at this thing," Mathis says. "We are trying to help them out to find out if it is even worth trying to do the feasibility piece of it. We should be able to put a scoping number on this thing to say, 'this makes sense.'" While there could be roadblocks ahead, Mathis remains enthusiastic. "We know we can put funding together for a plant like this over a 20-year period, so I can't possibly imagine that we can't make it work," he says. Sahara desert
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"It's unfathomable to me and I am willing to pony up and get the right pricing on the fuel. This is something that this country needs to do. Oak Creek can be a wonderful example of what this country can be doing to solve its energy needs." In Mathis' best case scenario, Oak Creek residents could be enjoying biomasspowered central heating by 2010.
A Bright, Warm Future? If Oak Creek decides to pursue biomass energy, there are other options for the community on the horizon, which Krall says could really benefit the town in the long run. "We own our own grid and there is great potential in firing that with electricity from biomass," Krall says. "It is interesting that Oak Creeks' high [electrical] use time is winter. But in the Midwest, the peak time is in the summer when everyone is running their air conditioners. My dream for Oak Creek is to improve its enterprise so we can get more money in to fund our general fund." Sales and property tax revenue often don't cover Oak Creek's general fund expenses. This has made the town reluctant to allow developers to do projects in the town, fearing more development could overtax existing facilities. "We fear we don't have enough money to cover the impacts on the infrastructure," Krall says. "We're not sure if people would move here, and if they do, if they would spend their money in Oak Creek. Many of the smaller communities around here are bedroom communities and the money is spent in Steamboat." Biomass could be the stabilizing force that would give Oak Creek the financial base that would allow it to grow in addition to providing relief from excessive energy prices for residents. "It's a way that we could really create a business opportunity for ourselves, while cutting peoples' heating costs," Krall says. BIO Jerry W. Kram is a Biomass Magazine staff writer. Reach him at jkram@bbiinternational .com or (701) 738-4920.
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Interest in biomass-based fuels has intensified since the Energy Bill was passed mandating the use of millions of gallons of advanced biofuels. At the Advanced Biofuels Workshop & Trade Show held recently in Minneapolis it was clear that the race to commercialization is on and all signs indicate progress is being made. By Bryan Sims
page event tag fforts are underway across the United States to develop innovative process technologies that may one day bridge the gap between first generation, or starch-based biofuels, and advanced biofuels. This sense of progress was evident at the 2008 Advanced Biofuels Workshop & Trade Show in Minneapolis in September. Tom Bryan, vice president of communications for BBI International, opened the general session by highlighting the importance of the federal government's support of the growth of advanced biofuels production and the concurrent development of novel technologies to guide that growth. The renewable fuels standard (RFS) in the Energy Independence & Security Act of 2007 requires the use of 600 million gallons of advanced biofuels in 2009. That's just the beginning. The requirement steadily increases until it hits 21 billion gallons in 2022, guaranteeing a significant expansion and transformation within the existing biofuels industry. Advanced biofuels in the legislation are defined as anything other than corn-starch-based ethanol that achieves a 50 percent greenhouse gas (GHG) emission reduction when compared with fossil fuels, whereas conventional biofuel, such as corn-based ethanol, must achieve a 20 percent GHG reduction. Cellulosic biofuels derived from nonfood-based feedstocks must achieve a 60 percent GHG reduction. The industry doesn't anticipate having difficulty meeting the increased conventional biofuel standard, however the advanced biofuel category presents a new challenge for the industry, according to Bryan. "In my mind, this mandate is achievable," he says. "There are so many research entities, scientists, start-up companies and others actively optimizing old technologies to adapt to meeting these mandates as well as those developing novel pathways for delivering cost-effective methods for producing advanced biofuels today." The federal government targets call for a new wave of more sustainable, efficient transportation fuels. According to Bryan, the transition from first-generation to second-generation biofuels won't be easy,
however, advanced biofuel technology developers can look to the success of the corn-based ethanol industry as a blueprint. "The existence of these biofuels is and will be a critical cornerstone for the development and commercialization of second-generation and advanced biofuels," he said. "The race is definitely on to produce these advanced biofuels in order to meet the targets the federal government has laid out for the emerging advanced biofuels space." John Christianson, principal partner with Minnesota-based Christianson & Associates PLLP, provided an overview of biofuels tax laws and incentives that have been adopted over the past couple of years. His presentation touched on the Biomass Crop Assistance Program and the Rural Energy for America Program, incentives provided for in the 2008 Farm Bill. "The one takeaway I would say, is that the Farm Bill has many provisions, tax incentives, loan guarantees and so forth, that are all related to advanced biofuels," Christianson said. "If you're looking to develop an advanced biofuels project, carefully examine the provisions in the Farm Bill and see what's applicable for you to gain the most benefit." While Christianson highlighted Farm Bill provisions, David Morris, vice president of the Institute for Local Self Reliance, talked about the Energy Bill. The impact of the new Energy Bill can't be underestimated as it supports the evolution of advanced and cellulosic biofuels, he said. "Essentially, Congress is mandating a huge increase in the production of a product that doesn't yet exist commercially and from a feedstock that doesn't largely exist either," Morris says. "That's called courage." Like the United States, countries and societies all over the world are trying to determine what role biological resources should play in the energy, national security, environmental and economic scheme of things. Much of the expansion efforts depend on the policies that countries adopt to support this growth. Unlike wind or solar, biomass has multiple uses such as in the textile, industrial, agricultural and construction industries. However,
event to grow a sustainable amount of biomass and support the growth of advanced biofuels, the United States must be mindful of the limited amount of biomass to harvest in limited land areas, according to Morris. "We're going to have to develop policies that don't divert the use of plant matter from a higher to a lower value use,� he said. Morris said that the United States and other countries must marry agricultural and energy goals in order for public policies to work. He stressed that biofuels advocates and developers should embrace the public policies laid out as advanced biofuels will be a significant foundation for the development of electric-driven motor vehicles in the future. "There's a symbiotic relationship that can be formed between the biofuels sector and the renewable energy sectors such as wind and solar energy, and there should be.� Morris believes that electricity will become the dominant transportation fuel. "A motor-driven vehicle is much more fuel efficient than an engine-driven vehicle,� he said. An electrified vehicle is quiet and is nonpolluting inside of cities. Moreover, if we have
Creating Markets for Advanced Biofuels For advanced biofuels to enter the marketplace, the ethanol industry must continue to aggressively move past the E10 "blend wall� and establish a market for higher blends. Ralph Groschen, senior marketing specialist for the Minnesota Department of Agriculture, discussed the importance of developing an E85 and midlevel blend infrastructure not only in Minnesota but also across the country. Blender pumps at retail gas stations could help in this regard. Currently, Minnesota exports more than 60 percent of its ethanol out of the state because of the E10 cap. "Blender pumps are a way of achieving a blend somewhere between E10 and E85 in combination with [flexible-fuel vehicles],� he said. "If there becomes
a significant legal market for conventional vehicles, midlevel blends will require some sort of U.S. EPA waiver.� Brian Jennings, executive vice president of the American Coalition for Ethanol, agreed with Groschen. "We need the transition of midlevel blends,� he said, adding that the United States cannot rely on the quantum leap from E10 to E85 to get the job done. "I would make the case that if we don't find this pathway and we don't have a market for advanced biofuel, it will chill investment, stymie growth, and slow or delay for years the commercialization of advanced biofuel in my opinion,� he said. "This is not the corn-based ethanol industry's problem. This is everyone's problem.�
continued on page 44
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Meeting the Biomass-Based Diesel Mandate The renewable fuels standard set forth in the Energy Independence & Security Act of 2007 will greatly change the future of renewable fuels use. How this new standard could affect the biodiesel and renewable diesel industries was the focus of one of the breakout sessions at the Advanced Biofuels Workshop & Trade Show. Stu Porter, manager of business development and projects for BBI International, highlighted the biomassderived diesel production mandate of 500 million gallons by 2009. He noted the emergence of hydrogenationderived renewable diesel (HDRD) re-
actions for producing renewable diesel. The HDRD pathway differs from conventional biodiesel production in that it uses hydrogen and a catalyst, such as platinum, palladium, rhodium or ruthenium, from virtually the same feedstocks used to produce biodiesel. HDRD also requires no special tank storage, can be pipelined to a blending site and to retail distribution centers. HDRD plants are also typically larger to achieve economies of scale. According to Porter, the only drawback HDRD diesel has is that there are currently no specifications for it as a pure fuel or a blend component in ASTM standards, whereas biodiesel
specifications are clearly outlined in ASTM for B5, B20, B100 and B5 Bioheat home heating oil. Jeremy Goodfellow, vice president of energy for Sanimax, explained the company's unique bio-pyrolysis approach that it uses to process various animal fats and yellow grease at its 20 MMgy biodiesel plant in De Forest, Wis. Since the technology has been used in the oil industry for nearly 30 years, financing a more widespread commercialization using a bio-pyrolysis method will require some government and partnership support, Goodfellow said.
event continued from page 42
Feedstock Management One issue that continues to challenge the development of cellulosic ethanol and other biomass-derived biofuels is feedstock logistics. Speakers at the Advanced Biofuels Workshop & Trade Show addressed solutions that could circumvent this hurdle, at least in the short term. Jim Hettenhaus, president and chief executive officer for CEA Inc., said that if it's done correctly, corn farmers could profit from harvesting corn stover and supplying the material to commercialscale cellulosic plants. A "one-pass harvest and haul" method is preferred whereby a farmer can concurrently harvest the corn, stalks and cobs and keep costs down. However, this would require a moderate to high capital expenditure to purchase the unique harvester. Other expenses, such as custom bailing, outsourcing contracts and fuel costs also have to be considered. Hettenhaus emphasized that the cost structure as-
sociated with the harvesting, storage and shipment of corn stover on a dry ton basis must be closely evaluated to create a sustainable feedstock supply chain. "Corn stover collection isn't easy, but it can be profitable if done right," Hettenhaus said. "Of course, cost is the prevailing issue when talking about the logistics of this material." Dick Carmical, general manager for Price BioStock, referred to the report jointly authored by the Oak Ridge National Laboratory and U.S. DOE titled: "Biomass as Feedstock for a Bioenergy and Bioproducts Industry: The Technical Feasibility of a Billion-Ton Annual Supply." According to the report, there are approximately 1 billion tons of biomass available in the United States, which will be needed to replace 30 percent of the nation's fuel by 2030 and compete against the volatile prices swings of imported oil price without subsidy support.
millions of electrified vehicles on the road we will have sufficient electric storage capacity to overcome the Achilles' heel of renewable energy, which is its intermittency." Every major vehicle manufacturer except Ford has announced it will be selling electric vehicles within three years. San Diego and San Francisco, among other U.S. cities, are developing citywide recharging stations to accommodate the use of electric vehicles. In addition, Congress is about to enact a $7,500 per vehicle tax credit for electric vehicles. "Compare that to the $50 per vehicle tax incentive that biofuels gets right now per year," Morris says. "That's enormous and that could very well happen as part of the 2007 Energy Bill." BIO Bryan Sims is a Biomass Magazine staff writer. Reach him at bsims @bbiinternational.com or (701) 738-4950.
Bioenergy in Action The Canadian Bioenergy Association's annual conference and trade show, held recently in Ottawa, testified to the rapid industry momentum experienced in 2008. By Crystal Luxmore
orth American companies and communities have a lot to learn from their European counterparts. European companies, primarily in Scandinavia, have decades of experience in biomass power and the logistics and incentives associated with it. The Canadian Bioenergy Association (CANBIO) is doing its part to bring those groups together in one location. The association's annual event was held Oct. 6-8 in Ottawa, Ontario. The conference stayed true to its theme, From Words to Action. Twentyfive trade show exhibitors from Ireland, Finland, Sweden, the United States and Canada, including companies John Deere, Ponsse, Metso Power and Buhler, showcased the latest technologies and equipment impacting the biomass industry. The event also featured a business-to-business session, where interested delegates held private meetings with trade show companies. "The one-on-one meetings were a great chance to sit down and just talk business with interested people," said Björn Vikinge of Vikinge Forest & Bioenergy AB. Project consultant and long-time forester Dean Johnson discussed the fast-paced changes in Canada's wood energy industry. He operates D.F. Johnson & Associates in Pembroke, Ontario. "Seven years ago we were burning mill residues, and four years ago mills were paying to have it removed," Johnson said. Johnson said that more competition for biomass residues is one factor in driv-
ing residue prices up over the past year. "Sawmill residues went from being considered waste to being a lucrative product in high demand," he said. Biomass buyers can expect annual price negotiations and shorter contract terms for biomass supply, Johnson said. He predicted that biomass prices could rise by as much as 25 percent over the next four years, though others in the industry predicted that currently inflated prices will fall due to recovery of the Canadian sawmill industry. Small-scale power generation also made big strides in 2008. Quebec is creating favorable regulations to help its struggling forest communities develop bioenergy heat and power projects. While Hydro Quebec continues to increase its biomass cogeneration targets, the real crusaders can be found at the regional level, said Carl Éric Guertin, CANBIO director and marketing director of the Quebec Wood Energy Board. Several regional groups throughout Quebec have been working together to get bioenergy off the ground in the province by visiting Scandinavia to study best practices and equipment. They've also published case studies for wood pellets, and central heating and district heating to help communities decide if they have a solid business case. The Bas-Saint-Laurent region, which is located along the south shore of the St. Lawrence River in Quebec, has set a goal to install 10 central heating projects by 2010. "The regional boards are crusaders," Guertin said. "They're really pushing wood-to-energy and they're working cooperatively to get biomass going here."
Following the conference, several Finnish companies visited Matapédia, Temiscaming and Ville Marie, Quebec, and Hearst, Ontario, to help those communities with their biomass plants.
Carbon Credits, Wood Pellets World Bioenergy Association President Kent Nyström's keynote address showed Canada has a long way to go before making bioenergy a critical part of its energy system. He said the turning point for his homeland of Sweden came when its government introduced a carbon tax. Citizens were given an income tax break in return for paying a tax on carbon. As a result, public acceptance was high, he said. "One thing is clear, whether it be through a carbon tax or trading in carbon credits, Canada needs to put a value on carbon now," CANBIO President Doug Bradley said as he summed up a panel discussion on Canada's renewable energy industry. WBA Secretary Karin Haara, who has worked in Scandinavia's biomass industry for more than 20 years, said that the discussions she heard at the conference made her "feel like I was sitting in an auditorium in Sweden in the year 1985. We had 7 percent of our country's energy coming from biomass in 1980, now it's 29 percent and we're going to double it again." Like Nyström, Haara said she feels strong government incentives, such as a carbon tax or cap-and-trade system, could help the industry take off. Speakers said the wood industry itself needs to change in order to achieve greater success. "We're in the energy business," said
The claims and statements made in this article belong exclusively to the author(s) and do not necessarily reflect the views of Biomass Magazine or its advertisers. All questions pertaining to this article should be directed to the author(s).
CANBIO's Paul Buckley, left, talks with World Bioenergy Association Secretary Karin Haara during the trade show of CANBIO's annual event.
John Swaan, CANBIO board member and executive director of the Canadian Wood Pellets Association. "We're not in the forest products business." Jane Todd, CANBIO director and Ontario Power Generation program manager for the Northwest, said the province's major power utility is intensively testing biomass to ready itself should the province decide to convert coal-fueled plants to biomass. From just one biomass-testing program in 2007 at its Nanticoke, Ontario, plant, Ontario Power Generation is conducting an "aggressive testing program in all of our plants," Todd said. The utility has been pleased with results thus far, she said. "Last year the Atikokan [Ontario] plant had never put a wood pellet in their plant, but by July (2008) it had burned 100 percent wood pellets for four hours," Todd said. "We can't believe how easy it was." Todd said part of the reason behind the shift was the recent review ordered by Energy Minister George Smitherman into the renewable energy and conservation portion of the Integrated Power System Plan. The province ordered the review to ensure it is maximizing renewable energy
sources, and biomass could prove an important part of the mix if the government wants to reach its goal of phasing out coal by 2014. Wood pellets are one of Canada's greatest bioenergy success stories. "We're global leaders in pellet production technology and our exports to Europe will continue to grow," Swaan said. His association has been developing a "super pellet" using steam explosion and torrefaction to get a pellet with 30 percent more calorific value, resulting in output of 6.5 megawatts per tonne. Swaan said they're in the "black box" phase of development and hope to bring the super pellet to market within the next year. Most of Canada's wood pellets are shipped to Europe, and Swaan said he sees it remaining the biggest market in the near future. However, he said more work needs to be done to develop a domestic industry for wood pellets, especially in the face of the recent economic crash. CANBIO and the Wood Pellet Association of Canada are working together to create Go Pellets, a program that promotes a domestic wood pellet market. "The pellet industry is the most active bioenergy
More than 60 delegates visited Abitibi-Bowater's cogeneration facility in Gatineau, Quebec, as part of the CANBIO conference's study tour.
market in Canada today," said CANBIO Director Chris Rees. "The only other country that's working on the super pellet is The Netherlands. Canada has a competitive advantage and the federal government should jump on this bandwagon." Rees said he would like to see domestic pellet production increase to 500,000 tonnes (551,000 tons) per year, with 200,000 tonnes (220,000 tons) for industrial use and the remainder for residential pellet furnaces, which already burn about 5 tonnes (5.5 tons) of pellets per year. Germany achieved this rate of residential use in approximately 10 years, and Rees said he thinks Canada can do the same. Go Pellets has applied to Industry Canada for funding to draw up a roadmap to develop the pellet market. It's also pulling together interested stakeholders to sit on an advisory board. Rees invited those interested in participating in the initiative to contact him at email@example.com.
Other Opportunities Pellets aren't the only area where Canadian research and development prowess is turning heads. Denis Arquin, vice president of engineering and implementation at Enerkem, told stakeholders how the company is turning "negative-value" feedstocks, such as municipal solid waste and used telephone poles or railroad ties, into ethanol. He said Enerkem's Westbury,
Quebec, ethanol plant should start up in 2008. The plant is expected to produce 5 million liters of ethanol per year (1.3 MMgy) from treated telephone polls. Arquin also outlined a deal that Enerkem signed with Edmonton, Alberta, which will see the company's plant take 100,000 tonnes (110,000 tons) of the city's municipal solid waste each year, helping Edmonton to achieve a 90 percent diversion rate from the landfill. Conference delegates got a chance to see waste-to-energy technology up close during a study tour at Plasco's Ottawa, Ontario, facility. Plasco's plant gasifies and converts municipal solid waste into a clean syngas. Plasco Program Manager Andrea Foottit said their process is unique because it doesn't require any pretreatment of the waste, which includes up to 8 percent shredded plastics. The process leaves 1.3 kilograms of disposal per tonne of waste processed. More than 60 delegates took part in the study tour. Delegates also visited Abitibi-Bowater's cogeneration plant in Hull, Quebec, and Camionnage Norman Sans-Cartier, a biomass harvesting and processing operation. BIO Crystal Luxmore is public relations manager for the Canadian Bioenergy Association. Reach her at email@example.com or (647) 239-5899.
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UPDATE Renewable Hydrogen: Biomass for Sustainable Hydrogen Transportation Fuel In the November issue, we discussed biomass-derived hydrogen as a third- or even fourth-generation biofuel requiring a major change in automobile technology and fuel infrastructure. Federal policy and automotive industry leaders truly believe that niche markets for hydrogen-based propulsion and power will appear in the next few years (some are already happening today), with deployment of affordable hydrogen vehicles within 10 to 20 years. Practically speaking, since we will not run out of oil in the next 20 to 30 years, the replacement of significant quantities of fossil-derived fuels and the replacement of traditional automobile propulsion systems will be slow. An important word is transition, defined here as a period of change in fuel types and production, fuel distribution and vehicle types. We have been using gasoline and diesel fuel in engines that were designed and built 100 years ago, with few fundamental changes since. Hydrogen as an alternative fuel can and will become a reality, but we appear to be going through a transition phase of first using ethanol and biodiesel in vehicles, requiring few changes. The introduction of alternative fuel vehicles such as hydrogen cars will be slow, unless market drivers force a more rapid transition. There is an ever-increasing possibility of politically-driven global disruption of oil supply, which could push hydrogen technologies into the forefront within five years. Demand for hydrogen in the oil, food, aeronautics and utility industries is met by reforming natural gas. During a time of transition toward hydrogen-powered vehicles, it is obvious that we will need to lean on conventional fossil technologies for hydrogen production, but eventually more sustainable renewable options will be desired to lower greenhouse gas emissions and increase energy security. This is where we enter the dawn of a new era. Renewable hydrogen options currently include using wind, solar and hydroelectric energies, and biomass feedstocks. Wind, solar and hydroelectric systems produce renewable electricity, which can be used to power an electrolyzer to produce hydrogen. Biomass or biobased resources can be converted through current thermochemical or biological processes to produce hydrogen. Biomass is probably the best resource in the next several decades for producing reliable, sustainable, large-scale quantities of renewable hydrogen.
Current electrolyzers are inefficient, and solar and wind-based systems simply do not have the capacity for producing sustainable, large quantities of hydrogen. Biomass can be collected in quantities ranging in the thousands of tons. Gasification, anaerobic digestion and conventional corn or next-generation cellulosic ethanol technologies can produce renewable hydrogen. A biomass gasifier produces primarily carbon monoxide, carbon dioxide, methane and hydrogen. Gasifiers can be operated to optimize that hydrogen component. Anaerobic digesters will convert biomass to methane, Zygarlicke which can be reformed like fossilbased natural gas to hydrogen. The ethanol production process can be interrupted in the wet mixed-alcohol stage with thermochemical processing to produce hydrogen. These are all fairly conventional technologies that can be improved, optimized and made cost-effective through economies of scale. Strains of bacterial microbes are being discovered that maximize hydrogen production yield and rates. Microbial systems are being integrated within fuel cells to deliver their hydrogen directly across a membrane for fuel cell electricity generation. A similar concept was developed and tested at the laboratory scale at the Energy & Environmental Research Center using thermochemistry instead of biology. A biomass gasifier was thermally integrated with a solid oxide fuel cell so that hydrogen and other syngas products would fuel electricity production. The distributed energy system could conceptually generate between 100 kilowatts and one megawatt of electrical power. We have entered an exciting age of hydrogen potential, and research is advancing the use of biomass as a resource for the production of biomass-based hydrogen.
Chris J. Zygarlicke, is a deputy associate director for research at the EERC and is vice chairman of the National Hydrogen Association Renewable Hydrogen Working Group. Reach him at czygarlicke@undeerc .org or (701) 777-5123.
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December 2008 Biomass Magazine
Published on Dec 1, 2008
December 2008 Biomass Magazine