Answering the Question

Seven major European utilities, working to help producers satisfy a blend of varying sustainability requirements, establish the Sustainable Biomass Partnership.
By Tim Portz | May 21, 2015

European Union member states are united in their commitment to growing their share of renewable energy as a means of driving down carbon emissions across the continent. The Renewable Energy Directive, established by the European parliament in 2009, set a binding target of 20 percent of final energy consumption in aggregate coming from renewable sources by 2020. The levels of in-place renewable production varies from country to country so each received their own goal, which achieved, will deliver the EU to its total goal. The goals vary widely and Sweden’s goal is the largest at 49 percent. This directive has been a boon for renewable energy producers and technologies in all categories, wood pellets included. The United Kingdom’s goal is 15 percent by 2020, an ambitious undertaking considering the U.K. had among the lowest percentages of renewable energy deployments in Europe when the directive was established at 1.5 percent. It didn’t take long for utilities, regulators and policy makers to realize that if those targets were to be met, transitioning large base load power stations from nonrenewable inputs to renewable inputs like wood pellets was going to have to be a part of the plan. The concept gained momentum, taking root in other countries, some with a well-established history of cofiring and global pellet production took off. As conversion plans began to take shape, regulators, NGOs and the general public began to ask for assurances that these conversions would, in fact, deliver the intended results and drive down overall carbon emissions. Sustainability requirements soon followed and it is here that the EU’s unified approach ends. What emerged was a patchwork of varying certification requirements and schemes that utilities and producers alike say inhibit efficient trade.

Development Time Line
In 2013, seven of the leading utilities in Europe took action forming the Sustainable Biomass Partnership with the stated goal of working to “enable an economically, environmentally and socially sustainable solid biomass supply chain that contributes to a low-carbon economy.” The end game for the SBP is to develop a certification scheme recognized within all pellet-buying countries in the EU, and potentially beyond, which reduces the drag the industry is already feeling, the multiple definitions of sustainability that have already emerged in the marketplace.

Working with a small group of stakeholders, the SBP developed a first draft of the scheme in March 2014 that it called the Biomass Assurance Framework Consultation Draft which was made public and open for public comment.

“We had a public consultation, a stakeholder consultation, which was open to all,” says Peter Wilson, SBP executive director.  “We had lots of responses, over 110 pages worth once we consolidated all of them. We did have a coordinated, combined response from the environmental NGOs and that was hugely valuable. So that has helped us get to where we are, which is this robust set of standards.”

After closing the comment period, the SBP refined the consultation draft and in September of 2014 published the Biomass Assurance Frameworks Standards version 0.0, meant to be a working beta version that could be introduced to a wider group of stakeholders and solicit further comments. “In this first version of the SBP framework, we involved and engaged with a lot more stakeholders,” Wilson says. “Most notably we included other supply chain operators like resource managers, forest owners and biomass producers. All of them have been invited to our development meetings to ensure that we are developing a standard which is practicable, which can be implemented while being as robust as possible.”

This further refinement resulted in the first working framework, the SBP Framework version 1.0, which was released at an event in Brussels in late March. This version will serve as a working version which biomass producers will be encouraged to participate in and member state policy makers will be asked to accept as a means of satisfying their sustainability and carbon reduction requirements. At the event, SBP chairman and Drax Group CEO Dorothy Thompson said, “We are encouraged by the interest that representatives of the EU Institutions have shown in the SBP and its Framework, and we look forward to working with them and other interested parties to make this a truly multistakeholder approach."

How It Works
From its outset, the SBP has been clear that it is not seeking to replace existing forest certification schemes like the Forest Steward Council, the Sustainable Forestry Initiative and others. In fact, the SBP has been built to leverage these existing certification schemes whenever possible. Still, these existing certification schemes fell short of the emerging requirements regulators in Europe were asking utilities, and by extension their biomass suppliers, to comply with.

Simply put the SBP Framework is a certification scheme that contains 38 indicators of sustainability that an independent third-party auditor will verify are being successfully met. Where the SBP differs from other schemes is in its ability to recognize that for producers within a given region, the risk of not meeting one or even many of the indicators is quite low. In these situations, the indicator is recognized as low-risk and the third-party verifier moves on. To illustrate, SBP technical director Simon Armstrong points to the indicator that prohibits child labor. “There is no risk of that in the United States or Canada because of existing employment laws, so you could just assess that as low risk on a regional scale,” he says.  “You can simply say there are extensive regulations around child labor. So for operators in Canada or the United States, there is no need to go and check their employment records.” The risks that will be deemed low-risk are likely to vary from region to region. In early pilots conducted in the Baltics, 35 of 38 indicators were deemed low-risk. The SBP hopes this ability to hone in specifically on only those areas where there is a specified risk will result in the more efficient uptake of the scheme and reduced costs for producers.

The SBP is clear that one of the goals of the certification process is to provide producers with a platform to raise the transparency of what they do and how they do it with an occasionally wary and suspicious public. “Someone said recently that biomass doesn’t have a sustainability problem, its got a transparency problem. That’s quite an interesting concept,” Armstrong says.
The SBP process concludes with producers making a summary of their third-party assessment publicly available. “One aspect of this is that when you’ve performed your risk assessment correctly, you’ve engaged enough stakeholders you should be confident you haven’t missed any big risks,” says Armstrong. “You want to be in a position that when you are making the summary publicly available, you don’t have a stakeholder saying you never gave us an opportunity to comment on this process. Finally, you certainly don’t want to be in a position where a stakeholder says we made you aware of a particular risk and you never did anything about it. This is about stakeholders having the opportunity to comment.”

Recognizing that producers may see this as simply a means to give their biggest opponents a platform to interrupt their business, the SBP is quick to point out the framework has been built to deflect these criticisms and provide a pathway for producers to put unfounded allegations to rest. “You don’t have to reach a consensus with these critics, you don’t have to reach an agreement,” says Armstrong. “But you have to demonstrate that you’ve taken aboard their comment and if it falls within the scope of the SBP requirements, the 38 indicators, that you’ve done something about it.”

Getting Certified
To participate in the SBP Framework and get certified, producers will need to engage a third party verifier to conduct an audit. Thus far, the SBP has accepted nine third-party certifiers as applicants that are actively progressing towards SBP approval. Ann Arbor, Michigan-based NSF International was the first North American certification body to be granted applicant status by the SPB.  NSF International will leverage deep experience in certifying both primary and secondary manufacturers in the forest sector and strong institutional experience with greenhouse gas verification to win certification contracts in the pellet sector.

“NSF International has completed its first SBP audit of a major biomass producer located in the southeast,” reports Norman Boatwright, manager of NSF International’s forestry programs. “The witness audit report is in the process of being completed and will be sent to SBP for approval. Once this is complete and SBP finds the audit and the audit report compliant with its standards and expectations, SBP will be able to approve NSF International as an official certification body.”

It is the hope of the SBP that existing momentum and progress with certification schemes and certifiers can speed the rate of uptake and approvals throughout the industry. “The standards have been deliberately structured to align with FSC and PEFC and other certification schemes,” says Wilson.  “If an auditor is coming to do an audit for FSC, PEFC, SFI etc., they will come with their checklist and then there will be additional questions on top for SBP. So the intent is an auditing team can come and they can tick off multiple schemes at one time. It was deliberately designed like that not only for the biomass producer but also for the certification body.”

This certainly aligns with NSF International’s thinking and, Boatwright adds, “NSF International currently certifies several biomass producers, all of which will likely require SBP certification. We are in the planning stages with several other biomass producers to determine the best way for them to become certified. Ideally, SBP audits should be conducted in conjunction with the other Forestry Program audits to reduce disruption to their operations as well as save time and costs.”

Finally, the SBP is quick to point out a major distinction between their program and other certification programs. The SBP certification does not bring with it a licensing fee or a production-based fee. Producers will have to pay third-party verifiers like NSF International, of course, and Armstrong allows that other nonsubscription costs should be expected but that the design of the SBP framework should keep those to a minimum. “The costs of certification schemes don’t come from the audits so much as they do in the changes to their management system,” he says.  “I think that is the crux of why this scheme is quite smart. Because we don’t go down the route of requiring the same level of effort for each indicator irrespective of risk.

Path Forward
The plan now is to let producers, certifiers and regulators get familiar and comfortable with  SBP Framework version 1.0 over the course of the next 18 to 24 months, enabling all parties as the SBP website puts it “to learn by doing.” The SBP is planning on robust engagement with a broad swath of stakeholders and anticipates releasing a more informed and refined version of the framework, version 2.0, in 2016.

The biggest question left to answer is whether SBP certification will satisfy European regulators. These efforts are ongoing and, by necessity, are happening at a country-by-country level. Knowing that without regulatory buy-in the Framework would fail, the SBP built it with an eye to the requirements already put forward by the regulatory bodies. “The standards have been built around the U.K. and the Dutch requirements,” says Armstrong. “The U.K. are currently benchmarking SBP to determine if it meets the sustainability requirement.” The SBP Framework may be experiencing the greatest regulatory approval momentum in Denmark. “The Danes have a voluntary agreement between industry and government which was negotiated with industry, government and NGOs and the conclusion that they came to was that if the generators in Denmark are using SBP certified material, then that means that they are meeting their sustainability requirements,” says Armstrong.

Ultimately, if biomass feedstocks are going to make a lasting contribution to the renewable energy targets of not only European countries, but other industrialized nations just beginning their journeys towards reducing greenhouse gas emissions, a system that reduces drag on the market must emerge. Sustainability requirements continue to be a moving target throughout Europe with prospective pellet-buying nations still working to build requirements that satisfy their citizens and policy makers but are also practicable for utilities and their feedstock partners. A harmonized, singular set of requirements seems unlikely and this market reality gave rise to the SBP Framework. The hope now of the SBP, its utility founders and the pellet producers counting on the European market is that regulators will see the logic in one certification scheme with the flexibility to satisfy multiple notions of sustainability.

Author: Tim Portz
Vice President of Content, Pellet Mill Magazine
701-738-4969
tportz@bbiinternational.com