“Pellets to Europe are presently 9 million tonnes for power plus 10 million tonnes for commercial, residential, and institu-tional heating annually,” says Murray. “Both sectors continue to grow rapidly. Most experts predict that Europe’s market will be 50 million tonnes by 2020, with South Korea and Japan each at about 5 million tonnes.” He notes that the Northeastern U.S. biomass heating market is also growing rapidly as a result of high oil prices, the introduction of European heating appliances and the cost savings of using bulk pellet deliveries over bags. RISING FUEL COSTS CARBON CREDITS We can all count on the fact that fossil fuel prices will continue to rise. This is tough on biomass companies, which need to gath-er forestry residues and other feedstocks, transport and process them – and in some cases, ship finished products such as pellets as well. At the same time, however, high electricity and fossil fuel prices are prompting more Canadians and beyond to look at biomass. Murray notes that only 45 per cent of Canadian homes are served by natural gas, which represents a huge opportunity for pellets to be used for heat and hot water production – but that getting there will require significant marketing effort. “In most provinces, pellets are cheaper than oil, electricity, propane. We need to educate Canadians about the modern automated pellet appliances that are commonplace in Europe.” ENVIRONMENTAL SYSTEMS DIVISION Dust Collector/Filtration Units-Fans-Ducting Systems-Shredders-Hogs The European Union has an Emissions Trading System where large emitters must buy emissions allowances, and various coun-tries in that region also have carbon taxes. However, Canada has no national meaningful carbon reduction policy, which hinders the growth of biomass use for energy. In Murray’s view, the Ca-nadian government’s focus on continued development of the oil sands means there will not be any federal carbon-controlling mechanisms introduced anytime soon. On a provincial level, Dan Fraleigh notes that B.C. has a car-bon tax and Alberta has a voluntary cap-and-trade system for large carbon emitters, as does Quebec (which trades with Cali-fornia companies). He expects something in Ontario in the next five to 10 years, but nothing is certain, and like Murray, Fraleigh expects nothing nationally in the foreseeable future. “The volun-tary carbon offset market is what’s most active in North America – buying credits for marketing purposes,” says the Chief Oper-ating Officer of Carbonzero, a firm which aids organizations in assessing, reporting, and reducing their emissions. In its new vision and action plan released in April, “Evolu-tion and Growth: From Biofuels To Bioeconomy,” the Canadian Renewable Fuels Association states that “Globally, more than 40 countries have or are in the process of putting a price on carbon. In so doing, they are effectively monetizing carbon benefits that accrue through the use of sustainable products, like biofuels.” However, while Fraleigh acknowledges that biomass projects are now eligible for credits, he expects that to end within the next decade or so. Offsets are a mechanism to encourage change, he notes, so when an offset-eligible activity such as biomass use becomes prevalent, offsets become unavailable for it (but then become available for other carbon-reducing activities that need support due to growth). GOVERNMENT INCENTIVES, POLICY AND SUPPORT Dust Collection & Material Handling systems Experts in since 1957 MacDonald Steel Environmental Systems Designs, manufacturers, installs and services • • • • Dust Collectors/Filters Cyclones Hogs and Shredders Abort Gates • Material and Air Handling Fans • Spark Detection and Extinguishing Systems Cambridge, Ontario Canada | PHONE 519-620-0500 www.macdonald-esi.com | [email protected] DIVISION OF TIGERCAT INTERNATIONAL The biomass industry has long called for stable government policy that supports the nation to use more biomass for energy. Kevin Kerschen, a senior project manager for Black & Veatch’s global energy business, echoes the sentiment. Black & Veatch has had a significant role in planning, evaluating and providing engineering services for many of the recent biopower projects under development in the U.S., including standalone biopower, co-firing biomass in coal plants and repowering coal plants with biomass fuel. In a recent Black & Veatch article, “Four Key Developments Needed to Boost Global Biomass Industry,” Kerschen notes that of all renewable energy sources, biomass is challenged by the widest and most complex set of factors that impact project de-velopment. These include everything from forestry sector reg-ulations to carbon emissions, and Kerschen says these issues have been among the reasons the biomass sector has seen slower growth compared to other renewable energy sources. “For more utilities to be willing to pay a premium for renew-able energy, there needs to be more consistent and well-defined government policies, and better clarity on environmental regula-tions as they pertain to biomass that urge utilities to embrace re-newable energy within the context of an overall national energy plan,” Kerschen says. “If governments put into place certain reg-ulations that foster a stable environment, where developers and SEPTEMBER/OCTOBER 2014 28 Canadian BIOMASS
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