Vol. 1, Issue 10
he old Civilian Conservation Corps was a job-creation lodestone of FDR’s New Deal, and known by many as the “Tree Army” because its forest preservation activity included the planting of an estimated 3 billion trees. The U.S. Dept. of Agriculture’s Commodity Credit Corporation (which also goes by “CCC”) also is aiming for job creation with its Biomass Crop Assistance Program (BCAP). But the way there this time around will likely involve planting trees and crops in order to harvest them as quickly as possible.
Rules for the program were published in the Federal Register in early February 2010
. BCAP does two things: Provide funding for agriculture and forest land owners and operators to receive matching payments for eligible biomass materials sold to qualified biomass conversion facilities for the production of heat, power, bio-based products or advanced biofuels. Second, BCAP will provide funding for producers of eligible renewable crops within a select geographical area to receive payments up to 75 percent of the cost of establishing the crop and annual payments for up to 15 years for crop production. Establishment funding, technical assistance and annual payments over the next 15 years total $536 million. Matching payments amount to $2.1 billion through 2013.
“We expect that approximately 7,500 producers of eligible crops and 50 biomass conversion facilities may receive establishment and annual payments and approximately 9,936 eligible material owners (that are not affiliated with a biomass conversion facility) and 701 biomass conversion facilities may be affected (which includes the 50, above) and may receive matching payments,” said the published rule.
The rule details how to qualify for matching payments from the program, and specifies project area selection criteria for initial projects seeking to qualify for the program.
“Advancing biomass and biofuel production holds the potential to create green jobs, which is one of the many ways the Obama Administration is working to rebuild and revitalize rural America,” said Agriculture Secretary Tom Vilsack in conjunction with the rule’s release. “Facilities that produce renewable fuel from biomass have to be designed, built and operated. Additionally, BCAP will stimulate biomass production and that will benefit producers and provide the materials necessary to generate clean energy and reduce carbon pollution.”
EPA has finalized a rule implementing the long-term renewable fuels mandate of 36 billion gallons by 2022 established by Congress. The Renewable Fuels Standard requires biofuels production to grow from last year’s 11.1 billion gallons to 36 billion gallons in 2022, with 21 billion gallons to come from advanced biofuels.
At about the same time as the new rule came down in D.C., Forest2Market, the Charlotte-based provider of market data about the wood supply chain, released full-year 2009 data that showed production down almost across the board for both hardwood and softwood pulp and paper mills. And sawmill production fell by 21.3 percent. Biomass (or fuel-wood) was the only class of wood fiber to increase in price in 2009, gaining 3.6 percent.
“This increase can be attributed in part to decreased sawmill production, since sawdust and other mill residues make up part of this category. Scarcity means higher prices,” said Daniel Stuber, who oversees analytics and data quality at Forest2Market. “Increased interest in biomass is also a factor. The Biomass Crop Assistance Program has incented loggers to remove tops, limbs and other residues during harvest and deliver them to companies where they are used to produce heat and electricity.”
Projects Real and Envisioned
According to the Dept. of Agriculture, early BCAP beneficiaries to date include a Vermont school that will replace 100 percent of its fossil fuel consumption with biomass, a start-up pellet company that uses locally-grown agriculture residues from Iowa farms and a rural electric cooperative that displaces fossil fuels with woodchips to generate low-cost electricity in northeastern Georgia.
The critical operating requirements for a biomass conversion plant are 2,500 KW of power (at 1.6 million kw/h per month), 75,000 MCF of natural gas, and a building between 100,000 sq. ft. and 200,000 sq. ft. (9,290 and 18,580 sq. m.) on between 75 and 150 acres (30 and 60 hectares), said a group of experts in a recent presentation on alternative energy site selection
. They also stipulate rail and truck access. Such a plant would likely receive a capital investment of between $25 million and $75 million, and could employ up to 200 people.
Barge access might not hurt either. Ron Brisbois is executive director of Grant County Economic Development Corp. in southwestern Wisconsin, along the Mississippi River not far from Dubuque, Iowa. He says power plants that bring in coal by barge are now looking at bringing in biomass (in the form of wood chips) the same way.
“A couple of power plants in Cassville from Alliant Energy and DTE are looking to expand,” he says, noting they have both rail and barge access. “The DTE plant is converting completely to biomass. Alliant’s is coal-fired, but testing a 5-percent biomass blend, which is in the testing phase.”
Alliant had been hoping to double its overall plant capacity to 500 MW with 20-percent biomass, but the application was denied by the Wisconsin Public Service Commission.
Brisbois says the biomass quotient is high in the region, “not only corn stove, but hardwood. We have a lot of hardwood mills, deciduous mills, a lot of oak and maple. There are cellulosic ethanol prospects looking at possible projects this year.”
A proximity analysis for Cassville found some 7.2 million tons of accessible biomass within 80 miles (129 km.).
In Boardman, Ore., Portland General Electric, like other utilities around the country, also is considering biomass as an option for a 585-MW coal-fired power plant it otherwise will have to close or upgrade with emissions abatement at considerable expense. It too hopes to replace up to 20 percent of coal with wood pellets or torrefied (roasted) plant material nuggets. But the cost and energy use of torrefaction are among the big question marks ahead.
Pellet Power Is So European
This rendering depicts the coming biomass-fueled power plant from Southern Power near Nacogdoches, Texas.
Rendering courtesy of American Renewables
Meanwhile, Southern Co. is figuring out how best to approach biomass and integrate it into its massive power-plant portfolio.
In November, the company’s Southern Power subsidiary committed to build one of the nation’s largest biomass-fueled projects in Sacul, Texas, in partnership with Austin Energy.
“This project represents another step in developing a diverse portfolio to meet the nation's growing energy demands,” said David Ratcliffe, Southern Company chairman, president and CEO.
Southern Power acquired the 100-megawatt Nacogdoches Generating Facility from American Renewables, LLC on Oct. 9, noting at the time that it would move ahead with construction and bring the plant on line in the summer of 2012 on its 165-acre (67-hectare) site. The plant's output is committed to Austin Energy in a 20-year agreement that will help the city of Austin, Texas, meet a 30-percent renewable energy goal.
The plant, which will receive an investment of between $475 million and $500 million, should employ about 40 people when fully operational. Its biomass supply will include forest residue from the surrounding areas, wood processing residues and clean municipal wood waste. The project will require approximately 1 million tons of fuel annually, which will be procured within a 75-mile (121-km.) radius of the project site.
The Nacogdoches plant is one of two Southern Company biomass projects. The Georgia Public Service Commission in March 2009
"Consumption of roundwood grows by 50 percent to meet an increased demand for building materials and other wood products, driving greater production. There is more use of forest biomass for power generation and fuel production."
— From the World Business Council for Sustainable Development’s “Vision 2050” report, issued in February 2010
approved Georgia Power's application to convert its 96 megawatt Plant Mitchell near Albany, Ga., to biomass. The company is evaluating the feasibility of converting five additional coal plants to biomass as well.
But in late January, Southern Co. execs announced
they were delaying work on the conversion of the plant in Georgia, citing uncertainty over EPA rules on boiler emissions that are expected to be clarified by April 2010.
That’s not stopping the biomass fuel chain from building in Georgia, however, as RWE Innogy of Germany and BMC of Sweden announced on January 20 that they would construct a $150-million wood pellet plant in Waycross, in southern Georgia’s Ware County, that will produce 750,000 tons of product annually, generated from the approximately 1.5 million metric tons of “fresh wood” the company expects to procure from the plant’s immediate vicinity.
“The plentiful resources in Ware County, such as its abundant forest assets and strategic railroad and highway access to Georgia’s deepwater ports, make it an ideal location for this renewable energy facility,” said Georgia Gov. Sonny Perdue.
“With its vast forest lands, Georgia is the ideal partner for us in respect to biomass,” said Prof. Fritz Vahrenholt, CEO of RWE Innogy. “What has convinced us in particular is the high standard of sustainability applied by the state in planting and harvesting forests. This is fully in line with our own criteria. These conditions certainly helped the decision to go ahead with the construction of the pellet factory and to create about 75 jobs."
RWE is also pursuing a $307-million biomass-fueled combined heat and power facility in Fife, Scotland.
Operating as Georgia BioMass, LLC, the new production facility will be built on a 300-acre (121-hectare) parcel of land donated by the Okefenokee Area Development Authority. Production at the Waycross plant is scheduled to begin in the first quarter of 2011.
But most of those pellets will not be headed to U.S. biomass plants. They’re going via the Port of Savannah to Europe (initially to the Netherlands), where renewable energy uses such as biomass are well advanced, triggered by the delicate blend of regulatory mandate and acceptance by industry and the public. Demand from Europe has stoked North American wood pellet production from 1 million metric tons in 2003 to some 6 million tons in 2009, according to the U.S. Dept. of Agriculture.
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