Conference: Speakers share supply chain know-how

Posted January 13, 2010, at 8:34 a.m. CST

Lessons learned by feedstock supply company PowerStock in its 12 years of operation can serve as building blocks in developing biomass supply chains anywhere, according to PowerStock CEO Steve Van Mouwerik. He addressed attendees at the Pacific West Biomass Conference & Expo as part of a panel titled Building Reliable Feedstock Collection and Supply Systems. PowerStock harvests and handles about 150,000 tons of biomass feedstock each year, while operating all necessary equipment.

The company, based in the Columbia River Basin in Oregon and Washington, got its start in the Asian Forage Export Industry in 1998 and has long-term relationships with its growers, a crucial element to a successful biomass supply company, Van Mouwerik said. Crops in the basin are varied, allowing for a selection of different feedstocks.

The first step in PowerStock's business model is to control the supply. This is where growers are key, he said. "Give 100 percent service to that grower and that grower community," he said. Accurate inventory at the stack level is also important.

Step two in the company's model is to partner with the demand. Commit early and follow through, Van Mouwerik said. "Before you make commitments to customers, make sure you have commitments from suppliers," he said, adding that it's important to manage the entire process from seed to market. The bottom line of feedstock security is composed of several aspects: grower relations, harvesting, marketing, equipment utilization, proprietary techniques and agricultural economics, he said.

John Shelly, cooperative extension adviser in the Forest Products and Utilization program at the University of California, Berkeley, addressed the available supply of woody biomass in the state. His definition of woody biomass, he said, is low-quality and low-value material. It can come from saw mill residue, landfill diversion, logging residue and slash, dedicated forests and trees killed by fire or disease. Potential uses for that woody biomass include energy, landscape materials and soil amendments. "The list is long as to what that can go into," Shelly said.

More woody biomass is available than what's being used, but the challenge is getting it to the power plants at a low cost, Shelly said. To increase its use for electricity generation, several measures need to be taken, including educating the public on the value of well-managed, productive forests; improving conversion efficiency of power plants; and comparing life-cycle assessments of various alternative energy resources, among others. One problem, however, is that the biomass industry competes with higher-value markets that can use that wood, he added.

But that's not the only problem. "We need an inclusive definition of biomass. Period," said Scott Miller, marketing consultant for Price BIOStock, a feedstock supply service company. Before the Energy Independence and Security Act of 2007, which established a renewable fuels standard (RFS) of 36 billion gallons by 2022, 19 million acres of qualifying biomass existed in California. After its implementation, however, that supply dwindled to 500,000 acres. EISA changed several definitions relating to biomass-derived fuels.

The mentality among environmentalists seems to be, "We'd rather see it burn than let loggers in," Miller said. "And that's killing our forests." Two important lessons to be learned from Miller's experience are that there is very little valueless waste, and that its mainly the location and feedstock flexibility that will determine wood cost, he said.