Learning from Austria’s Biomass Thermal Success Story

Austria’s renewable energy policies and biomass thermal technologies are a model the U.S. could follow in reducing its reliance on petroleum fuels.
By William Strauss | April 28, 2011

In early March in Upper Austria, more than 100,000 people visited the three-day annual renewable home energy show in Wels. The show was complimented with a world-class conference called the World Sustainable Energy Days, where more than 750 experts from 56 countries shared information on how to efficiently heat homes and businesses with renewable energy. 

This year I was honored to be one of the keynote session speakers at the event. I talked about the vision of the Biomass Thermal Energy Council, the Northeast Biomass Thermal Working Group, and several other sponsoring groups. On behalf of these groups, I told the conference attendees about the U.S. biomass heating industry’s vision for meeting 25 percent of the Northeastern U.S.’s heating needs by 2025 with renewable energy resources. This goal was presented to the U.S. biomass heating industry at BTEC’s Manchester, N.H., conference, Heating the Northeast, a year ago. My company, FutureMetrics, was one of the lead consultants for the analysis that is at the core of the paper that articulates the vision. If that vision is achieved, FutureMetrics estimates that it would keep $4.5 billion of Northeast heating dollars from being “exported” out of the region and it would create more than 140,000 new jobs1.

The vision that I presented (more on that later in this article) is nothing new to the Austrians or to many other Western European nations. It is centered upon the use of renewable energy for heating homes and businesses and upon improving the efficiency of homes and businesses so that they require less thermal energy. Many of the presentations at the WSED conference showed how policy and the development of biomass thermal technologies have moved Austria away from reliance on petroleum fuels.

Christiane Egger, the deputy director of the Upper Austria Energy Saving Association, presented a remarkable statistic. Of the new homes built in Upper Austria in 2009, more than 85 percent used modern Austrian wood pellet boilers coupled with solar thermal hot water collectors. The chart labeled The End of the Oil Era? shows the remarkable change from 1999. 

Egger also told the attendees about the three-pronged approach of the Upper Austrian sustainable energy strategy that has achieved such dramatic success. She characterized the policy as using a carrot, stick and tambourine. The “stick” represents legal measures such as emissions and efficiency standards, and a renewable heating mandate. The “carrot” is financial measures such as grant programs, regional research and development programs, and pilot projects. The “tambourine” represents educational efforts, training in the form of free energy advice, marketing campaigns, local energy action plans and a sustainable energy business network.

Only two people from the U.S. were invited to speak at the conference. The other was Harry “Dutch” Dresser of Maine Energy Systems LLC (MESys). Dresser explained about how MESys has emulated the Austrian template in Maine and other Northeastern states. He recounted the history of how MESys has partnered with the most highly respected producer of modern pellet boilers systems, the Austrian company ÖkoFEN. ÖkoFEN and its president, Herbert Ortner, are considered the founders of modern pellet boiler technology and they continue to be the innovative leaders. ÖkoFEN has almost 35,000 pellet boiler systems in European homes and businesses. Ortner’s company also had a large display in the trade show featuring the most advanced, fully automatic and environmentally clean systems in the world. They are as clean and efficient as modern heating oil boilers and, as Les Otten, the MESys principal director who also attended the conference says, the fuel smells like pine trees. Dresser also spoke about how MESys has partnered with another Austrian company that is considered the leading expert in the design and manufacturing of pellet fuel delivery trucks, Tropper Machines and Systems GmbH. The attendees learned that MESys is currently the only company in the U.S. with American Society of Mechanical Engineers certified pellet boilers, and with fully pressurized pneumatic pellet delivery trucks with certified weigh scales onboard. 

But whereas Austria and other Western European nations have a mature market in biomass thermal systems and fuel delivery infrastructure for homes and businesses, the U.S. with companies such as MESys is where Austria was 15 years ago; just starting out.

That is why I presented the 25x25 vision and told the attendees about how critically important it is for the heating oil dependent states to follow in their footsteps.

To illustrate the motive for this vision, I talked about how the Northeast states are uniquely and overwhelmingly dependent on heating oil for home heating. As a result, with the exception of Hawaii, these states, and especially the more rural states with limited access to natural gas, are some of the most petroleum dependent states in the U.S.

Because of the Northeast’s dependency on heating oil, based on heating oil prices in mid-March, more than $16.2 billion are “exported” out of the Northeast economy every year2. 

I told the attendees that because this exported money does not circulate in the local economies, commerce and jobs are lost. We estimate that if the entire $16.2 billion were to remain in the economy, the direct, indirect and induced effects would create almost 950,000 new and permanent jobs. But given the current quantities of sustainable biomass available in the region, the 25x25 vision sets a more modest benchmark. It calls for 25 percent of thermal needs from renewables by 2025, of which about 18 percent would be from biomass systems so as to not exceed the sustainable supply of biomass. That assumes that the current demand for wood from the pulp and paper sector remains constant from now to 2025. In Maine alone, that amounts to 6.5 million to 8 million sustainably harvested tons per year that may or may not be in demand for pulp making by 2025.

Unfortunately, the Northeast remains addicted to heating oil and as the price increases, we export more money and jobs. Beginning with heating oil prices from just a few months ago and forecasting the effect of an increase to $4.50 per gallon, we estimate that the heating oil “tax” will destroy almost 390,000 jobs.

This economic assault is dire in the rural and poorer states which are the most dependent on heating oil because natural gas infrastructure is limited.

The WSED was inspiring for those of us trying to implement an alternative to heating oil in the Northeast. It would seem that we have a situation in these states in which the penalties for not moving away from oil dependence for thermal needs would be sufficient to motivate home and business owners and policymakers to act (a stick). Certainly the fact that energy from pellet fuel is currently about 50 percent of the cost of the same energy from heating oil and is nearly one-third the cost of propane should be a carrot. But it is not sufficient.

What we need are carrot policies that encourage conversion (just as the Upper Austrian government has successfully done). And what is needed even more are tambourines educating people and businesses as to the maturity of pellet boiler systems and the economic benefits of using pellet fuel. There are reliable clean and hands-free technologies that can replace oil boilers here now. But policymakers and the general public have for the most part never heard about pellet boilers; or think that they are primitive and dirty and need constant attention.

Finally, one of the interesting features of the conference was the remote devices that were placed at every seat, allowing periodic instant feedback or voting on questions that arose. Near the end of the conference, after asking the more than 750 experts to vote on where the most growth in the pellet boiler business would be, the Northeast U.S. was the top vote getter amongst the key potential pellet heating locations in Europe, South America and Asia.

Let’s hope they are right.

1The complete vision paper can be downloaded at www.FutureMetrics.com.

2This is based on Energy Information Adminstration data, which shows that 78 percent of every dollar spent on heating oil leaves the region (and many of those dollars leave the country).

Author: William Strauss
President, FutureMetrics LLC