PELLETS Bioenergy International No 83, 7-2015 15 )FBSEJO)BMJGBY THESE WERE SOME of the headlines given by Michele Rebiere, CFO, Viridis Energy Inc., and President of Wood Pellet Association of Canada (WPAC) in her opening remarks and then discussed by around 180 participants during the 3rd WPAC held in Halifax, Nova Scotia, at the start of November. Korean kerfuffle Driven by the Renewable Portfolio Standard (RPS) obliging Korean generators to co-fire, the South Korean industrial pellet market emerged in earnest last year as, according to Fiona Matthews, Senior Analyst, HawkinsWright, imports climbed to 1.9 million tonnes up from 400 000 tonnes 2013 with Canada, Malaysia and Vietnam as main suppliers. However, as Matthews explained, the tender system in place puts a very clear emphasis on price, which together with 30 percent lower demand this year thus far has pushed prices down to around US$110 tonne/CIF, seemingly a price level matched by Vietnamese suppliers. At the beginning of 2015 Korean generators required FSC or PEFC chain-of-custody certificates from exporters. But fraudulent certificates appeared prompting the Korea Forest Promotion Institute (KFPI) to require biomass exporters to provide government-issued tenure documents and fibre supply contracts as sustainability evidence using an Apostille Certificate. As a result of this compounding factor from a Canadian perspective, Canada is not a signatory of the Apostille Convention, and exports dropped 74 percent over January through September. Dutch SDE+ Thanks to lobbying from WPAC, Korean authorities have since revised requirements reopening the market for Canadian producers. Gordon Murray, Executive Director, WPAC also gave an update on the Netherlands once Canada’s largest pellet export market. However producers have not shipped any “meaningful volume” since 2011 as a result of Dutch policy change. – When the Dutch MEP subsidy scheme expired just over 12 months ago, so too did co-firing with Canadian pellets, remarked Murray adding it was the UK, Belgium, Italy, Japan and South Korea that had grown. Murray outlined the legislative and promotional efforts WPAC together with southern colleagues USIPA have made in getting acceptance for North American sustainability criteria, a pre-requisite for SDE+ eligibility. The new SDE+ subsidy system came into play earlier this year and is available through to 2023. Biomass co-firing is though restricted to plants from 1990 or later and capped at 25 petajoules (PJ) of electricity annually, about 3.5 million tonnes of wood pellets. Two energy companies applied this year for co-firing under the scheme but were unsuccessful, the EUR 3.5 billion budget for 2015 had already been taken for wind power projects. – The earliest we could see any new co-firing in the Netherlands would be in late 2016 at Essent’s Amer 9 plant, which is already converted for biomass. Others have conversion projects in the pipeline, but no investment decisions will be made until the results of the 2016 round of SDE+ applications are known. Assuming success, they have three years to complete their projects to retain the subsidy so the next wave of co-firing will not come on line until 2018 at the earliest, Murray explained. He added that the sustainability requirements are likely to be “workable” for Canada but may be difficult for US producers depending on the Sustainable Biomass Partnership (SBP). Gaining momentum Elaborating on the SBP, Deborah Keedy, Drax Power recounted that the SBP was formed in 2013 to provide “assurance” that woody biomass, woodchip and pellet, is sourced from “legal and sustainable sources” noting the varied definition of sustainability between EU Member States. – SBP meets all current EU sustainability requirements and recognizes the credibility of existing forest certification schemes such as FSC/PEFC. It does not wish to compete with or replicate them but address the gaps and their lack of uptake, said Keedy. Getting pellet producers SBP certified has been a challenge, SBP require field audits to be performed by “approved” certification bodies that already carry out FSC and PEFC audits. – SBP certificates are being issued and focus is on improving SBP resources to deliver certification in a timely manner, she said Thus far only two such bodies have been approved by SBP and to date three pellet producers, Westervelt Renewable Energy, SBE Latvia Ltd and AKZ Ltd have been certified. According to Keedy, Drax aims for SBP to be the “primary measure for sustainability” by the end of 2016 while running its own system in parallel for an “intervening” period. The real crunch question, as Debroah Keedy put it, is if SBP can gain broader acceptance beyond Europe as standard for wood pellet sustainability. Text & photos: Alan Sherrard BI83/5082/AS Editor’s note: An Apostille facilitates public document circulation by certifing the authenticity of the signature, see www.hcch.net What represents the greatest shift in the pellet market? Where are the best opportunities for Canadian producers next year and will that change over the next 3-5 years? Proud pellet producer with his truck, Jonathan Levesque VP Marketing & Development, Group Savoie with Canada’s first-of-its-kind bulk delivery truck. Michele Rebiere, CFO, Viridis Energy Inc., and WPAC President expressing her producer view as Scotia Atlantic Biomass during the “Power Panel”. – Focus is on improving SBP resources to deliver certification in a timely manner, remarked Deborah Keedy, Head of Biomass Procurement, Drax. A job well done, Gordon Murray (left) Executive Director, WPAC gets a well-deserved pat on the shoulder by Brent Boyko, Senior Manager Business Development, Ontario Power Generation (OPG) during closing remarks.
Bioenergy International no 7 December 2015
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