PELLETS Investing in a fibre future THERE IS NO REASON TO DOUBT this as it is to be achieved by increasing production capacity at some of the existing plants as well as establishing new ones. In fact an eighth plant has been announced and would seem a typical modus operandi for the company. Sia Broceni Pellets, a subsidiary of AS Graanul Invest, is to build a 150 000 tonne per annum plant in Broceni, Latvia. A 16-hectare (ha) site has been selected, planning permission granted, long-term feedstock contracts with major players in the region agreed and production is expected to come online at the beginning of 2016. – We are also in the process of doubling capacity at our Imavere facility here in Estonia, revealed Raul Kirjanen. Market, resource and location The underlying reason for expansion is that Graanul Invest firmly believes there is significant market potential in Europe for European produced pellets, in the domestic heat, commercial heat and utility markets. As a group that started operations in late 2003 the company has grown to take a share in all three markets producing both industrial grade and ENplus pellets. There is over 7.5 million ha forestland in the Baltic States. All three countries, Lithuania, Latvia and Estonia have a forest cover similar to that of the Nordic countries, 30-50 percent of the land area and a similar Boreal species composition with softwoods mainly pine (Pinus sylvestris) and spruce (Picea abies) along with hardwoods mainly birch (Betula sp.), alder (Alnus sp.) and aspen (Populus tremulus). The countries have well-developed primary and secondary mechanical wood processing industries giving rise to suitable pellet feedstock. – There is no pulp or paper industry of significance in terms of wood fibre competition. Instead pulpwood and fuelwood chips are exported to Nordic pulp mills and heat plants, explained Kirjanen. There is a limit to how far inland from a port one can afford to source fibre which according to Kirjanen is in the 50-100 km range depending on transportation costs and quality. Being sited almost 240 km from the coast the new OÜ Osula Graanul pellet plant in Võrumaa, southern Estonia is a case in point. Currently under commissioning its 350 000 tonne per annum nameplate capacity 36 Bioenergy Internat ional No 78, 2-2015 makes it perhaps the second largest plant in the entire Nordic Baltic region. The plant is sited literally down the road from one of its main feedstock suppliers, AS Toftan, a sawmill that produces 200 000 m3 sawn wood per annum. Roundwood discussions The plant is designed to handle and process various forms of wood feedstock, in all some 600 000 m3 of wood per annum. Sawmill residuals such as sawdust and shavings are estimated to account for 40 percent of the demand whereas as energy wood and some low grade pulpwood supplied as logs make up the balance. – This is a significant volume and will benefit wood processors and forest owners in southern Estonia by offering a local market year round for residues and low quality logs, said Kirjanen. The use of roundwood in pellet production has become a contentious issue with calls for legislating a cascading principle. – To my mind some of these discussions express a lack of understanding of what forestry and forest industry is and what it means to be a forest owner, at least here in the Baltics. Cascading is in essence a “first right of refusal” and does not automatically mean better sustainability or better functioning market. Unmerchantable means that, for some reason, there is no market for the log regardless of size or quality. We are providing a market where before there was none and this is beneficial to all parties, emphasized Kirjanen. He added that the company is a holder of several certifications including Green Gold Label (GGL) sustainable biomass supply chain, Forest Stewardship Council (FSC) chain of custody and controlled wood and are engaged in the Sustaianble Biomass Partnership (SBP). – The risk of this extra certification and administrative burden is that smaller forest owners who cannot afford this will lose out. In effect they would be shut out from a market which surely was not the intention, warned Kirjanen. It is a valid point and worth remembering that large areas of forests in the Baltic states were damaged by warfare during World War II. During the following Soviet occupation, all agricultural- and forestland was nationalised, people with knowledge about forest management were no longer in place having been killed during the war or displaced. In other With the commissioning of its seventh wood pellet facility, Estonian based AS Graanul Invest has increased its total annual production capacity to over 1 million tonnes making it one of the largest producers in Northern Europe. According to Raul Kirjanen, CEO for AS Graanul Invest there is room for more revealing plans to double capacity by end of 2018.
Bioenergy no 2 - March 2015
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