Franklin plant with McAuliffe ties under a campaign spotlight

http://articles.dailypress.com/2013-08-11/news/dp-nws-mcauliffe-wood-pellets-20130811_1_terry-mcauliffe-franklin-pellets-pellet-plants

August 11, 2013|By Michael Welles Shapiro, mwshapiro@dailypress.com | 757-247-4744

 

For more than two years, talk of a new wood pellet plant has dangled the promise of jobs and new business in the rural town of Franklin.

More recently an associated storage and export facility announced late last year offered hope of a long-term tenant at a mostly vacant state-owned shipping terminal in Portsmouth.

Now that Terry McAuliffe, a business partner involved in the deals, is running for governor, the projects have become fodder in a slash-and-burn political campaign. Most recently the group Citizens United produced a 29-minute film portraying McAuliffe as a serial exaggerator in his business life and asking Franklin residents, "Where are the jobs?"

Though neither site is in service, interviews, public documents released by the Virginia Port Authority and a recent article in the trade publication Biomass Magazine all suggest progress is being made toward a pellet operation, albeit at a slower pace than was originally anticipated by a McAuliffe business partner and a Houston-based energy company involved in the deals.

Peter O'Keefe, the McAuliffe business associate, told the Daily Press in April 2011 that "if all goes well, we will be up and running in about 18 to 24 months" — or by April 2013.

He said Friday it has taken longer to finance the projects because utility companies in the United Kingdom are waiting on two much-delayed regulatory decisions before they enter into new long-term contracts to buy American wood pellets.

"They're more than a year behind where we thought they would be (on the ruling)," O'Keefe said of the U.K. Department of Energy and Climate Change. But with "the way those decisions are expected to come down, the outlook is bright."

Citing confidentiality agreements, O'Keefe said he could not go into any level of detail about negotiations with International Paper over a lease site for what's called Franklin Pellets.

McAuliffe declined to discuss the wood pellet project, saying they would be better addressed by O'Keefe. But a McAuliffe spokesman rebutted several of the points made in the Citizens United film.
Pellet plants pulverize a variety of forms of wood, including waste byproduct from lumber facilities, and produce pellets that can be burned as a supplement to or substitute for coal at power plants.

The Franklin initiative is one of a number of prospective wood pellet plants that have sprouted up across the southeastern part of the country. Existing pellet plants and the prospective new facilities seek to take advantage of a European Union subsidy program that created a hunger among British and European utility companies for U.S. and Canadian product.

The partnership with McAuliffe ties is hoping to build a plant called Franklin Pellets on land leased from International Paper, which runs a large campus that is now home to a fluff-pulp mill and a recycled tissue company. Using a separate corporation, the group is more than 11 months into a lease negotiation with port officials.

There are several indicators that there's been progress on both sets of negotiations, according to three sources familiar with the talks who all declined to speak on the record citing the confidentiality agreements.

"They're trying to make a go of it and get the (Portsmouth Marine Terminal) lease together," one source said.

The 20-year lease includes a six-month interim early termination period that gave CMI and MultiFuels an opportunity to walk away. That period expired Feb. 28. The Daily Press obtained a copy of the lease from the port authority.

"There's no effective date yet as far as occupancy goes, but they did not walk away from it," the source said. "They're trying to finalize the lease and an occupancy agreement but they have to find a buyer (for their pellets)."

That would put Franklin Pellets in the same position as numerous other would-be pellet operations.
Seth Ginther, a Richmond lawyer and head of the U.S. Industrial Pellet Association, said the financing for a wave of new wood pellet developments are on hold pending an environmental policy decision in the U.K. that's expected to stoke more demand for U.S. pellets.

"If you're a developer in today's market for export to Europe you're constantly juggling three different balls — European policy, raising money for a project for when the policy gets in place, and also logistics," Ginther said.

"Once you have that policy certainty, you finance your facility on the back of that off-take agreement," he said, referring to a contract, typically with a utility, to ship a certain amount of pellets from a manufacturing plant.

Dogwood Alliance launches campaign against logging for energy

http://www.mountainx.com/article/50340/Dogwood-Alliance-launches-campaign-against-logging-for-energy

By David Forbes on 05/29/2013 04:05 AM

From the Dogwood Alliance:

May 28, 2013 – Southern forests are being burned for electricity, and a new campaign announced today aims to put an end to it. Dogwood Alliance and the Natural Resources Defense Council (NRDC) have launched “Our Forests Aren’t Fuel” to raise awareness of an alarming and rapidly-growing practice of logging forests and burning the trees as fuel to generate electricity

At the forefront of burning trees logged from Southern forests for electricity are some of Europe’s largest utility companies, including Drax, Electrobel and RWE. Rising demand by these companies has resulted in the rapid expansion of wood pellet exports from the Southern US. The American South is now the largest exporter of wood pellets in the world. Recent analyses indicate there are twenty-four pellet facilities currently operating in the Southeast, and sixteen additional plants planned for construction in the near-term. Market analysts project that annual exports of wood pellets from the South will more than triple from 1.3 million tons in 2012 to nearly 6 million tons by 2015. All of the South’s largest domestic utilities, including Dominion Resources and Duke Energy, are also beginning to burn wood with plans for expansion in the future.

“This rapidly expanding trend of burning trees for energy will both accelerate climate change and destroy forests,” said Danna Smith, Executive Director of Dogwood Alliance. “Southern forests not only protect us from climate change, but protect our drinking water, provide habitat for wildlife and contribute to our quality of life. We need these companies to stop burning trees for electricity and embrace a clean energy future that helps to protect, rather than destroy forests.”

“With the advancement of clean, renewable energy alternatives, the growing practice of burning trees for electricity is a major step in the wrong direction,” said Debbie Hammel, Senior Resource Specialist of the Natural Resources Defense Council. “Our Forests Aren’t Fuel lets the public know about the extent of this ecological devastation and calls on utilities to end the practice. It’s an even dirtier form of energy production than burning fossil fuels, it destroys valuable southern ecosystems, and it isn’t necessary.”

Energy from burning trees – or biomass – has been widely promoted as a form of renewable energy along with technologies like solar, wind, and geothermal. Over the past two years, however, mounting scientific evidence has discredited biomass from forests as a clean, renewable fuel. Recent scientific reports document that burning whole trees to produce electricity actually increases greenhouse gas pollution in the near-term compared with fossil fuels and emits higher levels of multiple air pollutants. This fact, combined with the negative impacts to water resources and wildlife associated with industrial logging have discredited whole trees as a clean fuel source. But current European and U.S. renewable energy policies and subsidies encourage the burning of trees as a “renewable” source of energy for power generation, helping to facilitate the rapid increase in demand for trees from Southern forests to burn in power plants.

Consequently, a new industry is spawning in the South. Companies like Maryland-based Enviva, the South’s largest pellet manufacturer, are grinding whole trees into wood pellets to be burned in power stations in Europe while also supplying wood to domestic utilities like Dominion Resources. New evidence that Enviva may be relying at least in part on the harvesting of wetland forests has recently emerged. Georgia Biomass, a wholly-owned subsidiary of the German utility RWE Innogy, is also manufacturing millions of tons of wood pellets annually to be burned in European biomass facilities.

“Our Forests Aren’t Fuel” organizers reveal the scope and scale of the growing biomass industry through a series of case studies on the campaign website that include wood pellet manufacturers, domestic utilities, and European utilities. Particular emphasis is placed on the following companies:

· Enviva - one of the largest manufacturers of wood pellets in the U.S. and Europe, with manufacturing facilities and partner facilities in Mississippi, North Carolina and Virginia. The Bethesda, Maryland-based company has an annual production capacity of more than 590,000 tons. It also operates a deep water terminal at the Port of Chesapeake, which has the capacity to receive and store up to three million tons of woody biomass annually. Much of its product is sold and shipped to European utilities, like Drax. Leftover biomass “residues,” like tree tops and limbs, are sold to domestic utilities, like Dominion Resources.

· Drax – major United Kingdom-based utility that recently shifted focus from co-firing biomass in coal power plants to full conversion of its largest plant to biomass. Drax has begun building pellet mills directly through its wholly owned subsidiary Drax Biomass. In December, 2012, Drax announced it will build Amite BioEnergy pellet mill in Gloster, Mississippi, and Morehouse BioEnergy in Bastrop, Louisiana, to supply wood pellets for use in its power plants, with production set to begin in 2014.

· Dominion Resources – the Richmond, Virginia-based utility recently launched several biomass operations that could well rely on whole trees in the near future. Its 83 megawatt plant in Pittsylvania, Virginia, is one of the largest biomass power stations on the east coast. Dominion is also converting three existing peak power coal-fired power stations into full-time biomass-burning facilities. The utility currently sources much of its biomass material as “residues” from wood pellet manufacturers like Enviva that export the bulk of its product to European markets. Should the supply of these residuals become limited, Dominion’s operations could increasingly rely on burning whole trees.

Full case studies for companies driving the biomass industry can be found on the “Our Forests Aren’t Fuel” website, http://www.dogwoodalliance.org/campaigns/bioenergy/, along with recommended actions for those concerned about losing southern forests for electricity, and a list of more than 70 supporting environmental groups.

The US surpassed Canada as the largest wood pellet exporter in the world

http://www.teatronaturale.com/article/3908.html

by S. C.

Pellet exports from the two primary pellet-producing regions on the North American continent, the U.S. South and British Columbia, have continued to grow, reaching a new record high of 760,000 tons in the 2Q/12, according to data from the pellet industry and customs statistics complied by the North American Wood Fiber Review.

Total Canadian exports to Europe in the 2Q rose 14 percent from the 1Q/12, with reports of BC pellet plants running at full capacity thanks to European demand. Pellet plants in Eastern Canada also continued small but frequent shipments over the Atlantic.

In the U.S. South, pellet export volumes rose 13 percent in the 2Q/12 from the previous quarter, in spite of some temporary slowdowns at Green Circle Bio Energy in Florida and Georgia Biomass, Georgia due to fires at a US port and at a pellet consumer in the United Kingdom. Shipments from Enviva’s new port facility in Virginia, additional volume from Fram Renewables, and new volumes from Low Country Biomass in South Carolina have all contributed to the growth in exports over the past 15 months, so that the US has now surpassed Canada to become the world’s largest exporter in 2012.

Three companies announced plans for constructing pellet plants in the state of Georgia in the 3Q/12. With six other pellet export plants already under construction and scheduled to begin operating in regions as widespread as Virginia to Texas, it is possible an additional 4.2 million tons of wood pellets will be crossing to Europe in 2015. This can be compared to an estimated 1.5 million tons likely to be exported from this region in 2012 as reported by the North American Wood Fiber Review.

Exports from both Eastern and Western Canada are also on schedule to grow, though not at the explosive rate being witnessed in the U.S. South. Several new Canadian pellet facilities, such as Holbrook Forest Products in Roddickton, Newfoundland, have expressed their intentions to export pellets, but have yet to do so for various reasons, including inadequate export dock facilities.

by S. C.

16 October 2012 Teatro Naturale International n. 10 Year 4