Forest Feedstock Supply Chain Challenges for a New

Creating forest sector solutions
www.fpinnovations.ca
Forest Feedstock Supply Chain
Challenges for a new Bioeconomy
Denis Cormier, FE, M.Sc.
VCO meeting, Oct. 2010
Burning questions concerning forest feedstock :
How much is out there?
What is the accessible and sustainable
supply?
Is there enough?
Where is it located?
In what form is the biomass?
How can it be recovered?
How much does it cost?
Outline
Forest-origin biomass:
 Drivers and constraints
 Sources
 Factors affecting quantity
Feedstock Challenges and Opportunities
Traditional Hog Fuel Supply Chain
Limited number of fixed locations (sawmills)
Relatively homogeneous supply
 Low value mill waste streams
Simple logistics
 Predictable quality and quantity
 Ready-to-burn form
 Routine purchase agreements, budgeting, etc.
All-season supply
On-highway haul
Demand > Offer
Forest-origin Biomass Supply
Drivers
High volumes potentially available
Provide new business opportunities
More volume to offset fixed
harvesting costs
Improve forest health and offset
reforestation activity costs
Produce a new revenue stream
(carbon credits and bio-products) for
forest companies
Forest-origin Biomass Supply
Constraints
Increased complexity:
 Multiple locations of various sizes
 Numerous suppliers
Linked with sequence and dispersion of
conventional harvest
Increased exposure to seasonal variability
affecting quality (MC) and volume
Greater regulatory requirements
Forest Biomass Sources
Harvest residues*
Under-utilized standing trees*
Sortyard/chipping terminal debris*
Early thinnings and “fire-smart” treatments
Stumpwood
Energy plantations
Non-productive stands
Burnt and insect-killed stems
*operational in Canada
Roadside Harvest Residues
Low-hanging fruit
• Already at roadside or landing
• Currently treated as waste
• Spending money to get rid of it
or to take it back to the cutover
Roadside Harvest Residues
• Grinding improves the
bulking factor for
transportation
• Pre-piling or integrated
delimbing to improve:
 Grinding efficiency
 Drying
 Contamination
Cut-to-Length Residues
 Change harvest method from the residues placed in
the trail to placed beside the trail
 Challenge for protection of advance growth systems
 Potential disturbances by another machine entry into
cutover
Cut-to-Length Residues
Forwarding is the most
popular handling system
in the Nordic countries
 Major advantages of
integration with
harvesting
 Appr. 20 $/odt not
integrated
Harvest Residues
Other potential treatments
Bundling
Compaction in
containers
Mobile chippers
Chipharvester
Single-tree Selection or Shelterwood Cuts
Methods for partial cut
residues in development
 Interesting potential
when no market for
hardwood pulp
 Difficult to extract big
tops without damaging
residual stand
Non Commercial Species or Undersized Trees
Under-utilized standing
trees
 Low impact in integrated
operations
Early thinnings and “firesmart” treatments
 Biomass market for
undersized stems
 Do not expect to cover
operating costs
Energy Crops and Salvage Cuts
Energy plantations
 Terrain selection and
distance can help
reducing the total cost
 Buffer in total supply
basket
Non-productive stands,
burnt and insect-killed
stems
 Similar to a regular
harvesting operation –
with similar costs
Stumpwood
Stumps
 Possible but not on the radar in Canada
 Many other available sources with less
controversies
Forest-origin Biomass Sources
- potential vs. recoverable volumes
Total Biomass
Economically
Viable ?
Technically
Usable
Potentially Available
Forest-origin Biomass Sources:
- factors affecting quantity
Degree of utilization (species harvested, topping diameter,
merchantable products extracted) – variable with market
conditions
Regional/local factors: stand and species
specific
Harvesting system employed (FT vs. CTL)
Recovery equipment
(e.g., drum chipper vs. horizontal
grinder)
Access, site conditions, seasonal factors, etc.
Maximum allowable delivered price
Biomass recovery on full-tree site, Kapuskasing, ON
Black spruce stand
Potentially available
50.5 ODt/ha
Roadside slash
32.6 ODt/ha
Recovered biomass
25.2 ODt/ha
Standing residuals
2.5 ODt/ha
Cutover slash
15.5 ODt/ha
Biomass recovery on cut-to-length site
Saguenay, QC : Mixedwood stand
Potentially available
55.8 ODt/ha
Recovered biomass
24.0 ODt/ha
Cutover slash
31.8 ODt/ha
Forest-origin Bioenergy Challenges
Supply accuracy
Financial
Technology
Integration and logistics
Supply quality
Transport
Storage and delivery
Selection of biopathways
Sustainability
Policy
Public perception
Reliable supply and distribution system
Challenges – Supply accuracy
• Lots of biomass around but realistic volumes need
to be established based on operational and financial
constraints
• Models need to be
validated
• No accuracy
figures available
Challenges - Financial
Cost of getting into the business
• High infrastructure and equipment costs
 State of the industry and availability of capital
 Capital costs for a small contractor to get into
the business are very high
• 50,000 ODt contract requires over $2 million in
capital costs and another $2 million in
operating costs
• Sustain or create 11-12 jobs
Challenges - Financial
Feedstock costs account for 45-60% of total
product cost
Total Product Cost
Delivered Wood Cost
~ 50%
Manufacturing Cost
~ 50%
Challenges - Financial
Biomass costs are primarily a factor of
transportation costs
• 40-60% of total delivered cost
Challenges – Financial
• Operational / tactical
planning platform for
biomass supply and
costs
• Integration with
conventional products
and silviculture
operations
• Full system planning
and analysis
Challenges - Technology
• Full-tree systems have a potential cost
advantage but recovery systems for residues
must be optimized
• Comminution technology still in
development
 Low utilization, high fuel consumption
 Not designed for working at roadside
 Sensitive to contamination, truck scheduling and
residue concentration
• Matching system selection to mill
requirements
Challenges - Technology
CTL-debris recovery
systems
• Equipment and
expertise is lacking in
Canada
• Forwarder bunks are
enlarged or modified to
increase payload and
facilitate handling
residues
Challenges - Technology
Adapted or dedicated
equipment for
unconventional
treatments
 Small-wood harvesting
 Energy crops
Challenges - Integration / Logistics
• Biomass recovery operation is often seen as a
clean-up operation
• Coordination with conventional harvesting phase is
desirable but may not always be possible
• Poor integration leads to quality problems
 Debris contamination, high moisture contents,
road-use scheduling, year-round supply of
quality biomass difficult
• Logistics is crucial for hot-logging integrated
operations
Challenges - Integration
Conventional harvest practices affect the efficiency
and quality of the residue recovery operation
 Concentrated vs. scattered debris, contaminates, road access
and snow removal, etc.
Challenges - Logistics
Comminution / trucking
 Balance grinder output and
trucking power
 Properly plan grinding
operation with maintenance,
fueling, moving breaks
between truck arrivals
Challenges - Logistics
Grinding on the ground
 Create a buffer for a better utilization of the
grinders
 Facilitate logistic of chips transportation
 Chips left on the ground (8 -14%)
 Risk of chips contamination
 Additional machinery counterbalance by
higher grinder productivity
Challenges – Supply Quality
Some processes are very flexible in feedstock
supply (combustion) while others require more
specific specifications (bio-chemical
conversion, fermentation, gasification);
Feedstock infeed may dictate specifications
Specifications to address:
 Moisture content and range
 Bark and needle content allowed
 Species mixes
 Size and shape of feedstock
 Contamination: sand, grit, char
 Chlorine (boiler life and emissions)
Challenges – Supply Quality
The customer sets the feedstock requirements
 Homogeneous or predictable quality is always best
+
In general, the larger the scale the lower the quality
demands
Fuel
quality
Boiler size
Increasing specifications increases cost!
Challenges – Supply Quality
• Moisture
 A living tree is wet (>50% water)
 Energy content (MJ/kg) varies by
species and component of the
tree but total variation is only
about 10%
 MC has a much greater influence
on energy value
 Plants should be buying energy
content but it is often not the case
today in Canada
 Delivering a year-round supply
with low moisture content a major
challenge
 Lack of low-cost and convenient
moisture testing methods and
equipment
Firing Efficiency - Gas @ 300 F
100
Summer
Winter
Efficiency (%
90
80
70
60
50
40
30
0
20
40
Moisture Content (% )
60
80
Challenges – Supply Quality
Particle sizes
 Type of comminution
equipment has a
large impact on
particle size
 Long sticks jam feed
augers
 Larger mills have
rehogging capabilities
 Interest in microchip
for pellet markets
Challenges – Supply Quality
Contamination
 Rocks, sand, metal
 Attitude adjustment
(material treated as waste
in past)
 Skidding and running over
residues increases risk of
contamination
 Piling with bulldozer
 Greater wear and tear on
equipment throughout the
supply chain
 Excessive ash content at
mill
Challenges - Transport
A Basic Problem:
Transporting a low-value, low bulk-density material with a high
moisture content over a long distance
 Importance of maximizing payload
Challenges - Transport
•Bulking Factors
Chips
37 %
Bulk
residues
Very short
transport
(< 10km)
20 %
Aligned
residues
Short transport
(< 50km)
30 %
Burnt wood
40 % Full trees
Storage
60%
Challenges - Transport
Distance from cut blocks
 +/- 17 $/odt @ 50 km
 + 10 $/odt @ 100 km
 + 40 $/odt @ 250 km
250 km
Challenges - Transport
•Road standards vs
vehicle dynamics
•Vertical and horizontal
curves
•Grades and traction
•Not all areas logged can be accessed for
biomass recovery!
Challenges - Transport
Satellite Yard
Optimisation
 Transport /
Comminution
• Improve bulking factor
• Comminution at the
mill sometime difficult
(space, noise)
Challenges - Transport
Energy Densification
 It may be more cost effective to convert the feedstock in
the field and transport a denser fuel
• e. g., a mobile biorefinery
Advanced Biorefinery Inc.
New transportation paradigms
Moving Energy
Challenges - Transport




Max. weight = 57,5 tonnes
Max. vol. = 113 m3
Bulking factor = 37%
Payment based on payload (green)
Impact of Moisture Reduction
Wood load
Bw
Load
55%
35%
56%
52%
17%
11%
27%
37%
16.3 tonnes
22.6 tonnes
Impact of Moisture Reduction
Energy Content
Bw
Calorific content
Total energy
55%
35%
12.6 GJ/tonne
15.1 GJ/tonne
20%
57
MWh
95 MWh
Impact of Moisture Reduction
Transport Cost
Bw
55%
35%
* 15 $/green tonne
Transport cost
9.50 $/MWh
5.50 $/MWh
4 $/MWh
More for
water
Emphasis and payment should be on energy
content not GMt
Challenges - Transport
Compensation
 With wet biomass, the van’s maximum payload is




usually reached before volume limit
With payment on a green tonne basis, there is little
incentive to improve practices
Forest suppliers must be compensated for
delivering clean, dry biomass
Deliveries should be based on MWh or ODt
Conventional harvest contractor should be
compensated for handling residues properly
Challenges – Storage and Delivery
Supply delivery requires
process control


Delivery schedules
Storage capacity for
seasonal fluctuation,
etc.)
Stockpiling of supply at
the mill
 Interest charges for paid
deliveries
 Additional value loss
due to dry-matter loss
and potential increase in
MC
 Need of monitoring to
avoid spontaneous
combustion
Challenges – Storage and Delivery
Other factors to consider:
 Noise
 Traffic volume
 Ash disposal
Challenges - Biopathways
• Identify the best use for the local resources
• Traditional and emerging product lines
• Various economic indicators (ROCE, employment, etc..)
Transforming Canada’s Forest Product Industry. Summary of findings from the
Future Bio-pathways Project. FPAC. Feb. 2010.
Challenges - Biopathways
•Economies of scale vs. feedstock costs
Plant gate cost per litre of ethanol, CDN softwood supply
$2.00
Combined
$/litre
$1.50
Feedstock collection
$1.00
Other operating
Capital repayment
$0.50
$0.00
10
100
1,000
10,000
Annual production (m illions of litres)
Source: T. Browne FPInnovations 2009
Challenges - Biopathways
Location
• Supply area
• Available product basket
Competing mills and
usages
Challenges - Sustainability
Sustainable removal levels must be
established
 Particularly for CTL operations, bioenergy
plantation or young stand recovery
 Not practical to recover it all
Prescriptions and removals should be site
specific
•
 Depending upon volume required, stay away
from questionable sites
Adaptive management approach
 Sweden: Guidelines (1986) => Periodic reviews
=> Regulations (2008)
Challenges - Sustainability
Most guidelines are selfimposed in Canada
 often based on soil
disturbances and trafficability
BC
 Set of guidelines for CWD
New-Brunswick
 Canadian leaders
 Restrictions based on Arp
 Return of unused FT residues
back into cutover
Challenges - Sustainability
Planning the
retention
 Biomass flow
tracking tool for
potential vs
technical
availability
 Developing a
new feature to
consider site
sensibility
assessments
Challenges - Policy
Clear policies and incentives for forest biomass
 stumpage and rights to biomass issues
Challenges – Public Perception
Challenges - Reliable supply and distribution
Cheaper energy but necessitate larger
investment
Community and institutional heating markets
need a distribution system as convenient and
reliable as oil
Summary and Opportunities
Bioproduct opportunities based on forest feedstocks
will revolutionize the way we view and manage the
forest
 A new product stream from our woodlands
operations (reduced cost of all feedstocks of the
value chain)
 Opportunities for previously by-passed stands
 Biomass harvesting can lead to actual increases in
current merchantable volumes
 Silvicultural improvements through biomass recovery
can lead to a more valuable forest
Creating forest sector solutions
www.fpinnovations.ca
Forest Feedstock Program
Researchers:
Luc Desrochers
Charles Friesen
Jack MacDonald
Marian Marinescu
Rick Reynolds
Stuart Spencer
Sylvain Volpé
Program Manager: Mark Ryans
Program Leader: Tony Sauder
Ass. Program Leader: Denis Cormier