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Biomass in the City of Roses

The 2009 International Biomass Conference & Expo drew a record crowd of more than 1,000 people to Portland, Ore., where they networked, shared and absorbed information, and determined how to successfully move forward in the growing biomass industry.
By Anna Austin
The weather in Portland, Ore., may have been glum, but it didn't dampen the spirits of attendees at the International Biomass Conference & Expo, which was held from April 28-30.

From the moment registration opened to the last session, the Portland Convention Center buzzed with excitement.

Prior to the event, 134 attendees participated in an industry tour of three Oregon biomass processing plants-animal bedding and fuel pellet producer West Oregon Wood Products, food residue-to-ethanol producer Natural Energy, and Clean Water Services, a wastewater treatment center that produces power through anaerobic digestion and gas recovery.

During the tour, 133 exhibitors set up their booths on the sold-out trade show floor preparing for the 1,045 people who registered to attend the event. Attendance increased by more than 20 percent, compared to the 2008 conference.

Conference organizer BBI International was pleased with the turnout and is already mapping out next year's event. "The trade show sold at a much faster pace than we anticipated," said Joe Bryan, vice president of media and events for BBI International. "Next year, as the economy improves and demand for biomass power, fuels and chemicals soars, we fully expect to double attendance and the size of the trade show."

Changing the World's Energy Future
At the opening general session, the importance of biomass was emphasized as a solution to ever-increasing energy demands and a way to solve America's dependence on foreign energy sources. In his opening remarks, BBI International CEO Mike Bryan told attendees that while the road to success in the biomass industry may be long and challenging, opportunity is great and the possibilities are endless.

From Bryan's perspective, in the future all biomass technologies may have the potential to be successful to some degree, but some will be on a faster track than others.

Companies in the industry that don't have a well-defined niche may have difficulty knowing how to position themselves. "One of the challenges in the biomass industry is the large variety of technologies-direct firing of biomass, gasification, pyrolysis, anaerobic digestion, fermentation, algae production-the problem is we don't really know for sure, at this juncture, which of these technologies are going to be successful in the years ahead," Bryan said. "But let me be clear on one thing. I believe that when the oil refineries of today are nothing but rusted relics of a past generation, renewable biomass will still be powering our world. Biomass will change the world's energy future, and the wonderful thing about that is it will change it in a way that does not create global conflict."

Oregon Department of Energy Director Michael Grainey reminded the general session crowd of exhibitors, project developers, technology providers, academia and other attendees of the energy challenges the U.S. faces. "In Oregon, we spend over $12 billion a year on energy; half of that is for oil-most of it goes out of state, and much of it goes out of the country. Your state may be similar."

Grainey pointed out that the U.S. imports more than two-thirds of the oil it consumes, which is twice the amount that was imported when the oil embargo drove up fuel prices more than 30 years ago. "While the recent drop in oil prices provides relief, we are all still paying over five times the price we paid for oil just a few years ago," he said. "Oil is the largest cause of our trade deficit, our balance payments deficit, and the single largest cause of inflation."

Major renewable energy initiatives have been developed in Oregon that are especially important to biomass, Grainey said, including an energy loan program which provides loans up to $20 million to cover capital costs of constructing renewable energy facilities. "We have over 30 biomass projects-totaling more than $100 million in landfill gas, cogeneration and biofuel facilities," he said. "We also have two tax credits-a capital investment tax credit called a business energy tax credit and a production tax credit-to encourage biomass use." Oregon also has a renewable fuel standard (RFS) for ethanol which has been in effect for more than a year, and has legislation pending to activate a biodiesel RFS this fall.

Grainey said President Barack Obama and his administration have shown their support for biomass. "Even before [Obama's] campaign, from his remarks you could tell that his belief in renewable energy is deeply felt," he said. "It is encouraging to know that we now have a strong ally at the very top of the White House-we have some fundamental choices to make about our energy future, and obligations to weigh the impacts of our energy choices. Your efforts will decide whether biomass and other renewable energy will play an increasing role in our future, or whether we will continue on a path of increased fossil fuels, increased pollution and increased imports."

Fighting for Legislative Support
Biomass Power Association President Robert Cleaves changed the focus of the general session to the importance of passing legislation that supports the aims and initiatives of the biomass industries. Cleaves spoke directly to the substance of continued energy and environmental policy reform.

"We (the biomass industry) have incredible growth potential," Cleaves said. "By the time our kids are in college, every town in America will be combusting wood, gasifying municipal solid waste (MSW), digesting manure and making biofuels-but let's get real, this is a very hard business."

Cleaves said the current focus of the BPA is to urge the government to provide a correct set of incentives to make the biomass industry and those involved successful because in the end, subsidies-whether outright subsidies such as production tax credits, or carbon tax credits-are what will make the industry move. "Without biomass, this country doesn't stand a prayer for meeting its renewable energy goals," he said. "If you look at the potential of biomass as a base-load, carbon-neutral alternative fuel to coal, things get really exciting."

Cleaves referenced a study recently brought before the U.S. Senate Energy Committee, which indicated biomass gives the "biggest bang for the taxpayers buck" in replacing carbon. "The study said if you look at wind, it has a 30 percent capacity factor and if you consider a 30 percent capacity factor with the 2-cent production tax credit (PTC) that it gets, it costs the taxpayer $12.28 per ton of carbon removed," he said. "Geothermal costs the taxpayer $7.74 cents, and biomass is close to $3 per ton [of carbon removed], at 1 cent for the PTC. For every dollar spent on a PTC, biomass removes four times the amount of carbon for the same dollar spent on wind. That's not to say that wind is not an important technology in meeting our renewable energy goals, but it does highlight the fact that there is something wrong with this situation."

Defining Biomass
So with all of this potential, why is the biomass industry unable to realize faster growth, greater support and better traction? "The answer is complicated, but I think it has a lot to do with failed government policies," Cleaves said. "Let's look at federal policies-we have no uniform definition of biomass, or what is considered renewable, or what is considered advanced technology. These terms are applied disparately among the states, and inconsistently at the federal level."

Cleaves pointed out there is no uniform definition for biomass, which varies in the Farm Bill and the Federal Transportation Bill, which are both at odds with the U.S. EPA definition and the U.S. Department of Defense definition. "It tends to be somewhat comical," he said. "Biomass should be a simple concept. If you look at the internal revenue code, you find a simple definition. It says essentially, biomass is organic material other than fossil fuel."

As a nation, the U.S. can't decide which technology it likes or dislikes and why, which causes incredible confusion in the marketplace and for developers, according to Cleaves. "Quite frankly, it's mess," he said. Take New England for example, Connecticut encourages combusting urban wood waste and New Hampshire bans it. Massachusetts bans combusting MSW, Maine excludes it from its renewable portfolio standard and Connecticut provides renewable energy credits for it."

Cleaves pointed out the lack of neutrality in the current energy tax policy, describing the internal revenue code as a "mish-mash of incoherent, irrational credits with largely no basis in economics or sound environmental policy." "On the whole, biomass is not well-treated," he said. "Every time we go to the Congressional meetings, we are told, ‘We don't really understand why you only get a half-credit; that must have been an oversight by congress.' We know it wasn't an oversight, because in the end, what it came down to is that there was only so much money to go around and industries with the largest lobbying teams won."

From Cleaves' perspective, in order to excel, the biomass industry needs to succeed in the next era of environmental energy policy expenditure. "The BPA is hard at work crafting a legislative solution to be successful in that fight," he said. "This industry needs to fight for every scrap that it is given, and it needs to be heard, well-organized and well-funded."

One of the BPA's main goals for the future is focused on the preservation of what the industry already has by extending the production tax credit for existing facilities, which expires at the end of this year. "If we let the production tax credit expire for existing facilities, then we will never restart plants that are currently shut in places like Maine and California," Cleaves said. "It will put many plants at risk of shutting down."

Besides extension of the current tax credit, Cleaves said the industry must also fight for what it doesn't have. "There is no policy justification for biomass being the one-half credit technology," he said. "If this country is really serious about renewable energy, it needs to pony-up. For too long, renewable energy technologies have lived in an uncomfortable coexistence-where they all are producing green power, but chasing a limited pie."

The 2010 International Biomass Conference & Expo will be held May 4-6 in Minneapolis.

Anna Austin is a Biomass Magazine associate editor. Reach her at aaustin@bbiinternational.com or (701) 738-4968.
 

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