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Drax Biomass Appoints Madden
Drax Biomass announced Peter Madden as its CEO of U.S. operations and also announced its port facility in Baton Rouge, La. is in operation.
Madden brings nearly 30 years of experience in the forestry industry and will guide the overall strategy and oversee day-to-day operations in the U.S. He most recently served as the vice president of Renewable Energy and Supply Chain for Plum Creek Timber Co. Madden began his career in forestry in 1988 as a field technician with the Westvaco Corp. in South Carolina. In 1992, he joined Georgia-Pacific Corp. where he held various positions including operations manager, procurement manager and senior financial analyst.
Drax Biomass is a wholly owned U.S. subsidiary of Drax Group plc, a major electricity generator in the United Kingdom. Drax Biomass has constructed wood pellet manufacturing facilities in Amite, Miss. and Morehouse, La. as well as a Gulf Regional Hub storage and export facility in Baton Rouge. By 2016, Drax anticipates employing more than 200 full-time U.S. employees.
Drax also reported that its pellet storage, handling and loading facilities at the Port of Greater Baton Rouge are complete, fully staffed and receiving pellets daily, with the first load on the MV TBC Princess. This first vessel forms part of the commissioning process, enabling Drax to test its ship loading equipment.
“We are extremely pleased that our port facilities are up and running,” says new Drax Biomass CEO Madden. “This complex project was delivered on time and to budget and forms a vital part of Drax’s ambitious plan to reduce its carbon emissions by at least 12 million tons per year.
The annual capacity of the facilities at Baton Rouge is around 3 million tonnes. The first vessel to use the Drax port facilities is a “handy size” and will be able to hold approximately 25,000 metric tonnes. Ultimately, this vessel will be followed by increasing sized vessels from Supra to the largest vessel the port has been designed to load—a Panamax. The two iconic domes on site can each store 40,000 tonnes.
Drax Signals Move Into Heat Sector
Drax has acquired Billington Bioenergy Ltd (BBE), the UK’s second largest wood pellet distributor. The move signals the power generator’s intention to enter the country’s growing biomass heat sector.
“This is an exciting opportunity to help transform the UK heat market in the same way we have made the UK power market so much less dependent on high carbon fossil fuels,” says Drax Group CEO Dorothy Thompson. “Biomass is a cost-effective, low carbon and dependable source of heat which homes and businesses can rely on. BBE is a great business, it shares our customer service ethos and unswerving commitment to sustainability so I am delighted to be working with them.”
BBE will continue to run from its Liverpool office, and all the team and existing arrangements will remain unchanged.
Proposed Idaho Pellet Mill Will Export
Centennial Renewable Energy of Idaho (CRE) announced is has signed agreements to purchase land for its first wood pellet project in the state and is now commencing engineering design with its lead design build contractor Dome Technology.
CRE is constructing a 160,000 metric ton per year wood pellet plant to produce pellets to the ENPlus A2 standard. CRE’s funding advisor CHP Ventures has secured development funds to take the project to financial close, according to a report.
The CRE facility has been developed on the fundamental principle of synergistic use of wood production residues. CRE’s projects are designed to promote economic sustainability in rural communities, decrease the carbon footprint through biomass energy production, improve forest health, and decrease the risk of wildfire to communities.
CRE has selected Dome Technology as its lead contractor to design and build the pellet mill. David Adams, CEO Dome Technology, comments, “Dome Technology has had a great deal of experience in designing and constructing wood pellet storage facilities in the U.S., Canada and Europe—the largest being approximately 284,000 metric tons of storage for Drax Power in Yorkshire, England. It is exciting to see CRE bringing similar vision and technology to our own back yard.”
Portucel Soporcel Begins Construction
Portucel Soporcel Group held a golden shovel ground-breaking ceremony March 27 for the construction of its pellet manufacturing plant in Greenwood, SC, according to a report of The Greenwood Partnership Alliance. The facility, which will produce the Colombo Energy brand, should be completed in the third quarter of 2016. It represents a global investment estimated at $110 million USD (approximately €100 million) and will create 70 jobs.
The ceremony was presided over by Group CEO, Diogo da Silveira, and included the presence of a delegation of state authorities, namely the Lt. Governor of South Carolina and Greenwood County officials.
“Although pellet production is a new venture for us, we believe that we are entering a sector with great potential for growth, one which allows us to move forward with our goal of internationalization and diversification of the Group’s industrial base, and even more so in a country which is so prominent in the field of forestry-based products,” da Silveira comments.
Colombo Energy will have a manufacturing capacity of 460,000 tons and will benefit from the favorable conditions of Greenwood County’s forestry raw materials and available energy. The Portucel Soporcel Group has already secured sales of 70% of its production through the signing of 10-year fixed-priced supply contracts targeted entirely to the European industrial market.
Portucel Soporcel Group is the European leader and sixth worldwide in the manufacture of uncoated woodfree printing and writing paper, and the largest European producer, and fifth worldwide in bleached eucalyptus kraft pulp.
Flagship Ventures Invests In Red Stock
Red Rock Biofuels LLC, unveiled a partnership with Flagship Ventures that sets the stage for the construction of its first commercial scale refinery in Lakeview, Ore. As part of this partnership, Flagship Ventures, a leading venture capital and venture creation firm focused on innovations in health care and sustainability, will invest in Red Rock, assume a seat on the Board of Directors and serve as a strategic advisor for future fundraising efforts.
Red Rock takes waste biomass from forests and sawmills, and using a proprietary process transforms it into domestically produced jet, diesel and naphtha fuels. The company’s process begins with the gasification of woody biomass to produce syngas, which is then cleaned and sent to a Fischer-Tropsch unit where it is converted to a high grade, renewable syncrude. Finally, standard upgrading refines the syncrude to yield renewable jet, diesel and naphtha fuels which provide a lower carbon, cost competitive alternative to crude oil-based fuels, according to the company.
Flagship will provide financial and strategic expertise as Red Rock moves toward construction of a commercial-scale refinery and secures additional partnerships, funding and customers. Flagship partner Brian Baynes, Ph.D., led the investment and will join Red Rock’s board of directors.
Last year was pivotal for Red Rock’s move toward commercial-scale production. The company received a $70 million DPA Title III award from the U.S. departments of Agriculture, Energy and Navy to help build its $200 million refinery. The refinery, slated to begin construction this summer, will convert approximately 140,000 dry tons of woody biomass into 15 million gallons per year of renewable, liquid transportation fuels. Also in 2014, Southwest Airlines agreed to purchase approximately 3 million gallons per year of Red Rock’s low carbon, renewable jet fuel.
“We formed Red Rock Biofuels in response to widespread and devastating wildfires in the Western U.S. and the rising demand for drop-in, cost competitive renewable jet and diesel fuels,” says Terry Kulesa, co-founder and CEO of Red Rock Biofuels. “By removing and repurposing the excess biomass that fuels destructive forest fires, we see great potential in the ‘waste to value’ sector, creating cleaner fuels, healthier forests and delivering sustainable biofuels.”
Throughout 2015, Red Rock expects to continue expanding both its team and geographic footprint through additional refineries as renewable fuels.
Markinch Biomass Opens In Scotland
A major addition to the Scottish Government’s plan for a more sustainable energy future in Scotland was reached in March with Fergus Ewing MSP, Minister for Business, Energy and Tourism, officially opening RWE’s Markinch Biomass Combined Heat and Power (CHP) plant in Fife, Scotland.
The state-of-the-art plant replaces an outdated coal and gas fired CHP power station on the site of premium paper and board manufacturer Tullis Russell. It represents a reduction in fossil fuel carbon dioxide emissions by around 250,000 tonnes per annum, delivering a major contribution to the UK’s renewable energy generation targets, according to RWE.
The new facility has an installed capacity of up to 65 MW and provides all of Tullis Russell’s electricity and steam requirements, with excess electricity generation being fed into local networks to fuel around 45,000 homes. The biomass CHP plant is fueled by approximately 90% recovered wood waste and approximately 10% virgin wood sourced from sustainably managed forests.
The Markinch CHP Plant has also supported the safeguarding of 500 jobs at Tullis Russell, which has been a major employer in Fife for more than 206 years. RWE worked in partnership with Tullis Russell, the Scottish Government, Fife Council and local community and community councils throughout the construction of the plant. More than 600 temporary jobs were created during the construction process and around 40 permanent jobs have been created at Markinch and the Offsite Fuel Processing Facility at Cardenden.
The plant is fueled by both recovered and virgin wood, with virgin logs being chipped at the former Bowhill Colliery site in Cardenden. Operated by The Purvis Group, the site chips, stores and supplies fuel to Markinch. Each month, the facility chips up to 6,500 tonnes of virgin wood supplied from a number of Forestry Commission Scotland certified sources. The site can also store 25,000 tonnes of recovered wood each year.
The state-of-the-art boiler system was designed and built by Finnish company Valmet.
As part of the project, RWE Innogy UK and Tullis Russell invested in landscaping initiatives to improve the area surrounding the biomass CHP plant, including the creation of a woodland habitat. The area has been planted with more than 1,000 trees, including birch, aspen and oaks plus more than 1,500 shrubs and Bird Cherry and Goat Willow species. Once mature, the area will support wildlife.
Uttar Pradesh Forest Gains Certification
Third-party certifier SCS Global Services announced that Uttar Pradesh Forest Corp. (UPFC) has met all of the requirements necessary to earn certification for responsible forestry under the internationally recognized Forest Stewardship Council (FSC) standard. The Forest Management Certification encompasses 13 forest divisions covering a total forest area of 349,296 hectares. This area represents roughly 40% of the FSC-certified forest area in South Asia.
UPFC manages all aspects of forestry operations within the State of Uttar Pradesh, located in northern India bordering on Nepal. The SCS audit team, consisting of seven professionals representing a variety of disciplines, completed a six-day field and office audit of the forest management operations as part of the assessment. The interdisciplinary team collected data, analyzed records, conducted interviews with staff and key stakeholders, and carried out a stakeholder analysis.
In each of UPFC’s forest divisions, the principle silvicultural practice for natural forest areas is conservation, with removal of only dead, dying and decayed trees. Planned harvests are practiced only in designated plantation areas. Areas containing rare, threatened or endangered species are recognized as sanctuaries and national parks where any form of extraction is prohibited.
EC Has Concerns About Lynemouth
In February The European Commission opened an investigation to assess whether UK plans to support the conversion of the Lynemouth coal power plant to operate entirely on biomass are in line with EU state aid rules. The Commission will investigate to make sure that the public funds used to support the project are limited to what is necessary and do not result in overcompensation. It will also assess whether the positive effects of the project in achieving EU energy and environmental objectives outweigh potential competition distortions in the market for biomass.
In December 2014 the UK announced plans to subsidize the conversion of the coal-fired Lynemouth power plant to operate on biomass. The plant would have the capacity to generate 420 MW of renewable electricity running exclusively on wood pellets. The project would receive support in the form of a so-called “Contract for Difference” fixing a certain sales price (“strike price”) for the electricity. This means that the generator of the Lynemouth power plant will earn money from selling its electricity into the market. When the average wholesale price of electricity is below the strike price, the generator will receive a top-up payment. According to UK estimates, the project would operate until 2027 and supply about 2.3 TWh of electricity per year. The plant would require approximately 1.5 million tonnes of wood pellets per year mainly sourced from the U.S. and Canada.
In its preliminary analysis, the Commission considered that the parties’ financial calculations and estimates regarding key cost parameters may be too conservative. These parameters, including the load factor of the plant (i.e. the actual electricity produced in a year compared to the maximum possible), its efficiency and the cost of wood pellets, significantly affect the project’s rate of return. At this stage, the Commission therefore has concerns that the actual rate of return could be higher than the parties estimate and could lead to overcompensation.
Moreover, the amount of wood pellets to be imported from overseas is considerable, as compared to the volume of the global wood pellets market. Subsidizing such a large volume of wood pellets could significantly distort competition in the biomass market. The Commission is therefore also concerned that on balance the measure’s negative effects on competition could outweigh its positive effect on achieving EU 2020 targets for renewable energy.
Foley Timber Puts Up Timberlands
Foley Timber and Land Co., which owns and manages 560,000 acres of timberlands in north central Florida, is exploring the sale of substantially all of its business assets and operations. The company’s 876 square miles of timberlands are centrally located between Tallahassee and Gainesville along Florida’s Gulf Coast.
The sale offers the opportunity to acquire timberland operations and related assets that generate significant cash flow through the superior management of highly productive timberlands on contiguous land in an attractive market, according to the company. Foley is majority-owned by company Chairman, Robert Day, and its President, Howard Leach.
“This is an unprecedented opportunity to acquire a premier tract of timberland and related operations in a growing market, supported by a track record of sustainable harvesting, deep customer relationships and long-standing customer supply agreements,” Leach says.
In 1994, a limited partnership was formed to acquire select Florida lands from Procter & Gamble. With the land’s proximity to the community of Foley and former ties to P&G’s Land and Timber division, as well as emphasizing the sustainable timber operations that would continue under the new ownership, the partnership called the business Foley Timber and Land Co.
Over the past 20 years Foley reports it has harvested nearly 23 million tons of wood and has planted more than 224 million trees on 280,000 acres. On average, Foley reforests about 14,000 acres per year, which includes the planting of 10 million trees per year.
ALC Members Lobby Congress, Air Issues
More than 60 members of the American Loggers Council met in Washington March 18-21 in a coordinated effort to present issues important to the timber harvesting industry to lawmakers. Caterpillar Forest Products, John Deere, Forestry Mutual Insurance and the Southern Loggers Cooperative also sent representatives to the gathering.
Scores of Capitol Hill visits included discussions on major issues such as the Youth Careers in Logging Act, truck weight reform, comprehensive Forest Service timber management reform, and fire suppression funding on federal lands. ALC members were briefed on these four issues by ALC staff and heard a presentation from Frank Gladics pertaining to possible reform of the USFS Small Business Administration (SBA) setaside program for timber sales.
Visits included a face-to-face with Sen. John McCain (R-AZ) to discuss the merits of his Flame Act Amendment that has been introduced in the Senate. It would help eliminate the practice of “fire-borrowing” by the Forest Service, which takes dollars from other budget line items to cover catastrophic fire events and does not leave the agency the funds it needs to perform land management activities that would help alleviate the occurrence of catastrophic fires.
Other issues discussed included the reintroduction of the Right to Haul Act, which would allow state legal weight tolerances to travel on interstate highways, and the Youth Careers in Logging Act, which has been reintroduced in both the House and Senate as HR 1215 and S 694, respectively.
In addition to legislative visits, members gathered at a Friday afternoon briefing to hear presentations from Rep. Tom McClintock (R-CA), who chairs the House Resources Committee Subcommittee on Public lands and the Environment. Other presenters included Bryan Rice, Forest Service Director of Land Management, and Bill Imbergamo, Director of the Federal Forest Resource Coalition.
Both Caitlin Rayman, Director of the Office of Freight Management and Operations with the Federal Highway Weight Administration, and Luke Loy, Senior Engineer for the Federal Motor Carrier Safety Administration’s Vehicle and Roadside Operations Div., were on hand to discuss the latest CSA issues and the long-awaited comprehensive truck size and weight study that should be released soon.
Discussions concluded with Candace Schnoor from John Deere giving insight into the economic outlook for the forestry sector in coming years, and Kevin Thieneman, President of Caterpillar Forest Products, challenging ALC to work with partners to improve the image of logging and its ability to attract and retain new workers.
Wood Resource Recovery Sues Gainesville Renewable Energy Center
A major supplier for Gainesville, Fla.’s biomass power plant has filed a breach of contract lawsuit against Gainesville Renewable Energy Center (GREC), the company operating the plant and selling power to the City of Gainesville, after GREC restricted the types of biomass it would accept.
Biomass producer Wood Resource Recovery (WRR) LLC terminated its contract with GREC and filed suit for more than $5 million in damages after GREC officials said the facility would no longer accept municipal yard waste or any biomass from lands zoned or classified as “agricultural.”
According to WRR owner Bill Gaston (WB, August 2013), those restrictions affect more than a third of his raw material supply, and such exemptions were never in the contract. Such actions make it impossible for WRR to continue to do business with GREC under the contract, Gaston says, though the power plant is still able procure fuel from WRR on a purchase-order basis.
Officials with GREC have said the lawsuit has no basis and WRR’s claims are inaccurate and without merit, but have refused to comment further because of the pending litigation.
According to a statement released by WRR’s legal team, WRR’s yard waste volume was included as proof of fuel supply when GREC was gaining regulatory approval and financing for the 102.5MW plant that started up in 2013. Under terms of the contract, WRR was supplying 264,000-277,000 dry tons of biomass annualy.
Removing yard waste—WRR also operates a major tree service in the area as well—from the list of allowable materials is equivalent to losing years of sales, WRR's legal team said. According to the statement, GREC also asked WRR to screen fines from raw material that were thought to be causing operational problems at the plant that were later unfounded, yet WRR had already made investments in screening equipment.
WRR’s legal team says representatives of the companies tried to work out the disagreement since GREC changed material specs last year, but mounting losses forced Gason and WRR to file the suit.
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