Biomass Commodity Exchange in development

By Erin Voegele
Web exclusive posted July 11, 2008 at 10:55 a.m. CST

Middleton, Wis.-based CleanTech Partners Inc. announced July 9 that implementation of the Biomass Commodity Exchange project is currently in progress.

The company is developing a business plan for the commodity exchange and conducting research to determine the viability of such a project. If the project ultimately proves viable, the exchange could be up and running by late 2009.

The objective of BCEX is to improve the efficiency of the supply chain that provides biomass to the forest products industry and the emerging biorefinery sector. The business plan includes the examination trade in existing woody biomass markets, such as pulpwood, emerging open-loop biomass markets that include forest residue, and the future trade of closed-loop energy crops, such as willow, poplar and switch grass.

Heartland Business Consultants is coordinating the project, which is funded by CleanTech Partner's Biorefinery Development Collaborative, Focus on Energy, New Page Corporation, WE Energies, the Wisconsin Public services and the U.S. Forest Service.

"The biomass industry is in the beginning of a new era across the United States," said Stephen Dinehart, Heartland Business Consultant's president. "Billions of dollars are being deployed to utilize our biomass resources for power generation and biofuels production-advanced and cellulosic. BCEX is the only project that is addressing the efficiency of the markets for that resource base."

Goals for the project include expanding the biomass market by providing a transparent pricing mechanism, reducing the trade costs in biomass commodities for current and future market participants, and encouraging the investment in market infrastructure by communicating current and future prices. The project will also promote the efficient management of Upper Midwest and U.S. biomass resources.

"The biomass commodity exchange will ensure the future vitality of the current forest products industry plus biofuels and biorefineries and will make sure the most efficient, effective market in which to conduct business and trade is possible", said Dinehart. "To accomplish this, we are actively seeking public and trade input to the business plan for a woody biomass commodity exchange."