A note from the World Sustainable Energy Days: biomass pellets

The World Sustainable Energy Days - one of the largest gatherings of its kind - are currently underway in Wels, Austria. Energy experts from 61 countries convene to take part in three conferences (European Pellets Conference: 28 February - 1 March; the European Energy Efficiency Conference: 1 March; the Conference on the "Energy Future, 2030": 2 March) and a seminar on "Rural Development & Sustainable Energy" (1 March). The Energiesparmesse, running from 1 - 4 March, looks at the latest developments in energy conservation and efficiency.

Some notes [*German] on the European Pellets Conference [*.pdf, overview] as it relates to Austria have meanwhile been published. Biomass fuel pellets are a clean, CO2-neutral and conventient fuel with rapidly growing market shares in many European countries (statistical overview: earlier post) and showing a growing global trade (earlier post on a large Swedish-owned pellet plant based in the U.S. aiming to supply Europe, on pelletiser in the Republic of Congo that will be producing 500,000 tons for exports on a large South African plant with similar goals, and on the Port of Antwerp's activities of building infrastructures to accomodate this trade). Biomass pellets are most often made from wood chips and forestry residues or from woody energy crops grown on dedicated plantations, even though dedicated herbaceous feedstocks (fast growing grass species) are receiving more and more attention as well (earlier post and here).

The fact that biomass has become directly competitive with fossil fuels (earlier post), has sparked a real investment boom in Austria: over 28,000 small biomass burning installations have been built, 12,000 of which utilise pellets; 528 medium-scale, highly efficient combined heat-and-power (CHP) biomass plants have been established (235 of those being district-heating systems) and 9 large biomass cogeneration plants, which are considerably more efficient than traditional utility-scale power plants (earlier post), replace an increasing amount of coal and oil in the country.

Researchers are currently working on developing ultra-efficient micro-CHP systems suitable for home use. With such a system, the household would buy a stock of pellets once a year, and draw both electricity and heating needs from the micro power plant. An interesting concept is emerging around this technology: with a micro-CHP plant, the household not only becomes its own utility, it would also be enabled to strategize around selling green electricity to the grid, which currently relies on large, far less efficient fossil fuel powered plants (earlier post):
bioenergy :: biofuels :: energy :: sustainability :: solid biofuels :: wood :: grass :: biomass :: combined heat-and-power :: cogeneration :: bioenergy trade ::

Last year, Austria used more than 1 million tons of biomass pellets for the first time, saving over a million tons of CO2. This places the country second after Sweden.

At the opening of the European Pellet Conference, a quick ranking of pellet producing countries was presented:

1. Sweden leads with an annual production of 1.4 million tons
2. Canada, 1.2 million tons/year
3. United States, 1.1 million tons/year
4. Austria, 600,000 tons/year

Austria's production doubled between 2004 and 2006. When it comes to utilising the pellets, Austria ranks fifth after Sweden, the U.S., Denmark and Germany.

It was noted that since December last year, pellet prices have shown a downward trend, after highs of €199 per ton in November. A relatively stable price is seen as a crucial aspect for creating consumer acceptance of the biofuel.

For this reason, the Austrian state of Oberösterreich has taken a series of initiatives to prevent pellet prices to become too volatile. The most important of these are:

1. stronger price controls: there has been suspicion that a biomass pellet cartel was operating that kept prices artificially high and the matter was investigated, but there were no clear indications of the existence of such a cartel. The matter has prompted the state government to create more stringent price controls, executed by the 'Bundeswettbewerbsbehörde' (the institution that investigates the fairness of competition.)

2. incentives for production increases: during a round-table, the Agrar-Landesrat (regional minister of agriculture) and the pellet industry have agreed to quadruple pellet production provided the government works out tax incentives for the companies involved.

3. the establishment of a pellet reserve: in order to strengthen continuous supplies and to offset sudden shortages, the state has studied the possibility of creating pellet reserves; a proposal is on the table to force pellet producers to stock 30% of the quantity they're projecting to sell during the winter season. Under the scheme, stock building will be initiated from September onwards and reach their maximum at the end of November, after which the build-down follows until the end of January.

We will be reporting on other aspects of the conferences hosted by the World Sustainable Energy Days, as soon as more information becomes available.

More information:
OEJournal: OberÖsterreich ist neben Schweden das Biomasseland Europas - Feb. 28, 2007
Biopact: Swedish group to build 550,000 ton biomass pellet plant in Florida for exports to Europe - Feb. 4, 2007
Biopact: South African company to produce biomass pellets for exports to Europe - Feb. 2, 2007