BIOENERGY – WOOD PELLETS (2006)

British Columbia has been called “the Saudi Arabia of bio-energy” by many international organizations. BC is home to the largest global supply of biomass that is available for use as a clean energy source. Most of this energy comes from what was once burned as waste in beehive burners and is now seen as a revenue source for BC.

In addition to the various forms of bioenergy (defined as any energy that comes from carbon based starting materials) including garbage and methanol, there is an expanding industry in wood biomass for energy. Wood Pellets are a clean energy now that advanced processing and combustion technology exists to produce zero, or near zero, emissions compared to the old wood stove technology.

Four wood pellet producers in northern BC have tripled in size for the last 4 years running. In 2005 they produced 1.2 million tons of wood pellets using some 400 employees for producing energy and $150M in revenues. These 4 produce the same volume of biomass as Germany! Canfor has just announced it will be producing a wood pellet plant in the Houston/Vanderhoof area as part of its Income Trust as a means to increase revenues, and C.H. Anderson is also developing the largest wood pellet plant in the world in northern BC within the next 2 years.

Ninety percent of the wood pellets produced were exported to Sweden for use in their power generators. Unfortunately under the Kyoto protocol the use of biomass from the carbon neutral source of wood, even using advanced clean burning technology gives credit to the end user and not the producer. As such, Sweden and indeed most countries of the European Union (EU) have expressed interest in BC wood pellets. Additional interest from the EU is garnered from the fact the goal is to have 20% of all EU energy produced from biomass by the year 2010 and most EU member countries do not have the capacity to produce the needed biomass.

The problem with bioenergy from wood waste in BC is the ability to be recognized as a viable industry and to have support of the provincial government. In 2004 the first international bioenergy conference was held in Prince George with 100 international researchers and industry representatives. Recognition of this event and the work in biomass in Canada and BC is being recognized in Europe. In fact, a Canadian won the European Lifetime achievement award for biomass combustion technology development in October!

The main driver behind this interest has been Kyoto and BC’s vast wood fibre supply that has essentially been seen as a waste. The Mountain Pine Beetle issue has simply increased the fibre supply that is available to launch the industry. The Chamber and industry representatives realise that the wood pellet industry launch depends on taking advantage of this sudden access to fibre to the point that a decrease in costs of $50 per thousand board feet will make wood pellets viable for primary breakdown.

The Chamber and industry representatives also realise our current advantage rests on accessing the significant resource that has become available due to the Pine Beetle issue. However, The Chamber realises the trees affected by this beetle represent a corroding asset to the Province that if not processed will be valueless. As such, this is an opportunity to produce revenues from a devastated asset and a chance to enter a growing market. If managed correctly, Canada and BC can place itself as a world producer and maintain this advantage long after the Mountain Pine Beetle is gone, through forest management and silviculture. The key will be to ensure a sustainable fibre supply and to support the export industry associated with this industry.


THE CHAMBER RECOMMENDS

That the Provincial Government;

1. recognize the growing wood pellet industry through inclusion of this as well as other clean technologies in the Provincial Energy Plan;

2. support the development of a wood pellet loading facility in the North West; and

3. work with the Canadian Wood Pellet Association in producing wood pellet industry standards necessary to make a viable and competitive sector.