Market Development of Refined Biomass - OPET Sweden

Summary
Within the bio-energy area, OPET Sweden have prioritised the provision of detailed information and the demonstration of bio-energy plants, infrastructure and trade possibilities for the more refined types of biomass fuel. The aim has been to make the target groups aware of the opportunities linked to this energy source.

The overall objective of our work on refined biomass is to facilitate the replacement of oil in the heating sector and also to increase electricity production from biomass. Our activities have facilitated the conversion of two 150 kW boilers from light fuel oil to wood pellets, instigated a connection between two Czech pellet producers and a Swedish utility and contributed to an increased awareness of the current technology and trade status of refined biomass amongst participants.

In particular:

• Market actor lists have been produced for 11 countries
• Fact sheets (8) have been produce showing good examples from several countries
• A joint seminar with a study tour and two bi-lateral workshops was arranged

The results were an increased transfer of knowledge and direct contacts between market actors involved in the sales of pellets and equipment. The market in Europe is developing extremely fast, and the potential for industrial development and value added business is large. The need for product quality assurance is important and will be a focus of future work.

End-user area	Industry Planning issues User behaviour
Target audience	Decision makers Households Local and regional authorities Property owners Utilities
Technical scope	Biomass Heating

Context
The increased utilisation of biomass for energy purposes is an essential component of activities to realise greenhouse gas mitigation and the fulfilment of the Kyoto Protocol, and the objectives outlined in the Green Paper on security of supply. In addition, the Campaign for Take-Off stated an objective of realising 1,000,000 dwellings heated by biomass.

Refined biomass, in the form of wood pellets, has the potential to overcome the current obstacles through the standardisation of fuel and technology, and the achievement of low emissions, high fire safety and cost efficient transport systems. Pellets look set to become a major fuel in the future. The market for wood pellets and attached technology has increased rapidly during the 1990s, but only in specific European regions and countries such as Sweden and Austria.

In order to ensure that the potential of wood pellets is realised, it is necessary to ensure that quality is guaranteed. In order to achieve quality assurance in equipment, fuel and handling systems, as well as open competitiveness and environmental aspects, co-operation between market actors such as researchers, trade associations and end-user groups is essential. This co-operation can only be initiated when information asymmetries and barriers have been reduced.

Objectives
The overall aim of this work package is to enhance the uptake of refined biomass. This will help phase out oil in the heating sector, especially for small scale users (<1 MW). It will also be possible to increase the use of renewables for electricity production in large CHP plants by replacing coal by refined biomass (e.g. co-firing). This will be done by:

• Increasing knowledge about the status of refined biomass in countries with a well developed infrastructure, etc. in the field of biomass utilisation, technology development status, market actor status, etc.
• Increasing knowledge about the need for information and contacts in countries in development phase concerning production, distribution and use of refined biomass.

Process
The project was divided into several tasks:

• A list of market actors that supplies the market with the relevant services and products will be extended to a more marketing oriented format, and also receive input from countries not participating during the previous OPET year. Increased knowledge on supplier etc will help facilitate a better competition within Europe, and make it easier for people to know where to ask for help concerning technologies (and services).
• Seminar/technology transfer meetings: In order for stakeholders to get to know each other and making technology transfer more probable, meetings were arranged. In this task, an Austrian seminar was arranged in Salzburg in November 2001.
• A survey of best practice projects was performed in new participating OPET countries, and there will be a continued activity to find best practices in OPET countries participating previous OPET year. These were collected in fact sheets and disseminated throughout the OPET network in standard format (developed last year). The format is good enough for colour printouts (hardcopy) for marketing purposes during meetings, workshops, etc., as well as in pdf format, for publishing on the web.
• Bi-lateral technology transfer meetings were arranged in order to find joint venture possibilities between market actors.

Actions
- Workshop
- Seminar
- Brochures and Project Advises

Financial resources and partners
The project budget was € 20,450 and was supported by the European Commission through the FP4 Programme. The work was carried out during the course of one year. The partner consortium consisted of participants from the following countries (within the OPET network):

• Sweden
• Denmark
• Austria
• Finland
• Germany
• Italy
• Slovakia
• Slovenia
• Bulgaria
• Romania
• Estonia
• Czech Republic

Results
The project leader was OPET Sweden. This report will therefore summarise the results from all partners, with Swedish activities explicitly mentioned.

As described above, the work largely involved summing up the status of activities in all participating countries, as well as trying to find good examples from countries with extensive experiences and transferring this knowledge to those with less. The work done on identifying market actors in 2002/2001 has been transferred to a more promotional-oriented format. This was also done with the fact sheets produced.

A seminar was arranged in Salzburg on 7 November 2001, in conjunction with the 2 nd European Round Table conference on Wood pellets. The OPET seminar was arranged for the OPETs as a working meeting, in which also the status for the development of refined biomass was presented for each country. A study tour was arranged, in collaboration with the municipality of Salzburg and OPET Austria. The tour was successful in showing good examples from the area, including pellets/solar installations. Many of the participants also attended the 2 nd Round Table conference.

Two bi-lateral workshops were also arranged; one between Austria and Finland, and one between Bulgaria and Sweden. Participation included transfer of knowledge, as well as direct meetings between market actors. The Swedish-Bulgarian workshop held in Sofia in March 2002 resulted in direct connections made between Bulgarian and Swedish market actors, and questions relating to purchasing briquette machines were transferred from Bulgarian to Swedish market actors for bi-lateral discussions.

In addition, a lot of work has been done to improve statistics and to facilitate bilateral and multilateral projects. The market is developing extremely fast and quality control systems are essential. This has been discussed in the work, and in a more extensive way in the European forum developed between leading countries.

Direct conversions of oil boilers to pellets are not always easy to establish in the short time span of an individual EU project, particularly when the focus is upon information activities. However, in Estonia one of two 150 kW boilers was converted from light fuel oil to wood pellets. The total investment of the project were 40,000 Euro, energy consumption - 620 MWh/y and CO2 emission reduction - about 153 tonnes per year (estimations).

A connection was developed by OPET Sweden and the Czech OPET office in Budweis between two Czech pellet producers and a Swedish utility in need of pellets. This was done during a period of cold weather in Sweden, where shortage of pellets made the sales departments of the utilities look outside Sweden for pellets. It resulted in offers, and whilst a change of weather and production availability made pellets available in the domestic market, the OPET network proved strong enough to overcome market obstacles at short notice and capable of promoting international collaboration.

Lessons learned and replication potential
The market for pellets is large in some countries in Europe (e.g. Sweden, Denmark, Austria) and developing fast in others (e.g. Finland, Germany). The potential is very large and, as a dense form of wood, it can be transported over Europe if the price is right. The OPET network is important for the future in order to maintain the good relations between the countries and to provide a continuous information point to enable connections to be made.

The project has resulted in another EU-project, entitled 'Pellets for Europe '. The main aim of the project is to support the development of the European pellet market, stimulating the use of clean, high quality biomass pellets for heating and CHP-production in Europe. To realize the general objectives, the project group will identify barriers, disseminate information and initiate promotion activities. Project work take place in close cooperation with local market actors and regional pellet networks will be established. In order to disseminate the information developed a website has been constructed, which displays price and market statistics, a data base of market actors (steadily growing due to online registration) and national contact information. Hotlines have been established for Germany, Denmark, Finland, Sweden, Austria and south Europe and networks of market actors in Sweden, Slovakia, Upper Austria, Bavaria, Bulgaria/Romania, Tuscany, England and in Spain have been initiated.