New biofuel plant will have only minor effects on existing forest industries and harvests in Norway

A new publication from researchers from Norwegian University of Life Sciences (NMBU) and University of Idaho has shown that a new biofuel plant Silva Green located in Tofte will have only a minor effect on existing forest industries and harvests in Norway. It was found that the domestic impacts will be dampened by changes in foreign trade flows, especially of chips.

Second-generation biofuels are often seen as an essential element in the future bioeconomy strategy. Biofuels and in particular second-generation (cellulosic) biofuels avoid the potential concerns regarding the food-versus-energy debate by focusing on the non-food portion of plants, but also may contribute to employment and development of rural areas, protection of the environment, and overall sustainability.

NMBU researchers Rafał Chudy, Hanne Sjølie and Birger Solberg together with Gregory Latta from the University of Idaho focused on the impacts of a new wood-based biofuel plant on the Norwegian forest sector. They analyzed how different tree species and wood assortment choices in biofuel production may impact timber trade and forest industry production in Norway, and what will be the most optimal feedstock mix used in the biofuel production.

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This research project is based on actual current plans of Statkraft and Södra Cell, who have joined forces to develop a second-generation biofuel facility in Norway, at Tofte, in Buskerud county, by the end of 2020. The expected cost of this investment will be around 500 million Norwegian kroner (1 NOK is equal to ca. 0.10 Euro). It was assumed that the plant will begin biofuel production in 2025 and produce 150 000 tons of biofuel per year requiring around 1 million cubic meters of woody biomass feedstock as input.

Why wood-based biofuel production in Norway?

“Norway has committed itself to a target by 2020 of  having a 67.5% share of renewable energy in gross final energy consumption. Already, the country has an extremely high share of renewable electricity (98% of it is related to hydropower), and its  potential of utilizing woody biomass for energy is considerable. Pulp and paper mills have been closed in the country the last two decades, sending second-generation biofuel plant high on the political agenda. Several plans exist for building biodiesel plants,  in line with the goal of the Norwegian Bioenergy Strategy to double the biomass use in energy production from 2008 to 2020. Agriculture comprises only 3% of Norway’s land area, so  the focus of this strategy is fully on woody biomass. It is expected that one may  double the biomass harvest and still be sustainable, and with the experienced decline in the pulp and paper industry, there should be biomass available to develop new biorefining for fuels and chemical markets”, says Birger Solberg, Professor of Forest Economics at NMBU.

What will be the most optimal feedstock mix to produce biofuels?

“Our results have shown that that the optimal biofuel feedstock mix will be dominated by softwood chips from pulpwood comprising 48% of total biomass inputs in 2030 and increasing to 67% by 2055, followed by hardwood chips from birch, comprising initially 34% of total biomass inputs and 16 % by 2055. The modelling results revealed also that the proportion of harvest residues will remain constant at about 18% over time and roundwood will not used at all for biofuel production. To create such feedstock mix, there will be a need of additional harvests in younger stands (pulpwood), imported wood chips from abroad (44% from Sweden, the rest from other countries), and finally chips coming from Norway’s domestic sawmilling industry“, says Dr Rafał Chudy, formerly Ph.D. candidate at NMBU, currently Scientific Project Officer at European Commission – Joint Research Centre.

Will the single biofuel plant will have any significant effects on forest sector in Norway?

“We found that a single medium-scale biofuel plant is not going to significantly affect the wood market in Norway, because trade of wood chips is buffering. However, looking at county-level harvest changes, it was found that in 2025 the largest increases in harvest (relative to business-as-usual scenario, i.e., no biofuel plant) are expected to occur in Akershus and Buskerud counties totaling 170 000 and 147 000 m3 respectively (ca. 19% increase in both counties)”, comments Dr Chudy.

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Although the consequences on forest sector in Norway were found minor, a potential winner of a new biofuel plant in Tofte was identified. Dr Rafał Chudy adds:

“Our results showed that the sawmilling industry may to some extent benefit as a result of the increase in demand for sawmill residues for use in biofuel production. The impact on the sawmilling industry is mainly a result of the increase in demand for sawmill residues for use in biofuel production. In other words, market linkages in the Norwegian forest sector lead to a vertical cascading demand where increased demand for sawmill residues results in increased sawnwood production, and consequently increased sawlog harvest.”

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Researchers used a NorFor model, which is an intertemporal partial, spatial equilibrium model of Norwegian forest sector.

What is the main strength of NorFor in the studies about wood-based biofuels?

“I believe our study shows that a forest sector model like NorFor is useful for doing scenarios and analyzing impacts of feedstock choices on forest resources, forestry and forest industry. The model includes the main products flows in the Norwegian forest sector and is economic consistent across the sector, from consumption, to industrial processing, trade and forestry. In contrast to other forest sector models applied in Norway, NorFor does not only capture the linkages between the competition for wood fiber between various users and industrial development, consumption and trade, but also with forest management. Forest growth in NorFor depends on which management alternative, including planting intensity, precommercial thinning, thinning and fertilization, that is chosen for each land area. On the top of that comes the choice of harvest timing. Close to 9000 permanent Norwegian Forest Inventory sample plots that together represent the productive forest landbase in Norway are included in the simulations”, says Hanne Sjølie, Associate Professor at Inland Norway University of Applied Sciences and researcher at NMBU.

Source: Chudy R.P., H.K.Sjølie, G.S.Latta, B.Solberg. 2019. Effects on forest products markets of second-generation biofuel production based on biomass from boreal forests: a case study from Norway. Scandinavian Journal of Forest Research Volume 34, 2019 – Issue 3.

Main photo: Oslo and the Oslofjord from above – the view from Holmenkollen Ski Jump. Credit: Rafal Chudy

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