Developing Markets for Wood Pellets & Torrefied Wood, Pt 2

Biofuels Digest
August 13, 2012
A two-part series in which Digest contributor Tim Sklar looks at where the wood pellet and torrified wood markets are headed.
By Tim Sklar

In Part I, here, we looked at the Current and Projected Market for wood pellets and torrified wood, plus Biomass Procurement, co-firing, CO2 tax policy, and risk mitigation strategies. Our series today picks up with purchase agreements, sustainability concerns and more on the economics.

WP Purchase Agreements and Other Contracting Issues

One utility representative presenting at the Summit explained in some detail the sustainability standards certifications that his company uses as part of their “Standard” biomass procurement contracts. He also had mentioned the audits that his company is subjected to by Government officials to determine CO2 savings offsets that reduce the amount obtained from sale of the credits issued them for WP they use in lieu of coal. As TW was not discussed, it would be safe to assume that CO2 credits earned on using TW would also be subject to audits and possible offsets. This is a further complication when trying to determine a TW price that is acceptable to all.

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