December 2012 Biomass Magazine by BBI International

December 2012

Policy Watch Election Results, Legislation and Government Programs That Matter in 2013 Page 32

Plus:

Current research shows production costs decline as investments rise Page 26

And: U.S. DOE Acting Biomass Program Manager Valerie Reed Talks Shop Page 24

www.biomassmagazine.com

INSIDE ¦ ADVERTISER INDEX¦ DECEMBER 2012 | VOLUME 6 | ISSUE 12 2013 Fuel Ethanol Workshop & Expo

2013 International Biomass Conference & Expo

Ace Glass

Airoflex Equipment

Algae Biomass Summit

BBI Consulting Services

Biomass Magazine

Buhler Inc.

Clariant Produckte Gmbh

Continental Biomass Industries, Inc.

CPM Roskamp Champion CST Industries, Inc. DuPont Industrial Biosciences Factory Sales and Engineering Inc.

2 30

Fagen Inc.

Fike Corporation

GEA Westfalia Separator

6 17

Himark bioGas

Hurst Boiler & Welding Co. Inc.

Indeck Power Equipment Co.

KEITH Manufacturing Company

Keller and Heckman

Percival Scientific, Inc.

Pittcon

PRODESA

Retsch, Inc.

RUD Chain

ThermoEnergy Corporation

Twin Ports Testing

Vecoplan LLC

West Salem Machinery

Wolf Material Handling Systems

FEATURES 24 Q&A The Beltway Biochemist Valerie Reed isn’t just acting manager of the U.S. DOE Biomass Program or a biochemist by trade. She’s also proving advanced biofuels skeptics wrong. Interviewed by Tim Portz

26 COST ANALYSIS Global Costs of Biomass Power Expert analysis and up-to-date research show the truth about worldwide biomass production: costs are going down and investments are going up. By Anna Simet

32 POLICY Looking into Policy What Barack Obama means for bioenergy in the next four years, and what to watch for in 2013. By Luke Geiver

38 SUSTAINABILITY Managing Woody Biomass: The Past Century in Review By Joshua Kane Harrell

DEPARTMENTS 04 EDITOR’S NOTE Making Our Case By Tim Portz

06 INDUSTRY EVENTS 07 POWER PLATFORM What the Election Results Mean for Biomass By Bob Cleaves

08 THERMAL DYNAMICS Is Ag Biomass Here to Stay? By Dan Arnett

10 ENERGY REVIEW The Water Energy Nexus and Biopower Production By Bruce C. Folkedahl

12 ALGAE APTITUDE Driving Algae Sustainability By Mary Rosenthal

14 BUSINESS BRIEFS 16 BIOMASS NEWS 42 MARKETPLACE

Biomass Magazine: (USPS No. 5336) December 2012, Vol. 6, Issue 12. Biomass Magazine is published monthly by BBI International. Principal Office: 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. Periodicals Postage Paid at Grand Forks, North Dakota and additional mailing offices. POSTMASTER: Send address changes to Biomass Magazine/ Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, North Dakota 58203.

DECEMBER 2012 | BIOMASS MAGAZINE 3

¦EDITOR’S NOTE

Making Our Case

TIM PORTZ VICE PRESIDENT OF CONTENT & EXECUTIVE EDITOR

tportz@bbiinternational.com

At the risk of diminishing President Obama’s successful bid for a second term, it can nevertheless be argued that the personal decisions we all made in the polling booths were merely a prologue to the looming decisions our elected officials face as we move into 2013. Our government is racing headlong toward the euphemistic fiscal cliff that received surprisingly little attention in the presidential debates, but re-emerged as the most pressing national issue almost before the race’s outcome was certain. The newly-elected and re-elected senators, representatives, and president may soon find themselves wishing for the stress and demands of a campaign trail as they face not only the fiscal cliff, but also an unresolved Farm Bill and an American public growing tired of watching their government kick the can down the road. This month’s issue of Biomass Magazine seeks to lay out what is at stake for the industry as our government returns to the hard work of running a country attempting to pull itself out of recession. Luke Geiver’s feature “Navigating the Political Scene” offers a snapshot of legislation that impacts various sectors of the biomass industry, paired with industry insider commentary describing the importance of particular policy segments. In his monthly column for Biomass Magazine, Bob Cleaves, president and CEO of the Biomass Power Association, echoes this theme, but takes the conversation a step further by questioning whether climate change policy, or at least a return to a national conversation about our energy future within the context of climate, is likely. As policymakers in Washington, D.C., take on these and other issues that will arise, the bioenergy sector continues to drive forward. Despite calls for a waiver of the renewable fuels standard, the industry’s first commercial-scale volumes of advanced biofuels are scheduled to come online in the coming year, utilizing different feedstocks while leveraging varied conversion pathways. In this issue we also report that US pellet capacity continues to rise as producers here serve customers in Western Europe, where, for now, the government has for now, made a stronger commitment than the U.S. to find and utilize energy sources with lower carbon profiles. Our industry’s best argument for future policy support will always be the successful outcomes that we argued would arise from legislation we worked for in the past. In this regard, the achievements we’re poised to make in 2013 may be the best case we’ve made in years.

4 BIOMASS MAGAZINE | DECEMBER 2012

EDITORIAL PRESIDENT & EDITOR IN CHIEF Tom Bryan tbryan@bbiinternational.com VICE PRESIDENT OF CONTENT & EXECUTIVE EDITOR Tim Portz tportz@bbiinternational.com CONTRIBUTIONS EDITOR Anna Simet asimet@bbiinternational.com FEATURES EDITOR Luke Geiver lgeiver@bbiinternational.com NEWS EDITOR Erin Voegele evoegele@bbiinternational.com COPY EDITOR Jan Tellmann jtellmann@bbiinternational.com

ART ART DIRECTOR Jaci Satterlund jsatterlund@bbiinternational.com GRAPHIC DESIGNER Elizabeth Burslie bburslie@bbiinternational.com

PUBLISHING & SALES CHAIRMAN Mike Bryan mbryan@bbiinternational.com CEO Joe Bryan jbryan@bbiinternational.com VICE PRESIDENT, SALES & MARKETING Matthew Spoor mspoor@bbiinternational.com EXECUTIVE ACCOUNT MANAGER Howard Brockhouse hbrockhouse@bbiinternational.com ACCOUNT MANAGERS Marty Steen msteen@bbiinternational.com Bob Brown bbrown@bbiinternational.com Andrea Anderson aanderson@bbiinternational.com CIRCULATION MANAGER Jessica Beaudry jbeaudry@bbiinternational.com ADVERTISING COORDINATOR Marla DeFoe mdefoe@bbiinternational.com

SENIOR MARKETING MANAGER John Nelson jnelson@bbiinternational.com

Subscriptions Biomass Magazine is free of charge to everyone with the exception of a shipping and handling charge of $49.95 for any country outside of the United States, Canada and Mexico. To subscribe, visit www.BiomassMagazine.com or you can send your mailing address and payment (checks made out to BBI International) to Biomass Magazine Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You can also fax a subscription form to 701-746-5367. Back Issues & Reprints Select back issues are available for $3.95 each, plus shipping. Article reprints are also available for a fee. For more information, contact us at 701-746-8385 or service@bbiinternational.com. Advertising Biomass Magazine provides a specific topic delivered to a highly targeted audience. We are committed to editorial excellence and high-quality print production. To find out more about Biomass Magazine advertising opportunities, please contact us at 701-746-8385 or service@bbiinternational.com. Letters to the Editor We welcome letters to the editor. Send to Biomass Magazine Letters to the Contributions Editor, 308 2nd Ave. N., Suite 304, Grand Forks, ND 58203 or email to asimet@bbiinternational.com. Please include your name, address and phone number. Letters may be edited for clarity and/or space.

Please recycle this magazine and remove inserts or samples before recycling

DECEMBER 2012 | BIOMASS MAGAZINE 5

¦INDUSTRY EVENTS Canadian Renewable Fuels Summit December 3-5, 2012 Westin Ottawa Hotel Ottawa, Ontario Canada is now a frontrunner in the worldwide effort to create clean, renewable sources of transportation fuel. Learn from industry experts, engage in valuable peer to peer collaboration, find solutions for your business challenges, discover new products and services. The CRFS is a great opportunity to exchange ideas and gain a global perspective on the renewable fuels industry. We offer insightful plenaries and are now offering concurrent industry breakout sessions. 613-594-5528, ext. 223 | www.greenfuels.org

You deserve consistency and quality through your entire biomass pelleting process —from chips to load-out. Get it with CPM. U Equipment for your total biomass process U Integrated biomass expertise U Engineered for quality, durability and consistency U Energy efficient Look to your Partner in Productivity—CPM—for your biomass pelleting solutions.

International Biomass Conference & Expo April 8-10, 2013 Minneapolis Convention Center Minneapolis, Minnesota Building on Innovation Organized by BBI International and coproduced by Biomass Magazine, the International Biomass Conference & Expo program will include 30-plus panels and more than 100 speakers, including 90 technical presentations on topics ranging from anaerobic digestion and gasification to pyrolysis and combined heat and power. This dynamic event unites industry professionals from all sectors of the world’s interconnected biomass utilization industries— biobased power, thermal energy, fuels and chemicals. 866-746-8385 | www.biomassconference.com

International Fuel Ethanol Workshop & Expo June 10-13, 2013 America’s Center St. Louis, Missouri Where Producers Meet Now in its 29th year, the FEW provides the global ethanol industry with cutting-edge content and unparalleled networking opportunities in a dynamic business-to-business environment. The FEW is the largest, longest running ethanol conference in the world—and the only event powered by Ethanol Producer Magazine. Visit our website to reserve premium booth space now. 866-746-8385 | www.fuelethanolworkshop.com

Algae Biomass Summit September 30-October 3, 2013

800-428-0846 6 BIOMASS MAGAZINE | DECEMBER 2012

Hilton Orlando Orlando, Florida This dynamic event unites industry professionals from all sectors of the world’s algae utilization industries including, but not limited to, financing, algal ecology, genetic systems, carbon partitioning, engineering & analysis, biofuels, animal feeds, fertilizers, bioplastics, supplements and foods. Organized by the Algae Biomass Organization and coproduced by BBI International, this event brings current and future producers of biobased products and energy together with algae crop growers, municipal leaders, technology providers, equipment manufacturers, project developers, investors and policy makers. It’s a true one-stop shop – the world’s premier educational and networking junction for all algae industries. 866-746-8385 | www.algaebiomasssummit.org

POWER PLATFORM¦

What the Election Results Mean for Biomass BY BOB CLEAVES

In the coming days, each of us will be treated to countless webinars and seminars on the Election Day post-mortem as it relates to renewable energy. Aside from the obvious winners—the president, Senate Democrats and House Republicans—and losers—Mitt Romney, Scott Brown, and the socalled “Mad Men” wing of the Republican Party— the following is what we know. The fire alarm caused by an assault on existing policies supporting renewable energy is less likely to happen now that we have a divided Congress and a president on record as supporting renewables. Whatever we think may happen on broader tax reform, be on the lookout for proposals to phase out tax benefits for certain renewables such as wind. In the context of that debate will come an opportunity for the biomass industry to educate Congress about the importance of tax benefits for our industry—which have long been inadequate to foster significant growth and less than benefits received by other renewables—and ways that Section 45 can continue to support an industry that is so vital to rural economies, sustainable forest management and agriculture. Next, it may be an overstatement to interpret the president’s win as a clear mandate for renewable energy. However, the voters appeared unmoved by U.S. DOE loan guarantees to failed solar panel manufacturers or electric car companies. Barely a word was spoken on climate during the campaign, at least until half of the nation’s largest city and huge swaths of the Mid-Atlantic Coast were underwater because of a storm surge that was only made

worse by documented rising seas levels. Will climate re-emerge on the congressional or White House agenda? While not immediately, the billions needed to shore up New York’s seawalls needs to be funded somehow. Did somebody say carbon tax? We see strong possibilities that climate will be the central environmental issue, even if it doesn’t poll well. For that reason, the role of biomass in combatting climate change through healthy forests, fire prevention and carbon dioxide avoidance will be important. Watch for the U.S. EPA to play a prominent role in that debate, and for BPA to make sure that the agency applies sound science and responsible public policy. Watch also for USDA to play a larger role in supporting the industry as a means of preventing forest fires and the promotion of energy crops like willow. Finally, it goes without saying that regulatory reform in a Romney administration would look very different from the president’s. Yet, with a divided Congress and an economy not yet emerged from a deep recession, we are optimistic that EPA will encourage the use of biomass and not regulate certain fuels as wastes. What remains to be seen is whether the Boiler MACT rulemaking, when completed by the EPA in the coming months, will be affordable and achievable. One thing is certain, however: we are all safe from political ads for at least a couple months. Author: Bob Cleaves President and CEO, Biomass Power Association www.USABiomass.org bob@biomasspowerassociation.com

DECEMBER 2012 | BIOMASS MAGAZINE 7

¦THERMAL DYNAMICS

Is Ag Biomass Here to Stay? BY DAN ARNETT When observing U.S. alternative energy during years to come, the real question that must be asked is, “Is agricultural biomass going to be a significant contributor, or just another good idea?” According to the U.S. DOE's Billion Ton Study, agriculture-derived biomass has to be part of the picture if we are going to achieve our goals as a country. That is the one point that is fairly easy to agree upon. Beyond that, however, there are many questions surrounding agricultural fibers. Agricultural biomass encompasses a wide range of plant fibers. These plants can have drastically different physical and chemical properties when compared to each other, and even more so when compared to wood fiber. One of the most significant lessons we learned when we began processing native warm season grasses was that just because it is ground up and looks similar to sawdust, does not mean that it will behave in the same manner as sawdust. Simply put, agricultural biomass is not wood. While discussing agricultural biomass, let’s take a moment and discuss agriculture itself. It must be observed and appreciated that the challenges and realities of agriculture in our country can vary greatly from region to region. Sometimes even 20 miles can make a stark difference in the appearance and resource availability of the countryside. For example, here in northwest Pennsylvania, our average field size is relatively small, at approximately 15 acres. Driving just 30 minutes to the west puts you in another world, with larger fields, changed weather, different drainage and flatter land. Utilization provides another contrast with woody biomass, as there seems to be several concepts of how best to collect and process a certain agricultural biomass for each unique source. One thing that must be kept in mind is that the utilization concept must recognize and allow for any current uses of the fiber and

8 BIOMASS MAGAZINE | DECEMBER 2012

its coproducts. One great example is a project planner proposing to use corn stover, collecting the fiber before it hits the ground and expecting the harvester to slow the ground speed in order to allow for this. This is not an acceptable scenario to the vast majority of grain producers. Currently, the thermal conversion of agricultural biomass―whether in baled, ground, or densified form―is best suited for consumption in commercial and more rural residential applications. This is where most of the earliest adoption has occurred. These markets have a vested interest in supporting agricultural products, which results in relatively more patience and willingness to work through the associated challenges of warranty issues, more ash, and different ash chemistry. While a few leaders in the biomass and pellet appliance industry have openly embraced agricultural biomass fuel and have started working with it, there is still a lot of work to be done. Understandably, a large portion of these appliance manufacturers have not invested the significant resources necessary to test and adapt appliances to agricultural fields. One of the most effective steps that can be taken to encourage the growth and development of agricultural biomass, both as a concept and as a crop, is to promote the growth of a profitable market for it. This can be achieved by dedicating resources to increase the number of people purchasing and using both smalland large-scale combustion appliances that are capable of utilizing the fiber. Is ag biomass here to stay? Yes. Will we use it in the most effective and efficient manner we are capable? We shall see. Author: Dan Arnett Biomass Coordinator, Ernst Conservation Seeds Vice Chair, BTEC Board of Directors dan@ernstseed.com

POWERING INNOVATIONS IN

FUEL DISCOVERY

Attending Pittcon, the worldâ&#x20AC;&#x2122;s largest annual conference and exposition for laboratory science, gives you the power to get a hands-on look at innovative equipment, learn about industry trends and discover new applications and methodologies used in the biomass industry. Technical sessions related to fuels and energy include the latest in mass spectroscopy, separation sciences, LC/GC and more.

Pittcon App Now Available

For more information on technical sessions, exhibitors and short courses, visit www.pittcon.org. follow us

Scan this or go to www.pittcon.org to save 50% on registration.

¦ENERGY REVIEW

The Water Energy Nexus and Biopower Production BY BRUCE C. FOLKEDAHL

A recent workshop on water and energy confirmed my understanding of the dynamic relationship water and energy share. Although the fossil power industry is becoming less reliant on large water resources because of the advent of more efficient, lower cost, air cooled and hybrid air/water–cooled condensers used in cooling boiler intake water, the need for large volumes of water still exists for the foreseeable future. For biomass power systems, the same cooling and other peripheral requirements for water still exist, but in many cases—especially for energy crops and agricultural residues—there is the added water balance requirement of agricultural water used in growing the green, renewable fuel. Though the low cost of natural gas seems to be the greatest challenge for biomass power development right now, water adds another challenge. The power industry is second only to agriculture as the largest domestic user of water, accounting for 39 percent of all freshwater withdrawals in the nation, 71 percent of which is used in fossil fuel-based electrical generation. The same technologies used to produce electricity from fossil-based fuels are, and will continue to be, used for a significant amount of biomass-based power production. Therefore, biopower systems are going to be challenged in obtaining site permits for new biomass power plant construction. The availability of water for use in biomass electric power generation may be limited in many parts of the U.S., and biomass power plants must compete with other industrial customers, agricultural interests and households for this limited commodity. Difficulty in obtaining necessary water permits can lead to delayed or abandoned projects. Infrastructure needs may also create a challenge with respect to water and biopower. A system for sustainable water supply can take years to develop with today’s entanglement of water rights and laws. Usually, these types of water rights issues are settled in court— over 90 percent—as opposed to the conference room. In areas that do not have an adequate water source, biomass power plant construction is often not even considered, even though these locations are ideal in other respects. Additionally, potential regulations curtailing carbon dioxide emissions will impact water use.

10 BIOMASS MAGAZINE | DECEMBER 2012

Because of the corrosive nature of carbonic acid, water will need to be removed to very low levels prior to the carbon dioxide being pipelined to its final destination. In lieu of these challenges, all hope is certainly not lost, as demonstrated by many biopower projects that are moving forward. Along the lines of water savings and efficiency, the Energy & Environmental Research Center, in conjunction with several commercial partners, is investigating several water-saving technologies. Tremendous new strides are being made in air-cooled condensers, hybrid air-cooled systems, water capture/recycle, and novel heat exchange media for hybrid cooling tower systems. One example is a hybrid wet/dry cooling system that utilizes a direct-contact, jet spray condensing cycle that is air-cooled in conjunction with a conventional wet cooling loop. This system can dramatically reduce water use and also has the potential to be retrofitted into existing plants. Retrofits in existing systems can be particularly difficult for conventional dry or hybrid systems because of space limitations required for modifications at the condensing site after the turbine and the required footprint needed for air-cooled systems on the grounds, as well as all of the requisite ducting. Another example currently under development at the EERC is a novel dry cooling technology. The system uses a nonvolatile heat-transfer fluid that takes advantage of primarily sensible heat rejection and only minimally relies on the latent heat of evaporation. The end result is a great reduction in water input. These are just a few examples of how solutions are being found to reduce the overall water footprint of heat and power production utilizing biomass. The biomass industry can play a part in reducing the water footprint of biomass utilization systems, whether it is in power production or in the production of bioproducts or biofuels, and the EERC is working with industry to do so. Author: Bruce C. Folkedahl Senior Research Manager, EERC (701) 777-5243 bfolkedahl@undeerc.org

12 BIOMASS MAGAZINE | DECEMBER 2012

Business Briefs PEOPLE, PRODUCTS & PARTNERSHIPS

Viessmann hires technical sales manager Viessmann Ltd. has appointed John Brain as technical sales manager of its products division. In his new position, Brain will provide support for the commercial sales team Brain's experience across the U.K. and includes managing large-scale projects. develop Viessmann’s product offering in biomass and combined-heat-and-power modules. He reports to Nigel Jefferson, sales director of commercial and renewable products. Prior to joining Viessman, Brain was employed by boiler manufacturer Hartley and Sugden. He has 20 years of experience in commercial and industrial boilers, including steam projects. Viessmann

14 BIOMASS MAGAZINE | DECEMBER 2012

manufactures a variety of heating systems that range in size from 1.5 to 116,000 kW, including biomass boilers, CHP systems, oil and gas-fired boilers, solar and photovoltaic systems, and ground and air and water heat pumps. Glycos Biotechnologies adds board member Glycos Biotechnologies Inc. has appointed Wan Abdul Rahaman bin WanYaacob to its Asia board of directors. WanYaacob has 40 years of experience working in the biotechnology and rubber industries, in both research and executive level positions. He currently serves as the advisor of biotechnology initiatives for the Northern Corridor Implementation Authority in Malaysia. He is also an adjunct professor in the department of biochemistry, biotechnology and

biomolecular science at the University of Putra Malaysia. WanYaacob also formerly served as executive vice president of Eco System for the Innovation Agency of Malaysia. As a member of Glycos Biotechnologies’ board, his knowledge of rubber and experience in the industry will be an asset to the company as it completes construction of its Malaysian facility and begins production of biobased isoprene, trademarked Bio-SIM. Amyris appoints vice president of global manufacturing, process development Charles Kraft is joining Amyris Inc. as the company’s new vice president of global manufacturing and process development. Kraft is a veteran of the specialty fermentation industry. As a member of the Amyris team, he will help the company

BUSINESS BRIEFS¦

take its industrial manufacturing capabilities to the next phase. Prior to joining Amyris, he served as vice president of operations and vice president of engineering at DuPont Tate & Lyle BioProducts, a joint venture producing 1,3 propanediol via the fermentation of sugars. He also spent nearly 20 years with Tate & Lyle’s citric acid production facility, where he held a number of operational positions. Fenz joins Virent’s board of directors Virent Inc. has added R. Krug Fenz to its board of directors. Fenz currently serves as senior manager of mergers and acquisitions and commercial finance in the Americas for Shell Oil Co. Prior to joining Shell in 1996, Fenz worked at a variety of international consulting firms and Fortune 500 companies, including Ross Corp.,

Ecolab, Lone Star Technologies, Pennzoil, Diamond Shamrock and Gulf Oil. He has 30 years of management experience and has spearheaded corporate growth and diversification through mergers, acquisitions and joint ventures, commercial product introduction, financing new business ventures and strategic planning. M-E-C adds vice president of sales M-E-C Co. has hired Stephen Rice to serve as its vice president of sales. M-E-C is a worldwide supplier of industrial dryer systems. Rice has extensive experience Rice brings valuable sales management in the wood products and industry. Prior to joining experience industry knowledge M-E-C, he served as to his new position.

Think an explosion will never happen in your facility?

president of Kilntek Inc., where he was responsible for establishing a business for manufacturing and installation of equipment for drying lumber and various combustions systems. Rice has also served as managing director of four engineering divisions throughout the U.S. and Canada for Moore International. In his new position with M-E-C, Rice will report to John Quick, the company’s president. His responsibilities will include the management and supervision of domestic and international sales teams.

SHARE YOUR INDUSTRY NEWS: To be included in the Business Briefs, send information (including photos and logos, if available) to Industry Briefs, Biomass Magazine, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You may also email information to evoegele@bbiinternational.com. Please include your name and telephone number in all correspondence.

Dust and gas explosions are deadly and commercially devastating. Many facilities are at risk, but just don’t know it. Fike is a global leader in the development and manufacture of reliable explosion protection solutions. And we offer a wide range of explosibility tests designed to assist you in identifying costly explosion hazards.

Rely on Fike’s Explosion Protection Expertise With over 40 years experience in developing innovative explosion protection technologies, Fike has the expertise to help you improve the safety of your facility and comply with changing regulations… all without spending a fortune.

1-866-758-6004

WWW.FIKE.COM

BiomassNews Booming growth expected in bioplastic production capacity

Community digester opens in Michigan

European Bioplastics projects that the global bioplastic industry will experience a fivefold increase in production volumes between 2011 and 2016, from approximately 1.2 million metric tons to 5.8 million metric tons. The most significant growth is expected to be in nonbiodegradable plastics, such as biobased polyethylene (PE) and polyethylene *Data sourced from European Bioplastics terephthalate (PET). The market forecast published by European Australia were 32.8 percent, 18.5 percent, Bioplastics estimates that PET will represent 13.7 percent and 0.4 percent. By 2016, Asia 4.6 million, or 80 percent of total bioplastic is expected to be home to 46.3 percent of production capacity, by 2016. capacity, with South America close behind Asia had the most bioplastic producat 45.1 percent. Europe, North America and tion capacity online in 2011, with 34.6 perAustralia are expected to represent a relative cent. The relative capacity percentages for 4.9 percent, 3.5 percent and 0.2 percent of South America, Europe, North America and production capacity.

7^dbVhh EgdXZhh^c\ HnhiZbh A^WZgVi^c\ JciVeeZY :cZg\n AY`_V+ $$' #&# %!*&

gVT`a]R_]]T T`^ 16 BIOMASS MAGAZINE | DECEMBER 2012

Novi Energy has opened a large-scale community digester project in southeastern Michigan. Construction of the $22 million Fremont Community Digester plant began in 2010. The facility is expected to be completed during the fourth quarter of 2012. The plant utilizes a complete-mix anaerobic digestion technology and is capable of taking in 100,000 tons of food waste on an annual basis. Feedstock will be sourced from a variety of regional food processors and agricultural operations. The resulting biogas will be fed to two reciprocating internal combustion engines to produce 3 MW of electricity, which is being sold to Consumers Energy under a long-term contract. Debt financing for the project came from Comerica Bank and was supported by a $12.8 million USDA 9003 loan guarantee. INDUS Energy LLC is the majority owner of the project.

2 h`c]UhZUV ]VRUVc Z_ dZkV cVUfTeZ`_ eVTY_`]`Xj GVTà]R_ h`c\d hZeY Z_UZgZUfR] Tfde`^Vcd e` UVdZX_ V_XZ_VVc ^R_fWRTefcV R_U Zâ]V^V_e eVTY_`]`XZTR]]j RUgR_TVU ^ReVcZR] daVTZWZT R_U Raa]ZTReZ`_ daVTZWZT dYcVUUZ_X WVcc`fd R_U _`_ WVcc`fd cV^`gR] dZkV R_U UV_dZej dVaRcReZ`_ dTcVV_Z_X R_U T]RddZWZTReZ`_ eVTY_`]`XZVd R_U ViecV^V]j VWWZTZV_e T`_gVj`c R_U Sf]\ ^ReVcZR] YR_U]Z_X ^VeVcZ_X de`cRXV R_U f_]`RUZ_X eVTY_`]`XZVd 4`_eRTe GVTà]R_ eÙRj e` ]VRc_ ^`cV RS`fe `fc ViZdeZ_X djdeV^d `c e` RccR_XV R gZdZe e` `_V `c dVgVcR] `W `fc Z_deR]]ReZ`_d

BIOMASSNEWS¦

US pellet industry progresses A report published by Residential/Commerical Densified Fuel Standards Wood Resources International Fuel Property PFI Premium PFI Standard PFI Utility found that the U.S. exported Normative information - Mandatory 40-46 38-46 38-46 more wood pellets than Cana- Bulk density, lb/cubic ft 0.23-0.285 0.23-0.285 0.23-0.285 Diameter, inches da during the first six months ≥ 96.5 ≥ 95 ≥ 95 of 2012. Although Canada was Pellet durability index ≤ 0.5 ≤1 ≤1 Fines, % (at the mill gate) formerly the world leader in ≤1 ≤2 ≤6 Inorganic ash, % pellet exports, U.S. production ≤1 ≤1 Length, % greater than 1.5 inches ≤ 1 has expanded rapidly. Exports Moisture, % ≤8 ≤ 10 ≤ 10 from the southern region of ≤ 300 ≤ 300 ≤ 300 Chloide, ppm the U.S. increased by 13 perNA NA NA Heating value cent during the second quarter Informative only - Not Mandatory NA NA NA Ash fusion alone. *Information sourced from Pellet Fuels Institute According to the report the U.S. has exported more than standards verification process developed 1.5 million tons of pellets this year, and is on track to export 5.7 million tons per year by the Pellet Fuels Institute and American Lumber Standard Committee. Some of the by 2015. characteristics analyzed include ash conSeveral U.S.-based pellet producers, tent and fuel density. Once verification is namely, U.S. American Wood Fibers, Curcomplete, participating mills will be able to ran Renewable Energy and Marth Wood label each bag of pellets with a certification Shavings & Supply, have entered into an agreement to certify their pellets. The group sticker to indicate the grade of the fuel. will participate in a testing protocol and

USDA awards loan guarantees for biomass power projects The USDA announced loan guarantees to support three biomass power plants in October. The funding was awarded under USDA Rural Development’s Rural Utilities Service. The program aims to help electric utilities upgrade, expand, maintain and replace rural energy infrastructure. It also funds renewable energy and energy conservation projects. Colorado-based Eagle Valley Clean Energy LLC was awarded a $40 million loan guarantee to partially finance an 11.5 MW biomass power plant. Green Energy Team LLC in Hawaii was awarded a $72.88 million loan guarantee to support the development of a 7.5 MW biomass power plant. Finally, East Texas Electric Cooperative Inc. was awarded a $151 million loan guarantee to develop a 50 MW biomass power plant. All awards are contingent on the recipients meeting the terms of their loan agreements.

¦BIOMASSNEWS Report: Algae industry can improve sustainability The National Research Council has published a report, noting that algae-based biofuel production could place unstable demands on energy, water and nutrients if capacity reaches 39 billion liters (10.3 billion gallons), or approximately 5 percent of the U.S. transportation fuel market. The report, titled “Sustainable Development of Algal Biofuels SOURCE: NATIONAL RESEARCH COUNCIL in the United States,” future growth of the algae industry. The named five specific areas that the NRC organization also said that the five areas considers to be concerns of high imhighlighted as primary concerns in the portance. They include water usage and report are already being addressed by rerequirements, nutrient supply, land area searchers and algal biofuel producers. For requirements, energy return on investment, example, companies are already recycling and life-cycle greenhouse gas emissions. nutrients, producing biobased methane The Algae Biomass Organization has from residual organics and using producapplauded the reports finding that these tion designs to minimize energy use. sustainability concerns are not a barrier to

K ELLER AND H ECKMAN

Canadian flight operates on 100 percent biofuel Agrisoma Biosciences Inc. and the National Research Council of Canada have successfully completed a civil jet flight using 100 percent biobased jet fuel. The fuel was manufactured from Resonance Energy Feedstock. Agrisoma contributed feedstock to the project. The company is commercializing the oilseed crop Brassica carinata, commonly known as Ethiopian mustard. The resulting oil was refined into biobased jet fuel using Applied Research Associates’ Isoconverson Process. The biojet was then used to fuel NRC’s Falcon 20 jet. As part of the test flight, a second aircraft, the T-33, tailed the Falcon in flight to collect emissions data. Researchers at the NRC will analyze the data to better understand the emission profile of the fuel and the environmental impacts of biofuels. Preliminary results are expected to be released later this year.

LLP

ACROSS THE GLOBE, AROUND THE CLOCK

COUNSELING RELATED TO: • Environmental liabilities and indemnifications for transportation, distribution and blending services

• Managing chemicals used in hydraulic fracturing

• Nationwide audits of oil storage and distribution facilities

• Environmental Protection Agency premanufacture notification requirements for fuel production strains, fuel intermediates, and fuels

• RFS and RFS2 regulations, registrations, and Renewable Identification Number (RIN) transactions

• Clearance needs related to uses of biomass and processing aids

www.khlaw.com 18 BIOMASS MAGAZINE | DECEMBER 2012

BIOMASSNEWS¦ UCS: 680 million tons of biomass by 2030 A report, titled “The Promise of Biomass,” published by the Union of Concerned Scientists demonstrates that the U.S. has the potential to dramatically increase our renewable energy supply though the use of biomass feedstock. Overall, the analysis determined that 680 million tons of biomass could be made available by 2030. That *Data sourced from Union of Concerned Scientists is enough biomass to trees like hybrid poplar and willow. produce either 54 billion The report provides detailed maps gallons of cellulosic biofuels or generate for each of the different biomass sources enough electricity to meet one-fifth of it has identifi ed. The maps describe nationwide demand. where the UCS expects certain types of According to the study, the largest feedstock to be abundant. In addition long-term opportunity to expand bioento energy crops, the study addresses ergy production in the U.S. is from dediagricultural residues, waste materials, and cated energy crops such as switchgrass forest biomass. and miscanthus as well as fast-growing

Scientists use directed evolution to improve microbes Researchers at Iowa State University are working to optimize microbes capable of converting bio-oil produced from fast pyrolysis into biofuels. The work focuses on the bacteria E. coli and the microalgae C. reinhardtii. Certain contaminants in the bio-oil have traditionally limited the ability of these microbes to convert pyrolysis oil into fuels and chemicals. The team is experimenting with pretreatments of this bio-oil that could reduce toxicity. They are also developing microbes that can tolerate the contaminants. The team is using a technique called directed evolution to produce microbes that are more tolerant of bio-oil contaminants. To do this the microbes are grown with higher and higher concentrations of bio-oils. As they divide they replicate their DNA. Sometimes mutations arise during the replication process. Some of these DNA “mistakes” help make the microbe more tolerant of the contaminants. The work is led by Laura Jarboe, an assistant professor of chemical and biological engineering.

¦BIOMASSNEWS European Commission proposes new biofuel policy Estimated indirect land use change emissions from biofuel Feedstock group

Estimated indirect land-use change emissions (gCO2eq/MJ)

Cereals and other starch-rich crops 12 Sugars

Oil crops

SOURCE: EU BIOFUEL PROPOSAL

The European Commission has released a proposal that aims to make significant changes to the EU’s biofuel policy. Specifically, the proposal seeks to limit the use of crop-based feedstock and include indirect land use change (ILUC) associated emissions in the greenhouse gas (GHG) profile of fuels. The proposal sets a 60 percent minimum GHG saving threshold for new biofuel production facilities, which the commission said aims to discourage additional investments in production facilities with low GHG performance. In addition, the proposal maintains the

20 BIOMASS MAGAZINE | DECEMBER 2012

10 percent renewable content goal for transportation fuels contained within the current Renewable Energy Directive, but caps crop-based fuels at 5 percent. The updated program would also establish incentives for biofuels that result in little or no ILUC emission, such as those manufactured from algae, straw or waste feedstocks. Representatives of the European biofuel industry have spoken out against the proposal, noting that it will decimate Europe’s biofuel industry in the midst of the European economic crisis.

Neste Oil brings pilot plant online, sells naphtha coproduct Neste Oil recently celebrated the grand opening of its microbial oil pilot plant in Porvoo, Finland. The facility converts waste and residue material into microbial oil feedstock, which can be converted into renewable diesel and other products via Neste Oil’s NExBTL process. The first phase of the pilot plant was completed in August. As of late October, the facility had already produced microbial-rich biomass. The aim of the research is to develop a technology that can be deployed on the industrial scale. The process is based on a bioreactor technology where residues from the agricultural and pulp and paper industries are fractionated into sugars and converted into oil by microbes. Neste Oil also announced that it is commercially supplying biobased naphtha to its customers. The substance is created as a coproduct of the NExBTL refining process. Naphtha can be used as a gasoline additive and as a feedstock for bioplastic production. Neste Oil is considering the commercialization of another NExBTL coproduct, biobased propane.

BIOMASSNEWSÂŚ New tools offer biogas developers an abundance of data

INEOS New Planet BioEnergy begins power production

Two new websites have Sample data: Joint Water Pollution launched with the goal of spurring Control Plant, Los Angeles, Calif. development in the biogas secFlow design 400 tor. The North East Biosolids and Flow average 300 Residuals Association launched a Outside waste fed to digesters No Mesophilic website that houses data on anaero- Digestion type Biogas utilized Yes bic digestion and biogas producBiogas flared Yes tion at U.S. wastewater treatment Biogas drives machinery Yes facilities. Visitors to the website can Biogas heats digesters Yes run a search for a wastewater treatBiogas used by HVAC No ment facility or browse plants in Biogas injection into pipeline No alphabetical order. The online tool Electricty from internal combustion engine Yes offers satellite images of the plants Electricity from turbine Yes as well as data related to plant Electricity from microturbine No Electricty from fuel cell No location, flow design and average, Electricity supplied to the grid Yes whether outside waste is fed into SOURCE: WWW.BIOGASDATA.ORG the digester, type of digestion used, within Wisconsin. The tool allows users and how the biogas is used. to assess potential feedstock source Baker Tilly Virchow Krause LLP providers, utility infrastructure, service and the Wisconsin State Energy Office territories and nearby publicly-owned have partnered to develop an online treatment works and waterways, highway mapping tool that aims to help projand other criteria. ect developers assess the potential for anaerobic digestion project development

INEOS New Planet BioEnergy, a joint venture of INEOS Bio, has commenced production of renewable power that will be used to power the biorefinery in addition to supplying the grid. Once fully operational, the cellulosic ethanol plant is expected to have the capacity to produce 8 million gallons of fuel along with 6 MW of renewable power from renewable biomass feedstock. Initially, the facility will take in yard, vegetative and agricultural wastes. There are also plans to run municipal solid waste through the plant. INEOS Bioâ&#x20AC;&#x2122;s BioEnergy technology enables the production of both fuel and power. The biomass feedstock goes through a gasification process to produce synthesis gas. The heat recovered from the hot syngas is fed into a steam turbine, creating electrical power. The syngas itself is processed into ethanol.

DECEMBER 2012 | BIOMASS MAGAZINE 21

¦BIOMASSNEWS German government expects increased biopower development

California gets 2.8 MW biogas fuel cell

The German Federal Environmental Ministry has released an environmental technology atlas produced by Roland Gerger Strategy Consultants that projects the total share of environmental technologies in Germany’s gross domestic product will increase from 11 percent in 2011 to more than 20 percent by 2025. The report, titled “GreenTech made in Germany 3.0,” is the third such atlas produced by the consulting organization for the German government. According to the report, renewable energy, in general, is expected to increase by more than €151.2 billion ($195.61 billion) by 2025, an 8 per- SOURCE: "GREENTECH MADE IN GERMANY 3." cent annual increase. Biogas plants In 2010, biomass was used to produce are of particular importance to the German 33.5 billion kilowatt hours of power, a 10 bioenergy sector. According to the report, 3,700 percent increase over the prior year. In addibiogas plants were in operation in Germany in tion, biomass accounted for 92 percent of heat 2007, with a combined output of 1,270 MW. By produced from renewable resources, providing 2010, the number of biogas plants had increased approximately 127 billion kWh of thermal to 5,900 with a total output of 2,300 MW. energy in 2010.

Ontario, Canada-based Anergia Inc. recently brought a 2.8 MW biogas-powered fuel cell online at a California waste water treatment plant. The San Bernardino County, Calif., municipal waste district Inland Empire Utility Agency’s RP-1 Water Recycling Facility can treat up to 44 million gallons of wastewater per day. Anergia, which owns and operates the fuel cell, is selling the resulting power and heat to IEUA under a 20-year power purchase agreement. The electricity produced through the project will be enough to offset approximately 60 percent of the water treatment plant’s grid-derived power. Danbury, Conn.-based FuelCell Energy Inc. supplied the technology for the project. The process requires only minimal cleaning of the biogas, including humidity and sulfur removal. The project at IEUA hosts FuelCell Energy’s largest size system, the DFC3000, which can also be deployed at hospitals, universities, large complexes and utility grid support applications.

We Turn Anaerobic Digester Wastewater Streams into Revenue Streams ;OLYTV,ULYN`»Z ;OLYTV (97 OPNO LMÄJPLUJ` HTTVUPH YLJV]LY` Z`Z[LT PZ HU \UILH[HISL VW[PVU MVY VWLYH[VYZ VM HUHLYVIPJ KPNLZ[LYZ ^OV ^HU[ [V IV[O JVTWS` ^P[O UP[YVNLU YLN\SH[PVUZ HUK YLJV]LY HTTVUPH HZ H ]HS\HISL WYVK\J[ ;OLYTV (97 YLJ`JSLZ [OL HTTVUPH PU KPNLZ[LY ^HZ[L^H[LY PU[V HTTVUP\T Z\SMH[L VY HTTVUP\T UP[YH[L MVY [OL WYVK\J[PVU VM ]HS\HISL MLY[PSPaLYZ HUK PUK\Z[YPHS WYVK\J[Z ;OLYTV (97 PZ LULYN` LMÄJPLU[ L_[YLTLS` YYVI\Z[ HUK JVTWHJ[ ¶ Z\P[HISL MVY L]LU Y\NNLK ÄLSK JVUKP[PVUZ YVI\ YV VI\ I Z[ HUK K JV JVTW TW WHJ HJ[[ ¶ ¶ Z\ \P[HI ISL MMVY VY L L]L ]LU U Y\ Y\NN NNLK NN LK K Ä ÄLS LK

For F Fo or mo more re iinformation nfor nf for orma rma mati tion ti on email ema e mail ma il info@thermoenergy.com or visit our website at www.thermoenergy.com

22 BIOMASS MAGAZINE | DECEMBER 2012

Setting the Record Straight on Algae Separation hen diﬀerent technology enters a market, there is always some question about how it compares to what’s been available. That’s the case with spiral plate versus disc stack separating equipment. Disc stack separation has a proven 50-year record in algae dewatering and concentration. With over 300 installations worldwide, the process has been perfected and a signiﬁcant amount of data collected.

3. G-forces over 10,000 allow for production of pastes that are 11.5% drier.

% Dry Solids

40 38 36 34 32 30 10 8 6 4 2 0

11.5% Difference 34 31.5

Spiral plate

Disc stack

4. Processing parameters such as speed and ejection time are adjustable on disc stack equipment. This allows production of solids with varying dry matter levels for diﬀerent customer requirements.

Design elements in disc stack machines allow production of a superior product at a lower cost. Here are the facts: 1. Continuous machine operation allows for maximum up-time during processing. Solids are ejected at regular intervals with absolutely no interruption. There is no need to slow down the equipment and then bring it up to operating speed with a disc stack separator. 2. Automatic cleaning-in-place (CIP) is programmed in the machine, saving time and labor costs.

With six service offices throughout North America and professionals that are experts in algae separation, GEA Westfalia Separator offers the centrifugal separation equipment that can cost-effectively meet your needs. We welcome the comparison between the two separation technologies. To learn more and find out about testing one of our machines, contact Keith Funsch at 201-784-4322 or Keith.Funsch@gea.com.

5. Thirty (30) models are available with capacities ranging from less than 1 m3/hr to over 150 m3/hr. We work with you to find the machine that maximizes production for your current operation. Most machines can be scaled up as needs change. 6. Energy consumption, given the complete range of disc stack machines we offer, is equal to or less than what spiral plate technology offers. Disc stack machines use up to 20% less power.

GEA Mechanical Equipment US, Inc.

GEA Westfalia Separator Division 100 Fairway Court Northvale, NJ 07647 Phone: 201-767-3900 Fax: 201-767-3901 Toll-Free: 800-722-6622 24-Hour Technical Help: 800-509-9299 www.wsus.com

engineering for a better world

Q&A The Beltway Biochemist Valerie Reed faces the challenges of driving down the cost of biomass conversion, replacing the whole barrel and holding her own at Thanksgiving amongst a family full of scientists. Valerie Reed, acting manager for the U.S. DOE Biomass Program, is leading a federal government initiative of nearly $200 million to expedite the commercialization of next-generation, biomass-based fuels and chemicals. With investments being made in pilot-scale demonstrations to commercial-scale facilities, Reed and the DOE Biomass Program coordinate the efforts of national laboratories, universities and private companies as they all work to prove out commercially viable conversion pathways and begin meeting the volumes set forth by the renewable fuels standard (RFS). As the industry anxiously awaits the commissioning of the biofuel and biochemical facilities of the future in places like Emmetsburg, Iowa, or Lake Providence, La., Reed looks toward 2013 with growing anticipation. You have a doctorate in biochemistry. What is your earliest memory of your interest in science? Science seems to have been with me since the beginning of time. My mom was the head of a science department for a high school, teaching chemistry, physics and technology. My dad was a chemical engineer for the pharmaceutical industry. My brother has a physics degree and my sister a medical degree, add to that my biochemistry degree and Thanksgiving dinner is a lot of fun! But I really knew I would follow a science career path when I took high school chemistry. I had the coolest teacher and was just in awe of the fun things we got to do in lab. One of your programâ&#x20AC;&#x2122;s recurring talking points is the notion of replacing all of the product streams that come from a barrel of oil. Why is this so critical? In the United States, we spend about $1 billion a day to import oil. Domestically 24 BIOMASS MAGAZINE | DECEMBER 2012

produced biofuels can improve this situation by decreasing imports. For example, ethanol already displaces about $20.9 billion worth of imported gasoline annually. But in order to fully reduce dependence on foreign oil we are pursuing a portfolio approach to develop additional technologies to replace gasoline, diesel, jet fuel, heavy distillates as well as a range of biobased chemicals and products. Youâ&#x20AC;&#x2122;ve led efforts in biomass utilization that have resulted in significant reductions to the price of cellulosic ethanol production. How exactly does research accomplish this, and, where are the savings found? Over the past decade, the DOEâ&#x20AC;&#x2122;s Biomass Program has supported a range of research and development projects focused on reducing the cost of cellulosic ethanol. These include a biochemical conversion case (fermentation to ethanol) and a thermochemical conversion case (gasification to ethanol) that have both shown the potential to be viable in the near term. In the biochemical case, the process scenario was based on dilute acid pretreatment of corn stover followed by enzymatic saccharification (which depolymerizes cellulose into glucose and hemicellulose into xylose, both fermentation sugars) and cofermentation of the five and six carbon sugars to yield ethanol, which is then distilled and purified. We worked with our partners at national laboratories, universities and industry to use this as a roadmap for the research needed to target the costreduction goals. From 2001 through 2012, production cost improvements across this process helped decrease the price of cellulosic ethanol from about $9 per gallon to around $2 per gallon. In the thermochemical case, the process scenario was based on the gasification of woody biomass followed by syngas cleanup, tar reforming, and catalytic mixed alcohol synthesis followed by the separation and purification of ethanol from the mixed alcohol stream. Thanks to technology and

Valerie Reed

Q&A ¦

INTERVIEWED BY TIM PORTZ

engineering improvements, we’ve seen the production costs of this process come down about $2.70 per gallon over the last five years. A handful of advanced biofuels facilities have received DOE funding and are expected to begin commercial production in 2013. Is there a sense of anticipation for you as you wait for these facilities to come online? I most definitely feel a growing excitement as we get closer to meeting goals set within this program over 20 years ago. I started my career in the Biomass Program straight out of graduate school. At that time, we were talking about possible sources of enzymes and what it would be like if fermentation organisms could utilize multiple sugars. When I would tell people what I was working on, there was a great deal of skepticism. Even within the DOE, I would hear people say that I would probably not see these goals met in my lifetime. Yet, here we are validating multiple technical pathways capable of meeting the modeled costs for cellulosic ethanol and seeing not just one, but several commercial facilities being built. It was not always a smooth trip, but the research and development of the past couple decades is clearly paying dividends and will continue to advance better production processes and more efficient conversion technologies in the future. Clearly the DOE is interested in working toward conversion strategies for a geographically diverse mix of biomass. Why is it so critical that advanced biofuels become plausible in all regions? While the current U.S. biofuel industry is centered primarily in the Midwest, we are committed to deploying every available feedstock and are investing in technologies that utilize biomass feedstocks from every region of the country. We are looking at woody feedstocks in Maine, Michigan and Oregon as well as energy crops, like switchgrass and sorghum, throughout the Southeast and in California and Colorado. Additionally, we are supporting technologies that can develop fuel from municipal

solid waste in urban areas throughout the country and algae in states like Florida and in the deserts of the Southwest. This is important for several reasons. First, in order to significantly reduce our dependence on imported oil we need to maximize the potential of biomass. Our recently updated billion ton study shows that across the U.S., there is potential to displace about one-third of our current transportation petroleum use with biomass in a sustainable manner. It’s also important because we recognize that seasonal variability, weather and other factors could sometimes inhibit production in one area of the country or another, and we want to be able to maintain a consistent supply of biomass feedstocks. In the end, we believe that every region has characteristics that make it advantageous to produce certain types of biomass and every part of the country has an important role to play in securing America’s energy future. The RFS calls for 22 billion gallons of advanced biofuels to be in the marketplace by 2022. So far, the industry has been unable to meet the modest targets. Is 2013 the year real production matches RFS mandate requirements?

• Bulk material transport • Coal-fired power plants • Biomass energy systems • Waste to energy plants • Waste incineration • Special solutions • Coal feeding • Bunker discharge conveyor • Ash extraction through wet de-ashing systems • Lime handling

Over the past several years, we have invested significantly in a variety of projects focused on bringing down technology costs, enhancing the yield of different biomass strains and increasing the efficiency and sustainability of production processes. We are committed to helping the industry achieve the targets set by Congress in 2007. We are certainly optimistic for 2013. We expect several of our integrated biorefinery projects will be coming online in the next few years. As you may know, Ineos Bio, Poet LLC and Abengoa BioEnergy have major commercial-scale plants under construction, and we are on track with several other of our demonstration-scale projects as well. As these projects are completed, the lessons learned from their scale up will help reduce market and technology challenges across the industry, driving private industry financing and helping meet the ambitious RFS goals. 7UDGLWLRQ LQ '\QDPLF ,QQRYDWLRQ

Phone: 800-553-7993 • sales@rudchain.com www.rudchain.com

¦COST ANALYSIS

26 BIOMASS MAGAZINE | DECEMBER 2012

COST ANALYSISÂŚ

Global Costs of Biomass Power Outdated renewable energy cost data may be stymieing growth, but experts are working to collect and present the truth to policymakers. BY ANNA SIMET

DECEMBER 2012 | BIOMASS MAGAZINE 27

ÂŚCOST ANALYSIS

he renewable energy industry may be labeled a pipedream by fossil fuel tycoons and stakeholders, but expert analysis is making it difficult to deny its potential, and not just in the U.S. On a global scale, the wind, solar and hydro industries are worth more than $1 billion annually, and developing countries continue to embrace the waste-based technologies of biogas and biomass power. While cost has typically been the biggest development hindrance, that is slowly starting to change. The International Renewable Energy Agency points out that recent years have seen dramatic cost reductions as a result of research and development and accelerated deployment, but unfortunately, policymakers are often exposed to outON: IRENA, which was founded in 2009 to promote the widespread and dated information. Since most are unaware of the latest SIGNING increased adoption of sustainable, renewable energy, has 102 member countries and 57 cost data, progress is not where it could be. signatories. In order to disperse and make available current re- SOURCE: IRENA newable energy market data, IRENA has published a fivepart renewable energy cost analysis series, with the hopes that it will assist IRENA data collection for the cost analysis series included acin policymaking, especially in its 102 member countries. Michael Taylor, quiring information from industry associations, project developers, IRENA renewable energy cost status and outlook analyst, explains that development banks, consultancies, market research data, government the organization has a mandate from its members to accelerate the de- reports and auction data. Additionally, IRENA worked with GIZ, a ployment of all types of renewable energy, and as part of this mandate, German-based sustainable development corporation, to collect deIRENAâ&#x20AC;&#x2122;s Innovation and Technology Centre has a specific program that tailed, real-world project data for 79 projects from 11 developing counfocuses on the costs and performance of renewable technologies. tries. And, data collection is still an ongoing effort. â&#x20AC;&#x153;The rapid growth in installed capacity of renewable energy techOne of the core conclusions of IRENA's research so far shows nologies, coupled with technology improvements and associated cost that the total installed costs of biomass power generation technologies reductions, means that even data from one or two years ago can signifi- vary significantly by technology and country, according to Taylor. cantly overestimate the cost of electricity from these technologies,â&#x20AC;? Taylor says. â&#x20AC;&#x153;The lack of accurate, reliable data on the cost and performance Technology and Feedstock Costs of renewable technologies is a significant barrier to their uptake.â&#x20AC;? Simply â&#x20AC;&#x153;The challenge when talking about biomass power generastated, renewable energy data becomes outdated in a hurry, and that isnâ&#x20AC;&#x2122;t tion is to convey the idea that we are actually talking about a series widely known. of technologies,â&#x20AC;? Taylor says. â&#x20AC;&#x153;The simple combustion of biomass

Get your copy of Aceâ&#x20AC;&#x2122;s...

Laboratory Glassware & Equipment Catalog Everything from adapters to ďŹ&#x201A;asks to vials! www.aceglass.com Find and â&#x20AC;&#x153;likeâ&#x20AC;? us on Facebook!

t QBHF DBUBMPH t "WBJMBCMF JO QSJOU WFSTJPO PS PO $% 30. t $PNQMFUF UFDIOJDBM TFDUJPO t 'BCSJDBUFE GSPN FYQBOTJPO CPSPTJMJDBUF HMBTTXBSF t "O FYUFOTJWF SFTPVSDF GPS BMM ZPVS MBCPSBUPSZ HMBTTXBSF BOE FRVJQNFOU OFFET

Toll-free:

Toll-free fax:

800-223-4524 800-543-6752 P.O. Box 688 Vineland, NJ 08362-0688

28 BIOMASS MAGAZINE | DECEMBER 2012

856-692-3333 t Fax: 856-692-8919

COST ANALYSIS¦ ers: equipment cost from factory gate to site delivery; total installed project cost, including fixed financStoker boiler ing costs; and the levelized cost of electricity (LCOE), a calculation of Bubbling and circulating fluidized boilers the cost of generating electricity at Fixed and fluidized bed gasifiers the point of connection to a load Stoker CHP or electricity grid. Gasifier CHP The LCOE of biomass-fired power plants range from 6 to 29 Landfill gas cents per kWh based on capital Digesters costs and feedstock costs. Where Cofiring low-cost feedstocks are available and capital costs are modest, bioOPERATIONAL COSTS: Typical capital costs and the levelized cost of electricity of biomass power mass can be a very competitive technologies. power generation option, according SOURCE: IRENA to the analysis, and where low-cost agricultural or forestry residues and to generate steam requires a very different technology than that wastes are available, biomass can often compete with conventional required to gasify wood chips and then burn that gas to provide power sources. Even where feedstocks are more expensive, the steam to power a turbine, and these technologies vary substantial- LCOE range for biomass is still more competitive than for dieselly in technology terms and cost. The situation is also complicated fired generation, making biomass an ideal solution for off-grid or by the fact that some technologies are more mature than others.” minigrid electricity supply. For example, the total installed costs of stoker boilers ranged There are four major components that largely determine the between $1,880 and $4,260 per kilowatt (kW) in 2010, while those LCOE for biomass-fired power generation technologies, according of circulating fluidized bed boilers were between $2,170 and $4,500 to Taylor: feedstock cost and quality, equipment cost and perforper kW. Anaerobic digester power systems had a significantly wide mance, the balance of project costs and the cost of capital. “The range of capital costs from $2,570 up to $6,100 per kW, and gas- feedstock costs and capital costs, including the cost of finance, priification technologies had total installed capital costs of between marily determine the LCOE for biomass-fired power generation,” $2,140 and $5,700 per kW. he says. “Feedstock costs typically account for between 20 percent While IRENA’s report recognizes that there are many possi- and 50 percent of the LCOE, but they can be even higher.” ble influences on cost, its modeling is based off of three key drivOperations and maintenance (OM) costs can make a significant

Investment costs USD/kW 1,880 - 4,260 2,170 - 4,500 2,140 - 5,700 3,550 - 6,820 5,570 - 6,545 1,917 - 2,436 2,574 - 6,104 140 - 850

LCOE range USD/kW 0.06 - 0.21 0.07 - 0.21 0.07 - 0.24 0.07 - 0.29 0.11 - 0.28 0.09 - 0.12 0.06 - 0.15 0.04 - 0.13

DECEMBER 2012 | BIOMASS MAGAZINE 29

¦COST ANALYSIS

REGIONAL OUTPUT: Global grid-connected biomass capacity in 2010 by feedstock and country/region. SOURCE: Platts

contribution to the levelized cost of electricity as well, accounting for 9 to 20 percent of the LCOE for biomass power plants. IRENA’s data indicates that it can be lower than this in the case of cofiring, but greater for plants with extensive fuel preparation or handling and conversion needs. Fixed OM costs typically range from 2 to 7 percent of installed costs per year for most biomass technologies, with variable OM costs of around one-half a cent

per kW hour (kWh). Landfill gas systems have much higher fixed OM costs, which can be 10 to 20 percent of initial capital costs per year. To bring down the cost of biomass power technologies over time, Taylor has some insight. “Part of the answer to this question lies in the fact that different technologies are at different stages of maturity,” he says. “Although we don’t expect significant cost re-

FACTORY SALES & ENGINEERING, Inc. BIOMASS BOILER & ENERGY SPECIALISTS INDUSTRIAL AND UTILITY APPLICATIONS Turnkey Boiler & Cogeneration Projects Direct Fired Hot Gas Energy Systems for Rotary Dryers Biomass Fired Thermal Oil Heaters for Process Heat or ORC Power Generation

Combustion Options include Fluidized Bed, Reciprocating & Vibrating Grate Technologies, & etc. Heat Recovery Steam Generators (HSRG) After Sales Parts & Support, Maintenance & Repair

Flexible Solid Fuel Combustion Capabilities

www.fsela.com 30 BIOMASS MAGAZINE | DECEMBER 2012

PH: 985.867.9150 FAX: 985.867.9155 E: salesinq@fsela.com

COST ANALYSIS¦ ductions for mature technologies like stoker boilers, the opportunities for cost reductions from many of the gasification technologies are much better.” On feedstock, Taylor says the use of agricultural or forestry residues at the site where they are processed often results in the lowest electricity costs, given the noted importance of feedstock costs relative to overall electricity generation costs from bioenergy. Current data shows that the most competitive projects using these feedstocks produce electricity for as low as 6 cents per kWh. Technology and cost specifics aside, some countries are clearly trailblazing the renewable energy path, and there are a few standouts and up-and-comers.

Market Trends and Growth Currently, Europe and North America account for around two-thirds of total installed renewable energy capacity, a result of a combination of supportive policies and low-cost feedstocks, notably agricultural and forestry residues, according to Taylor. A specific example of that is in Germany, which in 2011 had 7,090 digesters, and was the leading country for both the quantity of plants and the amount of installed capacity at 2,394 MW of electricity. Virtually all of this capacity is located in the agricultural sector where corn silage, other crops and animal slurry are used, according to IRENA, and this is driven by a feed-in tariff in Germany that supports electricity generation from biogas. Outside of Europe and North America, Brazil stands out as an important market for renewable energy, with 9 percent of global installed capacity in 2011, Taylor says. “What we found particularly interesting [when collecting data] were some of the plans that smaller countries have for the future,” he remarks. “Uruguay, for instance, plans to add only renewable capacity over the next 10 years, including a mix of predominantly bioenergy and wind, with some

solar. They project that by 2015 biomass will provide 18 percent of their electricity needs and will help reduce average electricity generation costs and reduce variability in those costs.” Overall, data shows that between 2010 and 2030, global biomass and waste power generation could grow from 62 to 270 gigawatts, with investments totaling between $21 billion and $35 billion. China and Brazil appear to have the largest potential, but growth in Brazil is hinged on the continuing development of the biofuel industry and the possibilities for using waste bagasse for electricity generation. The amount of bagasse available, however, depends on the ethanol and sugar markets, which makes it difficult to negotiate long-term contracts that are designed to reduce price risk and guarantee security of feedstock supply, both of which will be required to allow access to financing. In China, growth potential depends on better utilization of the large quantities of agricultural residues and waste produced. Now that the cost analysis series is complete and available, IRENA plans to supplement them over time with new project cost data collected from member countries, and will also add the costs of renewables in end-use sectors, such as transportation. While up-to-date data now confirms that power generation technologies are becoming increasingly competitive—it accounts for half of all new power generation capacity additions worldwide—building on existing biomass industry segments will be essential for continued growth, as well as nurturing the new and lesser-deployed technologies. "Further deployment, commercial experience, learning-by-doing and large scale production could all help bring down costs for these less mature technologies," Taylor adds. Author: Anna Simet Contributions Editor, Biomass Magazine asimet@bbiinternational.com 701-751-2756

DECEMBER 2012 | BIOMASS MAGAZINE 31

ÂŚPOLICY

FUELING THE FUTURE: The support of the USDA and the U.S. DOE has helped the U.S. Navy begin to fuel its fleet with advanced biofuels, a policy that many believe will help the bioenergy industry expand. PHOTO: USDA

32 BIOMASS MAGAZINE | DECEMBER 2012

POLICYÂŚ

Navigating The Political Scene How election results, under-fire programs and agendas will impact 2013. BY LUKE GEIVER

DECEMBER 2012 | BIOMASS MAGAZINE 33

¦POLICY

he financial success and growth potential of the biomass industry in 2013 may not be determined by a single day in November, but the long-term health of the industry will be transformed by the 2012 election results. Although President Barack Obama secured his role for the next four years as the country’s ultimate decision maker, the political landscape appears to be littered with many of the same divisive issues that, for the biomass industry, have muddled progress and blurred the view of how renewable energy can positively alter the country’s energy practices and rural economies. The renewable fuel standard (RFS) is still under attack and successful programs are in limbo, yet the combination of a president who many in the industry supported, and the potential for new legislation means the industry will excel in 2013. A looming fiscal cliff, tax reform, immigration or even potential climate change legislation will earn the attention of the country at large, but in the 2013 biomass industry, several issues, programs or general strategies centered on biomass utilization will garner attention. The following is a compilation of industry perspectives, policy factors and political situations that could illuminate the best biomassbased strategies and provide a glimpse of what will matter in 2013.

Obama’s Impact Obama is in, the Democrats retained control of the Senate, and the Republicans did the same in the House of Representatives. What all of that means is anyone’s guess. Regarding the president’s impact on fossil fuel development, James Coan, an energy forum research associate from a think tank at the James A. Baker Institute for Public Policy at Rice University, says that although most oil companies in Houston would have preferred it if Mitt Romney had won, those same companies have also done very well under Obama.

Than Just

For bioenergy, Phil Fraas, a partner at the Washington, D.C.based office of Stinson Morrison Hecker LLP, says that Obama’s second term will mean continued efforts to commercialize biofuels. Fraas has worked in agriculture and renewable energy law for over 20 years, and believes that the collaboration between the U.S. Navy, the U.S. DOE and USDA will gain ground in 2013 because of Obama’s re-election. Jim Bowe, a partner in the global transactions group for another D.C.-based firm, King & Spalding, also believes Obama's term will mean continued development in biofuels, a situation both Fraas and Bowe say may not have happened under Romney. “I’m not expecting massive benefits to be showered upon the renewable fuels or renewable generating industries,” says the long-time renewable power veteran. “Although, I think there is more lip service likely to be paid to them [biofuels].” Michael McAdams, president of the Advanced Biofuels Association, is optimistic about Obama’s re-election, pointing towards his consistent support of the industry. “Over the last four years he has worked to create a broader renewable fuels industry across the board,” he says, “I think that bodes for a bright future for the advanced biofuel industry in the U.S.” Bob Cleaves, president of the Biomass Power Association, offered a less clear opinion of Obama’s re-election immediately following the results, saying that the BPA is still evaluating what election results mean for biomass. “We hope to work with the Obama administration over the next four years,” Cleaves says. Although position changes have not been announced for either the USDA’s secretary role currently filled by former Iowa Governor Tom Vilsack, or the DOE’s Secretary of Energy position occupied by Steven Chu, the biomass industry will not have to deal with the perceived difficulties linked to Romney’s poten-

Results

Providing the expertise for innovative solutions that lead to a sustainable tomorrow.

Fuel Testing

Biomass Analysis

Pellet Quality

Consulting Services www.twinportstesting.com

1301 N 3rd Street Superior WI 54880 34 BIOMASS MAGAZINE | DECEMBER 2012

715-392-7114 800-373-2562

POLICY¦ Current American Legislation Recovery and Reinvestment Act 2009 Type

Energy Indepence and Security Act 2007

1603 Tax Grant

RFS2

2008 Farm Bill Programs

USDA 9003 USDA 9007 USDA 9011 USDA 9008 Loan Grant & Loans BCAP Grants BRDI Grants Program

Value-Added Producer Grant Program

B & I Loan Guarantee Program

Section 305, Rural Electrification Act of 1936; 7 U.S.C. 904, 935

DOE Budget Appropriations

USDA Rural Utility Service

DOE Grants

Pellets

Power

Thermal

Biogas

Advanced Biofuels

Chemicals

POLICY MATTERS: The chart shows the legislation vehicle for each bioenergy-based policy that industry experts believe have had an impact. SOURCE: WESTAR TRADE RESOURCES

tial staff choices. Political analysts indicated that Romney’s team would have included several members from the fossil fuels industry, including the American Petroleum Institute’s President and CEO, Jack Gerard. An energy debate held between an Obama and Romney representative in October at Massachusetts Institute of Technology, may however, provide the best example of what Obama’s impact will be on bioenergy. During the debate, Joseph Aldy, a faculty member at the Harvard Kennedy School, told the crowd that, on the subject of energy policy, the president’s approach “has

focused on an all of the above strategy.” That strategy, he added, “has supported the development of all energy resources, oil and gas, coal, nuclear, wind, solar and biofuels.”

Policy Uncertainty Bowe could be right about Obama’s support of bioenergy. In the next four years, that support may only amount to more lip service during a State of the Union address or a visit to a pilot plant by the president, but the political scene in Washington will have a large impact on several programs that support biomass. In fact, some industry experts

DECEMBER 2012 | BIOMASS MAGAZINE 35

¦POLICY believe other issues that are determined by Congress are of far greater importance than who lives in the White House. Cindy Thyfault, CEO of Westar Trade Resources, a renewable energy consulting firm based in Texas, seems to speak for everyone in the industry involved in a project with government ties. “The two main issues of utmost importance are the debate and discussions underway of modifying the renewable fuel standard and the concurrent debate concerning the 2012 Farm Bill Energy Title,” Thyfault says.

36 BIOMASS MAGAZINE | DECEMBER 2012

Fraas agrees. “I will be watching whether the energy title of the farm bill will be renewed with adequate funding,” he says. “Right now, budget restraints are weighing heavily on the drafters of the new farm bill,” adding that it is an open question of whether they will find the money needed to match the amount given to the energy title in 2008. USDA dollars invested in renewable biomass has seen a dramatic rise since 2003, when it hovered around $10 million. In 2012, that total will exceed $510 million.

Earlier this year the Senate Agricultural Committee passed a version of the 2012 Farm Bill that included an amended Energy Title section that would mandate energy program funding. The program would allocate roughly $800 million over five years. The vote to pass the Energy Title was strong, passing with a bipartisan, 16-5 vote. But, the current belief on passage of the Farm Bill shows a vote will not happen until the spring of 2013 because of a lame duck Congress that will be debating a way to stop automatic spending cuts or risk another U.S. credit downgrade, all before Congress leaves for January recess. The 2012 Farm Bill Energy Title has specific programs to watch in 2013. “For second-generation biofuels,” Coan says, “the most important are the loan guarantees that are allowing the construction of first-of-a-kind commercial production facilities.” For advanced biofuels, Thyfault agrees with Coan about the important role loan guarantees have played. She points to the USDA 9003 program that has totaled roughly $1.08 billion. “This program has been instrumental in bridging the technology risk gap for financing,” she says. Along with the 9003 program, she also advocates for another loan option, the USDA Business and Industry Loan Program. Although the program has lowered the amount of funding available per project from $25 million to $10 million, she does note the program has mandatory appropriations each year, equal to $1 billion in 2013. The biomass-based power generation industry needs to keep an eye on state-level renewable portfolio standards (RPS), Coan says, and Bowe agrees. “One thing I will be watching is whether there continues to be erosion for the support of RPS’s,” he says, “you don’t hear as much about those as you did years ago.” In the southern U.S. markets, an RPS can drive utilities to think of alternative generation sources, a huge benefit to biomass because the wind source is meager and the ability to grow fuel is well-established, he says. For Fraas, a Biomass Crop Assistance Program expert with several clients who have utilized the

POLICY¦ program, BCAP is another program that merits attention. Funding for BCAP has not been extended for 2013. Outside of the programs linked to the 2012 Farm Bill, there are those offered by the DOE. All of the programs in the DOE are subject to congressional appropriations, Thyfault says. “So, the 2013 appropriations budget will also be a key indicator of future plans and programs,” she says for loan guarantees sponsored by the DOE.

The Potential in Policy The political landscape in 2013 shouldn’t be entirely classified as a place where biomass-based energy programs could remain in limbo or ultimately begin to change forever. Kathy Halvorsen, professor of natural resource policy at Michigan Technological University, says that although the November elections have left us all with a divided Congress, positive change could be coming. “I think something is going to shake loose in Congress on carbon and climate in 2013,” she says. “Look for something on climate change or carbon credits to come along, especially in light of Superstorm Sandy.” Don’t discount her sentiments on the divisive topic either. Bowe also implies that there is a push in the power industries to diversify their fuel mix and to lower their carbon footprint. Bowe points to a recently commissioned biomass power facility at Colby College in Maine. According to Bowe, the college is indicative of many institutions across the country that are spending money to lower their carbon footprint. It’s not just institutions concerned with carbon or a renewed government push towards climate legislation that could provide opportunity in 2013. According to Bowe, the Obama administration’s commitment to retire coal-based power generation facilities would open the door for biomass, and, although it may sound unlikely, the surplus of natural gas could actually help biomass power as coal facilities will also have to compete with natural gas and may choose to cease operations or look to other cofiring options to compete on price.

In the end, trying to predict if or when climate legislation happens, how natural gas prices will affect project development or when a Farm Bill will pass, all based on any of those issues’ relative to a divided Congress or the return of Obama may be a futile effort. Both Thyfault and Bowe insinuate that may be true. With all of the issues to watch for in 2013, Bowe says he wouldn’t trust the work of Washington to any business in bioenergy just yet. And although Thyfault will stay abreast of the Farm Bill and other topics, she believes in this simple

policy of her own: “The most successful companies will be making changes now, and not waiting until after the RFS and the Farm Bill debates are finalized.” Author: Luke Geiver Features Editor, Biomass Magazine lgeiver@bbiinternational.com 701-738-4944

Cellulosic ethanol from agricultural residues THINK AHEAD, THINK SUNLIQUID®

Highly efﬁcient sunliquid is an economic and sustainable process to generate biobased products from lignocellulosic biomass. It opens up new feedstocks not only for fuel, but also for green chemistry from untapped resources – like cellulosic ethanol from straw. WWW.CLARIANT.COM WWW.SUNLIQUID.COM

DECEMBER 2012 | BIOMASS MAGAZINE 37

¦SUSTAINABILITY CONTRIBUTION

Managing Woody Biomass: The Past Century in Review Foresters and timberland managers have stabilized woody biomass in the U.S. for the last century, meeting consumer demand without exhausting supply. BY JOSHUA KANE HARRELL

t the turn of the 20th century, U.S. President Theodore Roosevelt warned Congress, with subsequent hyperbole appearing in New York Times headlines, that “a timber famine is inevitable.” Gifford Pinchot, the first chief of the U.S. Forest Service, echoed the sentiment by proclaiming, “In 20 years, the timber supply in the United States on government reserves and private holdings, at the present rate of cutting, will be exhausted.” The timber famine or scarcity never happened, despite the increased consumer demand placed on our nation’s timber resources through the

Roaring Twenties, post-World War II boom and other high-growth periods. The complete opposite of timber scarcity has occurred over the past century. To exemplify the purest definition of sustainability, the amount of forestland in the U.S. has remained stable around 750 million acres from 1907 to 2007. Additionally, over the past two decades, forestland has increased by 20 million acres. As of 2006, the volume of annual net growth exceeded the volume of annual removals by 38 percent. The U.S. is growing more timber volume than it is harvesting, by a fairly wide margin.

The claims and statements made in this article belong exclusively to the author(s) and do not necessarily reflect the views of Biomass Magazine or its advertisers. All questions pertaining to this article should be directed to the author(s).

38 BIOMASS MAGAZINE | DECEMBER 2012

If a timber famine occurred, stumpage prices—the amount paid for standing timber— would have reflected the inherent scarcity. According to the revealing economic study by Johnson and Libecap, the annualized rate of change in stumpage prices during the perceived timber famine era remained a constant 6 percent. Supply and demand stayed in relative balance, never approaching a supply shortage that could be termed a “famine.” Why has the timber resource remained abundant in the face of growing demand? Simply put, markets existed that created de-

SUSTAINABILITYÂŚ mand. A major factor aiding in the expansion of forestland is the presence of deep, well-established markets for wood products. A nation of consumers required wood for prosperity, thereby fostering development of private sector innovation in the form of technological improvements in milling and tree-felling technology, advances in silviculture, tree-seedling genetics and tree-farming practices, and the conversion of degraded agricultural lands to timberland plantations aided by federal government programs. In the wake of appreciating timber commodity prices, the consumer side of the equation responded with advances in wood conservation measures (e.g., utility pole treatment) and product substitution.

SOURCE: USDA FOREST SERVICE, FOREST INVENTORY ANALYSIS PROGRAM

Burgeoning Biomass Markets Differentiating from the aforementioned traditional timber markets, the woody biomass market, defined as supply for energy demand, emerged vigorously over the past decade. Ironically, wood has been used as a source of fuel in the U.S. since the Colonial Era. Seen through the prism of contributing to cellulosic ethanol, heat generation and electrical power generation, the growth of this emerging market has largely been precipitated by government subsidies, legislative initiatives/mandates, increasing oil prices, negative pressure on utilization of food resources and environmental solutions for alternative energy sources. The pressures for the woody biomass market to flourish present a dichotomy of optimism and pause for concern over the actual market formation. Forisk Consulting LLC estimates there are a total of 452 announced or operating woody biomass projects in the U.S. with a projected operating capacity of 124.8 million green tons of wood annually by 2022. Of the projects that actually pass the Forisk screening criteria of successful project financing, proven technology, permitting, supply agreements, etc., Forisk projects that only 77 million green tons of wood annually will be needed, a decrease of 38 percent from the total capacity of all 452 projects.

DECEMBER 2012 | BIOMASS MAGAZINE 39

¦SUSTAINABILITY

SOURCE: USDA FOREST SERVICE, FOREST INVENTORY ANALYSIS PROGRAM

As a data point, the forest products industry currently consumes more than 500 million green tons of wood annually. Anecdotally, Forest Investment Associates has directly met with dozens of potential biomass participants who have expressed interest in securing biomass supply to support potential bioenergy projects. While FIA has had the opportunity to fully evaluate the potential for adding value to timberlands through working with some of these participants, the exercises were largely in vain. Substantiating the screening process conducted by Forisk, most of these potential biomass participants are no longer in existence for a myriad of reasons.

Stalled Biomass Markets

Integrated Control Systems ,WV WKH +XUVW GULYH IRU JUHDWHU HIÀFLHQF\ WKDW VSXUV LQQRYDWLRQ DJDLQ DQG DJDLQ WKURXJK RXW WKH SDFNDJH ERLOHU LQGXVWU\ +XUVW SHUIRUPDQFH VHULHV ERLOHUV DJDLQ OHDG WKH ZD\ ZLWK RXU ÁH[LEOH GHVLJQV LQFRUSRUDWLQJ true master LQWHJUDWLRQ DQG UHDO WLPH PRQLWRULQJ VHWWLQJ WKH VWDQGDUGV DQG WKH SDWK WR PD[LPL]LQJ ERLOHU URRP HIÀFLHQF\ MAXIMIZES BOILER ROOM EFFICIENCY INCREASES PRODUCTIVITY REDUCES OPERATING COSTS

40 BIOMASS MAGAZINE | DECEMBER 2012

What has hampered the development of the woody biomass market? There is no doubt the financial crisis of 2008-’09 took a toll. Largely, project financing, technological capability and environmental resistance have squeezed out potential market participants. In the first instance, a number of enterprises tried to put the cart before the horse by attempting to secure long-term biomass feedstock supply agreements, in order to secure debt financing, in order to build a biomassusing facility. It seems cliché, but FIA is a firm adherent of the “Field of Dreams” mantra, “Build it and they will come,” i.e., if new bioenergy facilities that consume biomass are developed, forest landowners will respond to meet the new demand by growing more wood. In technological capabilities, FIA's interest in the market was piqued in 2006 by an announcement of the Range Fuels’ cellulosic ethanol facility in Soperton, Ga. At full production, the facility was projected to consume 1.6 million green tons of woody biomass feedstock, in an economically depressed area that could have benefited greatly from the related jobs. Sadly, the commercial-scale feasibility of the two-step, thermochemical conversion process was lacking, at least in profitability. With cautious optimism, FIA turns to KiOR Inc. as it prepares for the start-up of the newly constructed cellulosic biofuel blend stock facility in Columbus, Miss. While liquid fuel production from biomass

SUSTAINABILITY¦ has struggled, pellet production is a proven, long-established technology that provides a reliable market in certain locales, albeit dependent upon European policy models. Much of the interest in woody biomass as an alternative fuel feedstock originated from the idea of American energy independence and environmental opposition to fossil fuel sources. Ironically, the same environmental community has condemned the use of woody biomass, petitioning for an equal carbon emissions footprint as coal. In the same vein, the final U.S. EPA Tailoring Rule announced in 2010 treated the regulation of greenhouse gas emissions from biomasssourced and fossil fuel-sourced electricity in an identical fashion. The EPA has deferred the permitting requirements until 2014 in order to gather more data, in the meantime injecting a fair amount of uncertainty into the market. Despite the setbacks in the woody biomass market, one thing has remained constant: the continual and sustainable management of the timber (and woody biomass) resource.

year). This planting density allows for a first thinning between ages 13 and 16 to remove pulpwood and a small amount of chip-n-saw. The increased residual spacing allows for sawtimber growth optimization over the next 10 years or so, until final harvest. In order to stay diversified in timberland management options, research and operational endeavors have been deployed to couple the pulpwood regime with the sawtimber regime in the form of so-called flex plantations.

This method provides for the interplanting of lower-value and higher-value genetic seedling stock. Whatever direction the traditionally deep timber markets or emerging biomass markets may take, land managers and foresters will be poised to provide forest products to both markets in order to meet demand. Author: Joshua Kane Harrell, Certified Forester Regional Investment Forester, Forest Investment Associates jharrell@forestinvest.com 404-261-9575

Maximum production. Low operating cost. The Bühler RWPR-900 is the ideal pellet mill for your biomass applications. The RWPR was designed with massive roll bearings to withstand the extreme pressures of biomass pelleting. To ensure ease of operation the pellet mill is equipped with a simple V-belt drive system with minimal moving parts. This top of the line pellet mill provides an effective and efﬁ cient pelleting solution. For more information please visit www.buhlergroup.com.

Bühler Inc., PO Box 9497, Minneapolis, MN 55440, 763-847-9900, buhler.minneapolis@buhlergroup.com, www.buhlergroup.com

Biomass Keeps Growing As an open free-market participant, foresters are poised to participate in supplying the emerging demand. In order to generate the highest returns for our clients, timberlands are managed for the highest and best product, which is presently sawtimber. If the net present value shifts such that a pulpwood or energy rotation provides a better proposition, management strategies will be adapted, as demonstrated in competitive pulpwood markets in the Southeast. Once upon a time, the southern forest products industrial landowners planted 1,000 to 1,200 trees per acre for the primary purpose of supplying feedstock for their pulp facilities. The mantra was, “plant them thick, cut them quick.” Since then, the sawtimber market has grown in the South, and the forest industry as a whole has practiced more intensive silviculture coupled with advanced gains in genetics. The optimum economic sawtimber rotation is satisfied by planting 500 to 600 trees per acre (with current mortality around plus or minus 5 percent in first

Heavy Duty Pellet Mill Maximum Production. Flexible controls optimize process Low operating costs. Rollers, dies and other wear parts are designed for maximum performance and longevity to increase uptime and proﬁ tability. Safe operation. A combined overload shear pin and belt slip monitor protect the pellet mill from overloads or foreign material entering the die.

Innovations for a better world. DECEMBER 2012 | BIOMASS MAGAZINE 41

ÂŚMARKETPLACE Biomass Magazine Marketplace

The Worldâ&#x20AC;&#x2122;s Largest and Longest Running Ethanol Conference

Biomass Pollution Control

UltraCat Catalyst Filter System %FFECTIVE ./X CONTROL STARTING AT ÂŞ& 0ARTICULATE TO LESS THAN LBS --"TU Â&#x2039; 6UL Z`Z[LT MVY 74 56x :62 /*S KPV_PUZ TLYJ\Y` VY HU` JVTIPUH[PVU Â&#x2039; 3V^ [LTW 56x JVU[YVS LSPTPUH[LZ :*9 ^P[O JH[HS`Z[ LTILKKLK Ă&#x201E;S[LYZ Â&#x2039; 7YVQLJ[Z \W [V 4> Meets Boiler & CISWI MACT Regulations

0H s KEVIN MOSS TRI MER COM

:PUJL -HJ[VY` /LHKX\HY[LYZ! 6^VZZV 4PJOPNHU

www.tri-mer.com ÂŠ

;YP 4LY *VYW

We broker all forms of biomass

DO IT RIGHT THE FIRST TIME www.advancedbiomasssolutions.com Contact us: sales@advancedbiomasssolutions.com or 218-782-3000

Projects donâ&#x20AC;&#x2122;t have room for error.

www.bbiinternaĆ&#x;onal.com 866-746-8385 | service@bbiinternaĆ&#x;onal.com

Reach Your Target Audience Advertise in Biomass Magazine

866-746-8385 service@bbiinternational.com www.biomassmagazine.com

42 BIOMASS MAGAZINE | DECEMBER 2012

June 10-13, 2013 Americaâ&#x20AC;&#x2122;s Center | St. Louis, MO

Make Plans to Attend REGISTER NOW Interested in Speaking? Presentation ideas and poster abstracts will be accepted through December 14, 2012. Submit in one of five tracks: Track 1: Pellets & Densified Biomass Track 2: Industrial & Commercial Thermal Energy Track 3: Biomass Power Track 4: Biogas & Landfill Gas Track 5: Advanced Biofuels & Biobased Chemicals

APRIL 8-10, 2013

Minneapolis, MN www.biomassconference.com

"The quality of business relationships built here are second to none." - Stephen S. Reidell, Eagle Innovations

866-746-8385 | service@bbiinternational.com |

#IBCE13 Follow Us: twitter.com/biomassmagazine