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BC Bugwood Envirochem Services Inc. as the Renewable Power Production Incentive and carbon credits may reduce the price of power enough to break even with electricity from combined cycle natural gas turbines. Debarking is most likely not necessary for bugwood use in coal plants, which would reduce the costs of pellets somewhat. However, shipping entire logs for chipping at the plant may be cheaper than shipping pellets, depending on the type of pre-processing required to use the wood in the coal plant. The domestic market for wood pellets seems limited: many BC communities do discourage or prohibit the use of wood pellets due to the environmental implications (particulate emissions). There may be some more market potential in the greenhouse sector, as well as some pulp & paper plants, but the larger market seems to lie overseas in Europe. It is not expected that China will become a market anytime soon due to the very high cost of pellets as compared to coal. However, the overseas market is limited by the very high shipping price (over $50 per tonne). This shipping cost brings the price of pellets over the market price of $170 that can be achieved in Europe. The reason why one BC pellet manufacturer exports pellets overseas is not known with certainty, but is presumably either that • they can sell pellets to Britain, where a higher than usual price can be paid for pellets than in other countries, due to the “Renewable Obligation Certificates”, which create considerable additional income for renewable power producers, but only exist due to a particular trading mechanism created by the British government to support renewables, or • because their cut license also includes other species than pine, as well as sawlog quality bugwood (at the same low stumpage fee), the amount of high-quality logs harvested and sold to other companies may provide a high enough return to counterbalance the high cost of bugwood as a feedstock through this second source of income. There is on-going investment in several pellet plants in BC, based on the bugwood resource. It is currently not known if the market in the UK or other European countries would allow for an expansion of this industry in BC. It is, however, possible to combine bugwood with other feedstocks, such as sawmill waste and bark residues. BC has large amounts of these biomass residues available, and co-processing of such free feedstocks with bugwood would reduce the average feedstock costs enough to achieve the commercial break-even point. It was also shown that an advanced (Entropic System) CHP plant can reach an ROI of 10% using bugwood. If such plants were built in BC, they could therefore process pellets that cost no more than $106 per tonne. Using low-value bark pellets, or mixed pellets, could therefore be an option to use this resource. Alternatively, chipping of logs at the CHP plant and mixing them with other low- cost forest residues could be an option. Producing lower-end industrial pellets that contain bark could also reduce prices enough to sell such pellets to Alberta coal plants for co-firing (note that such pellets are currently not accepted by industry). Industry could negotiate with Alberta utilities to determine the maximum price that could be obtained for such pellets. If long-term contracts can be obtained, then the viability of such production based on residues from smaller sawmills and bark residues in BC could sustain production even when the bugwood resource is diminished in 10-15 years. Note that much of the equipment is written off after ten years, allowing a somewhat increased margin for feedstock costs. Cellulignin: Cellulignin (CL) briquettes were developed as a means to process the biomass into a renewable fuel with high energy density but without significant ash and inorganics. Once compacted, it has the energy density of bituminous coal, but with much better burning characteristics as the particles are very small (less than 250 microns and burn quickly). This technology is promising as the briquettes can be transformed into a cellulignin powder, which Page 89PDF Image | IDENTIFYING ENVIRONMENTALLY PREFERABLE USES FOR BIOMASS
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