Energy consulting firm launches new company for wood fiber sales

By Katie Fletcher | October 31, 2016

Aeon Energy Solutions Inc.—a multifaceted sales, marketing and energy consulting firm—recently announced the launch of United Fiber Supply & Development Associates LLC to absorb the marketing and selling of the fiber products line of business previously promoted and sold through AES. This leaves AES the ability to remain focused on hard equipment sales, which includes its torrefaction and wood sanitation equipment lines.

In the very recent past, AES had been shouldering both the fiber side of the company’s business model as well as the equipment side, but now they are split into two entities, according to Joe Majka, president and CEO of both.  “Aeon Energy has separated our advanced torrefaction equipment and wood sanitation equipment lines from our clean fuels and fiber products, bringing these clean fuels to domestic and international markets,” he said. “Worldwide demand for cleaner fuels to meet regulatory and consumer demands has allowed Aeon to split our marketing resources into distinct lines of business to ensure effective and efficient delivery of these renewable, green energy products and our advanced clean tech production equipment.”

UFSDA’s focus is on the renewable fuels sector centered on production derived from various biomass feedstocks, including torrefied (black) fuel pellets, white wood fuel pellets, woodchips-fuel grade, whole logs, railroad crossties, lumber, and sourcing and supplying forest manufacturing or sawmill residuals used in these types of products.

Since UFSDA’s recent launch its made a few announcements including its offering of torrefied and white pellets as well as woodchips to Japanese and Korean markets. Currently, the European market is soft for pellets, Majka noted. “The commercial pellets that are out there right now, they’re all on a contract basis—they’re spoken for—spot market prices are so depressed that not too many people are interested in operating in the spot market at this moment,” he said.

On Europe’s residential market side, Majka noted that what the season will bring in regards to white pellets is still unknown, so keeping that in mind, they chose to look toward Asia. “Japan and Korea, but especially Japan, have shown in the past six to 10 months or so a large increase in their interest in torrefied pellets,” Majka said. “For the past several years, they’ve been pretty established in white commercial pellets for their power stations, but the movement is definitely a foot now.”

Majka added that based on what the company hears from power generating stations and large suppliers in those countries, “torrefied pellets is becoming the commodity of choice for fuel to power generation stations. That led us to put a little bit more emphasis on Japan and Korea at the moment and we think those are more than emerging markets.”

According to Majka, there is great potential for a lot of players coming out of North America. He said although competition is keen, it’s only keen with companies that have the technology available to produce that kind of product, and there is “definitely room for more if they can either get the technology by buying the equipment or manufacturing their own form of technology,” he said.

Another announcement UFSDA made is its offering of heat-sanitized woodchips to the U.K., Belgium, Germany, France and other potential buying countries. Currently, UFSDA’s activity with sanitized woodchips is primarily delivered to the company for the European market by Maine Biomass Exports Inc. UFSDA is the exclusive direct global agent for MBE, which was established for the purpose of processing woodchips for combined-heat-and-power (CHP) generation and MDF uses, in accordance to EU Phytosanitation standards.

MBE CEO Arthur House has been developing a processing facility for the woodchips in Stockton Springs, Maine. He expects full operation, what MBE calls “turnkey,” for the $21 million heat treatment facility by the end of 2017, and to begin shipping overseas out of the Port of Searsport by the first quarter of 2018. “The only reason that we’re not doing it sooner is because our buyer is not ready to start taking shipment until that time, otherwise we’d be building now,” House said. According to House, the buyer is a large Belgium company, and MBE is currently negotiating its second contract with them, which would start delivery in January 2019. “We have 600,000 metric tons of heat-treated biomass under contract to start shipping first quarter of 2018,” House said. One 300,000-metric-ton production line is scheduled to come online at the end of 2017, and the next at the end of 2018.

Majka serves as an independent consultant of MBE, and AES is supplying the equipment for the woodchip processing facility. AES partnered with Konza Renewable Fuels to provide its torrefaction technology to project developers, like House.

Konza’s torrefaction technology is based on Thompson Dryers dehydration experience based in Topeka, Kansas. Konza has been running a research and development pilot-scale torrefaction system in Healy, Kansas, for the better part of a decade, and it can produce up to 1,500 pounds per hour of torrefied biomass from green biomass. They’ve now developed their flagship 100,000 metric ton per year system they call the Wapiti. The Wapiti will be able to produce torrefied biomass with a higher heating value of approximately 22 gigajoules per metric ton or 9,500 Btu per pound at a rate of 12 metric tons per hour.

Portuguese company AFS has purchased a full-size Wapiti capable of producing 100,000 metric tons of torrefied material per year. Currently, the system is being fabricated in Kansas and constructed in Portugal to supply AFS customers with biocoal.

AES recently announced that Konza was also selected as the base torrefaction technology for Western Wood Development LLC’s torrefied pellet product production. WWD is based in Northern California and was created to address growing demand in Japan and Korea for high-quality, industrial-grade pellets and second generation torrefied wood pellets.

“There scheduled production will hopefully begin in early 2017 on the West Coast for torrefied,” Majka said. “We act as a sales agent for that particular entity.”

Overall, Majka hopes UFSDA’s torrefied pellet handling will continue to grow over the next few years. Next year, the company is looking at 100,000 metric tons, due to the time it will take to build infrastructure to produce the product. In 2018, Majka said they’ll be looking at an additional 200,000 metric tons. The following year, another 300,000 tons’ capability, and by 2020, if every goes well, about 700,000 metric tons minimum. “We’re only looking at one facility in 2017 in the U.S. and then we’ll see where it goes from there,” Majka said. “In western Canada we’re looking at two facilities, one in 2017 at 100,000 tons and one in 2018 at an additional 100,000 tons to service a domestic client there for torrefied pellets.”