Building Out Smart
February 22, 2023
BY Anna Simet
The North American wood pellet industry has gone through several phases in the 15 years I have been writing about it. I recall an interview I had in 2009, with the owner of a plant in Oregon that no longer exists, and he told me, “It [the wood pellet industry] goes through [development] cycles and has not experienced very steady growth over the past 20-plus years.” He lamented what he essentially described as a gold rush—too many plants were built in a short time in response to a perceived shortage and soaring demand—and the result was excessive capacity, he said. Well, a decade and many lessons learned later, things have changed to a degree. While capacity growth doesn’t come close to that of some industries in the bioenergy space—such as renewable natural gas, for example—it has been moderate, cautious growth. The U.S. heating pellet sector is particularly mindful of market saturation (or oversaturation), and seasoned producers only invest in new hardware when they are confident they can move the additional tonnage. Their relationship with buyers is very different than those of industrial producers that have long-term contracts with overseas clients.
Lately, there has been an uptick in announced capacity expansion and new plant plans. As for what’s on our radar, Grand River Pellets Ltd. in St. Leonard, New Brunswick, is doubling its capacity to 220,000 metric tons; Drax is expanding its Aliceville, Alabama, plant from 250,000 to 380,00 tons; and California-based Golden State Natural Resources announced initial development of two plants in California, in Tuolumne and Lassen counties, at 300,000 and 700,000 tons, respectively. Requests for interviews with GSNR went unanswered, but they have released a fair amount of information. The last project I’ll mention is a plant proposed in Vermont—30,000-ton-per-year PK Wood Pellet LLC, which was awarded $450,000 via the USDA’s Rural Energy for America Program. While this isn’t an exhaustive roundup, all of these announcements were made within just a couple of months.
As global demand for pellet increases, so does the demand for certifications, particularly ENplus. For this issue, I had a lengthy discussion about standards with Chris Wiberg, vice president of Biomass Energy Lab, from their initial development to potential areas for improvement, to a surge in ENplus certifications. Wiberg is the go-to guy when it comes to meeting specs, and he had a lot of interesting things to share in our page-16 feature, Quality Matters.
Our second feature, written by international freelancer Eugene Gerden, provides an overview of the Russian biomass sector. We’ve covered the impact of the banishment of the country’s participation in the global wood pellet market on other countries, but this piece pivots to the implications on this market itself (though perhaps the situation isn’t quite as dire as it should be, as there is growing suspicion Russian pellets are still illegally entering the market).
Finally, my usual plug for the International Biomass Conference: If you’re reading this, you might be there. We’ll have wood pellet trade organization leaders Tim Portz, Pellet Fuels Institute, and Amandine Muskus, U.S. Industrial Pellet Association, joining me on stage for our annual association round table. Be sure to bring your questions—hope to see you there.
Author: Editor
asimet@bbiinternational.com
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