Carbon tax and particulates, matters discussed at Pellets 2017
Wrapping up the Swedish annual wood pellet conference, two issues stood out as being of particular importance – carbon tax and particulate matter (PM).
Held annually the two-day national pellet conference took place in Kalmar Castle, one of the most well preserved medieval fortresses in Sweden. Located in Kalmar on the Baltic coast in southeast Sweden, it is an impressive naval defence structure and nowadays partially heated via the city’s biomass fuelled district heating network.
Sitting in a room surrounded by a several metre thick stonewall, the venue was an auspicious reminder of Baltic Sea politics in the middle ages when control of the Baltic Sea trade, by force or by marriage, was top of the agenda. Coupled with the dismal grey weather with southerly air masses laden with by-products of continental coal-fired combustion, it was the perfect setting to discuss wood pellet industry issues such as markets, trade, carbon tax and emissions.
Apart from updates on Swedish pellet markets, grant schemes and examples of fossil to biomass conversions in industry, carbon tax and emissions, in particular particulate emissions (PM), were points of discussion.
– We have already tested carbon tax on a full national economic scale and contrary to widely held fears of being thrown back into the 19th century, our economy has not collapsed and jobs have not moved abroad, said Bengt-Erik Löfgren, CEO, Swedish Pellet Association.
Instead Sweden, which has no fossil resources of its own and a carbon tax at around EUR 120 per tonne, has managed to decouple its economy from greenhouse gas (GHG) emissions since its introduction in 1991. Over the same period it has increased the share of bioenergy to over 35 percent of the country’s final energy consumption, increased its forest inventory and increased productivity of its forest industry (note a comprehensive overview can be found in the Svebio publication “Bioenergy – The Swedish Experience“).
– Unlike subsidies, taxes on fossil energy provide governments with cash flow and it stimulates the development of all renewable alternatives without undue market distortion. In bioenergy, sustainable jobs are created in rural areas, cash stays in the local economy and the cost of energy such as heat is lowered. The pellet industry is part of the Swedish forest industry providing a revenue stream for by-products, explained Löfgren.
It would seem that France is following suite; a 2016 production output reaching 1.15 million tonnes in relative balance with demand at 1.1 million tonnes and the introduction of a carbon tax in 2014 with year-on-year increases to reach EUR 56 per tonne in 2020.
– On the heat appliance side, France is very like Italy in that it is a pellet stove market. In 2016 we expect to have reached 100 000 unit sales for the first time ever whereas pellet boiler sales remain at around 4 400 units, said Eric Vial, CEO for ProPellets France and chairman of the European Pellet Council (EPC).
Although Vial is pleased with this development, there is room for expansion and a need to reduce weather dependency.
– We are of course happy with this direction in the residential market but we want to see more development in the commercial and industrial sectors. We hope that the carbon tax will help like it has done in Sweden, commented Vial.
Outlining the implications of eco-labelling, Ecodesign and Medium Combustion Plant (MCP) directives for pellet heat appliance and boiler manufacturers, Robert Ingvarsson Janfire saw no immediate cause for concern for Swedish manufacturers.
– As far as we can see most manufacturers already fulfil upcoming tougher emission requirements such as for particulates, said Ingvarsson, pointing out that over 30 percent of residential biomass boiler installations in Sweden were in fact old.
– Many of the first generation residential pellet heat installations were pellet burners installed by those that used firewood or oil in existing multi-fuel boilers that date from the 1980’s and 1990’s. These have way higher emissions of PM than a modern pellet or firewood boiler and something we need to address if we are going to compete with other alternatives such as heat pumps, Ingvarsson remarked.
It’s a valid point – I only have to look at my own “first gen” pellet burner installation in an 1980’s boiler. My next-door neighbours on the other hand both opted to drill the front yard and install a “state-of-the-art emissions free” heat pump solution. Much to the disappointment of my local pellet producers I’m sure.