Small scale biomass projects blaze a trail

Written by: RWW | Published:

Matt Drew, MD of Saxlund, argues why locally-based sustainable, small scale biomass systems, combined with heat and power, can achieve more than some may believe.

Renewable energy has grown in popularity across the UK during the past few years, in both the residential and industrial sectors. The last 12 months have been some of the most successful in the renewable energy sector with even more investment and large numbers of green jobs being created. Biomass is just one part of the industry which is leading the way.

According to the latest findings from the ICAEW/Grant Thornton UK Business Confidence Monitor (BCM), business confidence is continuing to rise and has been sustained for the past six consecutive quarters, as the UK economic recovery gains a stronger foothold. With this in mind, the biomass market is changing the way it is managing its business models in order to maximise profits and encourage more growth. 

An upward trend is seeing more companies invest in building smaller heat and power electrical centres - based at the site of, rather than away from, industrial scale heat and power consumers.

With the renewable heat incentive (RHI) fully underway, heat for industry, whether it be for on-site heating or industrial processes, is now a major driver for investment, and combining heat with electrical power production means that the efficiencies in terms of generation and investment are very attractive to developers.

For example, a factory that manufactures food or pharmaceutical products will require an industrial heat centre to operate. 

Heat supply contracts are difficult to manage with third parties, such as supplying to a number of companies on an industrial park, as the investor will question whether the heat consumers will still be in business in the long term. 

This is especially in the case of biomass fuelled combined heat and power (CHP) plants under the government’s forthcoming contract for difference (CfD) where there will only be an uplift in electricity sale prices if the plant is a CHP, and investors will demand a 25-year heat take-off agreement. 

Therefore it makes commercial sense to build a centre on the site of an industrial heat consumer, rather than rely on third party customers who may or may not be in for the long haul.

Bigger isn’t always better

It’s no surprise that large power station installations like Drax can put strategic strain on the global timber industry. They consume vast volumes of imported timber, potentially taking away the financial resources from more sustainable projects, which use UK sourced wood in the form of forestry or low grade (and lower cost) timber waste. 

In addition to this, large power stations’ reliance on imported wood pellets is not cheap and can only be manufactured using good quality wood, making the process even more expensive. 

This undoubtedly has an impact on deforestation, particularly with the increase in the number of coal-to-biomass conversion projects, with Drax leading the way as the largest single emitter of carbon dioxide in the UK. Although it’s expected that its emissions will be reduced by about 10 million tonnes as a result of converting to sustainable biomass.

While pushing through such larger co-firing/coal conversion projects to enable them to say they are achieving renewable targets, the government shouldn’t forget about dedicated small scale biomass as an effective and efficient way to generate power. 

The efficiency of combined heat and power (CHP) can be almost double the percentage that the larger power stations can produce, so it makes sense to consider creating a greater number of smaller scale projects that can generate more than 75% efficiency, compared to 30/35%. The cost of conversion to wood pellets may be cheaper, but it is sacrificing overall efficiencies.

Pöyry Forest Industry Consulting, a specialist in bioenergy and biomass procurement strategies, predicts that by 2015, global pellet demand will almost double, reaching approximately 24 million tonnes (CAGR of 10.5%), due to the world’s need to develop renewable forms of energy and reduce greenhouse gas emissions. 

It’s not surprising therefore that wood pellets are an attractive option as biomass material, particularly due to the greater transport efficiency over longer shipping distances, but UK companies should make more effort to use UK sourced materials to reduce additional importing costs and take advantage of lower cost materials.

British materials support the UK economy

There should be more CHP plants scattered across the UK, rather than a handful of large scale plants such as Drax. Smaller scale biomass projects that use wood for both heat and power achieve much more efficiency, particularly as they can use lower grade fuel, such as forestry waste (twigs, sticks, stumps, etc) and low quality waste wood, which can be sourced in the UK instead of overseas. 

The European Commission produced a draft proposal in 2013 for a European biomass policy setting out the sustainability criteria for future biomass use, which specified that biomass can only be sourced from forests which are sustainably managed; this demonstrates that there is a need for tighter reins to be placed on sustainable forestry management resources in the UK, particularly those which supply biomass plants. 

In addition, with the UK economy predicted to exceed its pre-recession growth peak later this year, according to the British Chambers of Commerce, the UK biomass, recycling and timber sectors should work closer together to support each other and use more UK materials to generate biomass energy. 

Reviewed by the Institute for European Environmental Policy, a new study also finds that a ‘waste to industry’ could support 300,000 direct jobs across Europe in construction, refining and waste collection between now and 2030, and creating up to €1.1 billion to €2.4 billion in net revenues for the agricultural and forestry sectors.

It could also play a significant role in providing an alternative to the declining fossil fuel supplies and help cut Europe’s growing transport emissions which are destined to become the single biggest source of CO2 by 2030.

This is put into sharp context by recent moves on the world stage, with nations now examining ways to reduce energy dependence upon major suppliers, such as Russia. 

Downstream we’ll see more opportunities for recycling, wood and biofuel generation over energy, which will provide added opportunities across a range of sectors and benefit the small to medium sized customer base.

- Saxlund is a provider of biomass solutions

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