Managing Woody Biomass
The renewable fuels standard will require the production of more than 15 billion gallons of cellulosic ethanol in the coming years requiring millions of tons of biomass. Moving that biomass from the fields and forests will be a logistical challenge. Some companies are gearing up to meet that challenge.
While the grain industry has developed a network over a couple of hundred years enabling it to deliver corn from Dubuque, Iowa, all the way to Abu Dhabi, United Arab Emirates, biomass-based industries such as pulp and paper producers have been sited as close as possible to the biomass source. The economics of hauling bulky biomass such as wood precludes long-distance transport of feedstocks, says Dick Carmical, president of Price Biostock Services, a subsidiary of The Price Companies Inc., which has been part of the timber industry for more than 40 years. Price Biostock was formed to offer a broad range of management and operations technology services to companies involved in the rapid growth of biofuels refineries in North America and abroad. "We are the wood guys," Carmical says. "If a company wants someone to take care of all areas of procurement, delivery and preprocessing and putting the woody biomass on a conveyer belt going into their converter, we can provide everything from that point back."
One of the issues facing the industry is that moving biomass more than 50 miles to a processing facility could take a major bite out of profits. "In today's market, it takes something like 12˝ cents per ton mile to move stuff around or maybe more," Carmical says. "If you move the procurement circle out to 100 miles, adding 50 miles of freight costs, you've just added $6-plus on a green weight basis to the cost of your biofuel. Figuring a 1 million ton per year facility, that's at least $6 million added to your raw material costs." Increasing the distance also makes supplying a biomass plant less attractive to the timber producer. "The producer is just like you or me," Carmical says. "He needs so much money everyday just to pay his bills. If you have him at a distance where he can make three or four loads a day, he has one set of economics. If you stretch him out to 100 miles, then he may only sell two loads a day. You as the consumer are going to have to pay the costs so he can make his living on two loads a day instead of three or four."
This makes the siting process for prospective biomass plants crucial. Other concerns that need to be considered in the site selection process include infrastructure, the type and quantities of biomass that are available on a sustainable basis, and who will be supplying the biomass. Carmical says the latter is one of the most important but underappreciated facets of the biomass industry. "Are we going to have to bring in a work force to do this?" he asked. "Or will we be able to use existing suppliers and are they amenable to the idea of expanding?"
A lot of the potential woody biomass in the United States is located in remote regions of the country. In areas like the Southeast, property rights have been divided and subdivided so that within a certain procurement circle, a biomass company may be faced with making leasing agreements with hundreds of landowners or biomass producers. "It's not like you are going out and buying clay or iron ore," Carmical says. "There is a personal investment in that land by the landowner whose dad or granddad cleared it up. As you go out to harvest that stuff, you have all these personalities involved." That is one reason many companies contract with biomass suppliers like Price Biostock rather than develop their own biomass delivery system. "You can get involved in brouhahas between the landowner and the harvesters. That's where we really earn our keep. We need to keep people happy so we can come back and harvest next time, but we also need to get the product delivered on a timely basis."
Harvesting and transporting woody biomass is an industrial process in itself. Price Biostock specializes in reducing round wood logs into high quality woodchips that can be easily transported by truck or rail to processing plants. This involves huge equipment that can move 50-foot logs around like matchsticks. Obviously, this equipment requires a tremendous investment and highly skilled operators. It isn't an investment a biofuels producer should take lightly.
Carmical says he expects the first generation of cellulosic biofuels plants will get their biomass from existing suppliers using existing equipment. As the industry develops, manufacturers will start to develop equipment especially to harvest biomass for biofuels. "They will wait until they see if biofuels is an ongoing industry or just a little hiccup," Carmical says.
When working with a new processor, Price Biostock will determine if there are existing suppliers that can furnish the needed biomass. "That's our preference," he says. "We will even give them long term contracts to help them feel comfortable expanding. We know that if we just demand they gear up in equipment and manpower, we will just be driving the price up." The company also analyzes alternative sources of biomass in the area. "We go after the low hanging fruit, the cheapest BTU (British thermal unit) across the scale," he added.
Wood waste from existing processors and construction debris are some examples of alternatives. The availability of alternatives depends on the type of process being used to produce biofuels. Thermochemical processes such as gasification have more latitude in feedstocks than processes based on enzymatic hydrolysis.
A supply chain is only as good as the roads and rails it moves on. Carmical says it is important to bring local officials on board early in the planning process to address any upgrades needed to keep the trucks moving safely and efficiently. If needed improvements are not in place before the trucks begin to roll, it may be harder to get them done down the road. "Normally, most of the biomass is in rural areas," he says. "Most rural areas are struggling so they will be very happy to see you, so those issues can usually be dealt with up front. But they do need to know it up front."
With dozens of deliveries being made daily, liability is a huge concern when moving woody biomass. Carmical says any business needs to make safety a top priority regarding both personnel and equipment. "We've been in business long enough to know that if we aren't safety conscious, we won't be in business long," he says. "We have to be safe both for the public and our own people. That's just a fundamental part of our business." Price Biostock drivers attend mandatory safety meetings and receive safety bonuses. "They hear about safety until they are tired of it," he adds. "It always surprised me as a young manager that you had to work to keep a man safe. They don't recognize there are things they have to do for their own good." All Price Biostock trucks also carry a toll-free number so drivers can report any unsafe activity. "I'm proud to say we get about as many people calling to compliment us on how our drivers work, as complain."
Wood burns and it contains energy that can be converted into biofuels or electricity, which makes it valuable. It also makes it a potential hazard when thousands of tons of woody biomass are gathered in one area. There are solid fire codes already in place that will make biomass processing facilities as safe as possible, as long as those codes are followed, Carmical says. Some of the steps include keeping only enough biomass on-site that's necessary for current production, implementing and following safety plans and cooperating with safety regulators when they do inspections. "We call those the checker guys who make sure we are applying proper procedure to everything we do," he adds.
Supply and demand
Because of the complexity of handling and transporting biomass, Carmical thinks a good percentage of cellulosic ethanol companies will eventually opt to contract with a company such as Price Biostock to develop their supply systems rather than create a supply chain from scratch. "I think there will be some that do both," he says. "There is some misinformation out there that makes people think biomass is like a chemical or something that will show up on order. Biomass is unique with the headaches due to weather and seasonality. Just like the pulp and paper industry found out when it moved to the U.S. South, sometimes it is best served by someone who specializes in that field."
Biomass startups often neglect the fine details of procurement until they get close to breaking ground. Even then, at times it's not the processor but the investors in the project that want assurances that there will be a smoothly operating supply line for the plant. "The investors aren't satisfied with the answer, ‘We'll take care of it.' That's when companies like ours will get the call," Carmical says.
One example of something a new entrant into biomass processing might not be aware of is the seasonality of wood harvesting. Carmical says that in the Southern forests, there are periods during the spring when timber harvesting ceases. This is done to preserve the forest soil from being torn up by heavy equipment when the ground is saturated. "The forest industry has adopted what are called best management practices," he says. "We voluntarily don't harvest during wet periods so we don't rut up the woods and track mud on the public roads. You have to take that into account and maybe store more inventory on-site. Companies need to be prepared to have a lot of flexibility."
Carmical sees a parallel between the petroleum industry and the future of the biomass industry. "When you look at oil and gas, nobody talks about refineries and pipelines. The discussion and buzz is always on the exploration, the development of the raw material. I think exactly the same thing is going to happen with biofuels. After we start getting the issues of technology addressed, the race will be for the biomass to make the product."
Jerry W. Kram is a Biomass Magazine staff writer. Reach him at firstname.lastname@example.org or (701) 738-4962.