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Wood Pellets Energizing Europe, Timber Industry

• October 12, 2011 • 4:00 AM

A thriving transatlantic trade in compressed wood scraps is creating New World timber jobs and meeting Old World clean energy requirements.

One strange side effect of the European campaign to slash emissions by 2020 is a boom in North American timber products. A chief at one British Columbia wood-processing firm, Pinnacle Renewable Energy, made a slightly surprising remark to Germany’s Manager Magazin this year: “We’ve grown to a size where we can fill whole cargo ships,” said Leroy Reitsma, Pinnacle’s chief operating officer, “and that makes it profitable to export wood pellets.”

Wood pellets?

Until recently they were a boring product for home stoves, usually found in northern supermarkets next to the Duraflame logs. But Europe’s international energy firms need more and more of them to mix into their coal-burning plants. Wood counts as a (slowly) renewable energy source, and it pollutes less than coal.

“Europe can meet its CO2 emissions goals with help from these overseas resources,” said Fritz Varenholt, chief of the German-owned energy firm Innogy, which opened a pellet plant this year in the U.S. state of Georgia.

By “co-firing” coal with Innogy pellets, the German energy firm RWE expects to save about a million tons of CO2 emissions per year, Varenholt said. The pellet trend should only grow after 2020, since Germany has decided to replace part of its nuclear power capacity with coal plants.

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European Dispatch

EUROPEAN DISPATCH
Michael Scott Moore complements his standing feature in Miller-McCune magazine with frequent posts on the policy challenges and solutions popping up on the other side of the pond.

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Wood pellets are just compressed sawdust and timber waste. Both Canada and the U.S. have huge surpluses. British Columbia’s forests in particular have been hit so hard by the mountain pine beetle that deadwood for pellets is abundant. Europeans can’t use wood from their own forests because much of the forest is gone or protected, and European land is tight.

Canada sold a million tons of pellets to Europe last year, mostly to the Netherlands, Belgium, and Britain. Pellets, along with lumber sales to China, helped the Canadian forest industry turn an overall profit last year for the first time since 2007, when the American housing market crash caused a critical slump.

Scientists even claim pellets are cleaner than natural gas. “When only the emissions from the burning fuel are analyzed, natural gas appears to be a cleaner option,” chemical and biological engineering professor Xiaotao Bi of the University of British Columbia explained to his campus’ Ingenuity magazine. “But when you factor in the entire life cycle of natural gas … with that of engineered wood pellets, which come from a renewable resource, the pellets are a far better environmental choice. They’re clean, and they’re sustainable.”

Even if you ship overseas in those champion polluters known as cargo ships?A study by researchers in Italy and Canada suggests that the long sea voyage from Vancouver to Stockholm (through the Panama Canal) accounts for 39 percent of the pellets’ “total energy content” once they’re burned in Europe. The “fossil fuel content” of the pellets, given such a long trip, “ranged from 19 percent to 35 percent, depending on whether natural gas or wood residue is used in the drying operation during the wood pellet production stage.”

So RWE’s new wood-pellet plant in Waycross, Ga., is a way to slash the shipping distance and secure a ready supply of cheap, Georgia-grown biomass. (Other German firms have already discovered the American South as a cheap place to build factories.) Innogy is also the largest “green-wood” pellet facility in the world, meaning it uses fresh wood from tree plantations, rather than timber waste.

But isn’t there something wrong here? Why should it take Europeans to buy up North American wood to cut emissions from their coal? North Americans burn coal, too. But the notion of mixing it with cheap timber scraps — even old shipping pallets or Christmas trees can be “pelleted” — hasn’t caught on. The difference has to do with Europe’s emissions goals, which the EU may actually achieve. “Europe is like the black hole for wood pellets,” said Brian Getzelman, who founded the American firm ArborPellet. “They just can’t get enough of them.”

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Michael Scott Moore
Michael Scott Moore was a 2006-2007 Fulbright fellow for journalism in Germany, and The Economist named his surf travelogue, "Sweetness and Blood," a book of the year in 2010. His first novel, "Too Much of Nothing," was published by Carroll & Graf in 2003, and he’s written about politics and travel for The Atlantic Monthly, Slate, the Los Angeles Times, and Spiegel Online in Berlin, where he serves as editor-at-large.

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