Progress for Torrefied Biomass Projects 

From the February 2011  Forest2Fuel newsletter.

Following two announcements by Vega Biofuels in the last month, we received a torrent of questions about Vega and torrefaction.
We covered the process of torrefaction as well as its benefits in the April 2009 issue of Forest2Mill . This month, we take a second look to see what progress has been made in bringing torrefied biomass or bio-coal to market.
As we reported in our previous article, torrefied biomass has much to recommend it as a fuel source for both domestic and export markets. Utilities in the U.S. and Europe are especially interested because they are under pressure to burn less coal. Because torrefied briquettes and pellets can be cofired with coal at little or no added cost, electric utilities will be ready consumers of torrefied biomass once it can be produced commercially.
A new article by Daniel Mahr in Power Magazine highlighted the use of torrefied biomass briquettes and pellets in “ Designing Fuel Systems for Large Biomass Plants .” According to Mahr, the benefits of preprocessing biomass in this fashion are these:
Torrefied pellets can be stored in outdoor stockpiles and handled much like coal. They have perhaps half of the energy density of coal, which is a big improvement in comparison to untreated biomass products. The ability to handle and store torrefied biomass much like coal can significantly reduce the capital cost for converting an existing coal-fired plant into a cofiring one.
Mahr also notes that two companies, Integro Earth Fuels, Inc. in North Carolina and Topell Energy in the Netherlands, are moving from pilot stages to building their first commercial facilities. The Topell facility, which is currently under construction, will produce 60,000 tons of torrefied biomass pellets for a power plant owned by Essent beginning in 2011.

While Integro has yet to start construction on their commercial facility, they are making progress on a variety of fronts:

  • They are successfully raising the capital necessary to build the plant, and are in the middle of an $8 million mixed securities offering.
  • They have sent product to at least one European power plant, and the test burns were successful.
  • They are in the negotiation process for a power purchase agreement.
  • They have narrowed down potential sites for the North Carolina plant, all of which have sufficient biomass supply to meet their feedstock requirements on a sustainable and ongoing basis.

Another torrefied biomass facility in the U.S. that has made news lately is HM3 Energy, which has a pilot plant in Troutdale, Oregon. In the last six months or so, the company has received two grants: a $90,000 grant from the USDA for research and a $241,000 award from the US Endowment for Forestry and Communities to continue operations of its pilot plant and purchase equipment for its commercial facility. The company is currently raising the money to build its first commercial facility in Prineville, which is slated for completion by mid-2012. Both Portland General Electric and PacifiCorp have expressed interest in purchasing HM3’s output.
Of all the facilities currently making progress, Vega Biofuels is probably the most questionable. While the company made two announcements at the beginning of February, none of the information provided can be confirmed.
One announcement outlined a change in location from Tifton, Georgia to an unspecified location in a southern Georgia “Free Port Trade Zone.” The release states that the company is “currently in negotiations to purchase” a warehouse in this area. Because the release does not specify the location of the new site, however, neither the warehouse negotiations nor the discussions with local officials (mentioned in the release) about tax breaks and credits can be confirmed. 
The second release reports that the company has signed a supply agreement with The Timber Group LLC. This report cannot be confirmed either. We do know for certain that The Timber Group LLC in question is not the respected timberland management group with offices in New York. Managing Director Mark Wishnee at TTG confirmed that his group had never heard of Vega Biofuels. The Timber Group LLC appears to be a company out of Cordele, Georgia that was organized in June 2010 by Jon C. Brooks. Neither Brooks nor the address listed on the incorporation filings could be identified.
While Vega Biofuels must provide confirmable details of the site and supply agreement before it can be considered viable, we continue to believe that torrefaction has legs. Europe continues to work toward its goal of 20 percent renewable by 2020, and as it does so demand for pre-processed biomass—both pellets and torrefied pellets—will grow. With its superior profile for meeting the energy density and phytosanitary standards needed for export markets and for lower shipping and storage costs, torrefied biomass is likely to gain significant market share as production capacity ramps up. 
 
Additional Stories from the December 2010 Forest2Fuel Newsletter:
Cellulosic Ethanol
SAFER Study on Biomass Defintion
Enviva Gains Traction
BCAP and the Budgeting Process

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