INSIDE ¦ ADVERTISER INDEX¦ JUNE 2013 | VOLUME 7 | ISSUE 6
2013 Algae BIomass Summit
On the Cover: Pellet handling and storage infrastructure work is well underway at Drax Power Station in Yorkshire, England.
2013 National Advanced Biofuels Conference & Expo 39 2014 International Biomass Conference & Expo
Biomass Industry Directory
Clariant Produckte (Deutchland)
CPM Beta Raven
CPM Roskamp Champion
Detroit Stoker Company
Colossal Conversion Drax Group Makes Power History Page 12
MW Ontario Power Plant Drops Coal for Pellets Page 20
Building Business Via an Ethanol Plant Retro¿t Page 40
Dome Technology Eastern Instruments Elliott Group Fagen Inc.
2 25 8 9
GEA Westfalia Separator
Indeck Power Equipment Co.
Jeffrey Rader Corporation
KEITH Manufacturing Company
Pellet Fuels Institute
Pellet Mill Magazine
West Salem Machinery Co.
Wolf Material Handing Systems
06 EDITOR’S NOTE For Many, Climate Debate Over By Tim Portz
07 INDUSTRY EVENTS 10 BUSINESS BRIEFS 36 MARKETPLACE
14 POWER 12 NEWS 13 COLUMN Retrofitted Biomass Facilities: As Good As New By Bob Cleaves
14 FEATURE Yorkshire’s Game Changer Strategic planning has enabled Drax Power Station to continue operations, comply with regulations and make a name for itself in the biomass industry. By Tim Portz
COPYRIGHT © 2013 by BBI International
Biomass Magazine: (USPS No. 5336) June 2013, Vol. 7, Issue 6. Biomass Magazine is published monthly by BBI International. Principal Office: 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. Periodicals Postage Paid at Grand Forks, North Dakota and additional mailing offices. POSTMASTER: Send address changes to Biomass Magazine/Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, North Dakota 58203.
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JUNE 2013 | BIOMASS MAGAZINE 3
JUNE 2013 | VOLUME 7 | ISSUE 6
22 PELLETS 20 NEWS 21 COLUMN Pellet Politics in the Pine Tree State By Bill Bell
22 FEATURE End of an Era A shining success resulting from Ontario's coal phase out, Atikokan Generating Station is in the middle of major coal-to-biomass conversion. By Anna Simet
THERMAL 28 NEWS
BIOGAS 30 NEWS 31 COLUMN Biogas Contributes to a Diverse Renewable Fuel Mix By Amanda Bilek
ADVANCED BIOFUELS & CHEMICALS 32 NEWS 33 COLUMN Time for Master Limited Partnerships By Mary Rosenthal
34 DEPARTMENT: Q&A A Trash-to-Treasure Alchemist Fiberight CEO Craig Stuart-Paul discusses opportunities yielded by utilizing a shuttered ethanol plant. By Tim Portz
Call Toll Free: 1.800.STOKER4 firstname.lastname@example.org www.detroitstoker.com JUNE 2013 | BIOMASS MAGAZINE 5
For Many, Climate Debate Over On May 9, at a monitoring station atop the volcano Mauna Loa, scientists concluded that for the first time ever, the daily average for carbon dioxide in the atmosphere exceeded 400 parts per million (ppm). The station has already recorded hourly spikes above this threshold, but until that day, the daily average had not exceeded 400 ppm. The public and the policymakers in this country may debate the implications and ramifications of this TIM PORTZ number, as well as the general trend of carbon in the VICE PRESIDENT OF CONTENT earth’s atmosphere. Amongst climate scientists, how& EXECUTIVE EDITOR email@example.com ever, there is little debate about how human beings are changing the planet’s climate. Unfortunately, climate scientists do not draft nor pass laws, and the U.S.—which was recently eclipsed by China as the No.1 generator of carbon dioxide—has no binding policy to begin limiting the amount of carbon that can be emitted via the production of the energy products we are so reliant upon. While more than half of U.S. states have a renewable portfolio standard on the books, and a handful of others have renewable targets and goals, the country’s policy and policymakers have, so far, shown no appetite to explicitly target carbon dioxide and pass robust policy that would significantly limit or make more expensive the generation of energy from fossil fuels by placing a price on its carbon. More and more, our industrialized peers are distancing themselves from our policy reluctance and charging forward with aggressive energy policies, all drafted and implemented to dramatically decrease carbon dioxide associated with energy production. Anna Simet’s feature, “End of an Era,” examines the complete elimination of coal from Ontario’s energy diet, and her article reports that “By the end of this year, the province will have shut down or converted 17 of its 19 coal units.” The power station featured in her piece, the 211-MW Atikokan Generating Station, is in the middle of coal-to-biomass migration, and the plant will burn wood pellets exclusively by mid2014. The ongoing conversion story at the Drax Power Station in England is tailor made for this conversion and retrofits issue. Drax's enormous biomass conversion, featured in “Yorkshire’s Game Changer,” on page 14, is a case study in the role aggressive policymaking can play in dramatically changing the trajectory of a country’s energy future. Whether or not policymakers in the U.S. eventually confront carbon emissions in a meaningful way almost seems beside the point now, as North American biomass resources are increasingly being tapped to deliver reduced-carbon Btu to foreign power facilities that are generating billions of dollars in capital investments for pellet facilities and port infrastructure. As Peter Emery, production director at Drax wryly muses, “We’re getting your biomass supply chain ready for you, so it’s there when you are ready for it.”
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EDITORIAL PRESIDENT & EDITOR IN CHIEF Tom Bryan firstname.lastname@example.org VICE PRESIDENT OF CONTENT & EXECUTIVE EDITOR Tim Portz email@example.com MANAGING EDITOR Anna Simet firstname.lastname@example.org NEWS EDITOR Erin Voegele email@example.com COPY EDITOR Jan Tellmann firstname.lastname@example.org
ART ART DIRECTOR Jaci Satterlund email@example.com GRAPHIC DESIGNER Elizabeth Burslie firstname.lastname@example.org
PUBLISHING & SALES CHAIRMAN Mike Bryan email@example.com CEO Joe Bryan firstname.lastname@example.org VICE PRESIDENT, SALES & MARKETING Matthew Spoor email@example.com BUSINESS DEVELOPMENT DIRECTOR Howard Brockhouse firstname.lastname@example.org ACCOUNT MANAGERS Marty Steen email@example.com Andrea Anderson firstname.lastname@example.org Kelsi Brorby kbrorby@bbiinternational Tami Pearson email@example.com CIRCULATION MANAGER Jessica Beaudry firstname.lastname@example.org ADVERTISING COORDINATOR Marla DeFoe email@example.com SENIOR MARKETING MANAGER John Nelson firstname.lastname@example.org
Subscriptions Biomass Magazine is free of charge to everyone with the exception of a shipping and handling charge of $49.95 for any country outside of the United States, Canada and Mexico. To subscribe, visit www.BiomassMagazine.com or you can send your mailing address and payment (checks made out to BBI International) to Biomass Magazine Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You can also fax a subscription form to 701-746-5367. Back Issues & Reprints Select back issues are available for $3.95 each, plus shipping. Article reprints are also available for a fee. For more information, contact us at 701-746-8385 or email@example.com. Advertising Biomass Magazine provides a specific topic delivered to a highly targeted audience. We are committed to editorial excellence and high-quality print production. To find out more about Biomass Magazine advertising opportunities, please contact us at 701-746-8385 or firstname.lastname@example.org. Letters to the Editor We welcome letters to the editor. Send to Biomass Magazine Letters to the Contributions Editor, 308 2nd Ave. N., Suite 304, Grand Forks, ND 58203 or email to email@example.com. Please include your name, address and phone number. Letters may be edited for clarity and/or space.
¦INDUSTRY EVENTS 21st European Biomass Conference & Exhibition June 3-6, 2013
Bella Center Copenhagen, Denmark The 2013 EU BC&E will be one of the leading annual meetings for the international biomass community. The conference will discuss major issues for the biomass markets in technical and business areas. +39 055 5002280 ext. 221 | www.conference-biomass.com
International Fuel Ethanol Workshop & Expo June 10-13, 2013
America’s Center St. Louis, Missouri Where Producers Meet Now in its 29th year, the FEW provides the global ethanol industry with cutting-edge content and unparalleled networking opportunities in a dynamic business-to-business environment. The FEW is the largest, longest running ethanol conference in the world—and the only event powered by Ethanol Producer Magazine. 866-746-8385 | www.fuelethanolworkshop.com
National Advanced Biofuels Conference & Expo Sept. 10-12, 2013
CenturyLink Center Omaha Omaha, Nebraska Proving Pathways. Building Capacity. Produced by BBI International, this national event will feature the world of advanced biofuels and biobased chemicals—technology scale-up, project finance, policy, national markets and more—with a core focus on the industrial, petroleum and agribusiness alliances defining the national advanced biofuels industry. 866-746-8385 | www.advancedbiofuelsconference.com
Algae Biomass Summit Sept.30-Oct. 3, 2013
Hilton Orlando Orlando, Florida This dynamic event unites industry professionals from all sectors of the world’s algae utilization industries including, but not limited to, financing, algal ecology, genetic systems, carbon partitioning, engineering & analysis, biofuels, animal feeds, fertilizers, bioplastics, supplements and foods. 866-746-8385 | www.algaebiomasssummit.org
International Biomass Conference & Expo March 24-26, 2014
Orlando Convention Center Orlando, Florida Organized by BBI International and coproduced by Biomass Magazine, the International Biomass Conference & Expo program will include 30-plus panels and more than 100 speakers, including 90 technical presentations on topics ranging from anaerobic digestion and gasification to pyrolysis and combined heat and power. This dynamic event unites industry professionals from all sectors of the world’s interconnected biomass utilization industries—biobased power, thermal energy, fuels and chemicals. 866-746-8385 | www.biomassconference.com
JUNE 2013 | BIOMASS MAGAZINE 7
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Challenge: Add biomass power generation and process steam on a limited budget.
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Business Briefs PEOPLE, PRODUCTS & PARTNERSHIPS
BIO welcomes new members, adds to governing board The Biotechnology Industry Organization has added several new members to its Industrial & Environmental Section, including Vitters is general Calysta Energy, manager of CocaCola Co.’s PlantBottle American Science Packaging Platform, and Technology which is advancing Corp., LanzaTech, plant-based packaging materials. The Coca-Cola Co., Lignol Energy Corp., Neol Biosolutions and Plum Creek. In addition, BIO has appointed Scott Vitters, general manager of The Coca-Cola Co.’s PlantBottle Packaging Platform, to the governing board of its Industrial & Environmental Section. The section represents companies at every stage of
the value chain in renewable feedstock, biobased product and renewable chemical production. Berkley biochemical professor wins Washington Carver award The Biotechnology Industry Organization named Jay Keasling as the recipient of its 2013 George Washington Carver Award. Keasling is a professor of The award biochemical engineering recognizes Keasling for his contributions at the University of to synthetic biology California, Berkeley, an associate laboratory director at Lawrence Berkeley National Laboratory, CEO of the Joint BioEnergy Institute, and director of the Synthetic Biology Engineering Research Center. He was recognized for his contributions in
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the field of synthetic biology promoting the use of engineering microbes to produce biofuels, medicines and cosmetic compounds from sugar and other forms of biomass. Forestry Endowment names chief financial officer The U.S. Endowment for Forestry and Communities has announced the addition of Signe Cann as chief financial officer. In her Signe Cann has new role, Cann will served in various be responsible for the CFO and consulting Endowment’s finances roles during her career. and organization efficiency. Prior to joining the Endowment on a full-time basis, she had been conducting a short-term consulting project
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on ways to enhance the organization’s financial systems. In January, she accepted the role of interim CFO. Niebling rejoins INRS Charlie Niebling has rejoined Innovative Natural Resources Solutions LLC. He served as a partner with the company in the mid-1990s. Niebling brings a INRS is a natural wealth of knowledge resource consulting and experience to company with offices INRS. in New Hampshire and Maine that specializes in renewable energy and forest sustainability. As a member of the INRS team, he will continue to work in the biomass thermal sector, in both development and strategic communications. For the past seven years,
Niebling was the general manager of New England Wood Pellet. He maintains a consulting agreement with NEWP. Neibling was a founder and first board chair of the Biomass Thermal Energy Council and recently received the 2013 International Excellence in BioEnergy Award from BBI International. BPA announces additions to board of directors The Biomass Power Association has announced Tom Beck, chief commercial officer of ReEnergy Holdings Inc., as its new chairman of the Beck is a founder of board. Paula Soos, ReEnergy. He sits on vice president of the company’s board of directors and is government relations a member of its at Covanta Energy executive committee.
m rgy Syste Heat Ene
Corp., the current chair, will serve as vice-chair. Bill Libro, director of government affairs for Minnesota Power, and Marvin Burchfield, vice president of the solid fuel business unit at FSE Energy, are joining the board as new members.
Libro manages federal legislative and regulatory issues for Minnesota Power, a subsidiary of ALLETE, a Midwest energy company.
SHARE YOUR INDUSTRY NEWS: To be included in the Business Briefs, send information (including photos and logos, if available) to Business Briefs, Biomass Magazine, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You may also email information to firstname.lastname@example.org. Please include your name and telephone number in all correspondence.
Biomass Pelletizing & Energy Systems Pellet Plants | Dryers | Furnaces | Steam Boilers | Thermal Oil Heaters | Cogeneration Dieffenbacher USA, Inc. 2000 McFarland 400 Blvd. | Alpahretta, GA 30004 Phone: (770) 226-6394 | email@example.com
www.dieffenbacher.com JUNE 2013 | BIOMASS MAGAZINE 11
PowerNews Biomass power expected to grow globally Global biomass/waste power generation (in TWh)
SOURCE: INTERNATIONAL ENERGY AGENCY
The International Energy Agency has made its annual report to the Clean Energy Ministerial, reporting that renewable technologies are a bright spot in an otherwise bleak assessment of progress towards low-carbon energy development. According to the report, renewable power technologies are on track to meet the 2 degree Celsius scenario (2DS) targets by 2020. The 2DS describes an energy system consistent
12 BIOMASS MAGAZINE | JUNE 2013
with an emissions trajectory that is expected to give an 80 percent chance of limiting global temperature increases by 2 degrees Celsius. Power production from solid biomass, biogas, renewable municipal solid waste and liquid biofuels grew by more than 170 terawatt hours (TWh) from 2000 through 2011, a growth rate of more than 8 percent per year. By 2011, approximately 310 TWh of capacity was installed, up from 280 TWh in 2010.
Bill would open MLPs to renewable energy investors Legislation recently introduced in the U.S. Senate could significantly level the playing field between fossil energy and renewable energy if passed by Congress and signed into law. The bill, titled the Master Limited Partnerships Parity Act, would allow investors in renewable energy projects access to the corporate structure of master limited partnerships (MLP), which offer significant tax benefits compared to other business structures. MLPs are currently only available to investors in fossil energy projects. MLPs are taxed as a partnership, but ownership interests are traded like corporate stock on a market. While income generated by C corporations is taxed at both the corporate and shareholder level, MLPs are only taxed at the shareholder level, since they are treated as a partnership for tax purposes. The bill was introduced by Sens. Chris Coons, D-Del.; Jerry Moran, RKan.; Debbie Stabenow, D-Mich.; and Lisa Murkowski, R-Alaska.
Retrofitted Biomass Facilities: As Good As New BY BOB CLEAVES
Retrofitting is an important practice that helps extend the life of a biomass facility. It allows a facility to adapt to changing technologies and environmental standards, ensuring compliance with new laws. Facilities sometimes qualify for government help toward the cost of the updates, which can sometimes be costly. Retrofitting is an easy, sensible way to maintain continued and reliable use of renewable energy resources, without constructing an entirely new facility. A plan is currently under consideration by the Connecticut General Assembly to reduce the eligibility of biomass under the state’s renewable portfolio standard (RPS). The proposal would disqualify retrofitted biomass facilities as renewable energy producers, because the facility would not be “new” enough. If enacted, this will affect biomass facilities all over New England. There are many reasons this proposal is not logical. Perhaps the biggest one is that a retrofitted biomass facility is every bit as clean as a brand new one; there is no practical difference between the two in terms of emissions and efficiency. The owners of biomass facilities, both in and out of the state, have invested tens of millions of dollars to install state-of-the-art technology to comply with Connecticut’s stringent requirements. These investments, made in reliance on a stable energy policy, should be recognized and respected.
In addition to tightening emissions on biomass plants, the study opens the state's portfolio of renewable energy sources to large hydropower—including hydropower and, possibly, fossil fuel power generated in Canada—and gives the state a way to enter into long-term contracts with energy project developers. Facility owners and operators won’t be the only ones financially affected by the Connecticut Department of Energy & Environmental Protection’s plan. The proposal stands to cost Connecticut taxpayers hundreds of millions of dollars. The study upon which proposed law is based shows that RPS program compliance costs would be at least 20 percent higher—or $300 million more over a 10-year period—if 75 percent of the currently eligible biomass resources were to be eliminated from the RPS beginning in 2015. Up until a few weeks ago, Connecticut state government encouraged the practice of retrofitting. The state’s new approach to biomass is a reversal. It provides no environmental benefit, it will be more expensive for ratepayers, and its fundamental shift in policy will send a conflicting message to investors about the stability of the Connecticut market. Author: Bob Cleaves President and CEO, Biomass Power Association www.biomasspowerassociation.com firstname.lastname@example.org
JUNE 2013 | BIOMASS MAGAZINE 13
A TALE OF TRANSITION: From the west, the southern cooling towers form a backdrop for Drax's coalfields and the first two of four domes that will store wood pellets it will use for half of its future output. PHOTO: TIM PORTZ
14 BIOMASS MAGAZINE | JUNE 2013
Yorkshire’s Game Changer Upon completion of its ambitious conversion, Drax Power Station will be the world’s largest single-site producer of biomass-derived power. BY TIM PORTZ
ince the commissioning of its first boilers in 1974, the 3,960 MW power plant at Drax, England, has resisted stasis. A decade after coming on line, the plant was expanded and nearly doubled in size to arrive at its current capacity. Since then, it has survived a miners strike, witnessed the privatization of the power generation industry in England, been owned by an American company, been purchased out of bank possession, and is presently one-third of the way through what is likely the largest coal-to-biomass plant conversion the world will ever see. The power plant in Drax, instantly identifiable by its collection of 12 massive hyperboloid cooling towers and 850-foot-high chimney (at one time the largest industrial chimney in the world), delivers between 7 and 8 of the United Kingdom’s electrical power. Drax’s output is double that of its closest U.K. rival, and with the exception of the Belchatow Power Station in Poland, no other power station in Europe is capable of matching its output. In so many ways, the enormity of the station is an incredible asset. It does, however, possess one glaring liability: as the U.K.’s largest coal-fired power station, Drax Power Station also holds the top spot on the country’s list of carbon dioxide (CO2) emitters, generating more than 20 million tons annually. With grow-
JUNE 2013 | BIOMASS MAGAZINE 15
ing awareness and an acknowledgment of the consequences of a high carbon energy platform in Britain and Europe, the government acted. Two policy measures in the European Union and the U.K., intended to spur the region toward a less carbon intensive energy future, set the table for action at Drax. First, the U.K.’s Renewables Obligation set increasing minimum percentages of electricity that power providers had to obtain from renewable sources. Next, the EU deployed the world’s largest emissions trading platform in 2005, the European Union Emission Trading Scheme, effectively putting a price on CO2 emissions. Together, the two form a classic carrot-and-stick policy combination. With just one power generation asset in its portfolio, the options for mitigating the risk of escalating carbon prices for the Drax Group were limited. Peter Emery, production director at Drax, notes, “We couldn’t just shut down the coal plant and build gas plants. All the other technology
PHOTO: TIM PORTZ
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POWER¦ was a long way off, so we needed some sort of plan that gave us a future.” Therefore, the team at Drax devised a three-part plan to drive down the facility’s carbon profile.
Three-Part Plan Part one of Drax’s plan to retool its plant for compliance with mandatory policy was to make the facility operate as efficiently as possible, utilizing existing and proven technologies. Part two was to identify a less carbon-dense fuel source, and part three would involve the capture and sequestration of any CO2 that remained in the production profile after the first two measures were implemented. To make the facility run more efficiently, the Drax team turned toward a modernization of the facility’s steam turbine fleet. The Drax Group made an investment of over £100 million ($153.7 million) and replaced all of the high- and low-pressure steam turbines at the facility, increasing the plant’s overall efficiency by around 5 percent. While that percentage may seem small, Emery warns against discounting the number too much. “That might not sound like a lot, but 5 percent when you are burning 10 million tons of coal is half a million tons of coal, which is 10,000 tons a week and a million tons of CO2 a year.” While the turbine upgrade began moving the needle toward reducing the plant’s CO2, its effects would be limited to a 5 percent reduction. To further reduce its carbon profile to levels the company was targeting, they moved into the second part of the plan: replacing coal with a more carbon benign fuel source. Biomass offered the Drax Group a fuel source that could be introduced into their production process and cofired with coal, and would drive the CO2 numbers at the facility down to a level the team felt was optimal. In 2006, as Drax was researching cofiring, the British government announced its intention to reform the Renewables Obligation scheme, and Drax would once more have to adapt to a game change. When the Renewables Obligation scheme was first
DRAX'S THREE-POINT PLAN: Drax Production Director Peter Emery identifies the three parts of Drax's carbon reduction strategy as efficiencies via turbine upgrades, conversion of three boilers to biomass fuels, and carbon capture and sequestration.
JUNE 2013 | BIOMASS MAGAZINE 17
PHOTO: TIM PORTZ
HALFWAY THERE: With two of four pellet domes nearly finished, foundation work for the third and fourth pellet domes has commenced.
drafted, all renewable technologies were awarded saleable Renewable Obligation Certificates at the same rate. As the program became established, however, policymakers feared that one or two near-term renewable technologies would be all that would attract investment dollars, and modified the policy
to drive investment into a broader portfolio. Most notable for Drax, megawatts derived from the cofiring of biomass were first reduced to 0.5 ROC per MWh, and subsequently to 0.3 ROC per MWh. With the revenue opportunity presented by cofiring biomass reduced by nearly 70 percent,
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18 BIOMASS MAGAZINE | JUNE 2013
Drax amended its conversion plans during the second quarter of 2012, and decided upon the complete conversion of three of its boilers to biomass. Reflecting on this policy shift, Emery notes full conversion is easier for policymakers to defend, suggesting that “instead of having green units with a black tinge— which you are always going to get with cofiring—if you can do a full conversion, you’ve got a green unit. There’s no debate about it.”
Cofiring to Full Conversion Converting three of its boilers to fire exclusively on biomass will require Drax and its supply chain partners to source, pelletize, ship by sea and rail, unload, temporarily store, and finally, deliver nearly 7 million tons of woody biomass to the plant’s boiler every year. This effort is already underway at the Drax site, at several of the U.K.’s busiest ports, at ports in the U.S., and in the construction of new pellet facilities in the southeastern U.S. The budget for Drax’s share of this ambitious undertaking is currently estimated at £700 million. Moving and storing massive amounts of solid fuels is not new to Drax, nor the ports and rail partners that work with Drax. The facility currently welcomes 35 coal trains each day, moving nearly 10,000 tons of coal onto the facility property. The difficulty is not the volume, but instead in the handling properties that are unique to biomass. For example, the biomass that will feed Drax’s boilers cannot be allowed to get wet. It must move in covered rail cars, from covered storage sites to enclosed storage containers on site, then along covered conveyers before it is delivered to the boilers. The first physical sign of Drax’s progress are two of four planned pellet storage domes that have risen just to the west of the plant’s southern cooling towers. Two more domes will be established and completed by the end of 2014, bringing the on-site covered storage capacity to nearly 300,000 metric tons. Now that the technical challenges are understood and solutions are under development and construction, Drax’s focus
Author: Tim Portz Executive Editor, Biomass Magazine firstname.lastname@example.org 651-398-9154
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is on building a supply chain that achieves the highest degree of sustainability possible. “We’re on the start of a journey, and we think that sustainability is a fundamental building block to that,” Emery says, drawing attention to the sustainability policy drafted and enforced by Drax. Drax’s sustainability policy ensures that the biomass that comes from the nearly 4,600 square miles of forest required for its fuel supply align with current accepted sustainability practices. Recognizing that the science of sustainable biomass is fluid, Drax makes clear its intentions of keeping pace with any changes, noting in its policy, “Over time we will seek to amend or improve them by working with accredited bodies to develop the use of internationally recognized standards and principles which will apply to all of our biomass procurement activities. In so doing, we hope to foster environmental leadership today and in the future.” Drax’s future as a predominantly biomass-fueled facility and company has become central to the organization’s mission. Its 2012 annual report is titled “Our Transformation Continues,” and features schematic illustrations of a coal yard and the construction of the facility’s pellet domes. Drax is now firing one of its boilers exclusively on biomass, and by the end of the year will have completed nearly half of the planned infrastructure work. Next year, as the infrastructure and supply chain mature, a second boiler will be commissioned for biomass combustion. Plans are already in place to accelerate commissioning of the third boiler, initially planned for 2016’17. In a broad scope, the enormity of Drax’s efforts have catapulted the organization into a leadership role in the biomass industry. “We are inventing a whole new business from the forests to produce electricity, and that’s a big ask,” says Emery. Recognizing that the conversion was ultimately inevitable, he adds, “we only have this coal facility. We’ve got a big carbon problem, and if we don’t do something, we’re out of business.”
PelletNews The Endowment upgrades, expands biomass database
Number of pellet mills by state.
The U.S. Endowment for Forestry and Communities created a database in 2010 that tracked industrial and select community-scale users of wood-to-energy facilities across North America. This spring, the Endowment unveiled major improvements to that database. Through the Woody Biomass Joint Venture, a partnership between the U.S. Forest Service and the Endowment, updates were completed to the database to ensure it serves as the most comprehensive
and up-to-date source of users and processors for wood for energy, including electric facilities, thermal installations and pellet mills. The University of Tennessee Office of Bioenergy Programs created and houses the system, with original funding provided by the Endowment, Forest Service, American Forest and Paper Association, Canadian Forest Service of Natural Resources Canada, Forest Products Association of Canada, and several others.
German Pellets plans second U.S. plant German Pellets has announced plans to construct a 1 million-metric-ton pellet plant in the central Louisiana town of Urania. The facility is being developed at the former site of a Georgia Pacific fiber and particleboard plant that closed more than a decade ago. As such, much of the facilityâ€™s infrastructure is already in place, including railway siding. The pellet plant is expected to be operational next April. News of the new plant came as German Pellets prepared to open a 500,000-metric-ton pellet plant in Woodville, Texas. The company plans to export pellets manufactured at both plants to Europe. Shipping will be completed via the harbor of Port Arthur on the Gulf of Mexico, a deep-water port where the company operates storage and loading systems. German Pellets also operates 14 pellet plants throughout Germany and Austria.
FSE Energy ensures the success of our woldwide customer base through the delivery of the highest quality heat and energy equipment solutions. Product details at www.fseenergy.com. 20 BIOMASS MAGAZINE | JUNE 2013
Pellet Politics in the Pine Tree State BY BILL BELL
My last column in Biomass Magazine described the carefully orchestrated presentations during which members of Maine’s Congressional delegation were informed of the merits that tax legislation would provide thermal biomass, the same favorable treatment that’s been accorded to other forms of renewable energy for years. As predicted, U.S. Sen. Angus King, I-Maine, is now introducing the Renewable Biomass Heating Initiative Act of 2013. If passed, this bill will amend Sections 25 and 48 of the Internal Revenue Service Code to put our industry on the same level playing field as other renewables. There’s one problem however: the bill won’t exactly be moving forward at warp speed. Once scored by Congressional staff for impact upon federal revenues, the bill –despite its boost to economic growth—will appear on the books as an expenditure, and Congress is hardly in a spending mood. Even more daunting: thermal biomass is not a national energy system. There is scant representation of northern tier states on the 38-member U.S. House Ways and Means Committee, with which tax law must originate. The Biomass Caucus, diligently assembled by the Biomass Thermal Energy Council, is relatively small. It will take very adept maneuvering and leveraging before we can achieve federal tax parity with other green energy. In the meantime, our Maine industry has therefore undertaken a major state legislative initiative, aimed at vastly increasing sales of pellet heating systems and Maine wood pellets. Details of our legislative “ask” are particular to Maine and subject to change, and therefore less important than the lessons being learned, which are: • Don’t spend any more time arguing with “the insulationists.” When our state’s energy policy and program administration were completely revamped about five years ago, equal emphasis was placed upon reducing oil consumption (Maine ranks #1 in the nation in dependency upon home heating oil) by curtailing energy consumption and by fuel-switching. However, once federal stimulus funds ran out, all the emphasis has been on insulation and weatherization. A de facto policy alliance has emerged between the state’s most influential environmental organization, which sees reduced consumption as its highest priority, and the oil dealers, who would rather be seeing homeowners cut their oil consumption than switch altogether. Fortunately, legislators understand that people have to pay the oil bill, and that the bill for the average Maine home has gone from $2,000 in 2007 to $3,000 at present.
The “insulationists” will continue to claim, with justification, that “the cheapest fuel is that which you don’t have to buy.” There is no winning this argument. Legislators, however, realize that reducing energy usage is only part of the answer; switching to Maine’s home-grown fuel is the other part, and one that creates local jobs. • Identifying special funding streams is critical to success. Any fuel-switching program is going to require an initial outlay of funds, and tapping into a state’s general fund means competing with hundreds of other worthy (and a few unworthy) claimants, from health care to highways. There are, however, energy-related funds coming to states participating in the Regional Greenhouse Gas Initiative, there are pockets of discretionary funds available to state energy and housing agencies, and many homeowners have equity that can be brought into play with attractive loan programs such as the PACE (Property Assessed Clean Energy) program. • Don’t concede to sharing programs with other renewable energy sectors. As noted above, the other sectors all have their federal tax incentives. To quote Les Otten of Maine Energy Systems, “If they are going to be included in this program along with us, they’ll be double-dipping.” Because thermal biomass is excluded from federal tax incentives, as well as from many state renewable energy credit programs, we deserve to seize the high ground. And hold it. • The oil dealers can be our best friends. The folks who install oil burners and deliver heating oil are good guys. They extend credit in times of individual hardship. They deliver in harsh winter weather and after hours, when necessary. They are welcome in most homes, in which they have installed reliable and convenient heating systems. They have many friends among state legislators. They are family businesses, often third-generation, which once delivered ice and coal. They will be bulk delivering wood pellets some day; some of them already are. Our most listened-to speaker at a recent hearing was an oil dealer who has added pellets to his line of business. By the time you read this article, our legislative initiative will have met with success, failure, or something in between. Stay tuned. Author: Bill Bell Executive Director, Maine Pellet Fuels Association email@example.com 207-752-1392
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AN AERIAL VIEW: The material transfer tower and silos at Atikokan Generation Station overlook Marmion Lake. PHOTO: BRENT BOYKO
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End of an Era Motivated by a province-wide coal phase out, Ontario Power Generation is revamping existing assets via a 211-MW coal-to-biomass conversion. BY ANNA SIMET
JUNE 2013 | BIOMASS MAGAZINE 23
One plant that has already burned its last pieces of coal is Ontario Power Generation’s Atikokan Generating Station, a 211-MW coal plant that’s being converted from low-sulphur lignite coal to wood pellets. Located in northwestern Ontario’s Atikokan, a small, scenic town dubbed “the canoeing capital of the world,” over 150 construction personnel are currently working on the site of AGS. That number is expected to reach 250 by midsummer, with jobs in construction, technical work and administration.
PHOTO: BRENT BOYKO
ith the close of 2014, Ontario will make history by becoming the first jurisdiction in North America—and one of the first in the world— to drop coal power from its energy portfolio. Pulling off such a feat hasn’t proved to be too difficult, evidenced by a quicker-than-planned transition. By the end of this year, the province will have shut down or converted 17 of its 19 coal units, leaving a full year for the remaining two to power down.
STACKING CEMENT: Slipforming of the fuel storage silos at AGS is now complete.
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PELLET¦ AGS EVENT TIMELINE
1985: Begins operations
2007: Ontario passes coal phase-out law
2006: Ontario government allots $4 million to biomass research center
2010: Ontario government directs power authority to contract biomass PPA
2008: AGS begins test firing wood pellets
2012: Biomass conversion at AGS begins
2011: OPG conducts sustainability analysis
While work on the $170 million project began last September, research of and plans to utilize biomass fuel span many years back.
History Back in the 1970s, Ontario Hydro—Ontario Power Generation’s predecessor—conducted preliminary investigations of biomass potential that included successful test burns of waste grain material at a number of OPG’s coal-fired stations, AGS among them. AGS began operations in 1985 and today employs about 85 people. In 2006, the provincial government allocated $4 million to build the Atikokan Biomass Research Center, and after a great deal of research and test burns over the next few years—as well as the passage of a province-wide law that required the cessation of coal use
at all power stations by Dec. 31, 2014—the project began to gain momentum and make sense to stakeholders and the community. Finally, a major milestone was reached in 2010, when the Ontario Minister of En2014: AGS ergy announced the official conversion, to begin and directed the Ontario Power Authority operations to negotiate a Power Purchase Agreement with Ontario Power Generation for biomass-generated electricity from AGS. Even further research was done then, including 2014 : Coal sustainability and safe handling and storage use in Ontario analyses, engineering concept studies and ceases according to combustion and ash studies. mandate Initially, the converted plant will cover peak demand, outages and weather-related needs, but using biomass will retain the plant’s capability of producing at full load of 205 MW. The conversion to biomass will cost less than building a new natural gas plant. While the cost of powering with wood pellets will be more expensive than coal, the plant will be able to meet the no-coal provincial mandate at minimal costs. While AGS isn’t the largest biomass conversion completed or ongoing, it is certainly notable—conversion of a lignite coal generating station to biomass has never been completed on such a scale. “Therefore, the technical solutions determined for this plant are very leading edge,” says AGS Station Manager Brent Boyko. “Components were chosen based on well-established industry success; however, the overall integration for this application is the first of its kind.” It’s actually far more challenging to retrofit a plant than to open a new one, according to Boyko. At AGS, that includes overhauling
PHOTO: BRENT BOYKO
MAKE WAY TO CONVEY: A cutout through six coal bunkers for new feed conveyors. The bottom of the bunkers are repurposed as surge bins.
the fuel handling facilities, installing 15 new burners and installing a new controls system. Slipform construction of the storage silos began the week of May 1, according to
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Darcey Bailey, ABC project engineering manager. Slipforming is the use of a continuous, cast-in-place method that relies on the quick-setting and high-strength properties of
concrete to create a structure with no joints. “The silos progressed very well,” Bailey says. “The work was continuous—24 hours a day, for nine to 10 days straight. The final height of the concrete is 43 meters (142 feet). Both silos were poured together, and the forms are joined with a solid bridge.” Completed May 11, 2,750 cubic meters of concrete—over 300 truckloads—were cast in the silos project, supported by over 200 metric tons of rebar. Now that the silo skeletons are erected, the walls of which are about one-half meter thick, work has begun to link them into the fuel transfer system into the plant. They will have a combined storage capacity of 10,000 metric tons. AGS has agreements in place with two northwestern Ontario pellet suppliers. Fuel supply contracts were recently signed with Atikokan Renewable Fuels, which was recently acquired by Rentech Inc., and Resolute Forest Products, each for 45,000 metric tons annually, for 10 years. The fuel has been sourced and will be processed in northwestern Ontario, and both companies include aboriginal involvement. Transportation con-
PELLET¦ tracts from the source to the station are also in place, according to Chris Fralick, plant manager for OPG's Northwest Thermal, which runs AGS and Thunder Bay Station. Once on site, the pellets will be received from self-unloading, rear discharge trucks— about five deliveries each day— and a new receiving system will transport the pellets to large storage silos via conveyor belt and a bucket elevator. “When needed for production, the pellets will be delivered to the plant on a first-in, first-out basis from the silos, via new conveyor belts and a second bucket elevator,” Bailey explains. “Once inside the powerhouse, the pellets are pulverized in the existing system and fed into the boiler much the same way the coal was previously.” Structural steel for the truck receiving and transfer tower is complete, the shell of which is about six stories high. Work on repurposing the coal-handling facilities inside the plant has also begun, and still to come are furnace and combustion system modifications, which will begin this year. All 15 of AGS’s burners are being replaced with Doosan Mark IV biomass burners. The plant utilizes a wall-fired, pulverizedfuel, radiant-heat Babcock & Wilcox boiler designed for lignite coal fuel, an ideal candidate for fuel conversion, due to the similar heat content of lignite coal and wood pellets. On the back end, new ash transport systems are being installed. Major equipment has been ordered and is arriving steadily, Bailey says, and work on the replacement of the controls system will begin soon. Besides the many construction workers on site, Atikokan Generating Station staff members are involved with the work going on.
Looking Ahead Besides working directly with AGS staff, contractors have islands set up throughout the station where they are able to work independently. AGS employees serve as contract monitors and administrators and work closely with contractors on quality control, says Bailey. “Their knowledge and familiarity of the plant and its operations are vital as the work pro-
gresses.” Therefore, all staff will be involved in commissioning and will be trained on process modifications prior to startup. Commissioning and in-service for AGS is planned for mid-2014, and further out on the horizon, OPG plans to continue to explore options for its other power stations. Advanced pellets have shown considerable promise, as they can be handled much like coal, but more research has to be done before they might be considered a viable option. “We have tested advanced biomass pellets at some of our other stations,” Fralick adds. “While they show great
promise, we are not quite at the point where they can be used in a commercial environment, but our testing of these materials continues.” Meanwhile, Ontario will finish the course it set out on six years ago. While biomass won’t be the right option for every plant, AGS is a successful example of preserving time, money and air quality by utilizing an abundant, clean and renewable resource. Author: Anna Simet Managing Editor, Biomass Magazine firstname.lastname@example.org 701-751-2756
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ThermalNews Vermont gets biomass district heat project The city of Montpelier, Vt., broke ground on a district heating project that will provide thermal energy to public and private buildings in the downtown area. The project is a joint undertaking by the city and state governments. The project will include a biomass heating plant built on the site of the existing downtown boiler system. The plant is expected to consume approximately 12,200 tons of locally sourced green wood chips per year. The project also includes the installation of new hot water distribution lines stretching more than an a half mile to an elementary school and police station. Once complete, the project will provide 41 million Btu of heat to 22 state- and city-owned buildings, with the potential to supply an additional 8.1 Btu of thermal energy to other neighboring buildings.
WOOD CHIP HEAT: Montpelier’s biomass-fueled district heating system will transport thermal energy through these lines to city- and state-owned buildings. PHOTO: WILLIAM FRASER, CITY MANAGER OF MONTPELIER
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Grandeg to incorporate ClearSign technology into pellet boilers ClearSign Combustion Corp. and Grandeg have announced their intention to enter into a development agreement to integrate ClearSign’s proprietary electrodynamic combustion control (ECC) technology into Grandeg’s commercial line of pellet boilers. Grandeg intends to provide up to $500,000 to support a phased initial project expected to begin in the second quarter of this year. The goal is to release a commercial solution employing ClearSign’s ECC technology in 2014. ECC technology computer-controlled, high-voltage, low-power electric fields to manipulate the movement of electrically charged ions that result from combustion. As a result, the technology can be manipulated to control flame shape and the transfer of heat. The technology consists of four basic components, including a controller, software, a power amplifier and electrodes. The technology has been shown to reduce particulate matter, carbon monoxide and total hydrocarbons.
Report: Midwest has abundant, increasing feedstocks A working report recently prepared by FutureMetrics Inc. outlines a vision to achieve 15 percent renewable thermal energy in the Midwest by 2025, with 10 percent derived from sustainably produced biomass. According to the report, in the Midwest, approximately 97 percent of thermal energy consumed in the residential sector is from nonrenewable sources, and no Midwestern states have adopted formal targets to reduce the reliance on fossil energy in heating markets. While other renewable thermal energy options exist in the U.S., the report stresses that biomass is the regionâ€™s most abundant renewable resource for thermal applications. Data included in the analysis demonstrates that Michigan currently leads the Midwestern states in biomass utilization for thermal energy. The state generates 4.44 percent of its thermal energy from
Minn. to study biomass heat for poultry barns
biomass sources. Minnesota, Ohio and Indiana generate a relative 2.66, 2.51 and 2.32 percent of thermal energy from biomass. Illinois, Iowa, North Dakota, South Dakota and Wisconsin all generate less than 2 percent of their thermal energy from renewable biomass sources. While little biomass is currently being utilized for thermal energy production, the report estimates a great deal of the renewable feedstock is available in the Midwest. About 104.82 million green tons of biomass is available in the region, including 86.73 million tons of agricultural biomass and 18.09 tons of forest biomass for pellet production. By 2025, the quantity of biomass is expected to increase to 147.02 million tons, including 114.5 million tons of agricultural biomass and 29.83 tons of forest biomass.
The Agricultural Utilization Research Institute is funding a study that will explore the benefits of using biomass-derived heat in Minnesota poultry barns. Jim Eiynck, owner of study participant Eventemp Biomassâ€™ national sales office in Becker, Minn., said the study will observe two barns: one utilizing liquid petroleum (LP) and the other woodchip biomass. The project will quantify the amount of LP and electricity utilized in a control barn and compare that performance with that of the barn heated by biomass. Additionally, the poultry will be assessed in each barn for chemical burns derived from ammonia exposure from the litter. Initial observations have been made in other poultry barns using thermal biomass. Eiynck said the potential benefits of forced-air biomass applications originate from the dry heat the system produces. He cited some poultry producers have noticed drier wall insulation, elimination of openflame heaters utilized in chick facilities, drier litter and lower fan use when utilizing forced-air biomass heaters in their barns.
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JUNE 2013 | BIOMASS MAGAZINE 29
BiogasNews USDA, dairy industry renew waste-to-energy agreement
Cellulosic ethanol from agricultural residues THINK AHEAD, THINK SUNLIQUID®
Highly efﬁcient sunliquid is an economic and sustainable process to generate biobased products from lignocellulosic biomass. It opens up new feedstocks not only for fuel, but also for sustainable chemistry from untapped resources – like cellulosic ethanol from agricultural residues.
Agricultural Secretary On-farm anaerobic digestion systems Tom Vilsack has renewed an agreement with U.S. dairy producers to accelerate the adoption of wasteto-energy projects and energy efficiency improvements on U.S. dairy farms. The original memorandum of understanding (MOU) was signed in Denmark in 2009. Since signing the MOU, the USDA has made nearly 180 awards to help finance the development, construction and biogas production of anaerobic digester programs with Rural Development programs, such as Rural Energy for America Program, Bioen- SOURCE: U.S. EPA AGSTAR, UPDATED SEPTEMBER 2012 ergy Program for Advanced Biofuels, Business and Industry Guarandairy farmers improve the sustainability of teed Loan Program, Value Added Protheir operations," Vilsack said. "This vital ducer Grants, and others. research also will support the dairy indus"Through this renewed commitment, try as it works to reach its long-term goal USDA and the Innovation Center for U.S. of reducing greenhouse gas emissions by Dairy will continue research that helps 25 percent by 2020."
Biomass-to-nitrogen technology to be installed at North Dakota biofuel plant Colorado-based Agrebon Inc. is developing a nitrogen fertilizer production plant adjacent to the Tharaldson Ethanol Inc. plant in Casselton, N.D. The fertilizer plant will generate biogas from ethanol stillage. The biogas will then be processed into urea, anhydrous ammonia and urea ammonium nitrate. The project is currently in the financing stage. An agreement with business development partner Progressive Nutrient Systems is already in place, while an agreement with the ethanol plant is nearing completion.
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The technology developed by Agrebon utilizes well-known technology that is used to convert natural gas into nitrogen, but substitutes biogas from an aerobic digestion system for the fossil-based natural gas. Approximately 1 pound of nitrogen can be produced per bushel of corn converted into ethanol. Pilot testing, economic modeling of the process, and an engineering review were completed at the University of North Dakota’s Energy and Environmental Research Center.
Biogas Contributes to a Diverse Renewable Fuel Mix BY AMANDA BILEK
Biogas energy systems have typically been considered a source of renewable electricity and/or combined heat and power, but several projects across the U.S. are demonstrating the suitability of biogas as a transportation fuel. Using biogas as a supply source of lower-carbon, domestic, renewable fuel is an exciting prospect, even in the face of abundant natural gas supplies and low prices. Since biogas can be converted to a product that is very similar to natural gas, biogas offers an alternative transportation fuel for vehicles converted or designed to run on natural gas. Given the historically low price for natural gas, many truck and heavy duty vehicle fleets are switching from diesel to natural gas. The build-out of additional natural gas refueling infrastructure and fleet conversions could accelerate the development of biogas as a transportation fuel, which provides diversity to the overall fuel mix and offers greater levels of carbon reductions. Biogas as a transportation fuel is also bolstered by the federal renewable fuel standard (RFS). This policy, passed by Congress and signed into law by President George W. Bush in 2007, sets a national production goal of 36 billion gallons of renewable fuel by 2022. Biogas is designated as an advanced biofuel under the law. The overall framework for the RFS provides more of a market pull for other renewable fuels like conventional and cellulosic ethanol, but the contribution that biogas can make in achieving the ambitious RFS targets should not be overlooked. In 2011, the American Gas Foundation commissioned a study by the Gas Technology Institute to determine the total national potential for renewable natural gas. Renewable natural gas is the term of art for defining biogas, a mixture of carbon dioxide and methane, to an upgraded or cleaned form that is mostly methane or substantially similar to natural gas. My organization, the Great Plains Institute, used the analysis from the American Gas Foundation to calculate the potential number of renewable fuel gallons that could be produced from biogas. Under an aggressive scenario, if the U.S. successfully converted
40 to 75 percent of the available livestock, municipal solid waste (MSW), wood residue and agriculture residue feedstocks to renewable natural gas, as much as 29 billion equivalent gallons of renewable fuel could be supplied. Obviously, this is an ambitious goal, and does not fully consider the economic or technical potential. However, the analysis demonstrates that biogas could supply a considerable amount of renewable fuel, while greatly reducing greenhouse gas emissions, and should not be dismissed or overlooked. The potential of biogas as a transportation fuel is already being demonstrated by projects across the country. Fair Oaks Dairy in Indiana is successfully displacing 1.5 million gallons of diesel fuel per year by collecting, cleaning and compressing biogas from a large herd of dairy cows. Biogas-based renewable fuel is used to run a fleet of milk delivery trucks and fuel for a public compressed natural gas (CNG) refueling station. In Ohio, Quasar Energy Group is working with the Solid Waste Authority of Central Ohio and Kurtz Bros. Inc. to collect biogas from municipal wastewater biosolids and food/beverage waste fats, oils and greases to displace approximately 1.3 million gallons of diesel fuel per year. A CNG refueling station is available onsite and is also available to public. Numerous municipal waste haulers are implementing projects to collect, clean and compress gas from landfills to provide renewable fuel for MSW vehicles. The possibilities are endless, and in addition to producing a lower-carbon source of fuel, materials that would otherwise be a strain on wastewater treatment facilities or livestock producers are transformed into a stable source of domestic, renewable fuel. Biogas is already contributing to the RFS and is positioned to make an even larger impact in the future. Author: Amanda Bilek Energy Policy Specialist, Great Plains Institute. email@example.com 612-278-7119
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AdvancedBiofuelNews IEA publishes update of advanced, cellulosic biofuel projects
Researchers extract hydrogen from biomass
The International EnPlant technology type ergy Agency Bioenergy Task 39 group has published a report outlining progress on more than 100 advanced biofuel projects under development worldwide. The report, titled “Status of Advanced Biofuels Demonstration Facilities in 2012,” is the second edition of the analysis. The first was published in 2010. Since the first report was published, the production capacity for lignocellulosic biofuels has tripled, with current annual capacity reaching approximately 140,000 metric tons of fuel. The production capacity for hydrotreating technology has grown at an even faster rate, reaching 2.19 million metric tons per year. did not provide sufficient data. As of the The analysis included data gathered close of 2012, 48 of the 71 projects were from 71 actively pursued advanced biofuel products. Additional projects were identified, operational, 9 were under construction and 14 were planned. but are either not being actively pursued or
Researchers at Virginia Tech have developed a revolutionary way to extract large quantities of hydrogen from plant material. Y.H. Percival Shang, an associate professor of biological systems engineering, and his team have used xylose to produce large quantities of hydrogen from any source of biomass. The method releases no greenhouse gases and does not required costly or heavy metals. Automobile manufacturers are aggressively trying to develop vehicles that run on hydrogen fuel cells, and Zhang’s discovery has opened the door to an inexpensive, renewable source of hydrogen. Obstacles to commercial biomass-to-hydrogen processes have historically included high processing costs and low yields. Zhang said he thinks he has found the answers to those problems through his use of a unique enzyme cocktail. “Many people believe we will enter the hydrogen economy soon, with a market capacity of at least $1 trillion in the United States alone,” Zhang said.
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ADVANCED BIOFUELS & CHEMICALS¦
Time for Master Limited Partnerships BY MARY ROSENTHAL Anyone who reads Biomass Magazine knows that those of us across the wide range of renewable energy technologies may not all be able to agree on every policy proposal that comes down the line, but there is one piece of legislation that should be universally supported. The recently introduced Master Limited Partnerships Parity Act legislation proposed by Sen. Chris Coons, D-Del., and a bipartisan group of co-sponsors, has the potential to accelerate commercialization of the next generation of domestically produced, sustainable energy, fuels and chemicals from almost any feedstock. By giving renewable energy projects the same tax incentives and treatment that fossil fuel projects have enjoyed for decades, the MLPPA will help those companies overcome the so-called “valley of death,” the space between successful pilot or demonstration facilities and full-blown commercial facilities. It will also increase investment opportunities for a wider audience, allowing more people to “vote with their dollars.” This is truly a technology-neutral approach. For many years, the biofuels industry has asked for similar policy treatment to the fossil fuels industry, and this is a powerful step in the right direction. Overcoming the Valley of Death Currently, many biofuel companies, including the algae industry, have been adept at raising early-stage capital for research and development. Yet, when it comes to the capital-intensive effort of building a facility, many biofuel companies are running into a challenge: the expense is considered too high for traditional venture capital, and too risky for traditional banks. As a result, many companies are forced to spend more time raising funds than deploying technology. Expanding the Master Limited Partnership provisions to renewable energy projects would assist in overcoming this problem, as MLPs are able to raise funds as corporations. Ownership interests are publicly traded and offer investors liquidity, limited liability and dividends, but are operated and taxed as partnerships. Due to the current regulations on MLPs, it has been primarily oil and gas companies that have benefited from the arrangement for some time, comprising more than 90
percent of MLPs. This bill levels the playing field, and gives renewable fuel companies the same tax treatment as their counterparts in the fossil world. Increasing Investment Opportunity In addition to leveling the playing field, MLPs open up an opportunity for consumers to play a role in financing clean energy projects in a way currently unavailable to them. Currently, a large majority of renewable energy projects are financed by a relatively small number of investors, which means only a few investors will reap the financial benefits of alternative energy’s success. MLPs would allow all Americans to make an investment in our clean energy future, and support the kinds of projects so many readers of this magazine are working to build. Creating Jobs and Driving Economic Growth We must be aware that capital availability for development of almost any renewable energy project will have a direct and positive impact on communities across America. Facility development creates wellpaying, long-term jobs up and down the supply chain, and salary and revenue taxes resulting from commercial production are funneled back into state coffers, without requiring an increase in any tax rate. It is an arrangement that can unleash a new investment engine in America, all without costing the government a single dime. For the U.S. algae industry, the timing couldn’t be better. Last year, algae-based fuels were offered to consumers for the first time, and we are seeing new precommercial algae-to-fuel facilities come online. With the availability of MLPs, companies in our industry will have the necessary framework to accelerate the production of renewable, domestic fuels from algae. Almost every other renewable energy and biomass industry would find MLPs similarly attractive. Let’s all get to work and voice our support for this bill. Author: Mary Rosenthal Executive Director, Algae Biomass Organization firstname.lastname@example.org 763-458-0068
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Q&A A Trash to Treasure Alchemist Converting an existing dry-mill corn ethanol plant to an advanced biofuel facility has accelerated Fiberight's commercialization plan. While Fiberight certainly isn’t the only advanced biofuel company eyeing municipal solid waste (MSW) as its chief input, it may be the only producer hinging its commercialization strategy on the retrofit of a plant designed to produce conventional fuel ethanol from conventional feedstocks. A facility in Blairstown, Iowa, is a central component in Fiberight’s efforts to move its conversion approach from pilot-scale to stable and profitable commercial production. Armed with a $25 million U.S. DOE loan guarantee, Fiberight and CEO Craig Stuart-Paul look to prove that their “minimill” concept is capable of converting a varied waste stream into valuable advanced biofuel and coproducts. You have extensive experience in resource recovery and are considered a pioneer in to the use of optical sorting technologies. Why is the sorting of the MSW stream so important to the Fiberight approach? This is the key to the Fiberight process, which is highly focused on recovering recyclables, as well as organics from the waste stream. We have a scalpel approach that allows us to create eight distinct streams of materials from waste and thus convert them most efficiently. They are cellulosic pulp for conversion to cellulosic ethanol; soluble organics for conversion to biogas and potentially bioplastics; recyclable cardboard and paper; recyclable metals; recyclable plastic containers; film plastic for conversion into wax and other polymers; low-grade plastic for cement kilns, and other residues.
By demonstrating this approach, we were able to comply with the U.S. EPA’s approach to MSW as a renewable biomass feedstock, and were awarded the first pathway approval last year. In 2009, you purchased a 10-year-old corn ethanol plant in Blairstown, Iowa. The facility continues to hold the leading edge of your commercialization plan. What was it about this facility that initially attracted you to it, and how has it remained central to your effort to grow to commercial scale? We realized that there was a certain “chicken-and-egg” approach to developing the business. In other words, owning the facility and having a permitted plant helped us attract finances, and would significantly reduce the project construction time and risk if we could design a system that would bolt onto existing infrastructure. Given that the main feedstocks we produce from waste are organic in nature, we developed pathways along with our industrial partner, Novozymes, to convert organics to sugar. Once we had sugar, we could use the majority of the existing plant. The capital markets have bought into this strategy, we have been able to secure financing, and the project is ready to start construction. Once started, it won’t be long before we begin production. As a corn ethanol plant, the facility was designed to yield 30 MMgy. As a wasteto-ethanol facility, the yield is 6 MMgy. Why does the output step down with MSW?
PHOTO: MARK WIELAND
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INTERVIEW BY TIM PORTZ
The facility is actually rated for 6 MMgy. The previous owners planned to expand to 30 MMgy, but that expansion never happened. Fortunate to us, all the civil work and infrastructure for expansion was installed, which was another thing that incentivized us to purchase the plant. Walk us through what will occur in Blairstown throughout 2013, as the facility is transformed and brought online to produce cellulosic ethanol. We are already into some of the detailed engineering, and have a sequential plan to bring the plant back online as a cellulosic biofuels facility. We will be starting on the changeover of the old plant next month, as we now have the data and design inputs from our Virginia demonstration plant. This will be followed by new hydrolysis systems, pretreatment, and then, finally, the waste processing center. God willing and the creek don’t rise, we could be pumping fuel by the end of the year. What were some of the most exciting discoveries that your reference commercial facility in Lawrenceville, Va., yielded as you commenced fully integrated operations last year? The biggest one was probably that when we put together all the diverse unit operations we had developed over the last five years, the plant worked, and worked well. Despite all the work you do, when building an integrated facility, there is always the chance for a major
surprise. We managed to avoid this. Beyond that, we have been very pleased with our enzymatic conversion process, and the speed at which we have been able to hydrolyze our substrates, leading to a significant reduction in the amount of new tanks needed in Blairstown. Further, the data we are getting from the anaerobic digestion plant indicates far greater gas production; we are at times converting over 95 percent of COD (chemical oxygen demand) in eight hours less than expected. Finally, our core principal of removing the organic fraction of the waste stream is working well—we have been able to get good, clean recyclables for separation. How do you balance the endless list of items that must keep completed to keep Fiberight moving forward to meet the milestones you, your public partners (USDA and the state of Iowa) and your private partners are all hoping for? We have to keep laser focused on the goal: delivering a commercially viable project at Blairstown, period. We get at least one offer a day to engage with domestic and international partners to develop projects in the future, but unless we deliver Blairstown well, all of this is moot. On a granular level, we operate under a disciplined program management approach, and I ensure that all of our stakeholders are aligned with the program, thus enabling our small team to deliver key tasks and milestones. This took a while to set up, and the goalposts were still moving until quite recently. Once done, this is an invaluable
tool, as it enables us to focus only what needs to get done, and when we do that, we move to what we would like to get done. How important are strategic partners to maintaining momentum on Fiberight’s road to commercialization? Our program management approach also allows us to identify areas where we need help, and frankly, without strong partnerships—particularly like the partnership we have with Novozymes— we would not be where we are today. If you consider that complex new technologies and processes can take upwards of 20 years to commercialize, it is foolish to think that you can do it all yourself. If you ultimately succeed in developing the perfect black box, someone else has already built a perfectly acceptable one and beat you to market. By working with a core group of focused industrial partners, the knowledge and resource pool increases exponentially, as does the momentum.
JUNE 2013 | BIOMASS MAGAZINE 35
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Published on May 21, 2013