Lignetics

Sandpoint pellet plant is foundation of Lignetics growth.

 

Finishing off a good selling season with a prolonged East Coast winter that kept sales strong through March, and watching a run-up in oil prices that’s leading toward more stove sales and domestic pellet usage, Lignetics President and CEO Ken Tucker is looking toward an even better year in 2011-12.

“What really helped the market this year was the prolonged winter, especially in the East, where heating oil is a big factor at all levels,” he says. “In November and December things weren’t looking too good, but in January winter kicked in. It’s the last of March and we’re still getting sales when it’s usually winding down this time of year.”

In the meantime, the recent run-up in oil prices should help plant the seed for more summer/early fall orders and also a sense of urgency among those who are considering switching to wood pellet stoves for home heat.

The situation leaves Lignetics well positioned in the domestic market, operating efficient plants in both Eastern and Western U.S. at Sandpoint, Id., Linn, WV and Kenbridge, Va. “We believe we’re located very well to handle the East and West Coast, and we’re in good shape to hit the major distribution points,” says Tucker, who joined the industry in 1979 at the Sandpoint mill under prior ownership and became employee #1 and general manager when Lignetics acquired the Idaho plant in 1983. He became President and CEO and largest stockholder in 1998.

Tucker adds that the company is also in great shape operationally, with a 2-year-old plant in Virginia that features robotics, the West Virginia plant that offers direct unloading into silos with live-bottom trailers and a negative air system, and the Idaho plant and its new wood-fired burner and dryer and emissions control system.

Lignetics

The Idaho plant dates to the late 1970s when it produced hog fuel pellets for a large local silver mine and other industrial facilities. Lignetics took over the plant in 1983, becoming one of the first large-scale Western U.S. fuel pellet plants. Lignetics was also the first company in the U.S. to sell bagged pellets for retail sale, Tucker says. The company was one of the first to begin producing bagged pellet fuel in the mid ’80s.

The Idaho plant is currently in its third generation of equipment, Tucker says, remembering that much of the first generation was feed industry equipment that had been modified to produce and handle wood fuel pellets.

Lignetics built a second pellet plant in 1992, this one in Missouri, but the pellet market surrounding the region’s Midwest location proved slow to develop, and the plant was sold in 2000. In the meantime, Lignetics opened up a new plant in 1995 in West Virginia that, after subsequent expansions, is now producing up to 140,000 tons/year. The company’s newest pellet plant opened in Kenbridge, Va. in 2009 with a 90,000 ton annual production capacity. At Sandpoint, Lignetics produces 75,000 tons/yr. in pellets, plus another 20,000 tons of fire log products.

For almost 20 years, Lignetics has manufactured and marketed the Pres-to-Log home fire logs and related products after buying the Pres-to-Log brand and trademark in 1993 and moving production to the Idaho plant.

Markets

The company pursues a variety of markets and produces pellets under the Lignetics and Pres-to-Log brand names, and firelogs, briquettes and fire starter products under the Pres-to-Log brand. Last year, Lignetics introduced its newest product, EZ Equine pelletized animal bedding. Lignetics sells to a wide variety of retailers, from the largest home centers to independent and small wood stove and hearth shops.

Though the Idaho plant originally did nothing but bulk shipments, as the bagged pellet business grew through the ’80s and early ’90s and more industrial customers switched to natural gas, the commercial business shrank to its current 5% of the plant’s output. However, rising natural gas prices are causing more facilities and their owners to consider switching to biomass, Tucker says, adding that he’s seeing more interest in institutional biomass systems in the region.

Tucker believes East Coast opportunities for biomass conversions and commercial accounts will also grow, but right now much of the action is just out of effective transportation range of Lignetics’ Eastern plants, in upstate New York, Vermont, New Hampshire and Maine. “There are transportation and freight issues, but when pellets are needed it becomes viable,” Tucker says, adding that the company was shipping into Maine in a high-demand market several years ago.

Looking at the recent efforts of the EPA to certify fuel pellet stoves and work with the Pellet Fuels Institute (PFI) to incorporate PFI’s pellet standards as part of EPA’s New Source Performance Standards for Residential Wood Heaters, Tucker says, “No one likes to see more government involvement, but in this case it’s probably needed.”

He notes that the wood pellet fuel industry has grown from several dozen producers to more than 100, with much of the growth coming the past four or five years. “Years ago, we mostly self-policed each other, and no one wanted to make a bad product that would reflect bad on the industry,” Tucker says. “Now, there are more than a hundred of us, and we have some who think you can take any grade of waste product and make a pellet that will work but that’s not true.

“Other producers may think this is a ‘get rich quick’ industry,” Tucker continues, “but good raw material is expensive and often hard to come by.”

Pellet heater manufacturers have pushed for some type of certification, and EPA has received stove performance and fuel quality complaints from consumers. It’s tough to design a stove that can handle a wide variety of fuel types, Tucker believes. “Now, if a stove manufacturer gets a complaint, he can ask, ‘Were you using PFI certified fuel?’”

The biggest impacts of the new PFI fuel pellet standards, released earlier this year, are the exclusion of scrap, treated or contaminated wood, and the requirement to use a third-party organization to certify fuel content, Tucker believes. “I think it will bring more discipline to the industry and should be helpful, but it’s not cheap to do,” he says.

When it comes to the EPA, “All they’re saying is just have in the bag what you say is in the bag,” Tucker says. “Most people are playing it right, but there’s always a fringe element that’s wanting to cut corners. The standards will provide challenges to some operators, and hopefully will level the playing field somewhat.”

Even so, the EPA plans to continue looking at BTU/ash criteria and will also be sampling and inspecting some pellet products at the retail level to get an idea of the variety of fuel on the market.

Sandpoint

At the Sandpoint mill, all raw material is purchased on a BDT basis and weighed by a third party. All incoming loads are sampled, and trucks are directed to a Columbia truck dump for unloading. Lignetics uses all sawmill-sourced material, mostly sawdust and shavings, but also some green and dry chips.

Feedstock is separated by size, species and green/dry sorts, 11 different sorts in all. Douglas fir is the primary species, with pine, cedar and hemlock also in the mix.

Oversize material is processed through a Jeffrey hog that was installed several years ago to handle chips, then joins the fines material through a Rotex shaker screen system and into the new Dupps dryer.

The dryer system is the Idaho plant’s biggest recent project, installed in 2007 to reduce reliance on natural gas. The new dryer line includes a new Onix wood-fired burner rated at 45MMBtu/hr. that replaces the old multi-fuel burner, though the plant still has ability to use the older burner if needed. Dryer emissions are controlled via a high efficiency primary cyclone and quad multi-clone in series. Project included a larger induced draft fan and taller and wider exhaust stack.

After drying, pellet feedstock is processed through an Andritz Sprout hammermill. A small amount, along with any waste or residual from upstream, is diverted from the dry air stream to a Bliss grinder that produces fuel for the wood-fired dryer burner.

Pellets are produced through three CPM pellet mills and flow to a CPM cooling tower and shaker and into storage bins prior to the bagging process.

The dryer line, hammermills and pellet machines are all housed under one roof and in the same room, where an elevated control room gives operators a good view of all three areas. Multiple flat panel monitors and the WonderWare system allow critical system monitoring, and an RS Logic control program governs machine centers.

The bagging line is from MTB, with product flowing to a Mueller palletizer and LanTech stretch wrap machine. In the Pres-to-Log department, two Pawert-SPM briquetting machines produce up to 48 tons of fire logs and briquettes daily.