Welcome to the 'wonderfuel' world of wood pellets

Under the rather unlikely-sounding headline of "SCR Euro-4 Axor barks up the BioDiesel tree" Biglorryblog learns that environmentally-friendly heating pioneer The Energy Crops Company is underlining its 'green' credentials by running its new Mercedes six-wheeler on BioDiesel. And as you all know, (or should do by now following my recent blog on Volvo's green truck fleet) BioDiesel fuel is almost CO2 neutral. The Axor 2633's Euro 4 SCR engine will run on a 50:50 blend of the stuff with regular diesel and according to the press blurb '...as a result, its emissions are exceptionally low.'

The new 26-tonner has a custom-built tank body, with high-pressure blowing system, by Feldbinder UK, of Spalding and for those of you that are curious The Energy Crops Company was founded in 2005 to provide sustainable wood-fired heating solutions to a wide range of commercial and industrial customers and specialises in supplying woood pellet fuel and, through its network of partners, offers a complete service for converting to biomass heating.

While it's still in its infancy in the UK, apparently the wood pellet industry is well established on the Continent and particularly popular in Austria, Germany and Scandinavia. The dried pellets are produced from wood taken from sustainable forests and are a carbon neutral heat source, the CO2 absorbed by trees during growth cancelling out that emitted when they are burnt.

The pellets require specially adapted biomass boilers but I am told are highly efficient, producing twice as much energy as 'wet' wood – 1kg of pellets provides as much heat as a 1 kilowatt electric fire running for five hours. And not a lot of people know that.

The new Axor has a maximum payload of 16 tonnes and will work on a contract with Nottinghamshire County Council which, over the last three years, has converted coal-fired boilers in 15 of its schools to wood pellet units; following the award of a £500,000 Bioenergy Capital Grant, more schools are now due to follow.

Strong mill may produce wood pellets

STRONG -- Although the Forster Manufacturing wood products mill closed nearly five years ago, ending an era of job security for the small town, investors could have the big empty building humming with about 30 jobs by spring.

Stephen Chute, an attorney from Rumford, and businessman Marshall Swain of Rangeley Plantation presented a plan to selectmen on Tuesday to produce wood pellets for the burgeoning pellet stove market. They have partnered with DG Energy Solutions, LLC, of San Diego, Calif., and plan to complete the purchase of the Forster plant to produce up to 80,000 tons of hardwood pellet fuel each year.

"We'll run 25 trucks a day, and we'll probably run 24 hours a day, so I want to be upfront about the extra noise and traffic in town," Chute said.

Current owners, Jeffrey and Lucinda Allen, have had the mill for sale for nearly three years. Chute and Swain will purchase 8 acres with the mill, but did not disclose a final sale price.

The company would purchase 150,000 tons of hardwood each year from wood suppliers rather than rely on leftovers, or residuals, from sawmills. The mill will strip bark from the logs to use as fuel in the boiler to generate electricity to power the plant.

Bulk loads and smaller 40-pound bags of pellets will be marketed by a distributor in Boston.

"We'll market to customers such as municipalities and school systems," Chute said. Retail hardware stores have been carrying the bags of dog-kibble sized chunks of wood and stove retailers have been marketing aggressively to consumers concerned about the rising price of oil.

Pellets will be dried in a process that removes water from the finished product.

The mill will require retrofitting for venting and a conveyer belt system to carry the pellets into a bagging system for shipment.

"We'll be bringing our vendors and principals from the company to tour the mill on Friday," Chute said. "We'll be using energy credits to offset our energy costs, and we'll have about 30 jobs we'll need to fill to operate the plant."

Selectmen and the water board of trustees will meet with the owners to learn more about the schedule of development plans over the next few months. Swain said they will order machinery in August, receive funding from the San Diego parent company in September and modify the building in October. In January 2008, they plan to start accumulating their hardwood inventory and begin testing the production process in March. With no interruptions in scheduling, the plant could begin producing wood pellets in May.

"We've presold our product five years in advance," Chute said. "We're putting about $6.5 million into this project."

International Forest Products in Boston will market the pellets to Lowes and Home Depot. The mill will not employ a sales force.

Pellet

The composition of wood pellets will depend on the source material (more on this later), although in all cases avoiding contamination and maintaining the right moisture content is essential.There were some early experiences with low-quality pellets, which tended to combust poorly or have undesirable emissions.The industry is acutely aware of the damaging effect that low-quality product could have on the market as a whole, and is rigorous about maintaining standards.

A large proportion of pellets have up to now been produced from compressed sawdust from the wood processing industries - typically furniture-making.This has two main implications: first, the sawdust generally comes from seasoned wood, so already has a lower moisture content than freshly harvested wood and needs less (or no) drying. Secondly, it means that these pellets can be manufactured wherever that industry is located. Interestingly, although Austria has a large forestry industry, a high percentage of the pellets produced there are made from imported Scandinavian wood that is used for furniture manufacture.However, this can only be done realistically in plants that are large enough to ensure a good flow of clean material, for the purity of pellet content is essential. That's why waste wood, from pallets or demolition, and which has most likely been treated with some type of preservative or coating, is unsuitable for pellet manufacture.

Other pellets,however,come straight out of the waste from the sawmill industry - as the massive pellet production figures from Sweden, Canada and the Baltic attest.These pellets mills make use of the waste that is produced as raw timber is processed into cut timber - using the sawdust and wood shavings.

With their low ash content,the quality of pellets from these two sources (furniture or sawmill) makes them excellent for the consumer (home heating) market. Pellets boilers and stoves tend to need a consistent, high quality of pellet to optimize their function, and it is important that the supply market delivers this.

Within the sawmill, another material which can easily be included in pellets is wood bark. This tends to be included in pellets for larger applications - large power plants or maybe CHP - where the requirements may not be so critical. (In fact, some pellet producers optimize the 'recipe' of batches of pellets specifically to meet the requirements of individual large power plants.) It then becomes a natural progression for pellets to start to include forestry and felling residues, although up until now this has not been carried out on any significant scale.

In December 2005, Bioenergy International published its latest survey (with the disclaimer that information on smaller plants is very hard to come by, and thus excluded plants producing less than 5000 tonnes of pellets per year, so these figures should be treated with some caution).

TABLE 1. Estimated production of pellets by country in 2005, from plants larger than 5000 tonnes/year. Sources: Bioenergy International December 2005 (see note in text); Wood Pellet Association of Canada
Sweden	1,356,000 tonnes	Two plants producing over 130,000 tonnes per year, 15 producing over 30,000 tonnes
Canada	1,000,000 tonnes	Five plants over 80,000 tonnes, several plants in the 200,000-tonne range
Russia	758,000 tonnes	Two 100,000-tonne plants, seven over 30,000 tonnes
US	600,000 tonnes
Denmark	535,000 tonnes	One 280,000-tonne plant and two over 80,000 tonnes
Finland	460,000 tonnes	Six plants over 30,000 tonnes
Austria	409,000 tonnes	Four plants over 30,000 tonnes, three in 80,000-100,000 tonne range
Germany	388,000 tonnes	Six plants over 30,000 tonnes
Poland	356,000 tonnes	One 100,000 tonne plant and three over 30,000 tonnes
Estonia	345,000 tonnes	Three plants over 80,000 tonnes
Latvia	340,000 tonnes	One 100,000 tonne plant, and four over 30,000 tonnes
Italy	169,000 tonnes	Estimated three over 30,000 tonnes, many small plants
Norway	138,000 tonnes	One plant over 30,000 tonnes
Lithuania	110,000 tonnes	One 60,000-tonne plant
UK	110,000 tonnes	Two 50,000-tonne plants
Netherlands	100,000 tonnes	One 100,000-tonne plant
Slovenia	90,000 tonnes	Two 40,000-tonne plants
Spain	70,000 tonnes	One 40,000-tonne plant
France	62,000 tonnes
Switzerland	60,000 tonnes	One plant over 35,000 tonnes
Slovakia		Seven plants, production not available

Producers vary in scale and approach. Just a few are mentioned below:

• Fulghum Fibrefuels Ltd is based in the United States, and was set up in the late 1990s to supply bulk, cleanburning biofuel to power plants in northern Europe. Its current annual production averages 80,000 tonnes.The company is a wholly owned subsidiary of Fulghum Fibers, Inc. which is a forestry/timber processing operation closely affiliated with specialist machinery producer Fulghum Industries, Inc. Currently, Fulghum is delivering bulk shipments from its Nova Scotia mill, which produces custom blends of biofuel pellets (manufactured from both wood sawdust and bark) for power plant customers in Europe.This mill was originally built in partnership with MacTara Lumber, which owns and operates the mill.The company says it has the capacity to build additional pellets mills at sites around the world to meet the power industry's future needs. Fulghum's in-house laboratory performs many tests including moisture content, pellet durability, particle size, and pellet size distribution.You can take a virtual tour of a Fulghum pellet mill at www.fulghumfibrefuels.com/milltour.htm

• Vapo Oy. Finland's Vapo Group focuses on production of heat and power from local sources, which include forest, peat (widely used in Finland though protected in many countries where peatlands are scarcer) and wastes.Vapo produces pellets at over ten plants in Finland,Sweden and Estonia, with the 'energy pellets' being divided into wood pellets and peat pellets.Total production in 2005 was in excess of 500,000 tonnes.

Sawdust from timber sawing or furniture manufacture is compressed to make a clean, durable, biofuel EDWARD MILFORD

• SIA Gaujas Granulas of Latvia, a member of the Baltic Bioenergy Group (BBG), is the largest and most modern producer of wood sawdust pellets in the Baltic countries. Currently around 95% of the wood pellets produced in Latvia are exported to Europe and Scandinavia, where they are used for both heating and electricity production.

• SCA Bionorr, of Sweden, produces 140,000 tonnes of pellets a year from Forest Stewardship Council-certified timber, and sells its product mainly for heating purposes - to homeowners, owners of medium sized heating plants and large district heating plants.

• German Pellets GmbH currently has a 70,000 tonnes/year plant operating in Baden-Württemberg, southwest Germany, and a 120,000 tonnes/year plant under construction in Wismar, on the Baltic coast east of Hamburg. Second phases for both these plants are planned, sized at 220,000 and 240,000 tonnes/year, respectively. Once built, the company's total capacity will be 650,000 tonnes/year.

• Ökowärme of Austria produces 95,000 tonnes of pellets a year at its state-of-the-art production plant, manufactured from sustainable forest enterprises. It claims 10,000 regular customers in Austria and abroad. Earlier this year the company opened up a new plant in Baden-Württemberg, Germany, in conjunction with BioPell,which will produce 45,000 tonnes per year of pellets, along with wood and bark briquettes. Heat for wood drying at the new plant comes from an on-site CHP plant run on locally-produced rapeseed oil.

PELLETS IN CHINA China plans for renewables to meet 10% of total energy consumption by 2020, and has extensive biomass resources. These include straw and wood waste, and feed grain that is now too old to use. According to Professor Liu Dehua of Tsinghua University (speaking at the 14th European Conference and Exhibition in Paris, last October) China plans to produce 50 million tonnes of pellets by 2020. Johan Vinterbäck, organizer of the upcoming 2nd World Pellets Conference (being held in Jönköping, Sweden, in May) the Chinese government has declared that 50 combined heat and power stations are to be built using straw pellets as fuel. China has serious energy issues but has seen the potential in pellets not least from local and global environmental perspectives', says Dr Vinterbäck.

 Other businesses are smaller, regional, and proud of it. One of many examples is ante-holz of Bromskirchen-Somplar in the Sauerland region of Hessen in Germany - the company stresses the regional quality of its pellets product, the benefits for the local forestry economy and to the environment if lengthy transport is not required.

WHERE IS PELLET PRODUCTION GOING?

Customers of all sizes need to be confident of getting hold of not only the right quality of pellets, but the right quantity when needed

Vapo's Matti Hilli said he expects to see a significant consolidation among the producers of pellets within the coming five years. He believes this will increase the cost efficiency, and allow more precise quality control, as well as 'remarkable savings' in logistics. Larger companies will also be able to time and finance their investments better, he says. A few companies in Europe will dominate 70%-80% of the total production by 2010, but small producer companies will operate regionally.

WHAT ABOUT DISTRIBUTION?

Pellets can be produced and used locally, but can also be shipped internationally to match up production and markets.At present,much of the North American produce is shipped to Europe for use in power generation, and within North America, pellet use tends - at present - to be concentrated on home heating. Much of the Scandinavian and Baltic product is also shipped to Europe.With the pellet market still being relatively new, it has experienced some imbalances of undersupply and oversupply, but stability is now being achieved.

Once this timber has been sawn and planed for the market, the sawdust and shavings will be ideal for pellet production EDWARD MILFORD

This is essential, for customers of all sizes need to be confident of getting hold of not only the right quality of pellets, but the right quantity when needed. At present, the pellet suppliers can be large, international businesses or small, local firms or farmers.

Being able to produce and use pellets on a local or regional basis has great appeal in terms of pellets' sustainability footprint.All the same, Hilli said he believes it is important for consolidation to occur in the distribution of pellets if the market is to expand rapidly.There will be tough competition, he believes, and only distributors who can add value at their stage of the supply chain will succeed.

He envisages that national distributors and possibly even Europe-wide distributors will serve the consumer market, ensuring supply and providing homogenized product quality and services. Some producer-distributors will concentrate on distribution, as they discover their core competence is in marketing and sales.Others will generate national sales networks and effective delivery systems and become large producers.

The needs of the three distinct markets - consumer, the medium-sized district heating or industrial plant market, and large condensing power plant market, will continue to differ.

GERMANY - PELLETS HEATING COMES OUT OF THE NICHE 2005 saw unprecedented demand for pellet heating systems in Germany, with 14,000 new systems installed (representing 2% of all new heating installations in Germany in 2005). This brings the total number of pellets heating systems installed in Germany up to 40,000. According to a market scenario recently released by the organizer of the Pellets 2006 trade fair and the 6th Pellets Industry Forum, taking place in October in Stuttgart, annual market growth of 15% can be expected in 2006. This would give pellets an 8% share of the German heating market by 2015, with an estimated 57,000 new installations being made each year and an annual industry turnover of €1.35 billion. (The market forecast assumes a stable policy environment and an oil price of between $50 and $100 a barrel.) The Pellets 2006 trade fair and the 6th Pellets Industry Forum are being organized by Solar Promotion GmbH, Pforzheim. The event is supported by the German Energy Pellet Association and the German Solar Energy Society. For further information: www.pellets2006.de

BEYOND WOOD - AGROPELLETS

It is not only wood that can be 'pelletized' for energy production. Agricultural residues - in particular, straw - are the obvious next step, with specific energy crops being investigated. One of the drivers is economics, since the agricultural residues are readily available for use and can boost production as demand for pellets grows. In southern Europe, for example, where there is little forest residue to pelletize, there are significant possibilities for using agricultural residues.This is also true of some of the new EU Member States, particularly Poland.

The next step for wood pellets is to start to use forest thinnings 

 

Straw has a naturally low moisture content, so does not usually need to be dried prior to pelletization, though it does need to be finely milled.Pelletized,however, it is far less bulky to store or transport than in straw bales, and again, it is protected from deterioration.

Depending on the crop the straw comes from, and the fertilizers used in its production, straw can have higher levels of nitrogen, sulphur, chlorine and potassium than wood. Emissions obviously need to be minimized, and this can be controlled to some extent during pellet manufacture, and then in combustion. At present however, it seems that straw pellets are more likely to be suitable for larger-scale use than in domestic heating.

The next step is the use of specific energy crops. As we reported in REW March-April 2005, (see Pellets appeal on www.renewable-energy-world.com) a Danish project carried out research on a range of different materials, including grains and seeds, for pellets production. Others are working with miscanthus (elephant grass) as a source of pellets. Vapo reports positive experiences of growing reed canary grass for energy purposes and for pellet raw material. With proper harvesting, says the company, reed canary grass does not have the same chemical problems as straw in the burning process.

The Balcas plant near Enniskillen in County Fermanagh, Northern Ireland, makes wood pellets from sawdust and woodchips, with a capacity of around 50,000 tonnes per year. Balcas chose to invest in the plant after a 40% increase in business had led to a surplus of sawdust and woodchips at their timber-processing plant. Its energy supply is provided by biomass-fuelled CHP (11.5MWth/2.7MWe) VYNCKE

In March, at the Bioenergy Europe 2006 conference in London, Dr Giuliano Grassi, Secretary General of the European Biomass Industry Association (EUBIA) aroused a great deal of interest when he told the audience about recent work on producing pellets from a wide range of energy crops and residues.The project has been trialling the pellets, testing their content and emissions to optimize them. Dr Grassi sees agropellets as going beyond heat and power. He believes that the pelletization process is a strategic key to substantially growing the bioenergy/biofuels sector, because of the great benefits the process offers in terms of stabilizing humid biomass. Dried and pelletized, the crop is protected from decay, is energy-dense, storable and transportable, making it suitable for later use in biofuels production, in gasification, or for syngas (to be converted to hydrogen). He estimates that the stabilization of biomass in Europe could be a market worth 26 billion by 2020.

The next step towards real energy-crop farming, according to Dr Grassi, is on-farm pelletization, using mobile pelleting equipment that can process crops or residues onsite. This would not only be a technical solution, but would give individual farmers the right motivation to get involved with pellets.They could store their product and release it onto the market as they wish. (And yes, quality control and labelling mechanisms would need to be in place.) Such energy crops could include miscanthus, though the trials for sweet sorghum, in particular, have been successful. Other purpose-grown grains, or surplus food grain, could also be converted into agropellets.

Growing energy crops specifically for conversion to pellets, rather than relying on wood residues, does start to change the economics.According to Dr Giuliano Grassi, the yield of sorghum is 25-28 dry tonnes/hectare, at a cost of €32/dry tonne while miscanthus comes in at 22 dry tonnes/hectare, at a cost of €30/dry tonne. However, a key opportunity for agropellets could be in replacing coal for power generation, by means of co-firing operations.

Ökowärme of Austria produces 95,000 tonnes of pellets a year at its state-ofthe- art production plant EDWARD MILFORD  

Dr Grassi explains that 31% of power in the EU is currently derived from coal. (Many of the new EU member states rely particularly heavily on coal). An initial target of 10% biomass co- firing would mean a rapid 20,000 MWe contribution from biomass, requiring approximately 70 million tonnes/year of dry biomass - such as pellets. Co-firing with agropellets could technically be increased to a level of 20%-25%, says Grassi, which could in turn have a large impact on rural development.

He has calculated that 1 kg of agropellets would typically avoid the emission of approximately 1.45 kg of CO₂ if used to replace coal.The pellets are also free from sulphur emissions and produce smaller amounts of noxious ash than coal. He believes that the price of agropellets could be competitive with imported coal, at a cost of approximately €64/tonne (partly compensated by the cost benefit, in Europe, of avoiding carbon emissions from coal).

For, or against, the grain?

When it comes to using grain - which could in fact be combusted in its natural state - conversion to pellets offers a number of advantages, as Bengt-Erik Löfgren (of Äfab, Sweden) pointed out in his presentation at the pellets conference section of the World Sustainable Energy Days, held in Wels, Austria, in March. Combusting un-palletized excess grain leads to output of nitrous oxide, sulphur dioxide and hydrochloric and other acids that would rapidly corrode exhaust chimneys, even at high flue gas temperatures. Pelletization offers the chance to add other ingredients that can reduce the acidification. The simple addition of sodium bicarbonate - baking powder - to grain pellets binds sulphur, chlorine and other substances that are harmful in flue gas, to the ashes.And this even increases the value of the ash as a soil improvement material.

An initial target of 10% biomass co-firing would mean 20,000 MWe from biomass, requiring 70 million tonnes/year of biomass

Strong mill may produce wood pellets

STRONG -- Although the Forster Manufacturing wood products mill closed nearly five years ago, ending an era of job security for the small town, investors could have the big empty building humming with about 30 jobs by spring.

Stephen Chute, an attorney from Rumford, and businessman Marshall Swain of Rangeley Plantation presented a plan to selectmen on Tuesday to produce wood pellets for the burgeoning pellet stove market. They have partnered with DG Energy Solutions, LLC, of San Diego, Calif., and plan to complete the purchase of the Forster plant to produce up to 80,000 tons of hardwood pellet fuel each year.

"We'll run 25 trucks a day, and we'll probably run 24 hours a day, so I want to be upfront about the extra noise and traffic in town," Chute said.

Current owners, Jeffrey and Lucinda Allen, have had the mill for sale for nearly three years. Chute and Swain will purchase 8 acres with the mill, but did not disclose a final sale price.

The company would purchase 150,000 tons of hardwood each year from wood suppliers rather than rely on leftovers, or residuals, from sawmills. The mill will strip bark from the logs to use as fuel in the boiler to generate electricity to power the plant.

Bulk loads and smaller 40-pound bags of pellets will be marketed by a distributor in Boston.

"We'll market to customers such as municipalities and school systems," Chute said. Retail hardware stores have been carrying the bags of dog-kibble sized chunks of wood and stove retailers have been marketing aggressively to consumers concerned about the rising price of oil.

Pellets will be dried in a process that removes water from the finished product.

The mill will require retrofitting for venting and a conveyer belt system to carry the pellets into a bagging system for shipment.

"We'll be bringing our vendors and principals from the company to tour the mill on Friday," Chute said. "We'll be using energy credits to offset our energy costs, and we'll have about 30 jobs we'll need to fill to operate the plant."

Selectmen and the water board of trustees will meet with the owners to learn more about the schedule of development plans over the next few months. Swain said they will order machinery in August, receive funding from the San Diego parent company in September and modify the building in October. In January 2008, they plan to start accumulating their hardwood inventory and begin testing the production process in March. With no interruptions in scheduling, the plant could begin producing wood pellets in May.

"We've presold our product five years in advance," Chute said. "We're putting about $6.5 million into this project."

International Forest Products in Boston will market the pellets to Lowes and Home Depot. The mill will not employ a sales force.

Gov't backs $97M in biofuel loans

The Associated Press August 21, 2007, 5:53PM ET

WASHINGTON

The U.S. Agriculture Department on Tuesday awarded $97 million in loan guarantees to support four biofuels projects as part of a broad push to encourage renewable energy use.

Clean Burn Fuels LLC will be loaned $35 million to build an ethanol plant in Hoke County, N.C., and Blackhawk Biofuels LLC was awarded $27.5 million for a planned biodiesel plant near Freeport, Ill.

Appling County Pellets LLC was awarded $19.5 million to produce wood pellet fuel in Appling County, Ga., and National Trail Biodiesel will be loaned $15 million to build a biodiesel production plant in Jasper County, Ill.

Current law mandates 7.5 billion gallons of renewable fuel use in the U.S. by 2012, but proposed legislation would increase the requirements to 36 billion gallons per year by 2022.

Trader Mitsubishi Sets Up Firm to Make Wood-Based Biofuels

Tokyo, Aug 20, 2007 (Jiji Press) - Major Japanese trader Mitsubishi Corp. <8058> said Monday that it has established a manufacturing and sales firm for wood-based biofuels in southwestern Japan.

The company, based in Hita, Oita Prefecture, plans to install facilities to manufacture pellets made mainly of cedar bark with a maximum annual output of 25,000 tons, the largest in Japan. The biofuels will be mixed with coal in order to reduce the amount of carbon dioxide emitted by coal-burning boilers.

The new company is owned 70 pct by Mitsubishi and the rest by a local lumbermill cooperative and another firm. Forestry is the main industry of Hita.

For the time being, the company will sell the waste wood-made pellets to small firms in Oita that own coal boilers.

Mitsubishi is currently in negotiations to build similar production facilities in other parts of Japan and it is looking to launch the business overseas, mainly in Asia, in the future. The company hopes to attain global biofuel pellet production of one million tons in 2010.

Mitsubishi Corp creates firm to produce biomass pellets

Japan's largest trading company Mitsubishi Corp. earlier announced it is making major investments in three types of biofuels (that can replace diesel, gasoline and coal). Yesterday, the company brought some clarity to its plans by explaining its interests in the solid biofuels segment. Mitsibushi says it has established a manufacturing and sales firm for wood pellets in southwestern Japan.

The company, based in Hita, Oita Prefecture, plans to install facilities to manufacture pellets made mainly of cedar bark with a maximum annual output of 25,000 tons, the largest in Japan. The biofuels will be mixed with coal and co-fired in order to reduce the amount of carbon dioxide emitted by coal-burning boilers.

The new company is owned 70 percent by Mitsubishi and the rest by a local lumber mill cooperative and another firm. Forestry is the main industry of Hita. For the time being, the company will sell the waste wood-made pellets to small firms in Oita that own coal-fired boilers.

Mitsubishi is currently in negotiations to build similar production facilities in other parts of Japan and it is looking to launch the business overseas, mainly in Asia, in the future. The company hopes to attain global biofuel pellet production of one million tons in 2010:

The company will be involved in ethanol production as well, both in Japan and abroad. In one of the first few deals, Mitsubishi this month invested 300 million yen (€1.9/$2.6 million) to take a 34-percent stake in a government-backed project to build an ethanol plant with annual output of 15 million liters on the northern island of Hokkaido.

When it comes to biodiesel, the company plans to produce 1 to 1.5 million tonnes a year by 2017 after building plants in Asia or in Central and South America.

Mitsubishi Corp to invest in three types of biofuels both in Japan and abroad

Japan's largest trading company Mitsubishi Corp. aims to take a slice of the growing green fuel market with a planned annual capacity of 2 billion liters (530 million gallons) of green ethanol by 2017, a senior manager tell Reuters.

The new plants will be based in Japan and other parts of Asia as well as in South America, where supply of feedstock is sustainable, competitive and ample, says Takashi Miyazaki, a general manager at Mitsubishi's renewables energy business unit.

Mitsubishi in April set up a team of 15 staff to produce and market three types of green fuel: (cellulosic) ethanol, (second-generation) green diesel and biomass fuel pellets.

• Ethanol: In one of the first few deals, Mitsubishi this month invested 300 million yen (€1.9/$2.6 million) to take a 34-percent stake in a government-backed project to build an ethanol plant with annual output of 15 million liters on the northern island of Hokkaido. Kirin Brewery Co. Ltd., Japan's second largest brewer, is providing fermentation technology to the Hokkaido project.
• Biodiesel: Miyazaki also said Mitsubishi plans to produce 1 to 1.5 million tonnes a year of biodiesel by 2017 after building plants in Asia or in Central and South America. The volume is compared with 5 million tonnes a year of the existing rapeseed-origin biodiesel market in Europe. Japanese household goods maker Lion Corp. will provide expertise when Mitsubishi starts its biodiesel projects. Lion has developed technology to produce methylester sulfonate, used in laundry detergents, from palm oil, a major feedstock for biodiesel in Asia.
• Pellets: on bio-pellets used to co-fire with coal and used to reduce CO2 emissions, Mitsubishi plans for a capacity of 4 million tonnes a year by 2017, of which domestic output will be 20,000 to 30,000 tonnes. Global demand for bio-pellets made from wood waste is expected to grow to 150 million tonnes a year by 2030, up from 8 million tonnes currently, according to the company's estimate.

The company is not new to the bioenergy sector. Recently it signed a comprehensive cooperation agreement with Dynamotive, a developer of second-generation biofuels based on the pyrolysis of biomass. Mitsubishi also agreed to a 30-year ethanol supply agreement with Brazilian producer Sao Martinho. But the Japanese trading firm now wants to go beyond trading and actively pursues a stake in the production chain:

The production of renewable energy - biofuels, biomass, solar energy and wind energy - has become one of Mitsubishi's new focused business segments.

Analysts said investing in unconventional areas is an industry-wide trend as trading firms look for a new source of profit growth. "I think biomass energy is relatively contiguous with the company's existing business," said Ben Wetmore, senior analyst at Mizuho Securities.

Global demand for biomass ethanol is set to leap to 280 billion liters (74 billion gallons) a year by 2030, boosted by policy incentives and new technology cutting production costs, more than six times as much as the 40 billion liters (10.5 billion gallons) produced currently, according to the company's forecast.

"Manufacturing is the most profitable in this field of business as we think supplies will have to catch up with high-flying demand in the next few decades," Miyazaki said. But he declined to elaborate on details of Japan's top trading company's investment plans for renewable fuels.

"It's difficult to sum it up. We understand it takes four to five years to build a facility and five to six years to make profits out of it," he said. "Also, situations differ from one country to another," he added.

Consultants reverse recommendation on Hamilton’s garbage incineration plan

Eighteen months ago, energy consultants said Hamilton and Niagara should build a garbage incinerator, but now they are saying it might make more sense to turn waste into fuel pellets.

Refuse-derived fuel recently became a more attractive option when the province made it easier to get permission to use it for power production.

Energy consultant David Merriman told Hamilton's waste plan working group York Region has a deal with a Vaughan company to turn some of its garbage into the fuel pellets.

He estimates the pellet-making process would cost $85 per tonne, compared with $147 a tonne for incineration, but would only work if there is long-term demand.

When the study began, both Hamilton and Niagara regions were worried about running out of landfill space. But since then, both cities have negotiated more space in local dumps.

The group decided to keep incineration, landfill and production of refuse-derived fuel on the agenda and to consult with the public again next year. Hamilton has already approved plans for an incinerator.

2006 Malaysian Palm Oil Market Summary

August 13, 2007 (TheEdgeDaily.com) — Kuwait Finance House Research said agriculture has been an important sector of the Malaysian economy, providing the impetus for economic growth in the past few decades and contributing to higher rural incomes.

In 2006, Malaysian agricultural exports rose to RM42.1 billion (2005: RM37.4 billion) or 7.15% (2005: 7.1%) of Malaysia's total export value.

Palm oil, being the largest contributor to the agricultural sector, recorded strong export earnings of RM21.6 billion or 51.4% of total agricultural exports value during the year, propelled by continuous R&D efforts to boost industry output and productivity.

The past two years have also seen Malaysia achieving milestones, especially on the biofuel front. Currently, there are five biodiesel plants in the country, with an additional five plants expected to come onboard by year-end.

Global efforts to reduce the dependency on fossil fuel, coupled with Malaysia's advantage in the palm oil industry will see the country continuing to pursue further biofuel initiatives.
2006 review and 2007 outlook

The palm oil price touched this year's high of RM2,886 per tonne on June 6, driven by expectations of a supply shortfall and rising global demand.

We think the palm oil price has reached its peak and is projected to trade between RM2,300 and 2,400 per tonne for the rest of the year. For full-year 2007, the palm oil price is expected to remain firm, averaging at RM2,300 per tonne (2006: RM1,900 per tonne), driven by the following factors:

• The Malaysian biofuel project, when fully implemented in 2008, is expected to absorb up to 500,000 tonnes of palm oil per annum. Malaysia has also agreed to set aside up to 40% (about six million tonnes) of the country's total palm oil production for biodiesel.

• Increased demand for palm oil from China with the abolishment of palm oil import quota will see the country buying an additional one million tonnes per year of palm oil in the next few years.

• Robust economic growth, higher edible oil consumption and the removal of palm oil import quota in India will see higher demand for palm oil. Palm oil exports to India rose by 10.7% y-o-y in June 2007.

• Lower import duty on processed palm oil in line with Asean Free Trade Area (Afta) agreement commitment will see increasing palm oil demand from Vietnam.

• Higher projected growth of global demand for vegetable oils (to 169 million tonnes per year by 2020 versus today's 90 million tonnes per year).

• Increasing worldwide demand for biodiesel will ensure increasing demand for palm oil (palm oil being a cheaper material input for biodiesel production compared to soya oil).

Planted area

Over the past two decades, Malaysia's total oil palm planted area increased from 640,000 hectares in 1975 to 4.17 million ha in 2006. In 2006 alone, the total oil palm planted area increased 2.8% y-o-y, driven mainly by Sabah and Sarawak with a combined growth of 4.5% versus Peninsular Malaysia's 1.6%.

Sabah has the largest oil palm planted area at 1.24 million ha, accounting for 30% of Malaysia's total oil palm planted area in the country. Matured areas stood at 3.5 million ha or 87.5% of Malaysia's total planted area in 2006.
Palm oil production

In 1H07, palm oil production stood at 6.68 million tonnes, 8.03% lower than 1H06's 7.26 million tonnes. This was mainly due to floods in the southern peninsula states during early 07 (palm oil output fell by 21.4% y-o-y to 1.05 million tonnes in Johor in 1H), excessive rainfall in the past six months as well as a dry season in June 2007 in major producing states, thus reducing the country's total palm oil production.

Reflecting lower palm oil production, FFB yield per ha was lower at 8.15 tonnes in 1H07 compared with. 9.05 tonnes in 1H06, while the oil extraction rate (OER) fell to 20.08% in

June 2007 against 20.31% in May 2007.

Nevertheless for full-year 2007, we project palm oil output to trend slightly higher by 3.8% y-o-y to 16.5 million tonnes, boosted by peak production cycle in 2H07.
Palm oil exports

For full-year 2007, we expect palm oil exports to trend higher to 20.89 million tonnes, with total palm oil export earnings of approximately RM46 billion (with the assumption that palm oil price averages at RM2,200 per tonne in 2007).

We expect higher palm oil demand this year from Vietnam (due to lower import duties on processed palm oil); the US (with the new trans-fat labelling law; and Jordan due to re-exports to the Iraqi market.
Catalysts for plantation sector

Plantation sector merger

Last year, Malaysia announced a mammoth plantation merger which will result in the largest listed palm oil company in Southeast Asia and the world. The combined entity is expected to have an estimated market capitalisation of RM75.5 billion, planted estates of 511,000 ha, plantation landbank of 578,337 ha and produces 5% to 6% of global CPO output.

The research house is positive about this merger as the entity is expected to derive economic synergies and economies of scale by ensuring optimal production, cost cutting/ savings and optimal capital usage. It maintains its aggressive outlook for a buoyant year for palm oil in 2007.
Biodiesel outlook

Malaysian Palm Oil Council (MPOC) said palm oil is suitable for use as second-generation biofuel in reducing carbon dioxide emissions by more than 80%, provided the processing stages are finetuned.

Output is largely meant for exports to Europe, the US and Japan. Excess output will be marketed locally through the B5 blend under the Malaysian Biofuel Policy.

The industry is mainly driven by surging oil prices that have stimulated the industry worldwide. Generally, biofuel plants are growing at a dizzy rate supported by strong demand from the US, Europe and other parts of Asia to reduce dependence on crude oil, reduce greenhouse gas emissions and boost agriculture.

Although the expansion and the importance of the biofuels industry are currently on the radar, the reseach house says the industry may not grow as fast as expected due to rising feedstock prices.
Economic considerations on biofuels

Vegetable oils form 80% to 90% of the biodiesel production cost, therefore, the cost of feedstock plays a crucial role in the biodiesel vs. fossil fuel diesel competition.

If palm oil prices stay at US$500 (RM1,738) per tonne and crude mineral oil at US$60 per barrel, the subsidy required to make biodiesel competitive versus petroleum diesel is US$1.25/litre.

This is possible through subsidies provided by the government to biodiesel producers or by reducing the diesel subsidy at the retail level, hence the cost is passed on to consumers.

Palm biodiesel will be attractive if the palm oil price stays below US$450 per tonne and crude oil prices stay above the US$70 per barrel (US$514 per tonne).
Possible solutions include:

• Allowing market forces to set the price of petroleum diesel;

• Legislation to make it mandatory to use biofuels blends. For example, EU countries used 4.5 million tonnes of biodiesel in 2006. This is expected to rise to about 6 million tonnes in 2007, and a mandatory 5.75% blending will take effect by 2010;

• Alternatively, the Malaysian government may cap palm oil prices at RM2,600 per tonne for its biofuel needs to ensure that prices remain competitive compared with fossil fuels. While this cap may not apply beyond the need of the biofuel industry, it is a bit of a dampener for industry players who may be forced to commit a percentage of annual production for biofuel purposes.
Outlook

From 2007 to 2012, the demand for vegetable oils is expected to increase by three million tonnes to 21 million tonnes due to relentless efforts in promoting the expansion of the global biodiesel industry.

The projected increase far exceeds the demand for food consumption by 40% to 60%. Due to competitive pricing, palm oil largely contributes as a cost-effective feedstock for biodiesel production.

Nevertheless, the growing demand for biodiesel is expected to counter the drawbacks of palm oil-based biodiesel. Meanwhile, palm oil exports from Malaysia and Indonesia are expected to surge moving forward as the palm oil-based biodiesel industry worldwide expands.

In conclusion, palm oil-based biodiesel seems to be the most competitive in terms of price and versatile in terms of usage. Malaysia and Indonesia, being the largest palm oil producers in the world, are in the best position to capitalise on biodiesel demand in the long term, hence creating a market with immense potential.

Moving forward, Malaysia is expected to take the lead in terms of palm oil-based biodiesel due to the country's supply, increasing prices and energy yields produced from palm oil-based biodiesel as compared with other vegetable oils.

Nevertheless, palm oil-based biodiesel will not take off as early as expected due to the costs involved for the development and expansion of the industry with the upsurge in palm oil prices stemming from the shortage of supply.

The power of pellets

The Port of Benton has patented a formula for creating pellets from agricultural waste that can be used to create cleaner, cheaper power and heat.

Last year, Roger Wright of the Port of Benton began working with different types of agricultural waste -- such as grape pomace, spent hops and mint slug -- to see which formula, when pelletized, created the highest BTUs.

The port received more than $200,000 in grants to do the study to demonstrate that biomass -- agricultural waste byproducts -- from area farmers could be used as a feedstock to produce clean energy through gasification.

Nearly two million tons of agricultural waste is generated each year in Benton, Franklin, Yakima, Walla Walla, and Klickitat counties.

While some of the waste can be used as feed for cattle and other stock, historically much of it has been dumped in rural areas, creating safety issues.

During the study, the waste was pelletized by Yakima Chief in Sunnyside. The pellets were then taken to FruitSmart, a Prosser-based company that dries fruit pulp, extracts the seeds and creates value-added products for the food manufacturing business.

Each day, the pellets were shoveled into a "biomass" gasifier, which burned the pellets and converted them to energy that was used to operate FruitSmart's seed separation machine, instead of the propane the company generally used. The experiment offset propane costs by up to 40 percent, Wright said.

And they kept track of which pellet "recipes" provided the highest BTUs, offering the greatest efficiency.

Wright said the project proved that agricultural waste could by processed into a fuel pellet that could produce clean energy at an economical cost when compared with other fuels.

The port isn't looking to get into the pellet production business itself, but it is looking for a company that's interested in manufacturing the pellets for them, said Scott Keller, the port's executive director.

The port's job is economical development, Keller said, and it will use the patent as a carrot to convince a pellet manufacturer to set up business in Benton County.

"Not so much as to collect royalty, but to force someone who is interested in doing something with it to do it here -- so we can do the project here and create jobs," Wright said.

Wright said the port is hoping to purchase industrial land in rural Benton County -- preferably the Prosser area -- to buy for a manufacturing plant. The location needs to be central to keep the cost of hauling agricultural waste low.

And the port is in discussions with Bear Mountain Forest Products, an Oregon-based company that makes wood pellets. Bob Sourek, the owner of the company, met with port officials last week, Wright said.

The port also is hoping to purchase a commercial gasifier and generator so it will be able to demonstrate the capabilities long-term.

Port officials demonstrated the project for Rep. Doc Hastings, R-Wash., last December in Whitstran.

Hastings said the project presents an exciting opportunity for the port and the community.

"Converting agriculture byproducts to fuel seems to be a natural fit for our farm-based communities," Hastings said.

Belgian-Dutch Partnership To Build Biocoal Pellet Plant

Thenergo, a clean energy company based in Antwerp, Belgium, has joined in a partnership with two Dutch companies, Eclair-E and Venture Kapitaalfonds III BV, to develop a new plant that will simultaneously produce biocoal pellets and electrical power. Biocoal is thermally processed wood debris, forest residue and chippings; the facility will obtain its materials from regionally sourced forest debris and pruned wood from public lands.

The new facility, which the company is calling an E-Park, will be located in the Dutch town of Coevorden, near the German border, and is designed to produce 75,000 tons of biocoal pellets annually while generating up to 42,800 MWh of electrical power. Construction is scheduled to begin in April 2008, and the facility is expected to be fully operational within 18 months.

"The combination of biocoal and electricity production adds a critical energy layer to Thenergo's biomass business model," says Kurt Alen, chief executive officer for Thenergo. "The combination of biocoal and electricity production adds a critical energy layer to Thenergo's biomass business model. Our new partnership has ambitions to develop a number of sustainable energy projects both in the Netherlands and internationally."

U.K. Company Moves Ahead On Canadian Pellet Plant

Monday 06 August 2007

Libra Natural Resources, a London-based company that acquires and invests in waste-to-energy assets, has announced the completion of its acquisition of all development rights associated with a proposed pellet plant in the West Kootenay region of British Columbia, Canada.

Libra Natural Resources is planning to build a 60,000 metric ton plant at a cost of approximately $5.6 million. Construction is expected to take six months and operations are slated to begin during the first quarter of 2008.

The acquisition is the British company's latest endeavor in the Canadian pellet fuel market. In June, it announced plans to upgrade its wood pellet production plants in the British Columbian towns of Westbank and Princeton

Clean energy is the whole idea behind a new factory going up in Jackson County.

http://palmpelletfuel.blogspot.com/

Cottondale Pellets

Back in February, business leaders announced plans for a new wood pellet manufacturing plant in Cottondale.

A company called Green Circle Bio-Energy will make the pellets, ship them by rail to Port Panama City, them ship with overseas to Europe.

Power plants there will burn the pellets as a cleaner alternative to coal.

The 100-million dollar operation should be up and running by the end of this year.

But Thursday, some scientists from the University of Florida stopped by the Cottondale plant site to suggest some possible alternative uses for the pellets.

They say their researchers are working on a way to create Ethanol fuel from wood. Dr. Jimmy G. Cheek, PhD. of the University of Florida says the pellet plant could figure into their future plans.

"Everbody who's looked at ethanol production agrees that corn and sugar are probably not the things we should be producing ethanol from. That it needs to be cellulose and we're been working on technology for 30 years at the University of Florida, that's been patented and we are trying to commercialize that patented intellectual property."

Ethanol burns cleaner than regular gasoline, and could reduce out dependency on foreign oil.

But cellulose-based ethanol may still be a few years away. Dr. Cheek says the scientists have it down to a 9-step manufacturing process, when it really needs to be a 2-to-3 step process.

Libra bags rights to Canada pellet plant

http://palmpelletfuel.blogspot.com/

Thu 02 Aug 2007

LONDON (SHARECAST) - Cleaner fuel group Libra Natural Resources is higher on plant upgrade news and confirmation it has completed the acquisition of all development rights associated with a proposed pellet plant in Canada.

Libra plans to build a 60,000 metric ton (5,000MT per Month) plant in the West Kootenay region of British Colombia, with a project capital cost of around C$6m, to be funded by existing cash resources and debt.

Following receipt of requisite permits, the plant will take around six months to construct and enter commercial service during the first quarter of 2008.

In addition, a project is now well advanced to install a semi-automated bagging line at the company's existing wood pellet production facilities at Westbank.

"We anticipate that the line will be operational in September and will immediately enhance earnings for LNR," said the group.

Meanwhile, a project to expand pellet production capacity at the Princeton-Co Generation plant is on schedule for completion in the fourth quarter and will immediately enhance earnings.

"We estimate that these upgrade projects alone, will increase LNR's 2008 revenue by at least 15%, with a similar beneficial impact on the combined earnings from the two plants," added the firm.

Pellet plant draws statewide attention

July 31, 2007

STEELE CITY

On a day last week that Gov. Charlie Crist announced a new 75 megawatt, waste-wood biomass plant in Liberty County, Jimmy Cheek talked about cellulosic ethanol research and listened onsite to the numbers involved with Green Circle Bio Energy's wood pellet plant in Jackson County.

The pellet plant in Steele City will produce 200 loads a day and require 350,000 acres of timber to support, project consulting engineer David Melvin told Cheek, the University of Florida's senior vice president of agriculture and natural resources. Then Jackson County Development Council Bill Stanton added another number to the mix: 1.1 billion pounds.

That's how many pounds of wood pellets the plant expects to produce annually, Stanton said.

"That's a lot of wood pellets," Cheek said.

As construction continues rapidly at Green Circle's wood pellet plant, the Jackson County facility has attracted statewide attention for its plunge into renewable energy production, local and state officials said Thursday.

The company's CEO and president, Olaf Roed, spoke at the 2007 Farm to Fuel Summit in St. Petersburg, put together by the Florida Department of Agriculture and Consumer Services.

This was Cheek's second Farm to Fuel summit. He said this year's conference differed from the 2006 event, with more people in attendance and a broader range of interests represented in St. Petersburg.

"The tenor was much more upbeat about biofuels," Cheek said, noting that the summit had attracted venture capitalists from other parts of the country.

Stanton also attended the summit.

Conversations at the summit centered around ways to convert potential alternative energy sources such as switchgrass, sugar cane and citrus refuse into fuel on a mass scale, Stanton said.

He said Green Circle's plant, which is scheduled to start production by the end of the year, attracted attention in part because it represented something tangible in all of the summit's discussions about renewable energy.

"It was a real project, where as everything else was speculative," Stanton said.

Pellets will be shipped by rail to Port Panama City, where they'll be stored in a bulk warehouse before shipment to Denmark and Germany for industrial power plant use, Melvin said.

Part of the electricity Green Circle uses in pellet production will come from methane gas supplied by Alabama and West Florida Electric Cooperatives, Melvin said, while the rest will come from hydropower sources.

Green Circle broke ground on the plant in February, the same month as Colorado-based Range Fuels announced plans for a $225 million wood-based ethanol plant in Soperton, Ga.

Cheek said UF researchers are looking for a new site to develop cellulosic ethanol.

He said the Legislature approved $20 million for the university this year to build a demonstration ethanol facility.

According to The Gainesville Sun, the plant is expected to initially produce 1 to 2 million gallons of ethanol per year, with a projected opening date of July 2008.

The plant would use E. coli bacteria to produce ethanol from plant material including sugar cane residue and fallen tree limbs, the Sun reported.

Green Circle's facility, plus UF's plans for cellulosic ethanol and Liberty County's new plant, show that the state can produce alternative energy, Cheek said.

Thinking long-term, Florida needs to develop trees more suited for energy purposes, Cheek said.

"We've got to get started with projects to develop new fuel sources," Cheek said.

Range Fuels' Georgia project is funded by Menlo Park, Calif.-based venture capital firm Khosla Ventures.

Cheek said that, in addition to scientific challenges, the renewable energy industry also must attract enough venture capitalists willing to invest $100 to 200 million in a Florida facility.

Wisconsin Pellet Fuel Firms Receive State Grants

Tuesday 31 July 2007

Two Wisconsin pellet fuel manufacturers received funds from the state's Department of Agriculture, Trade and Consumer Protection's 2007 Agricultural Development and Diversification grant program.

Great Lakes Renewable Energy Inc. of Rice Lake will receive $25,000 to develop wood pellet fuel from timber harvest waste, a by-product of paper production and other timber-based industries. Agrecol Corp. of Madison will receive $46,000 to conduct a comprehensive feasibility study to develop a bioheat business based on converting native grasses into biomass fuel pellets.

"Innovation and diversity are our strengths," says Rod Nilsestuen, Wisconsin's Secretary of Agriculture. "These projects were selected for their demonstrated ability to add value to agricultural products, help farmers and create jobs."

Pellet Fuel: Green Heat for Your Home

Plan Ahead, Order Your Pellet Fuel Now

    ARLINGTON, Va., June 18 /PRNewswire-USNewswire/ -- Pellet fuel
manufacturers urge pellet stove, furnace and boiler homeowners to stock-up 
on environmentally friendly pellet fuel before the 2007 heating season
begins in September.

    Summertime is the ideal time to lock-in your fuel cost for the year by
taking advantage of current supplies. Order at least 50 percent of your 
annual fuel needs for your pellet appliances during the summer months,
suggests industry insiders. Using pellet fuel, you can save money on your
heating bills while burning a renewable fuel that is good for the
 environment.

    "We can't stress enough the importance of buying pellet fuel before the
season hits," said Don Kaiser, Pellet Fuel Institute executive director.
"The fuel is readily available, and consumers may find dealers offering 
pre-season promotions with early-purchase incentives."

    Pellet stoves, boilers and furnaces are efficient home heaters thanks
to state-of-the-art technology that helps control the fuel-to-air ratio
 within the heating appliance and ensures almost complete combustion of the
fuel. This technology generates minimal wood smoke, making pellet
appliances the lowest emission solid-fuel burning heating product available 
today, and a popular choice in areas where air quality is an issue.

    Pellet fuel is the perfect choice for people that often experience high
home heating bills due to fluctuating energy costs. More than 3-times 
efficient than cordwood, pellet fuel is made from sustainable sources and
its low moisture content allows for maximum burn and minimum particulate
exhaust. On average, western homes use two tons of pellets fuel per season 
and in the colder east, it jumps to three tons.

    So, don't wait. Be wise and buy now while the inventory is high.

    The Pellet Fuels Institute, located in Arlington, Virginia, is a non-
profit association dedicated to promoting the use of wood pellets and other 
biomass fiber fuels.

Sumita Town in Iwate to Subsidize 3/4 of Pellet Stove Purchase Price

Sumita Town of Iwate Prefecture, Japan, has announced that it will subsidize three-quarters of the purchase price of pellet stoves (installation cost excluded) starting from fiscal 2004 for a limited time.

The eligible recipients of the subsidy are residents and business entities in the town. Pellet stoves produced both in Japan and abroad will be covered with the plan. The details, including the maximum funds to be provided under the subsidy, are under consideration.

Pellet stoves use pellets made of wood biomass such as bark and wood meal as fuel. Currently, basic models sell at high prices, from 200,000 to 400,000 yen (U.S.$1,900 to U.S.$3,700), presenting a major obstacle to sales.

Sumita Town, about 90 percent of which is covered by forests, has been making a strong effort to introduce wood biomass energy. In 2003, the town built wood pellet production lines in mills, and started to produce and sell wood pellets. It has installed pellet stoves in public facilities such as schools. The new subsidy is intended to promote the use of pellet stoves at home.

New Wood Pellet Manufacturing Plant Opening In Corinth

Play Video

Workers at Corinth Wood Pellets are just days away from opening up what could become the largest wood pellet manufacturing plant in the country, with plans to produce more than 140,000 tons of wood pellets each year.

When the first two pellet making production lines are running it's estimated there will be about 30 full time workers. When Corinth Wood Pellets adds a third line there could be 40 employees.

Workers are busy this week getting the pellet manufacturing plant ready to go. They've moved into the site of the former Corinth Products and Higgins Lumber Mill.

Ken Eldredge is a manager at the plant and he says there is worldwide demand for the pellets, used in wood stoves, because the price of wood is more constant than oil.

Construction Begins on Largest Wood Pellet Plant in United States Schuyler Wood Pellet Will Heat 40,000 Homes

Schuyler NY – New England Wood Pellet LLC today announced that it has begun construction of its Schuyler New York wood pellet manufacturing plant.  At 100,000 tons per year of wood pellet production, the plant will be the largest wood pellet manufacturing facility in the United States, and produce enough renewable energy annually to heat 40,000 homes.

The $12 million plant will be located in the Schuyler Business and Industrial Park on Route 5 just east of Utica, within sight of the NY Thruway.  Schuyler Wood Pellet will have about 20 employees when production begins in May 2007.  An estimated 75 additional jobs will be created by the facility in trucking and retailing.  Schuyler Wood Pellet will infuse the local economy with over $10 million in expenditures annually.

"We're extremely excited about our new location in Schuyler," said Steve Walker, President and CEO of New England Wood Pellet at a ground-breaking ceremony today.  "It's perfectly located to supply homeowners and businesses in Utica, Syracuse and the rest of central New York, where pellet shortages have been severe in recent years."

Attending the ground-breaking was NY Congressman Sherwood Boehlert (R-Utica), long a champion of environmental and renewable energy issues in Congress.  Congressman Boehlert is retiring this year after 24 years in Congress.  "As a strong supporter of advancing alternative energy and job creation, I welcome New England Wood Pellet to the beautiful Mohawk Valley" said Boehlert.  "Not only will this new facility produce enough energy to heat 40,000 local homes - it will also create close to 20 full time jobs and strengthen the local tax base.  Today's announcement is yet another example of how working in partnership at all levels of government delivers results and improves the quality of life in our region."

The plant will produce premium grade wood pellet fuel from a variety of clean wood waste, including sawdust, wood chips, shavings and grindings from wood product manufacturing plants throughout central New York State.  These residues are dried and ground to a fine sawdust, and compressed into ¼ inch diameter pellets – a clean, energy-dense and convenient fuel that can be burned in pellet stoves, furnaces and boilers.

New England Wood Pellet was aided greatly in identifying and securing the site by the Herkimer County Industrial Development Agency, which owns the business park.  The park is located in an Empire Zone, which provided the company with certain incentives created by the State of New York to encourage new job creation in economically depressed regions of the state.

The company is accepting inquiries from potential new retailers and institutional, commercial or industrial users of wood pellets interested in large-scale heating or power generation.

#                      #                      #

Based in Jaffrey NH, New England Wood Pellet is on track to be the largest manufacturer and distributor of wood pellet fuel in the U.S.  The company recently announced that it had begun operations of its Palmer MA packaging and reload center, where over 80,000 tons per year of wood pellets are being imported from British Columbia, Canada, bagged and distributed throughout the northeast.  The company expects to make an announcement within a month on a second new 100,000 ton/year plant, elsewhere in the northeastern U.S.

Wood pellets a growing business, wood consumer

Date:  April 2, 2006

Charlie Niebling sees the closing of the Fraser Papers Inc. pulp mill in Berlin as part of a painful, but necessary shift from paper manufacturing to renewable energy development in the Northeast.

"Anything that grows ultimately can be turned into an energy-dense fuel that can be combusted cleanly," Niebling said. "I think there's a very bright future for the forests of northern New England as an energy source."

Niebling, long a spokesman for responsible forest management as former executive director of the New Hampshire Timberland Owners Association, and former policy director at the Society for the Protection of New Hampshire Forests, is now advocating for policies favorable to alternative energy as public affairs coordinator for New England Wood Pellet LLC, of Jaffrey.

The company, which makes fuel pellets from compressed sawdust, can use waste sawdust from lumber mills. But to feed growing demand, it is buying more hardwood logs and chips, which it grinds and dries.

Even before Hurricane Katrina sent heating oil, propane and natural gas prices soaring last fall, pellet stoves were flying out of stores. New England Wood Pellet, the biggest fuel supplier in the region, was unable to meet the demand for its product.

It installed a third pellet-making machine last summer and will add another this spring, bringing its capacity to 100,000 tons a year. It also plans to build new plants in west-central Massachusetts and central New York State in the next year and a half, Niebling said.

"We think the future of pellet fuel isn't in pellet stoves -- it's in large-scale boilers and furnaces" and electric generating plants, Niebling said. "We're in the early phases of a technological revolution."

That technology already is well-advanced in Europe, Niebling said. While there are regulatory hurdles to importing pellet-burning furnaces and boilers, he predicts those barriers will fall soon, thanks to a national push for greater energy independence.

"There's just tremendous potential there that we've barely scratched the surface of," he said.

At least one prominent innovator agrees. Dean Kamen, inventor of the Segway and head of DEKA Research & Development in Manchester, recently joined the board of New England Wood Pellet.

"He's providing oversight and guidance" as the company expands, Niebling said.

Kamen could not be reached for comment.

Originally posted at: http://www.boston.com/news/local/maine/articles/2006/04/02/wood_pellets_a_growing_business_wood_consumer/