Bumping up Biomass utilization

The increased demand for green energy—and the sheer volume of beetle-killed trees—could re-define wood biomass utilization in the British Columbia Interior.

By Jim Stirling  

Excess wood residues. Beetle-killed pine trees. Increased demand for green energy. Those tantalizing ingredients are poised to re-define the wood biomass utilization industry in the interior of British Columbia. Some predict it will revolutionize it. But it’s more likely to be a case of baby steps forward before the structure is in place to allow the diverse initiatives proposed to make economic sense. The possibilities, however, are definitely intriguing.                                   

Utilizing wood biomass for energy production is not new. It’s just that North America has been slow on the uptake. Parts of Europe, in contrast, have long recognized and successfully used wood in various forms to help power their industries and communities. Ironically, quantities of the raw material they require are actually exported from BC.    

Crown Corporation BC Hydro has identified beetle-killed timber as a prime example of a renewable energy source, and has received more than 80 responses to a call for expressions of interest from companies interested in building wood-driven power plants.                                
But a couple of recent political ideologies have brought the wood energy idea closer to home and elevated its profile. The BC Liberal government’s Forest Revitalization Initiative is in large part a response to the mountain pine beetle epidemic and the falldown in future fibre supply for dimension lumber production.                                   

Key elements within the initiative: finding feasible ways to diversify the forest industry and create new opportunities and jobs. The provincial government views a large-scale, wood-driven bioenergy industry as a generator for those objectives on a sustainable basis.                                   
Last spring, BC Hydro, a government Crown agency, announced an updated energy plan for the province. The emphasis, says BC Hydro, is on environmental sustainability focusing on energy conservation and clean, renewable energy sources. BC Hydro identifies beetle-killed timber, wood wastes and agricultural residues as examples of such sources. BC Hydro called for expressions of interest from companies and partnerships interested in building wood driven power plants. It received more than 80 total responses. Since then, the government has announced it aims to use wood fibre from various sources to produce enough electricity to power 400,000 homes. The government believes that’s just the beginning. It reckons that during the next 10 years, about 800 million cubic metres of beetle-killed lodgepole pine will be available for use.                                   

A couple of companies have been quick off the mark to outline their response to BC Hydro’s expression of interest and the government’s overall call for forest industry diversification. Nexterra Energy of Vancouver joined forces with Pristine Power of Calgary to create BC Bioenergy Power Network.                                   

The new company proposes building 15 individual, small-scale power plants at a total cost of $500 million. Each would have a production capacity in the 10 to 20 megawatt of power range, and they’d be scattered around the Interior, in part to help reduce fibre transportation costs. Nexterra Energy has developed a gasification process to convert wood fibre to power that would be used in the plants.                                   

The system is in use at Tolko Industries Ltd’s Heffley Creek plywood mill in BC’s southern Interior. Pristine Power proposes financing, building and operating the network’s plants.                                   

Wood residues produced by sawmills is seen as the primary initial feedstock for the proposed plants followed by roadside wood wastes with the potential of backing that up with beetle-killed timber utilization.                                   

It’s estimated a 10 megawatt power plant would need 60,000 bone dry tonnes of wood waste a year to operate, or about 140,000 cubic metres of wood. The BC Ministry of Forests and Range estimates 2.5 million bone dry tonnes of roadside wood waste (about six million cubic metres) exists between Williams Lake in the central Cariboo to Burns Lake in west central BC. And that doesn’t factor in the beetle-killed wood volumes.
The problem is not a lack of potential fibre; it’s whether access and utilization makes economic sense without subsidies of one description or another. Some observers feel at least part of the cost effectiveness question revolves around tenure reform and/or forging new partnerships. Between licensees and bioenergy companies, for example, whereby the latter could access wood produced but not utilized by the licensees.                                   

Arrangements might be negotiated to bring in more wood from the bush earmarked specifically for energy production. Loggers harvesting beetlekilled stands today are directed to deliver specified processed saw logs to mill yards. The rest of the material stays in the bush. At least some of it has other potential uses. But it’s often piled and burned which is wasteful and not particularly environmentally friendly.
Licensees would expect to be compensated for volumes of “their” wood ending up in wood-fired power plants. But that’s a debatable point if they’re squandering it. The situation reflects that bioenergy, like every new industry, has its challenges. It needs the establishment of solid and fair ground rules to flourish. The pulp and paper industry is concerned about bioenergy developments getting ahead of themselves. It’s worried subsidies to help the bioenergy industry— which the pulp sector suggests are necessary to make it economic —could cost them the fibre they use and drive up demand for sawdust and chips. Bioenergy proponents counter the intent is to use the growing volumes of wood fibre that are currently not being economically used.                                   

There are other potential users out there eyeing the unexpected fibre bonanza created by the pine beetle epidemic. Wood pellet manufacturing plans are gaining a stronger foothold in the BC central Interior. Plants are operating in Williams Lake, Quesnel, Prince George, Vanderhoof and Houston. Others are in the advanced planning and pre-production stages. For example, TallOil Canada Inc and its Swedish partners have proposed four new pellet manufacturing plants for locations near Vanderhoof, Fraser Lake, Quesnel and Williams Lake.                                   

In 2005, Ainsworth Lumber was the highest bidder on two beetle-killed salvage licences in central BC. The company planned to build two OSB plants in the region.

The pulp and paper industry is concerned that subsidies to the bioenergy industry could cost them the fibre they use and drive up the demand for sawdust and chips.   

In 2006, however, Ainsworth relinquished its salvage licence privileges for the Vanderhoof area, but kept its options open for constructing an OSB plant between Quesnel and Prince George. But that project is by no means a certainty. Ainsworth was committed to completing expansion of its OSB plant in Grande Prairie, Alberta. Then it placed other proposed projects on hold. Markets for OSB, like dimension lumber, have been hit badly by a steep reduction in housing starts in the US.                                   

The way it sits right now, Ainsworth has until January, 2009 to make a construction start on an OSB plant in the Quesnel-Prince George area to keep its beetle salvage licence in good standing. And by then, all players should have a better understanding of where BC’s wood biomass energy industry is heading.     

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