B.C. forestry company looks to profit from wood waste

Clean Capital News

BY MAURA FORREST

October 2, 2014

British Columbia will be home to two new wood pellet plants in 2015, in Fort St. John and Chetwynd.

Canfor Corporation, a Vancouver-based forestry company, announced plans last week to build the plants at two of its sawmill sites in northern B.C. The facilities will convert sawmill waste to wood pellets and will produce about 175,000 tonnes of pellets each year.

Some of these pellets will be sold through a long-term agreement with a power utility customer. The rest will be used to generate on-site electricity to help power the Canfor operations. The initiative has received funding from a BC Hydro Power Smart program that pays “for the development and installation of clean or renewable on-site generation that displaces electricity otherwise supplied by BC Hydro.”

“We are pleased to continue our strong partnership with BC Hydro on renewable energy, and contribute to the province’s goals of sustainable power generation,” stated Canfor’s president and CEO Don Kayne in a press release.

British Columbia is already Canada’s largest wood pellet producer, according to the Wood Pellet Association of Canada. In 2012, Canada’s 42 pellet plants had a total annual production capacity of three million tonnes, generating $208 million in exports. About two-thirds of that capacity is in B.C.

The province’s wood pellet industry is continuing to grow, in part because of the ongoing mountain pine beetle infestation that has killed huge swaths of pine forest, rendering them unsuitable for lumber but usable as biofuel.

Wood pellets were initially used mainly for home heating. But these days, they’re being used more frequently as a replacement for coal in power plants. Most of Canada’s wood pellets are exported to the European Union, which has committed itself to more than 20-per-cent renewable energy usage by 2020. Demand for the pellets from Europe is growing steadily. 

Burning wood pellets is widely considered to be carbon-neutral, since the carbon emissions would be released anyway if the wood were allowed to decompose naturally. Moreover, emissions are offset by planting new trees that draw carbon dioxide out of the atmosphere.

However, some argue that burning wood pellets is not as environmentally friendly as it seems. It can take decades for forests to regrow and take up significant amounts of CO2 after having been logged. Also, the transportation of wood pellets from Canada to Europe has a substantial carbon footprint.

Concerns have also been raised about reductions in air quality from particulates released during the pellet production process.



Photo Credit: Rick Payette