Analysis of the Forest Biomass Value Chain in the U.S. C.T. Smith Faculty of Forestry

1. Analysis of the Forest Biomass Value Chain in the U.S. C.T. Smith Faculty of Forestry University of Toronto Associate Leader, IEA Bioenergy Task 31 & Jianbang Gan Department of Forest Science Texas A&M University Status, Trends, and Future of the South’s Forest and Agricultural Biomass University of Georgia, Athens 30 August 2005

2. Acknowledgements • IEA (International Energy Agency) Bioenergy Task 31 • “Biomass Production for Energy from Sustainable Forestry”

3. Objectives • Review opportunity for a biobased economy • in the South • Describe critical components of sustainable • bioenergy production systems • Estimate potential for forest bioenergy production • in U.S. • Discuss opportunities to make a difference • Stimulate discussions and questions

4. Solar <1% Geothermal 5% Biomass 46% Wind 2% Hydroelectric 46% Biomass Share of U.S. Energy Supply(data for 2003) Source: AEO 2004 tables (released in December 2003) based on US energy consumption. Overall breakdown Table A1 (Total Energy Supply and Disposition), and Renewable breakdown Table A18 (Renewable Energy, Consumption by Section and Source). Slide courtesy Mile Pacheco, NREL, US-DOE.

5. < 5 TWh Recycled wood Forest sector > 50 TWh ~ 3 TWh Imports 0.7 TWh Thinning Residues 4.4 TWh Chipwood 1 TWh By-products 5 TWh Black liquor, Pine oil > 35 TWh Forest energy is important in Nordic countries… Denmark 5, Norway >10, in Sweden and Finland ~25% Source: Björheden, 2004

6. Dominant forest types in NE, NC and Southern states Southern forests – mix of naturally regenerated and planted forests

7. Issues and opportunities facing the South • The South provides 60% of the USA timber supply • Many rural communities are: • richly endowed with forest resources • heavily dependent on forestry • socially & economically disadvantaged • Recent setbacks in pulpwood markets • Urgent need to diversify utilization of forest resources • Potentially large resource of underutilized biomass • small diameter, dense stands • stands posing high fire risk in WUI areas • harvest residues • manufacturing and processing residues • Bioenergy and biobased products are: • timely and viable option

8. If Bioenergy and biobased products are • a timely and viable option, • What is necessary to seize the moment? • Educate key communities of interest about • Resource availability • Sustainable forest management • Harvesting and transport logistics system design • Processing systems • Woody biomass utilization opportunities • Assuming factors key to implementation include • awareness of realistic opportunities • technical knowledge • demonstrated success of business plans • coordination of key communities of interest

9. Critical Components of Sustainable Bioenergy Production Systems Environmental Sustainability Consumer Demand Sustainable Production of Biobased Products Sustainable Forest Operations Manufacturing/ Energy Production Product Delivery Logistics Rural Economic Development Martin Holmer, 2001 IEA Bioenergy Task 31

10. Critical components to sustainable systems • Sustainable resource production rates and value • Quality and volume considerations • Function of supply and demand • U.S. has substantial forest resources • Are sustainable production rates high enough? • Who wants it? What will they pay? • New product opportunities • Bioenergy • Bio-based products • e.g. Fiber & chemicals incl. polymers, pharmaceuticals • Carbon stored in products and forest ecosystem

11. What opportunities exist for increased • bioenergy production in the USA? • Assessment data required includes: • Regional distribution of biomass & logging residues, • e.g. based on most recent FIA data (most recent?) • Spatial biomass density (dry tonnes/ha) • Average logging residue recovery (assume 70%) • Annual rates of productivity • Maximum transport distance (e.g. 100 km) • Biofuel demand by various sizes of power plant

12. Source: Texas Forest Service, 2004 Source: Spatial Science Laboratory, Texas A&M

13. Biomass (dry 1000 Mg) 800 or above (4) 600 to 799 (5) (3) 400 to 599 200 to 399 (10) 0 to 199 (28) Recoverable Logging Residues from Growing Stock

14. Biomass (dry 1000 Mg) 800 or above (21) 600 to 799 (5) 400 to 599 (5) 200 to 399 (2) 0 to 199 (17) Recoverable Logging Residues from Growing Stock and Other Sources

15. Annual Recoverable Logging Residues

16. DOE/USDA Billion Ton Vision Paper Recoverable forest biomass (106 dry tons/yr) 41 Logging & other residue 60 Fuel treatments 35 Fuel wood 106 Forest products industry waste 37 Urban wood residues 89 Forest growth 368 Total

17. DOE/USDA Billion Ton Vision Paper • Annual biomass resource potential • (106 dry tons/yr) • 368 Forest resources • 998 Agricultural resources • 1366 Total resource potential

18. Pathway Link to Resource Base DOE/USDA Billion Ton Vision Paper 1,2 6,7 3 4 “Pathway” Identification Numbers 5 Source: Russo

19. Potential is fine… but is it competitive? • Examine critical points in the value chain • Harvesting and product recovery • Transportation • Logistical and cost considerations • Note progress made in Nordic countries

20. Forest operations Logistical character of forestry Forest industry Tertiary production Points Forest operations & transports Secondary production Lines (network flow) Forest Primary production Areas Source: Björheden

21. Logging slash from precommercial thinning Whole-tree material at roadside ‘Conventional’ forestry Source: Hakkila Logging slash from final harvest

22. Loose residues Source: Björheden Courtesy Tapio Ranta, VTT Processes 2002

23. Bundling... Source: Björheden Courtesy Tapio Ranta, VTT Processes 2002 Source: Kärhä

24. Bundle forwarding – variable load size Source: Kärhä

25. Systems cost comparison, €/MWh... Source Tapio Ranta, VTT Processes 2002 100 km Bundling under development Source: Björheden

26. Conventional Forestry Logging residues Can forest biofuels compete with coal? Eucalyptus Hybrid poplar

27. Price trends of forest fuels in Sweden Source: Björheden

28. Cost competitiveness of using woody biomass in U.S. electricity production

29. U.S. electricity generation cost under various CO2 emission reductions

30. What might enable deployment of bioenergy • production systems using forest fuels • in the USA? • Sustainable high rates of biomass productivity • Competitive biomass procurement and transportation • systems • Competitive cost of capitalization • Local factors may differ… • e.g. forest growth rates, production costs, • skilled labor, affordable capital, efficient equipment

31. For the United States, can we develop regional working models for sustainable production of bioenergy and biobased products from forests?

32. Let’s make a difference • How can focused R&D programs create new opportunities? • Fiber, chemicals, energy, carbon trading (e.g. CCX) • Policy analysis – impact of policy alternatives • at individual forest ownership, regional and national levels • e.g. 2007 Farm Bill analysis teams • Key partners: • State and federal government and agencies, industry, academia, • forest landowners • Can we influence things locally, or do global factors dominate?

33. Sugar Platform Fuels Chemicals & Materials U.S. Department of EnergyEnergy Efficiency and Renewable EnergyOffice of the Biomass Program Advanced Biomass R&D Sugar Feedstocks, Lignin Intermediates Residues Combined Heat & Power Biomass Clean Gas Thermochemical Platform Conditioned Gas Bio-oils Systems Integration = Biorefineries Source: Russo

34. Conversion Pathway Options Under Program “A” Biorefinery Pathway Feedstocks Consideration ( each has a Milestones Partners B Milestone - cost target ) Complete systems level demonstration and validation of all technologies to improve corn wet mill facilities using corn grain feedstock Complete systems level demonstration and validation of all technologies to improve corn dry mill facilities using corn ( and other ) grain feedstock Complete systems level demonstration and validation of all technologies to improve natural oil processing facilities using oil crop feedstock Complete systems level demonstration and validation of all technologies to improve processing facilities using agricultural residue feedstocks Forest Sector Biorefinery Pathways Note DOE “partner” opportunities! Pulp and Paper Mills · New Fractionation Process for • Georgia-Pacific • Agenda 2020 Hemicellulose Removal · Wood · Products from C 5 / C 6 Sugars · Mill · Black Liquor Gasification Wastes · Products from BLG Syn Gas Forest Product Mills • None · Wood · Pyrolysis Oil Upgrading · Mill Wastes · Biomass Sugar Production · Products from C 5 / C 6 Sugars Forest Residues · Logging • None · Products from Lignin Residues · Biomass Gasification · Fuel · Products from Synthesis Gas Treatments · New Fractionation Processes · Products from New Process Intermediates · Non-Forest Wood Wastes Biomass Sugar Production • None · Products from C 5 / C 6 Sugars · MSW & · Products from Lignin Urban · Biomass Gasification Wood · Products from Synthesis Gas Wastes · New Fractionation Processes · Products from New Process Intermediates Source: Russo

35. Critical Components of Sustainable Bioenergy Production Systems Environmental Sustainability Consumer Demand Sustainable Production of Biobased Products Sustainable Forest Operations Manufacturing/ Energy Production Product Delivery Logistics Rural Economic Development Martin Holmer, 2001 IEA Bioenergy Task 31

36. Thanks!