International pellet trade

Transcription

1 International pellet trade Martin Junginger, Richard Sikkema, Utrecht University Results of the project Closing meeting Brussels Wednesday 18 th of November 2009

2 Presentation Overview 1. Overview of global and European trade 2. Supply: logistics of pellet trade 3. Barriers and drivers of international pellet trade 4. Future prospects 5. Discussion

3 Current bioenergy trade Canada E. Europe & Russia W. Europe USA Japan Ethanol Wood pellets Brazil S. Africa Malaysia & Indonesia Australia Veg. oils & biodiesel Annual int. traded volumes of ethanol, biodiesel and wood pellets > 4 million tonnes in 2009 and increasing rapidly

4 Global WP trade 1990 s Canada 1990s USA W. Europe 1998 Wood pellets

5 Global WP trade 2008 Canada 2001 W. Europe E. Europe & Russia 1990s USA 2008 Japan Wood pellets

6 Global WP trade 2009 Canada 2001 (?) W. Europe E. Europe & Russia 1998 USA 2008 Japan 2008 Wood pellets S. Africa Australia 2009 Wood pellet trade around the world

7 Market types 2009 based on Eurostat trade data Canada, USA, S. Africa, Argentina Source: Draft article European wood pellet markets for heating and power production (Sikkema R. et al.) Import > 100 Kton Export > 100 Kton Bulk power Bulk DH & CHP Loose RH Bagged RH Major exporters

8 Import Export Estimation 2008* [Tons per year (2008)] Russia Canada Netherlands Belgium UK Finland Sweden Denmark Eastern Italy 2009: Increased domestic consumption in e.g. Poland (large scale) USA as new major exporter in 2009! Austria Germany 0 High quality High quality Industrial Industrial demand export demand Export * Based on difference between domestic production and domestic consumption

9 Expected external trade in 2009 (in 1000 tonne) source: Eurostat (Extrapolated from July/August) Exporter Importer Recorded by Exporter Total EU extra trade No records (start in 2012) Recorded by Importer 1,742 Canada NL No records 419 USA NL 412 USA Belgium 220 Russia Sweden 159 Canada Belgium 66 Russia Denmark 61

10 Expected EU internal trade in 2009 (x 1,000 tonne) Source:Eurostat (extrapolated from July/August) Exporter Importer Recorded by Exporter Recorded by Importer Total EU intra trade 2,690 1,779 Austria Italy Estonia Denmark Lithuania Denmark Germany Spain Latvia Sweden Latvia Germany 109 No records yet Latvia Denmark 89 23

11 Logistics Supply of pellets Storage pellet plant Way of transport Contracts Quality standard Bulk power International pellet plants Bulk DH&CHP European pellet plants Average: 2,500 to 5,000 tonnes per plant Ocean shipping, etc Sea coasters Longterm contracts (up to 2 yr) and additional purchase spotmarkets General criteria Company specific Residential heating (bulk & bags) Domestic production plants Average: 2,500 to 5,000 tonnes per plant Lorry transport Annual deliveries (1-5 tonne) Lorry & pr cars Incidental Purchase (15-25 kg) Detailed strict criteria; country specific standard (Ö-norm, SS187-, DIN+, UZ)

12 European harbors: major hubs for international pellet trading

13 Feedstock Pellet Distribution production Supply chain analysis Costs of pellet supply to the end user Primary energy inputs within Pellets the pellet supply chain Case 3 All cases Purchase All cases Avoided GHG emissions compared with fossil Own fuels production Bulk power both bulk & external Cases plants 2 & 3 Low quality both bulk & Combined Case Sawmills 1 Case 2 bags Integrated pellet mill Logs bags (case 1b) feedstock Train transport bags Bags heating; Bulk heating 3 typical pellet chains: Bulk power heating Bagging Drying with 1: Domestic Chipping bulk pellets for district heating Drying Sweden, with replacing natural Storage heating gas & oil 2: Domestic pellets in bags for residential renewables (case 3b) heating Italy, replacing Handling natural gas 3: Canadian bulk Wet pellets for power (Dry) Export harbor Truck transport productionwet in the Netherlands, (Dry) replacing Pre dryed sawdust shavings coal sawdust shavings 1. Feedstock All cases both bulk & bags Purchase external Sawmills feedstock Case 2b Cases 1 & 2 Own production Integrated pellet mill Transport Cases 2 & 3 Bags heating; Bulk power Milling Handling retailers Pressing & cooling 2. Pellet production Combined Private car feedstock transport Low quality Logs (case 1b) Combined feedstock Drying with renewables Low quality Pre dryed Handling & Wet (Dry) sawdust shavings Wet Removing (Dry) feedstock sawdust shavings Milling Bags & bulk Case 2b Logs (case 1b) fines Storage feedstock Pressing & Transport cooling heating at pellet Handling plant & Combined feedstock Handling & Pellets storage pellet pant Cases 1 & 2 Removing Storage Bags & bulk fines Low quality Handling & heating Pre treatment Logs (case 1b) Storage feedstock Handling & at pellet plant Energy plants storage pellet pant Chipping All cases both bulk & bags Pellets Drying with natural gas (case 3b) Ocean shipping Storage & Handling imprt harbor 3. Distribution Case 1 Bulk heating Pellets Truck transport Inland river shipping Handling & Storage Energy plants Case 2 bags heating Bagging Handling retailers Private car transport Pre treatment Case 3 Bulk power plants Train transport Storage & Handling Export harbor Ocean shipping Storage & Handling imprt harbor Inland river shipping

14 Typical prim. energy inputs 9 Typical wood pellet heating value: GJ LHV /tonne Handling & storage power plant Inland river transport Primary energy input (GJ / tonne pellet delivered) wet sawdust small logs wet sawdust pre dried shavings biomass drying natural gas drying 1: bulk pellets heating 2: small bags pellets heating 3: bulk pellets power Handling & storage import harbor Sea transport (by traders) Handling & storage export harbor Transport private cars Handling & storage retailers Transport of pellets by train Transport of pellets by truck Bagging of pellets Removing fines Handling & storage pellet plant Conditioning, pelletizing & cooling Milling (incl chipping) Drying Handling & storage feedstock Transport feedstock Purchase feedstock sawmill More information: Sikkema et al., 2009, BioFPR, forthcoming

15 Typical GHG emissions 350 Handling & storage power plant Inland river transport GHG emissions (kg CO2 eq / tonne pellet delivered) wet sawdust small logs wet sawdust pre dried shavings biomass drying natural gas drying Copernicus 1: bulk Institute pellets heating 2: small bags pellets 3: bulk pellets power Research Institute for Sustainable Development heating and Innovation Handling & storage import harbor Sea transport (by traders) Handling & storage export harbor Transport private cars Handling & storage retailers Transport of pellets by train Transport of pellets by truck Bagging of pellets Removing fines Handling & storage pellet plant Conditioning, pelletizing & cooling Milling (incl chipping) Drying Handling & storage feedstock Transport feedstock Purchase feedstock sawmill More information: Sikkema et al., 2009, BioFPR, forthcomgng

16 Avoided GHG emissions GHG of wood pellets GHG of fossil fuel option 92% 84% 97% 97% 82% 81% base case sawdust additional case chipped logs base case wet sawdust additional case pre dryed shavings base case drying with renewables additional case drying with natural gas Avoided emissions (kg CO2 eq per ton pellet) More information: Sikkema et al., 2009, BioFPR, forthcoming Bulk pellets district heating (heating oil) Pellets small bags residual heating (natural gas) Bulk pellets for power production (coal)

17 Typical delivered WP costs Costs per tonne pellet delivered to end user ( /tonne) : bulk pellets for heating 2: bagged pellets for 3: bulk pellets for power heating Handling & storage power plant Inland river transport Handling & storage import harbor Sea transport (by traders) Handling & storage export harbor Transport private cars Handling & storage retailers Transport of pellets by truck Transport of pellets by train Bagging of pellets Removing fines Handling & storage pellet plant Conditioning, pelletizing & cooling Milling (=standard grinding) Drying Handling & storage feedstock Transport feedstock Purchase feedstock sawmill Data from , No profit margins included. More information: Sikkema et al., 2009, BioFPR, forthcomgng

18 Barriers for wood pellet trade 13 Main barriers for pellets trade Number of answers (2 per respondent) Competition for feedstock Lack of policies for large-scale pellet use (cofiring) Lack of policies for small-scale use (residential heating) Workshop results, Utrecht, June 2008 High investments for pellet stoves Lack prices & traded volumes statistics Competition with natural gas, coal, Sustainability criteria

19 Barriers for wood pellet trade 7 Logistical challenges 6 5 Number of answers Development of pellet terminals Development of loading/unloading equipment Advanced treatment options (e.g. torrefied pellets) Prevailing high (long distance) ocean shipping rates Workshop results, Utrecht, June 2008

20 Drivers for wood pellet trade Main drivers for pellet trade 12 Number of answers (2 per respondent) Increasing oil prices Increasing CO2 prices Policies for heating/chp application Policies for large-scale electricity production Workshop results, Utrecht, June 2008

21 Future demand prospects (1 EJ = J) Gross Energy Cons. RES (EJ) In % of GEC Wood pellets (mln tonnes) In % of GEC Situation EJ % 0.1% - Co-firing 2 - Heating 4 Potential future pellet use in 2020 (75 EJ) 15 20% 2.9% - 15% co-firing based on J. Hansson (2009) % heating oil based on consumption in 2004 (Eurofuel) transport fuel p.m. p.m.

22 Discussion Historical pellet trade (until 2008): rough estimations New trade statistics Eurostat: intra EU export import (for various reasons) Stock changes industrial bulk pellets (power) considerable Barriers: Feedstock scarcity & policy Drivers: Oil prices and policy Future demand vs available feedstock global markets

23 Discussion (continued) Pellet markets are getting more & more mature: Feedstock of pellets will be diversified (logs) Strategic pellet stocks for heating as well One European quality standard CEN/TS, ISO Creation of price indexes for pellet markets

24 Thank you for your attention! Dank voor uw aandacht! Merci bien pour votre attention!

25 7. More information? Websites: Forthcoming publications: R. Sikkema, H.M. Junginger, W. Pichler, S. Hayes, A.P.C. Faaij, The international logistics of wood pellets for heating and power production in Europe; Costs, energy-input and greenhouse gas (GHG) balances of pellet consumption in Italy, Sweden and the Netherlands. Accepted with minor changes by BioFPR, Nov R. Sikkema, H.M. Junginger, M. Steiner, W. Hiegl, A.P.C. Faaij, European wood pellet markets for heating and power production, manuscript in preparation, Nov

26 European markets Sub deliverables: Report pellet market 2008 (= presentation HFA) Draft article pellet market 2009 (submission in 2010) Consumption (Source import = production & export 2009: + import database export Eurostat) +/- Δ stock Differences 2009 and 2010 situation: Spain, Hungary, Bulgaria; Greece: no major exporters (Eurostat preliminary trade figures: export is neglible) Poland: major market is large power companies Denmark: major market: medium scale CHP & DH Finland: pellets mainly exported; within Finland optimal distances (<100 km) for sawdust transport

27 End users Country specific # Storage end users Intermediate Actors Market characteristics Power plants NL: 2-4 power plants Harbor silo or on site: 200 Kton 10 Kton International traders Pellets in bulk Medium scale DH Sweden: 10 to 20 plants On site: Up to 500 tonnes Intern. & domestic traders Pellets in bags Small users (Residential heating) Austria: 63,000 boilers & stoves Italy: 700,000 stoves Residential stoves & commercial boilers: Ca. 1 to 40 tonnes (bulk); kg (bagged pellets) Bulk via domestic trader Bags via retailer s shops

28 Marginal costs (pellets versus coal) Fuel Equal O&M costs Extra capital costs 0,120 Power production costs (in per kwh) 0,100 0,080 0,060 0,040 0,020 0,000 Cofiring pellets Imported coal low Imported coal high Case 3 Electricity production

29 Marginal heating costs (pellets versus fossil fuels) Fuel O&M costs Capital costs 35,00 30,00 25,00 20,00 15,00 10,00 5,00 0,00 Bulk pellets Heavy fuel oil low Heavy fuel oil high Pellets in bags Natural gas low Natural gas high Productioncosts (in / GJth) district heating residential heating heat