Wood pellet industry creating confusion

ASHEVILLE — A relatively new yet rapidly growing industry that makes wood pellets to burn for energy in place of coal, with production mills proposed in Western North Carolina and Upstate South Carolina, is generating heat of another kind – confusion.

Critics believe the little-known industry's rapid growth will damage Southern forests, the environment and quality of life. Industry proponents say wood pellets are a sustainable form of energy that burns cleaner than coal and can strengthen rural economies by adding jobs.

A recent report by the Natural Resources Defense Council, in cooperation with the Asheville-based Dogwood Alliance, highlights the fact that Southeastern forestlands are being cut and industrial manufacturing plants are being built in the United States to create wood pellets primarily shipped to Europe.

“It’s an exploding market. Wood pellet exports, with potential to open a facility in the Upstate and WNC, to be shipped out of Wilmington, North Carolina, we’re going to see this ever-growing hunger for trees,” said Scot Quaranda with the Dogwood Alliance, an environmental conservation nonprofit that focuses on Southern forests.

“It’s not the kind of high-quality wood product that WNC is known for. They’ll take everything they can get their hands on, meaning an impact on endangered species and forests, landowners converting to plantations so their land can be harvested more quickly, and increasing in toxins and water quality. It seems like the sky is barely the limit for this industry.”

The technology has been around since the 1990s, but Quaranda said the first wood pellet “mega mill” was built by Enviva, a Bethesda, Maryland-based company, in 2008 in Cottondale, Florida. Shipping to Europe out of Panama City, Florida, the plant produces 650,000 tons of wood pellets a year.

In 2009, fewer than 1,000 tons of wood pellets were being produced in the U.S., Quaranda said. Today, there are more than 5 million tons of pellets being produced.

The report released in October by the Natural Resources Defense Council, a 45-year-old environmental action nonprofit headquartered in New York City, says there is an imminent threat from the mushrooming wood pellet industry on three fragile forest ecosystems in the Southeast.

GIS mapping techniques detail three hot spots – the Virginia-North Carolina border, Southeastern Georgia, the Alabama-Mississippi border – where potential heavy wood harvesting from unprotected bottomland hardwood forests and established and proposed wood pellet facilities exist. The report also identifies a fourth emerging hot spot in Louisiana.

“Endangered forests across the South are in the crosshairs of a wood pellet industry that is not sustainable,” said Debbie Hammel, senior resource specialist with Natural Resources Defense Council.

“This mapping provides the undeniable visual proof of the threat wood pellet production poses to the South’s irreplaceable wetland forests. We need permanent protections in place today to ensure they’re not destroyed.”

Produced in conjunction with the Conservation Biology Institute, the report contains a series of maps of the South where more than 24 million acres of unprotected wetland forests are susceptible to becoming fuel for existing and proposed wood pellet mills across the region to meet the demand of European biomass energy facilities.

The data shows the geographic overlap, using a potential 75-mile radius sourcing area, between the region’s unprotected forests and existing and proposed wood pellet facilities, demonstrating the pressures on forests within their potential harvesting territory. Those forests provide habitat to rare and endangered species, filter freshwater for surrounding communities and act as a buffer against flooding and sea-level rise.

Wood pellet facilities buy wood from landowners in the form of trees or residues and grind them up into pellets people could burn in their wood stoves, Hammel said.

“But these pellets are destined for big power companies in the European Union. They are putting them on ships, to cross the Atlantic," he said.

Science points to the fact that cutting down a tree, grinding it, and burning it to produce electricity, releases carbon into the atmosphere, Hammel said.

Wood pellet mills proposed for Upstate, WNC

South Carolina has two wood pellet facilities in operation and three proposed — one by Innova in Edgefield, one by Enviva (the largest wood pellet producer in the United States) in Laurens County, and a third by Drax, a United Kingdom company, in Abbeville County.

Enviva operates two wood pellet plants in North Carolina — one in Hertford County and one in Northampton County — both in the eastern part of the state. Two are proposed for Sampson and Richmond counties.

Verdante Bioenergy Services, a biomass consulting firm based in Lenoir, North Carolina, conducted a study in 2014 to determine the feasibility of a biomass depot at three sites in the WNC foothills – Burke, Catawba and Caldwell counties.

David Waechter, Verdante founder, said the study found those sites suitable for biomass depots, but it would not be economically feasible to ship pellets from WNC to Europe.

“Another thing people fail to understand — no one cuts down a forest to make biomass energy,” Waechter said.

“Biomass is the material that is left behind after timber. The value of saw timber can be as much as 3,000 percent more than the value of biomass. The value of pulp can be as much as 300 percent more valuable than biomass — the branches, the crooked trees, stuff that’s not suitable for pulp market, the stuff that gets piled up or left to rot or burn. I think people misunderstand.”

Since 2012, wood exports from the United States have more than doubled, and they are expected to reach 5.7 million tons this year. By 2020, the region is expected to produce as much as 70 million metric tons, according to the resources defense council report.

“The demand that would be required to power Drax would exceed their total supply of trees. They do a better job of protecting their forests in the United Kingdom than we do in the United States,” Hammel said.

In the South, more than 80 percent of forest land is privately owned, so harvesting is allowed if property owners choose to allow it, Quaranda said.

“We get to live in a little bit of a bubble in WNC because we have so many public lands, but there’s even a study for a pellet mill in Burke County. The (logging for pellet mills) is mostly on private lands," he said. "There have been proposals to do some logging on national forests. If we see an uptick in multiple uses of our national forests where more timber sales are happening, it might happen in our national forests.”

One of the biggest draws and economic drivers in WNC is the forests and forest-based tourism, from hiking and mountain biking to hunting, fishing, backpacking and sightseeing, Quaranda said.

“It creates jobs, but as we move toward extractive industries, the quality of life and communities declines. They’re low-paying jobs, basically liquidating the resources that communities are relying on, for short-term industries,” he said.

The defense council's wood pellet industry study came about because they had been working for many years in the southern United States to protect bottomland hardwood forests, which are unique in the South, Hammel said.

“You find a lot of endangered and critically imperiled wildlife, songbirds, bears, that are found along streams flooded a portion of year," she said. "They provide other services — filter clean water, and flood protection for communities. We decided to do an analysis to see what kind of threat wood pellet plants imposed. We found over 50 in the South included critical habitat for threatened or endangered wildlife.”

Of those 50, 35 are located within the hotpsots and overlap their sourcing area with nearly 15 million unprotected acres of bottomland forests containing 600 threatened, endangered or imperiled species, and more than 18 miles of freshwater river and streams.

“We’re hoping to illuminate that these companies pose a threat to some of the most unique and vulnerable habitat. We want three things: 1. To correct the accounting error saying wood pellets are carbon neutral; 2. Adequate sustainable policies in place to prevent damaging unique woodlands; and 3. We’re asking them to put a cap on the amount of wood pellets that would qualify under their policy,” Hammel said.

The community of Lake James, a 501(c)3 homeowner-focused group in Burke County, recently met to discuss the possibility of a wood pellet plant coming to their county.

Group president George Johnson said homeowners were a little sensitive to learn about a proposed plant.

Burke, Catawba and Caldwell counties are identified for a possible facility, according to a March 2014 feasibility study from Verdanté BioEnergy Services on biomass depot/processing facilities in the western Piedmont of North Carolina.

The Burke County facility would convert the biomass chips into pellets for sale in the United States, with the potential of exporting, according to the study. Pellets can be burned to produce heat or power and also can be used in customized “feedstock blends.”

“This NRDC report gives a big picture of what’s happening with the wood pellet and biomass industry growth on the coast from North Carolina to Mississippi. It looks like it’s going to have dramatic impact on forests in those areas,” Johnson said.

Homeowners on Lake James are concerned about the plants themselves, Johnson said. In other counties, they have increased traffic, caused noise from chipping and pellet operations and created worries about increased truck traffic on curvy mountain roads.

“It would be nice to get a sense of the scale of these operations. In this neck of the woods, people are really sensitive to the views because it’s a tourist attraction,” Johnson said.

Experts say wood pellets better than coal

Kent Jenkins, vice president of communications for Enviva, said the company provides about 2.2 million metric tons of wood pellets to coal-fired power plants in the United Kingdom and Europe, enabling them to cut their greenhouse gas emissions by up to 80 percent.

He said the pellets are made using responsible, sustainable practices that protect American forests, and the plants employ hundreds of people and support community businesses, which is especially important in the rural South, where jobs and economic opportunity are sometimes scarce.

Jenkins pointed to a study published Nov. 16, “Carbon Savings with Transatlantic Trade in Pellets: Accounting for Market-Driven Effects,” conducted by professors from the University of Illinois, the University of Georgia and N.C. State University, showing the greenhouse gas intensity of wood-pellet based electricity is 74 percent to 85 percent lower than that of coal-based electricity.

The study also found that the greenhouse gas intensity of pellets produced using agricultural and forest biomass is 28 percent to 34 percent lower than that of pellets produced using forest biomass only.

The company runs six plants in four states and is building a second company-owned port in Wilmington. A seventh plant in Sampson County is now under construction. That plant, which Jenkins calls a template for other proposed mills, will employ about 80 people there and two dozen at the Port of Wilmington. It is estimated to generate 200 jobs in related fields such as logging and transportation.

He said the Laurens County site under consideration in the Upstate of South Carolina does not have a definite timeframe for construction.

Jenkins stresses that the company, and the wood pellet industry, was founded to focus on renewable energy sources, in order to move away from burning coal.

“From a financial standpoint, the most valuable part of the tree is the very long, straight parts used for telephone poles, then saw logs are used for furniture, then wood used to make durable things like pallets, and finally the last thing left, are the branches, limbs, tops or pulpwood used to make paper. The only wood that Enviva uses is that leftover, low-grade wood,” Jenkins said.

He said the demand for all wood has gone down a lot, partly due to the slump in housing, and partly because of the Internet, with less paper is being used.

“The wood pellet industry accounts for a very small part of commercial forestry in the South. We think the pellets we’re producing significantly reduces the amount of carbon that goes into the atmosphere. We do not only have a good effect on climate, but the way we work does respect and protect forests.”

Jeff Beacham, president of the South Carolina Native Plant Society, based in Greenville, South Carolina, said the wood pellet industry is a complex issue that deserves more time and study beyond the NRDC report.

“The Native Plant Society is one of the stronger conservation organizations in South Carolina. We work a lot with people in the forestry industry. We support silviculture. It’s an important part of our economy and an important part of managing our natural environment,” Beacham said.

At the same time, there is conflicting information from both sides – from the conservationists and from the industry.

“It’s a new facet to our silviculture industry; it’s moving fast. Are we looking at it in a smart way? Is it going to have impacts because it’s moving so fast and there is such a high demand in Europe?

“We need more information from the wood pellet industry and from conservation. It would be great if groups could come together and find common ground — from people who are trying to make money and those who are managing those resources in a sustainable way — it benefits everyone."

To read the full report, "Southern Forests at Risk" by the Natural Resources Defense Council, click here.

For more about Enviva, visit www.envivabiomass.com.

Where are the wood pellet plants:

North Carolina: Enviva operates two wood pellet plants - one in Hertford County and one in Northampton County. Two are proposed for Sampson and Richmond counties, and a feasibility study was done for a plant in Burke County.

South Carolina: Two wood pellet facilities are in operation and three proposed - by Innova in Edgefield, by Enviva (the largest wood pellet producer in the United States) in Laurens County, and by Drax, a United Kingdom company, in Abbeville, County.

Findings from the NRDC "Southern Forests at Risk" report shows:

• 35 proposed or existing mills are located within the identified hot spots;
• Nearly 15 million unprotected acres of wetland forests within a potential 75-mile sourcing radius of facilities, an area nearly the size of West Virginia;
• An anticipated 10 million dry metric tons of production per year for all operating and proposed mills;
• The examined hot spots are home to 606 imperiled, threatened or endangered species; and
• 18,327 miles of impaired freshwater rivers and streams flow within the examined regions, putting the waters at new risk to logging pollution.