The Sustainability Standoff

Commercial forests in the Southeast are owned by millions of private individuals and families who are currently struggling to see the value in taking on the cost of certification.
By Tim Portz | June 05, 2017

Three or four years ago, a producer remarked to me that the pellet business was really a very simple business. “It’s a feedstock business,” he said. “You buy some feedstock, add some value to it by densifying it, and then sell it for a premium that pays for that densification and leaves a little profit,” he said. Written here, the true spirit of his comment is not conveyed, however. The twinkle in his eye that day suggested it would be folly to think of this business as simple, precisely because it is a feedstock-dependent business.

The story I wrote for this issue of Pellet Mill Magazine reveals why feedstock management is anything but simple, and outlines the kind of complexities my producer colleague held in his mind when he was teasing me about the simple nature of this business.

The two other stories in this issue point toward a feedstock complication of an entirely different nature, one that emerged with the rise in the cofiring of wood pellets in power stations in Europe. Ron Kotrba’s page-10 story, “Stimulating Sustainability Certification in North America,” explains the latest chapter in the story of certifications European pellet buyers are requiring from North American producers.

Despite urgings by other European power providers and the industry in North America, the Dutch government has decided that, in order for power produced from pellets to qualify for SDE+ reimbursement, the pellets burned must be certified to a standard satisfactory to them. Ultimately, Dutch policymakers want to see certification of wood pellets reach all the way back to the parcel where the materials were harvested from, instead of the regional assessments available to producers in other certification schemes.

The enormity of this challenge cannot be overstated. Commercial forests in the Southeast are owned by millions of private individuals and families who are currently struggling to see the value in taking on the cost of certification, particularly when they feel strongly that their forests are managed sustainably now, certified or otherwise. Further, selling wood fiber to pellet mills is just one aspect of most private forest management plans, and is certainly not the driving economic force. Kotrba’s story makes it clear the ongoing debate about feedstock sustainability in the U.S. is far from settled. The Dutch, he finds, are doubling down on certification of feedstock as a foundation to any state support for biomass cofiring.


Author: Tim Portz
Vice President of Content & Executive Editor
tportz@bbiinternational.com