TRADE OF SOLID BIOFUEL, AND FUEL PRICES IN...

EUBIONETEUBIONET - - European European bioenergy bioenergy networksnetworks 11

TRADE OF SOLID BIOFUEL, AND FUELTRADE OF SOLID BIOFUEL, AND FUELPRICES IN EUROPEPRICES IN EUROPE

Eija Alakangas, VTT Processes, FinlandBengt Hillgring, SLU, Sweden

Lars Nikolaisen, DTI, Denmark


International trade and fuel prices of solid biofuels

International International tradetrade and and fuel prices fuel prices of of solid biofuelssolid biofuels

� Study was carried out by the AFBnet- Europeanbioenergy network (now EUBIONET) in 1999

� Summary report and 20 country reports published ininternet (http://afbnet.vtt.fi - publications, Task 2)

� European international trade volume is about 50 PJ/a.� Estimated biomass resources 4 500 PJ/a and current

use 1800 PJ/a


FOREST RESIDUES INDUSTRIAL BY-PRODUCTS(sawdust, bark, chips)DOMESTIC FIREWOODWOOD WASTESREFINED WOOD FUELS(pellets, briquettes)PEATOTHER (SRC, straw)

POLAND GERMANY

HOLLAND

BELGIUM

FRANCE

ROMANIA

BULGARIA

UKRAINE

BELO-

RUSSIA

LITHUANIA

SPAIN

PORTUGAL

NORWAY

SWEDEN

FINLAND

KINGDOM

IRELAND

AUSTRIA SWITZERLAND

ALBANIA

MOLDOVA

RUSSIA

CZECH. REP.

SLOVAK REP.

SLOVENIA

CROATIA

BOSNIA - HERCEGOVINA

ITALY

YUGOSLAVIA

HUNGARY

RUSSIA

LATVIA

ESTONIA

DENMARK

UNITED

LUX.

GREECE

MONTENEGRO

NORTHERN AFRICA

JAPAN, TURKEY, HONG KONG,ARAB EMIRATES

BIOMASS TRADE IN EUROPE

CANADA

CANADA

44

Purchase fromwood processing industry

COMPANY WITHDIVERSIFIED ACTIVITIES

• biofuels• wood for industry• energy production

Wood fuelharvesting/bundling/baling/chipping

CONTRACTORS

BIOFUELS

HEAT

HEAT

ELECTRICITY

SawdustBarkChips fromedgings, slabsCutter shavings

CuttershavingsGrindingdust e.g.

Pellet or briquetteproduction(own or licencing)

Briquettes orpellets

LogisticsGlobal positioningsystems

Fuel quality control

CUSTOMER• Municipal CHP plant• Industrial CHP plant

CUSTOMERS• energy utility• industry

Wood chipsStraw balesLogging residuebundles

BiofuelBiofuel trading in large-scale trading in large-scale

Trade basis: energy content and measured properties (€/MWh,€/GJ)

Briquettes orpellets Sacks Bulk

Retailer

GPS

Import of biofuels

55

Purchase fromWood processing industry

ENTREPRENEUR OR

CO-OPERATIVE

TRANSPORTATION

CHIPPING

FUEL HARVESTING

BIOFUELS

EndingsSlabsWood chipsRotten wood

CUSTOMERS• Communities (< 1 MW)• SME

Services

Operation and maintenance

HEAT

Wood chips

Small strawbales

BiofuelBiofuel trading- Small-scale district heat trading- Small-scale district heat

RadiatorsRadiateurs

Trade basis: Heat production (€/MWh,€/GJ)

66

BiofuelBiofuel trading for households, farms etc. trading for households, farms etc.

FUELPRODUCER

=SUPPLIER

BIOFUELS

Logs

Wood chips

Straw bales

CUSTOMERS• Households• Farms

Biofueldatabase

• suppliers• volumes• typicalproperties

ELECTRONIC BIOFUEL MARKET PLACE e-tradeELECTRONIC BIOFUEL MARKET PLACE e-tradeOrder via Internet

LogsPellets

Trade basic: Volume or package basis (€/m3 loose, €/m3 stacked)

Pellet hopper

Flexiblehose 20 m

Most of fire wood is not traded (purchase from own forest or “black markets”)


Why international trading ?WhyWhy international international trading trading ? ?� Surplus or lack of own biomass resources

� Denmark; use of pellets bigger than own production� Sweden; over capacity of pellets� Netherlands; lack of own biomass resources

� Better prices from abroad� In Baltic countries and some CEE countries prices of fossil

fuels are low� poor competitiveness of solid biofuels in domestic market� better price by exporting

� National support incentives boost trading� Big differences in support mechanisms in Europe� Germany; new RES-E act; energy producer can pay high price

for solid biofuels (4-9 EUR/GJ)� CO2 taxes in fossil fuels (Sweden, Denmark and Finland)

� imported fuels may be cheaper than own production


Problems Problems Problems

� No good information on spot markets� no good statistics of biofuel prices and traded amounts� difficult to calculate the influence of different support

mechanisms on fuel price

� Influence on other biomass resource markets� forest industry and energy sector can start competing with

each other for use of wood resourcesthere can be also influence on material recycling

� Biofuel standardisation needed� ongoing work in CEN TC 335-Solid biofuels

99

Local or internationally traded?Local or internationally traded?

� Forest chips and straw are local fuels� high transportation costs (30 - 50% of total cost)� low calorific value per volume (moisture content 50%)� bundling can be integrated into timber and pulp wood

procurement chain � same equipment and logistics managementcan be used in forest haulage and on-road transportation

� straw needs special boilers and bale handling systems

� Refined biomass fuels are more suitable for internationaltrading� high calorific value per volume (3 times higher than forest chips)� homogenous material suitable for pneumatic unloading� production capacity is increasing� can be crushed and used also by cofiring with coal in pulverized

combustion boilers� liquid biofuels for heating (e.g.pyrolysis oil) under development


Transportation costs of logging residues chips€/GJ (Finland)

TransportationTransportation costscosts of of logginglogging residuesresidues chips chips€€/GJ (Finland)/GJ (Finland)

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

0 10 20 30 40 50 60 70 80 90 100

Tranportation distance, km

€/GJ

Logging residue, loose

Chipping at a stand

Chipping at road-side terminal

Bundling of logging residues


Storage space need for different biofuelsComparision with light fuel oil

Storage space needStorage space need for for different biofuelsdifferent biofuelsComparision with light fuel oilComparision with light fuel oil

25

20

15

10

5

01

1.7

8

11

3.2

8.4

11.5 12.511.5

Oil Woo

d pe

llet

Logg

ing

resid

ue ch

ips,

fresh

Logg

ing

resid

ue b

undl

er

Shre

dded

bar

k, fre

sh (p

ine)

Sod

peat

Mille

d pe

at

Stor

age

spac

e, m

/10

MW

h3/

2Coal Sh

redd

ed b

ark,

dry (

birc

h)

Big

stra

w ba

le

19

Logg

ing

resid

ue ch

ips,

dry

Logg

ing

resid

ue ch

ips,

bund

ler

10 MWh = 1 m3 light fuel oil = 36 GJ


ExampleWood fuel prices - €/GJ for DH plants

(1 - 5 MWth) in 1999

ExampleExampleWood Wood fuel pricesfuel prices - - €€/GJ for DH/GJ for DH plants plants

(1 - 5(1 - 5 MW MWthth)) in 1999in 1999

Country Wood chips Bark, sawdust, chips Wood pelletsDenmark 4.50 4.20 5.00Finland 3.00 1.60 7.50Germany 3.70 3.10 6.10Sweden 3.40 2.90 4.80France 4.00 1.10 10.60Latvia 1.60 0.80 3.30


ConclusionsConclusionsConclusions� New directives RES-E, WID and green certificates will

boost trading� More comprehensive analysis of solid biofuel trade is

needed� Development of customs statistics

� tariff nomenclature should to include different biofuels

� Continuous follow-up of biofuel prices� International trading will change

� Sweden from importer to exporter?� Competition between different countries: Germany, Denmark� Effect to forest industry; availability of wood raw material

TRADE OF SOLID BIOFUEL, AND FUEL PRICES IN...

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