canadian wood pellet industry update g murray epc.pdf · wood pellet association of canada 12 ....
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European Pellet Conference 2011
Gordon Murray, Executive Director
March 3, 2011
Canadian Wood Pellet Industry Update
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Outline
• Canadian pellet production
• Existing markets
• Distribution
• North American market situation
• New market focus: Republic of Korea
• Torrefaction project
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Canadian annual pellet production capacity as of January 1, 2011 – tonnes
Wood Pellet Association of Canada 3
Plants Average Largest Total %
Western Canada
16 118,000 400,000 1889,000 71%
Eastern Canada
18 43,000 120,000 774,000 29%
All of Canada
34 78,000 400,000 2663,000 100%
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Canadian pellet shipments – tonnes
Wood Pellet Association of Canada 4
2010 2011F
Europe 1,350,000 1,750,000
North America 90,000 90,000
Japan 60,000 100,000
1,500,000 1,990,000
*estimates only – Statistics Canada does not track wood pellets as a separate product and producers are reluctant to share data
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Overseas Pellet Distribution Chain
• Pellets loaded on rail cars or truck at plant site
• West: rail to Vancouver or Prince Rupert
• East: truck to Belledune or Halifax
• Unloading and temporary storage at terminal
• Pellets loaded on bulk carrier
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Canadian pellet shipping routes
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European markets for Canadian pellets
Wood Pellet Association of Canada 7
• Belgium – power generation
• The Netherlands – power generation
• United Kingdom – power generation
• Denmark – power/district heating
• Italy – residential heating
• Canadian market share in Europe ~ 15%
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North American Market Situation
• GHG reduction is not a top political priority
• No political or industry support for biomass energy in US or Canada
• Pellets can’t compete with low natural gas and coal prices
• Pellets are cost competitive only in areas not served by natural gas
Wood Pellet Association of Canada 8
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Market focus: Republic of Korea
• Rapid economic growth
• World’s 10th largest energy consumer
• 5th largest crude oil importer
• 2nd largest coal importer
• 64% of electricity is thermal
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Electricity generation by type
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Korean Coal Consumption is Growing
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Korean coal consumption (2008)
• Power generation: 64 million tons
• Steel mills: 58 million tons
• Total: 122 million tons
• Co-firing 5% with wood pellets would require 6 million tons of wood pellets (assuming 1.5 tons pellets per ton of coal)
• Equals 3 times Canada’s current capacity
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Korean GHG strategy
• Nov 2009: announced 30% reduction from projected level by 2020
• Sep 2010: announced 374 companies must meet government GHG reduction targets
• RPS for power generation: 2012 – 2%
• Increase ½% annually until 2020 – 10%
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WPAC torrefaction project • 2010 – review of 50+ technology
providers
• Ranking and technology selection
• 2011 – capital raising and plant construction in British Columbia
• Target 5 tonnes/hour – 30,000 tonnes/year
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Thank you!
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