JULY 2009

Biomass plays big role in California green energy policies

The State of California has mandated that the annual percentage of renewable power generated in-state be bolstered by the conversion of a coal-fired power plant in Bakersfield to one that uses local agricultural and urban wood waste to generate clean, renewable electricity.

Millennium Energy, LLC, is converting the Mt. Poso Cogeneration facility, built in 1989, to process biomass. The conversion is estimated to cost $30 million.

“The conversion process of the combustor is minor; Mt. Poso facility’s combustor is a circulating fluidized bed type which, by design, is capable of utilizing several varying types of fuel,” explained Wayne Terry, Millennium’s vice president. He also mentioned, “Some shielding of the super heater sections to minimize erosion and increasing the capacity of the bed classification system are the areas of major concern. The additional ash loading as a result of the use of agricultural wood waste increases the potential erosion.

“Those changes are going to be accomplished in a 30 day outage window as part of the overall conversion,” he added. “Because we do not have a fuel staging area for biomass, the largest portion of the investment is developing 22 acres of the facility’s property to accommodate the biomass.”

Millennium plans to break ground in September 2009 and be ready to utilize 100 percent biomass in July 2010.

The plant currently uses a mix of 80 percent coal and 20 percent biomass.

“We had an opportunity to start the conversion early by adding biomass to our fuel,” said Terry. “We have been burning biomass since the beginning of 2009.”

Terry noted that very few plants in the United States have been converted from coal to biomass.

“We are the first converted cogeneration plant in California,” he said. “Some of the steam generated from our process will continue to be used to thermally enhance oil recovery efforts in an adjacent oil field.”

California legislation calls for the state to produce 20 percent of its annual energy consumption from renewable power. While the state is encouraging this sector, the Mt. Poso conversion is not receiving any state or federal funding. Terry said the business case for the plant conversion is sound and that it could be done in similar areas where there is a guaranteed supply of feedstock.

When it becomes operational, the plant will be producing 44 megawatts (385,440 megawatt hours annually). One megawatt, said Terry, is sufficient in California to power approximately 900 homes. Securing feedstock has not posed a problem as the plant is located in the southern section of the San Joaquin Valley, which has a substantial agricultural sector.

“There is a good supply of agricultural wood, as well as a significant amount of urban material available,” said Terry. “The local county and city landfills separate woody material and divert it to biomass energy production, while sending the other material for composting.”

What pleases Terry is that business, government and the public are partnering to guarantee this material is not wasted.

The irony is that farmers have historically burned the agricultural waste, which is a major contributor of particulate pollutants in the San Joaquin Valley.

“The State of California is phasing out ‘open-burning’ of agricultural wood waste, which in turn generates more available fuel for biomass facilities,” said Terry, who added that this will also eliminate landfilling or spreading the waste wood, which when it decays, produces methane, a greenhouse gas (GHG). “We estimate the Mt. Poso facility will consume approximately 420,000 tons of agricultural and urban wood waste per year.

“A biomass facility has emissions, including carbon monoxide, but a biomass facility does not add to the carbon cycle by burning fossil fuels that have been sequestered for millions of years. The carbon emissions from a biomass facility are from material that is already part of the natural carbon cycle. In fact, when you consider the reduction in methane, a biomass facility helps clean the environment,” Terry said.

Evan Edgar, principal civil engineer of Edgar & Associates, Inc., and regulatory advocate for the California Refuse Recycling Council, has been a vocal advocate of maximizing the recovery of wood from construction and demolition activity to serve as feedstock for power production.

Edgar said that Governor Arnold Schwarzenegger’s Bio-Energy Action Plan and Executive Order S-06-06, in conjunction with the adopted AB 32 Scoping Plan, wants to accelerate the Renewable Portfolio Standard (RPS) to reduce GHG by bringing on 350 megawatts of new green power from biomass by 2010, and 1,500 MW of green power from biomass by 2020.

“With 1 million bone dry tons producing 150 MW of power, the potential new market could be 1 million tons of wood chips from the MSW sector to biomass energy in 2010,” said Edgar, “and 4 million tons of wood chips from the MSW sector to biomass energy by 2020, potentially diverting all of the 4 million tons of lumber that was disposed as solid waste in California landfills in 2003.”

Currently there are 32 biomass plants operating in California that are producing 660 MW, with 11 plants that are idle, which could produce a further 122 MW if re-opened.

Edgar also noted that several biomass plants have dismantled.

“All of the biomass plants that have closed have done so for economic reasons,” he said, “and the inability to compete on price with fossil-fueled generation, where there are hopes that the increase in the RPS and an increase in the wholesale price of renewable energy will re-power the idle capacity and bring on new facilities.

“The amount of fuel used per year peaked at 6.4 million tons in 1990, bottomed out at 4.4 million tons in 1996, and is now operating at 5.2 million tons per year,” he added, “Over the years, the supply of biomass materials has been a blend of mill residue, in-forest residue, agricultural wastes and wood chips from MSW sources, with MSW wood chips taking the lead in 2001 and now supplying over 40 percent of the market as tracked by The Green Power Institute.”

According to the Green Power Institute statistics, wood chips production from MSW peaked at nearly 1 million tons in 1992, and bottomed out at 0.5 million tons in 1995. Production steadily increased to 1.5 million tons in 2004, but declined to 1.2 million tons in 2006. Production nearly doubled (2.1 million tons) in 2008.

Edgar said the price per ton of wood chips has been volatile. The price peaked at $40 plus in 1990, but between 1994 and 2001, declined to the $14 to $18 range. Since 2003, when the price rose to $25, it has been steadily rising, which is helping to stimulate production.

To better understand the role of wood chips in energy production in California, Gregg Morris, a director with the Green Power Institute, has created CA Biomass Fuel Supply Curves for Northern and Southern California and has related wholesale electricity pricing to biomass fuel pricing analysis.

“As wholesale prices average 9 cents per kilowatt hour,” said Edgar, “the fuel price hovers around $30 per ton. As the RPS to increase renewable energy is pushed from 20 percent in 2010 to 33 percent in 2020, the wholesale electricity price now being almost 12 cents per-kilowatt hour, should continue to increase the price of wood chips.

“The current 660 MW operating capacity would need to increase over 50 percent over the next few years,” he added. “Biomass energy represents just 2.4 percent of the state’s energy consumption in 2006, and could reach 6 percent of the state’s needs by 2020. Reaching the RPS is banking on biomass power increasing by 250 percent over the decade.”

Feedstock is essential to the production of biomass and of the 40.2 million tons of municipal solid waste disposed of in California landfills in 2003, this almost 4 million tons of lumber.

Due to a decline in new construction and a launch of C&D processing activity, Edgar estimates that the landfilling of lumber is now about 2 million tons. But with the value of wood chips being appreciated, particularly as the 140 MW biomass plant capacity has come on-line since 2006, increased wood chip production from the MSW sector is diverting more wood from landfills.

“The statistics clearly support the fact that the increased demand for renewable energy increase the supply of biomass fuel and garners higher prices,” he said. “Incremental demand calls for a greater supply at a higher price.”

The California Energy Commission (CEC) released a report, An Assessment of Biomass Resources in California, 2007, where CEC determined that there are 83 million bone dry tons (BDT/y) of biomass resources in California, projected to increase to 98 BDT/y by 2020.

“The current technical recoverable potential includes 9.6 million BDT from MSW in 2007,” he added. “Biomass from the agricultural, forestry and MSW sector that would be technically feasible to obtain totals 32 million BDT in 2007, increasing to 40 million BDT in 2020. The demand for biomass will grow where up to 12 million tons of biomass could contribute to producing almost 6 percent of the state’s energy needs to assist in achieving the 33 percent RPS goal in 2020.”

The CEC study determined that there are 32 million tons of retrievable biomass from landfills, forests, and agriculture to reach the RPS in the near term, still setting aside 20 million tons to produce bio-fuels.

Edgar stresses that some of the mothballed biomass plants and those that have been dismantled employed older technologies.

“Future bio-conversion facilities will be leaner and cleaner, and would qualify as distributed generation projects,” he said. “Be ready to add small green boxes at your MRF that use up to 40 TPD of your clean wood chips and produce 1MW; use that green power on-site, and sell the rest back to an investor-owned utility, whose usage would qualify as part of their quota needed to reach their RPS goal.

“New types of conversion technologies producing many types of fuel products to meet future mandates will be facing new statutory definitions,” he added. “These facilities will be chasing the 12 million tons of biomass supply for the RPS, as well as the other 30 million tons of biomass for bio-fuels, in this competitive Bio-World.”