Tag Archives: energy
USDA Commits To Biomass
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Turning Wood Chips Into Gasoline? NJ Firm Hopes To
Published: Thursday, 3 Oct 2013 By: Brad Quick, CNBC field producer Source: Primus Green Energy View from the north side of the demonstration plant. A New Jersey company has opened an energy facility that converts cheap natural gas into gasoline, and the firm hopes to eventually convert biomass—wood chips or switchgrass, for instance—and even to make jet fuel. The process being carried out by Primus Green Energy at its synthetic gas-to-gasoline, or “STG+,” facility, which launched Wednesday, is not new, but the size and efficiency of this particular plant are. Primus hopes to create about 100,000 gallons of gas a year—a small amount compared with modern oil refineries, but still making it the largest facility of its kind anywhere in the world, Primus said. Primus takes cheap natural gas and through a chemical process, converts it into more expensive gasoline that can power your car. Primus is using the new plant as a testing facility, a scaled-down version of how it hopes its future plants will operate. The company hopes the operation will be enough to show investors that the technology is both economically feasible and possible to build on a larger scale. Pavel Molchanov, an energy analyst with Raymond James, said Primus has to prove it can raise capital before it can be successful. “This is an early stage company. They’ve yet to produce gasoline commercially. It’s going to take some time to scale up,” Molchanov said. “With any scale up comes the need for a large amount of capital. Raising capital is never easy, particularly for an early stage business.” To date, Primus has raised about $60 million, all of it through an investment from IC Green Energy, the renewable energy arm of Israel Corp . Primus is working with Credit Suisse to raise additional capital by the end of the year. ( Read more : Six myths about renewable energy) A larger facility that will produce 28 million gallons a year, which the company hopes have built by 2016, will cost roughly $280 million. That’s cheaper than what it would cost to build an oil refinery of the same size. Natgas price worries? Not really, says CEO Source: Primus Green Energy Primus Green Energy CEO Robert Johnsen Molchanov said he sees the cost of natural gas as another potential headwind. “If natural gas prices go up, it would not be helpful for their margins,” he said. “I’d like to see what would happen if prices doubled.” Primus CEO Robert Johnsen said that’s not a scenario that keeps him up at night. The natural gas industry just released its winter forecast, and both supply and demand look as if they’ll remain steady, with prices hovering at around $3.47. Johnsen estimates that at current natural gas prices, it costs him about $1.65 to create one gallon of gasoline, far cheaper than the big oil refiners. And with those kinds of margins, prices would need to move significantly higher before the process was no longer profitable. “Natural gas would have to be in the double digits for us to be uneconomic, given the current forecast for gasoline prices,” Johnsen said. Continue reading
Stobart Biomass Announces Wales Waste Wood Deal
30 September 2013 Wood By Michael Holder Stobart Biomass has signed a 15-year feedstock contract for the 14.7MW Western Bioenergy Limited biomass facility in South Wales, which will see a ‘significant’ increase in the amount of waste wood processed at the plant. Around 150,000 tonnes of virgin and waste feedstock will be provided by Stobart under the contract, which will last for the lifetime of the facility and eventually see it accept around 55% grade A waste wood. According to Stobart, the contract initially requires a mix of 80% virgin wood and 20% grade A recycled wood, moving to 57% and 43% respectively following planned upgrades to the plant, which are due to begin in summer 2014. The biomass fuel company, a subsidiary of Stobart Group, will supply around 50% of the feedstock itself and manage and process the remainder, which will be supplied by an unnamed third party. At present, Western Bionergy gives the Forestry Commission as the largest single supplier to the plant. Furthermore, Stobart Group’s estates division has invested £800,000 to take a ‘small’ stake in the the Port Talbot plant, which has just been acquired by Green Investment Bank (GIB)’s fund, Greensphere Capital LLP. Andrew Tinkler, Stobart Group chief executive officer, said: “This is the first biomass supply contract with Greensphere under our Master Framework Agreement and represents another step in the development of our partnership in this growing market. We are pleased to have been able to make an investment in the project, which we expect to result in attractive returns for the Group.” Productive Operational since 2008, the £33 million Western Bioenergy Limited plant produces enough electricity to power 28,000 homes and was described as the first commercial-scale power station of its kind in Wales. Greensphere announced today (September 30) the plant upgrade is being part-financed by an £11 million investment provided by the Greensphere-managed UK Green and Sustainable Waste and Energy Investment Limited Partnership (UKGSWEI) fund. The GIB said the overall amount invested in the plant was commercially sensitive, but co-investment has also been provided by Signia Wealth Management as well as Stobart. Shaun Kingsbury, chief executive, UK Green Investment Bank, said: “This investment will secure the long-term future of an important Welsh renewable energy plant and will improve its efficiency and sustainability. “The Greensphere fund was set up, in part, to help support the UK’s waste wood biomass sector and its first acquisition of an operational asset is an important step.” The plant was purchased by Greensphere from a consortium of South Wales timber company Western Log Group and renewable energy investment firm Good Energies, operating as Western Bioenergy. Related links: Stobart Group Greensphere Capital LLP Divya Seshamani, managing partner, Greensphere Capital LLP, added: “We see the Port Talbot plant as a cornerstone of the waste-wood-to-energy platform we are building in this sector.” Greensphere was set up in 2012 with an initial fund of £30 million to invest in energy-from-waste projects, namely anaerobic digestion (AD) and waste wood biomass developments (see letsrecycle.com story). The Port Talbot biomass plant is the fund’s second investment. Continue reading
