USIPA conference opens with an eye on new leadership in UK

Harold Arnold, USIPA Chairman and President of Fram Renewable Fuel opened the 5th Annual Exporting Pellets Conference in Miami by suggesting that wood pellets were not a commodity, but instead a “specialty fuel with every increasing requirements.” Arnold continued by contrasting current marketplace conditions with those from one year ago when conference attendees last convened, including the first conservative majority in the British Parliament in nearly two decades. 

Arnold then turned the conference stage over to a panel that provided an assessment of the current market for wood pellets and demand trajectories looking into the coming decade. John Bingham, director at Hawkins Wright, opened the discussion and drew attention the newly installed conservative majority which, with full control over energy policies since 1997, is already reigning in investments in renewable technologies. Bingham noted that Parliament has already removed the exemption from a climate change levy that had been afforded renewable producers since its passage in 2001.  Additionally, Bingham reported that the government intends to end subsidies for onshore wind by April 1, 2016. Bingham offered that the conservatives could very well enjoy a majority for at least a decade as the labor party seems to have “imploded.” Still, he offered that the conservatives will likely “want to meet their carbon commitments at the lowest cost,” which bodes well for biomass co-firing but wondered aloud “if they’ll have the budget available to do it.” Bingham concluded by noting that changes in currency valuation have resulted in a 15% increase in the cost of wood pellets for those buying with euros.

The morning continued with a panel comprised of pellet buying European utilities. Deborah Keedy, head of biomass procurement at Drax Power, told the audience that despite significant amount of political uncertainty Drax was committed to “keeping biomass on the energy radar in the U.K.” Keedy continued by reporting that a third unit is under conversion to biomass inputs and will likely come online in October. Further, Keepy said that Drax is committed to the conversion of a fourth boiler so long as some form of government support is there for it. The conversation continued to focus on the role that subsidies play in the transition away from fossil fuel derived energy. “Without any subsidies, we (utilities) wouldn’t convert any coal plants to biomass,” said Martin de Wolff, head of biofuel trading at RWE Supply and Trading. Panelists continued by stressing the relative affordability of biomass co-firing or conversions when compared to other renewable, low-carbon energy sources. “Biomass to energy is the only technology that can deliver large scale carbon reductions governments are looking for,” said Peter Thomsen, vice president, DONG Energy Thermal Power. 

The morning concluded with a discussion of sustainability and the continued hope that the Sustainable Biomass Partnership (SBP) would be able to establish itself as a single source of certification that producers could use to satisfy all of their European buyers. Keedy said simply, “We are very clear at Drax that we want all of our producers to be SBP –certified by 2016.”

The lunch keynote was given by Chuck Leavell, a forest landowner and the keyboardist for the Rolling Stones. Leavell compared the collaborative nature of rock and roll bands with the collaboration required in industries, saying that the aims of the larger group should supersede the aims of its individual members.

The 5th Annual Pellets conference continues through Tues., Sept. 22, in Miami.