Marius Hachenberg, wood pellets are generally mentioned in the context of domestic heating systems. What role can they play in industry?
For energy suppliers, public utility companies and the manufacturing industry, converting to renewable energy presents a challenge, in particular with regard to heating. Wind and solar farms are ideal for generating electricity. By contrast, there are only a few technologies already available for producing green heating that are reliable in terms of security of supply, price stability, and predictability. Gas is often no longer a financially, technically, or logistically viable option. Industrial wood pellets can fill an important gap, because existing coal-fired power stations and energy generation facilities for energy-intensive industries can be converted to wood pellets relatively quickly and inexpensively.
How much do companies need to invest in order to be able to use wood pellets?
Converting some power plants to industrial wood pellets is not too challenging from a technical perspective and could be achieved within roughly two years, for a fraction of the cost of building a new replacement power station. The option of replacing coal with wood is particularly useful in the case of system-critical plants that cannot convert to gas for a variety of reasons. In particular in the case of combined heat and power plants, it is possible to achieve a climate-friendly efficiency level of up to 90 percent using the current energy infrastructure, which means retaining existing sites, safeguarding jobs and giving them a green future.
And talking about green issues, what are the emission levels?
The greenhouse gas emissions of sustainably produced biomass over its entire life cycle are more than 85 percent lower than those of coal. In comparison to natural gas, the emissions can be reduced by around 70 percent and, in the case of LNG, by slightly more.
How expensive is energy produced from pellets in comparison to the alternatives?
Contrary to many people’s expectations, carbon-free, renewable raw materials are less expensive than fossil fuels. At the current CO₂ price of 85 to 90 euros per metric ton, industrial wood pellets used for heat production are up to 20 percent cheaper than black coal and almost 46 percent cheaper than gas.
Which industries are already using pellets?
At the moment, the energy industry is the main user of industrial wood pellets, particularly in Europe and Asia where companies like Orsted, Drax, Sumitomo and Mitsubishi have been relying on energy from wood for a long time. More recently we have seen an increase in the use of industrial wood pellets in the energy-intensive industries. They can play an important role in the production of green process heat, for example, in the steel, cement and lime sectors. This is why the steel company ArcelorMittal, among others, is focusing on developing biomass technologies alongside hydrogen. Wood as a raw material is also a candidate for defossilizing the fuel and chemical industries. For instance, aviation companies are pressing ahead with the production of bio-based aviation fuels. We have already signed declarations of intent in this area.
What other applications are you expecting to emerge in the future?
Bioenergy with carbon capture and utilization or storage (BECCUS) will be one of the very few options in the future that will enable us to actually remove carbon from the atmosphere and achieve negative emissions. This means that climate-positive industries are almost within reach. As soon as the technology has reached maturity, BECCUS could represent the beginning of a new era for low-carbon fuel applications. As a result, companies would be able to achieve or even exceed their international net-zero targets. In hydrogen value chains, bioenergy can also function as a base load technology, a raw material, and a provider of green carbon.
What is the substitution potential of wood pellets?
It is difficult to quantify the substitution potential, in part because the possible applications of industrial pellets are so wide-ranging. According to FutureMetrics, the demand for pellets in Germany from the electricity and heating market alone will roughly triple by 2027. With the emergence of the industrial bioeconomy in Germany, the number of bio-to-x applications will grow and will increasingly replace gas, oil and coal. However, this will only be possible with sustainable biomass. On a global scale, we are expecting there to be a demand from the chemical industry alone for 450 million metric tons of carbon.
How sustainable are your pellets?
Sustainability is the fundamental requirement for the production of energy from wood. The cascade use of wood is the common practice. This means that the valuable trunks are supplied to sawmills or the construction and furniture industries and function as long-term carbon sinks, while the byproducts of the traditional timber harvest, including thinnings, trees that are diseased, too thin or deformed, and also residues such as the crown, branches and fibers, go for pellet production. What is really important is that the forests as a whole continue to grow and are maintained for the future. This is why we source our timber only from forests that are replanted.
Where does your wood come from?
From the south-east of the USA, where Enviva has its headquarters. In this area there are 40 percent more trees than there were 25 years ago. It is one of the largest forestry regions in the world, covering an area of 1.2 million square kilometers, which is around three times the size of Germany. It has an annual net growth of 320 million metric tons. And our satellite-based track-and-trace program enables us to trace the origin of our wood in real time.
How did Enviva come about?
Enviva was founded in 2004 with the intention of actively combating climate change and promoting the concept of bioenergy, by converting what had been seen as waste products from the forestry industry into green energy. Today we are the largest manufacturer of sustainably produced industrial wood pellets. Enviva employs 1,400 people worldwide and has ten production facilities in the USA with a total capacity of approximately 6.2 million metric tons of timber per year, supplying customers in Asia and Europe.