Rubber tree chips to fuel Danish power plant

By Lisa Gibson | October 26, 2011

Danish utility Verdo Group has contracted with U.K.-based Africa Renewables Ltd. (AfriRen) for 750,000 metric tons (826,700 tons) of wood chips over five years, produced from unproductive rubber trees in Ghana, West Africa.

Africa Renewables launched its Ghana supply chain project earlier this year, harvesting redundant rubber trees from the Ghana Rubber Estates Ltd. plantation for chipping and sale to European utilities and energy traders. “The ‘redundant rubber trees’ are trees that are past their prime and are no longer producing rubber sap,” said Sonia Medina, partner and chief operation officer of Africa Renewables. “Biomass extraction is an efficient way of recycling them. The project is fully sustainable as all trees are replaced by GREL.”

The project, located between the GREL plantation and the port of Takoradi, will also include the development of a five-hectare (12 acres) storage depot to house wood chips between monthly shipments, a spare part store and a mechanical workshop. The storage facility can house up to 110,000 meters cubed and shipments are expected to begin in November.

“This is very big news for AfriRen,” Medina said of the Verdo contract. The agreement covers the supply of wood chips to Verdo’s 140-megawatt combined-heat-and-power plant in Randers, Denmark. “The 750,000 metric ton figure is the expected biomass production from Ghana,” she clarified. “Verdo’s own needs are larger than that.”

The plant was converted from coal in 2009 and will only use a portion of the contracted wood chips. “Verdo also expects to trade some of the biomass to other players in the European market, so the rubber wood chips will also hit other countries outside of Scandinavia,” Medina added. Verdo also operates two wood pellet/briquette plants in the U.K.

“We view this agreement as a strategic partnership,” said Kim Frimer, CEO of Verdo. “AfriRen provides us with exclusive long-term sustainable source of biomass which further diversifies our supply chain. It offers us a port [Takoradi] that is open all year round and unlike Baltic ports, which are prone to freezing, allows for exports of much dryer wood chips with higher energy content than those from other parts of the world. Meanwhile we provide AfriRen with our unique expertise to ensure they hit their ambitious growth targets.”