market analysis of wood resources - central baltic project...
TRANSCRIPT
The contents of this publication reflect the authors' views. The Managing Authority of the Central Baltic INTERREG IV A Programme cannot be held liable for information published by the project partners.
MARKET ANALYSIS OF WOOD RESOURCES
FOR DISTRICT HEATING IN THE REGIONS OF
ÖSTERGÖTLAND (SWEDEN), VIDZEME
(LATVIA), SOUTH ESTONIA (ESTONIA)
Report in the project Wood Energy and Clean tech
2011 09 09
Authors: Emilien Saindon, East Sweden Energy Agency,
Marika Rosa, SIA Ekodoma, Latvia
Priit Pikk, Estonian University of Life Sciences
Table of Contents TABLE OF CONTENTS 2
INTRODUCTION 3
WOOD PRODUCTS IN ÖSTERGÖTLAND, SWEDEN 5
THE REGION 5
ANALYSIS 7
HARVESTED WOODY BIOMASS OF ÖSTERGÖTLAND COUNTY 7
DISTRICT HEATING IN ÖSTERGÖTLANDCOUNTY 9
FUEL AND FOREST ASSORTMENTS PRICES 11
Prices of woody biomass 11
Commercial energy prices in Sweden 12
WOOD PRODUCTS IN VIDZEME REGIONAL PLANNING 14
REGION 14
ANALYSIS 15
WOOD PRODUCTS IN SOUTH ESTONIA REGION 19
THE REGION 19
ANALYSIS 20
HARVESTED WOODY BIOMASS FROM REGION 20
Biomass usage for heat energy purposes per ha of forest area 20
REGIONAL USE OF WOODY BIOMASS 21
Use of timber 21
Energy generation in District heating 21
Used of pulp 22
Selling prices of the woody biomass 22
Volume of biomass used for pellets, woodchips, and other fuels. 23
Distribution of fuels in share of generated heat energy for district heating 23
Heat energy production in region 24
FUEL PRICES IN ESTONIA 25
Energy prices in Estonia and in South Estonian region 25
COMPARATIVE STUDY 26
HARVESTED WOODY BIOMASS 26
DISTRICT HEATING 27
PRICES 28
PRICES OF WOODY BIOMASS 28
COMMERCIAL ENERGY PRICES 28
REFERENCES 30
2
Introduction
During the 2010‐2012 runs County Administrative Board of Östergötland the EU‐funded
project, Wood Energy and Cleantech. The project aims to share knowledge and skills in
environment‐friendly use of wood fuels in district heating. Organizations from Sweden,
Estonia and Latvia are participating to Wood Energy and Cleantech project. As a part of this
project a market analysis was performed and is summarized in the following report.
The aim of the report is to compare the district heating generation and consumption based
on woody biomass fuel in the region of Östergötland, Vidzeme planning region and the
south Estonia region. The report will try to identify the opportunities to increase the use of
wood energy in district heating with the regional resources.
In the report we will describe the market situation for the wood energy for the district
heating.
In this study we will focus on:
Description and comparison of the existing of woody biomass resources.
Description and comparison of woody biomass share for energy use, timber and
pulp generation.
Description and comparison the resources prices and woody biomass products
Methods
This study is not performed to introduce any product on the market but was done to
understand the prerequisite for the use of woody biomass in the sector of energy generation
focusing only on district heating (referred as end users) in the region of Östergötland,
Vidzeme planning region and the south Estonia region.
We divided the market analysis in three different blocks in order to map the overall “added
value chain” of the woody biomass for energy generation within district heating(see scheme
1):
1. Volume available.
2. Added value chain.
3. End users.
Based on the scheme 1, we have developed a data sheet collection gathering all data from
each block.
3
Scheme 1 - Overview of the added value chain
The collection of data was done using to a large extend the official statistic available both on
a national and regional level. Furthermore we used data, collected from several companies
when lacking official statistic.
The main hurdles encountered have been the poor quality of the data available but also the
non‐existence of statistic in several fields. To have comparative material the regions have
been in some cases approximating or estimating the numbers based on current knowledge.
We have decided to do the analysis based on the period 2005‐2008. Statistic from 2009 and
2010 was used depending on the availability of the data.
It has been shown during the process that data upon import/export or even costs were not
available on a regional level.
The study is divided in four differents chapters. The first three chapters are dedicated to
describe the current situation in each region; each region produced its own analysis.The last
chapter is the comparative study of the three regions Östergötland Region, Vidzeme
planning region and the south Estonia region.
4
Wood products in Östergötland, Sweden
The region Östergötland region includes 13 municipalities (table2). The total area is 9 987km² and has
424 333 inhabitants. The region has 10 large boiler plants and 3 CHP plants corresponding of
a capacity of at least 2787 MW (table 1).
Östergötland County
Area 9,987 km²
Population 424,333
Forest 64 % (SCB, 2007)
Boiler plants 10 (large)
CHP plants 3
Total MW of installed capacity There are at least 2787 Mw of installed capacity in the region
Table 1 ‐ General overview of the Östergötland County
A presentation of the forestland prerequisities in Östergötland are being presented in Table
2.
Municipality Area km2
Forest Area (Productive) km2
Forest Area %
Boxholm 606,97 405,57 67 Finspång 1 221,74 786,46 64
Kinda 1 308,74 857,48 66 Linköping 1 575,91 633,47 40
Mjölby 559,94 200,41 36 Motala 1 057,10 534,78 51
Norrköping 1 612,03 706,97 44 Söderköping 691,24 348,12 50
Vadstena 208,85 15,11 7 Valdemarsvik 781,69 411,57 53
Ydre 782,65 524,26 67 Åtvidaberg 784,32 489,92 62 Ödeshög 452,21 238,80 53
Table 2 ‐ General overview of the forestland in Östergötland County
Distric heating system is widely spread over the all region. This is shown in table 3 where all
the suppliers are listed.
5
Table 3‐ Municipalities (left side) and district heating distributors (right side) in the Östergötland region (According to the report Reneawble energy in Östergötland, 2008). There are 10 different companies contributing to the district heating sector in Östergötland.
6
Analysis
Harvested woody biomass of Östergötland County According to the statistic, from Skogstyrelsen statistical book 2010 (see Graph1) the total
removal from forest in 2008 was of 3.1 million m3 . The regional use of woody biomass for
timber generation, pulp generation and for energy generation were respectively 1.3, 4.3 and
1 million m3 the same year. In 2009 the forest growth was about 4,6‐4,9 million m3
(riksskogstaxeringen 2011). Blue line indicates annual growth.
Distribution of Regional use of Woody biomass
0
1000
2000
3000
4000
5000
6000
7000
8000
2005 2006 2007 2008 2009
Vo
lum
e o
f W
oo
dy
bio
mas
s (1
000
m3)
Regional use of wood biomassfor energy generation
Regional use of wood biomassfor timber generation
Regional use of wood biomassfor pulp generation
Graph 1a and 1b ‐ regional use of woody biomass vs woody biomass removal from forest in Östergötland (period 2005‐2009, from Skogstyrelsen statisticalbook 2010).
7
When adding the regional use for the 3 different segment, the cumulative volumes
correspond to 6339 (1000 m3) in 2008 whereas the removal from forest correspond to
around 3116 (1000 m3). This trend can be observed along the period 2005‐2008; Except for
2005 were the woody biomass removals exceeded extensively the whole regional use of
woody biomass. This is due to the hurricane Gudrun that has damaged the forest to a large
extent hence increased the volume of woody biommass available on the market.
During the period 2006‐2008 the woody biomass removal from the forest has been quite
steady. However looking at the cumulitative need of woody biomass in the region it is only
representing 50 % of the total regional woody biomass used.
The majority of the volumes needed are for pulp production. This is mainly due to the
presence of large papermills in the region (Holmen and Billerud). As we can see in graph 1
the demand for woody biomass to produce pulp has slighly increase during the period 2005
to 2009 but remain quite steady. The need of woody biomass for timber generation and for
energy generation in the district heating correspond respectively to 20% and 15 % (see
graph 2) of the use of woody biomass in the region in 2009. Even though the consumption
has known some fluctuation the volume for energy generation remains rather stable.
Graph 2‐ Total regional use of woody biomass in 2009 (period 2005‐2009, from Skogstyrelsen statisticalbook and svensk fjärvärme).
As conclusion it seems that the region is importing important volumes in order to match the
demand in the different sector while we have a large forest growth. There are no detailed
data available on regional level to track in which segment the removals from forest of
Östergötland are used in/outside the region.
8
District heating in ÖstergötlandCounty
According to the Swedish district heating association ( Svensk fjärrvärme) two types of fuels
are dominating in the distrcit heating of Östergötland; waste represent 1100 GWh and
woody biomass 1900 GWh in 2009. Fossil fuels such as heavy fuel oils and coal are
representing 900 GWh % in 2009.
Graph 4‐ Fuels purchased by district heating companies (period 2005‐2009, from svensk fjärvärme).
Waste and woody biomass over the period 2005 – 2009 being the largest fuels used is
mainly due to the types of boilers implemented in the county.
Woody biomass is including recycled woodchips, refined woody biomass (including pellets
and briquets) and non refined biomass ( e.g Top and branches, bark, woodchips, saw dust).
According to the statistic from Svensk Fjärvärme the dominant component of non refined
woody biomass used are top and branches and the main component of refined woody
biomass are briquets. The use of pellets is negligeable in the district heating of Östergötland
but is primarily used by private households.
9
Graph 6‐ Fuel usage in the district heating compared to energy production (period 2005‐2009, from svensk fjärvärme)
Even if top and branches, recycled woodships are the main woody biomass used in district
heating we can observed great fluctuation over the period 2006‐2009. As we can see in
graph 5 non refined woody biomass was the largest fuel used untill 2008 where the volume
used decrease considerabely. In the same time the use of recycled woodchips has been
increasing reaching its top of 850 GWh. The avilibilty of the recycled woodships and top and
branches are mainly the reasons of these fluctuations especially taking into account the
price of these two different fuels (see fuel and assortiments prices).
The use of pellets and briquets is not common in the different boilers and CHP plants
implemented in the County. In Östergötland the use of woody biomass resulting directly
from harvesting is representing 40 % of the fuel used in the district heating. The two factors
that can influence the set up of fuels aside environmental regulations and the technicals
feasibility of the boilers, are the prices of the different fuels and their availibity.
10
Fuel and forest assortments prices
As it was emphasised in the previous chapter it is important to look at the prices from the
two different perspectives; one from the forest owners but also from the district heating
companies.
Prices of woody biomass
Graph 6‐ Prices of the different assortiments in Sweden (period 2005‐2010, Facts and figures ‐ Energy in Sweden 2010, Energy Swedish Agency 2011)
Exchange rate used (source
http://ec.europa.eu/budget/inforeuro/index.cfm?fuseaction=currency_historique¤cy
=167&Language=en)
2005 2006 2007 2008 2009 2010
exchange rate euro(SEK to EUR) 0.107950417 0.10775 0.108421333 0.104966833 0.094039583 0.104127333
11
As we can see in graph 6 the prices for woody biomass for pulp generation and for timber
generation is much higher today than the price of woody biomass for energy generation.
We can see that in 2010 the price for woody biomass used for timber generation is of 57
ekv EUR / m3 f ub and 32.8 ekv EUR / m3 f ub for pulp generation., while the price for woody
biomass for energy generation is about 15.90 eqv EUR/ m3 putting the price of biomass for
pulp generation and for timber generation respectively two times and 3,5 times higher than
for woody biomass for energy generation. There are no detailed data available what the
production costs are and what is the import and export of the resources from the region.
Commercial energy prices in Sweden
Graph 7‐ Prices of the different assortiments in Sweden (period 2005‐2010, Facts and figures ‐ Energy in Sweden 2010, Energy Swedish Agency 2011)
From graph 7 we can see that the prices are much lower for forest fuels (woodchips) than it
is for coal, and heavy fuel oils. As we can see in graph 5 the use of heavy fuel oils and coal
are rather restricted and meanly used for peak heating. Thefuels prices that are not
represented in graph 7 are the prices for waste and recycled woodchips. These price level
were not available on national statisic therefore we used the purchasing prices from a single
plant owner
The price for waste was around ‐0.04 eqv EUR/Kg average in 2009 while recycled woodchips
is around 10 eqv EUR/MWh . The price for Top and branches and woodchips are respectively
18 eqvEUR/MWh and 21 eqv EUR/MWh.
12
From a cost point of view it is seems that both waste, recycled woodchips and top and
branches are the most cost effektive fuels. These fuels ara also largely represented in the
fuels used by the district heating companies in Östergötland.
Other variables are to be taken into consideration when looking at the purchasing of fuels
for district heating companies namely enviremonental regulations (especially on CO2
emissions) and technical constraint for the boilers.
Some of the plant owners, have developed, in order to be less dependent of the availibility
and therefore of price fluctuation, storage surfaces for the different fuels. This enable the
distrcit heating companies to purchase fuel at the lowest price available regardless if this is
top and branches or recycled woodchips.
13
Wood products in Vidzeme regional planning
Region Vidzeme planning region consists of 26 municipal districts: one large city Valmiera and 25
districts. Vidzeme is the richest forestry region in Latvia. The total territory of forests in
Vidzeme planning region is 7871.63 km2 or 52%. The total population of the region is 238815
in 2010, which is only 11% of total population. General overview of Vidzeme regions is given
in table 4.
Table 4:General overview of Vidzeme region Vidzeme region
Area 15,257 km²
Population 238,815
Forest 7,871.6
Wood production Around 4.17 million m3 [WP4 Market analysis report]
Wood consumption in DH 237,366 m3
Boiler plants 120 [1]
CHP plants 7 [1]
Total MW of installed capacity 331.6 MW [1]
According to Central Bureau of Statistics there are 120 boiler houses and seven CHP in
Vidzeme planning region with total installed capacity of 331.6 MW. Number of inhabitants
and forest areas of 25 counties and Valmiera city are summarised in table 5.
Table 5: Overview of the Vidzeme planning region per municipality
Municipal districts Inhabitants Area, km2 Forest area,
km2 Forest area, %
Valmiera city 27465 18.2
Alūksnes 19703 1699.8 1002.76 59%
Amatas 6545 741.8 438.59 59%
Apes 4456 545.1 315.81 58%
Beverīnas 3642 301.8 141.75 47%
Burtnieku 8831 710.1 293.29 41%
Cēsu 19858 171.7 87.68 51%
Cesvaines 3274 190.5 79.94 42%
Ērgļu 3690 379.5 213.54 56%
Gulbenes 25073 1876.1 1005.14 54%
Jaunpiebalgas 2799 251 129.40 52%
Līgatnes 4133 167.7 75.67 45%
Lubānas 2969 346.9 219.77 63%
Madonas 28876 2153.4 975.59 45%
Mazsalacas 4176 417.9 219.03 52%
Nauk ēnu 2365 280.6 138.79 49%
Pārgaujas 4530 487.5 251.59 52%
14
Priekuļu 9671 301.8 135.12 45%
Raunas 4214 309.1 151.45 49%
Rūjienas 6453 352.2 172.12 49%
Smiltenes 14629 949 487.07 51%
Strenču 4422 376 203.14 54%
Valkas 10999 910.3 560.86 62%
Valmieras 7069 498.1 219.5 44%
Varakļānu 4109 279 64.25 23%
Vecpiebalgas 4864 542.5 289.79 53%
Analysis According to JWEE 2007 woody biomass removals from forests in Vidzeme planning region
in 2007 were 3.39 million solid m3 but outside forests – 27 thous. m3. Gross regional supply
of woody biomass from forests was 2.78 million m3 but outside forests – 27 thous. m3.
Regional total woody biomass used for energy per ha forest available for wood supply was
2.6 m³ round wood equivalent/ha.
Results of collected data are gathered in the figures below. Based on the data from Forest
Product Statistics and applying factors graph 8 shows the use of woody biomass for energy
and timber generation in Vidzeme planning region.
0
500 000
1 000 000
1 500 000
2 000 000
2 500 000
3 000 000
3 500 000
2005 2006 2007 2008 2009
Regional use
of woody biomass, solid
m3
Energy generation Timber generation
Graph 8. Regional use of woody biomass for energy generation for DH and timber generation in Vidzeme planning region
Forestry is one of the main economical activities in Vidzeme region where many wood
processing companies are operating. Graph 8 gives rough numbers that show the large share
of use of woody biomass for timber generation and around 250 thous. m3 for energy
generation. Energy generation numbers indicate the use of biomass for district heating
needs for households in Vidzeme planning region.
Heat energy production in district heating in Vidzeme planning region and share of the fuels
used is shown in Graph 9.
15
194248 192267 186867 197731
154667
182593 169647 161218 128352
171853
0
50000
100000
150000
200000
250000
300000
350000
400000
2005 2006 2007 2008 2009
Regional energy consumption in district
heating, M
Wh/year
woody biomass
natural gas
other fossil fuels
Graph 9. Energy production in district heating and share of the fuels
The share of the fuels used in district heating in Vidzeme in 2005‐2009 issteady: it is almost
48‐52 for biomass and natural gas. In the meantime it should be mentioned that out of 26
municipalities only two are using natural gas and contribute to the large share of natural gas
in overall energy balance of the region.
Volumes and the selling prices of the woody biomass for pulp, timber and energy generation
are shown in graph 10. Volumes and selling prices of final products ‐ woodchips, pellets and
other biomass products are summarised in Graph 5.
0
10
20
30
40
50
60
70
80
90
0
500 000
1 000 000
1 500 000
2 000 000
2 500 000
3 000 000
3 500 000
2005 2006 2007 2008 2009 Selling price of woody biomass, €/m
3
Volume of woody biomass, m
3
Pulp generation Timber generation Energy generation
Pulp generation Timber generation Energy generation
Graph 10. Volumes and average selling prices (lines) of woody biomass for pulp, timber and energy generation in 2005‐2009
Year 2007 was the peak of the growth of the Latvian economy followed by economical crisis
in 2008‐2011. The impact of the economical development on wood processing industry is
well described in Graph 10 with very high prices of the resources in 2007 and decrease in
2008‐2009.
16
0
20
40
60
80
100
120
140
0
200000
400000
600000
800000
1000000
1200000
1400000
1600000
2005 2006 2007 2008 2009 2010
Selling price of resource, €/t
Volume of resource, MWh/year
Woodchips produced Pellets produced Other biomass produced
Woodchip price Pellet price Woody biomass price
Graph 11. Volumes and selling prices of woodchips, pellets and other biomass products in 2005‐2010
The prices of the woodchips and wood logs in 2006‐2010 had a small increase but in average
are around 20€ and 30€ per ton respectively. In the meantime the price of the pellets
increased from 97€ in 2006 until 135€ in 2010 as well as the production volumes as large
pellet factory started operating in 2007. The production volumes of the woodchips and
other biomass are stable around 2.35 TWh/year.
In Graphs 12 and 13 are shown average prices for fossil fuel resources in Latvia and heat
energy and electricity average tariffs in Latvia and lowest tariffs for heat production in
Vidzeme planning region.
0
10
20
30
40
50
60
70
80
90
100
2006 2007 2008 2009 2010
Prices of the resources, €/M
Wh natural gas
coal
HFO
LPG
diesel oil
woodchips
pellets
other biomass
Graph 12. Price of purchased fuel resources in Latvia in 2006‐2010
17
0,0
20,0
40,0
60,0
80,0
100,0
120,0
2005 2006 2007 2008 2009 2010
Tariff, €/M
Wh
Heat tariff in Vidzeme for biomass Average heat tariff Latvia
Electricity tariff Latvia
Graph 13. Heat and electricity tariffs in Latvia in 2005‐2010
The average heat tariff in Latvia has increased from 30€ to 55€/MWh in 2006‐2010. The heat
tariff in Vidzeme region for biomass boiler houses has had increase from 15€/MWh in 2005
until 42€/MWh. Electricity tariff in five years rose from 51€/MWh till 100€/MWh.
Vidzeme planning region is the richest forestry region in Latvia. The total territory of forests
in Vidzeme planning region is 7871.63 km2or 52%. According to the Vidzeme Development
Plan there were 172 wood processing companies operating in the region in 2007.
Wood resources are mainly used for timber, pulp and energy generation. Around 6% of the
total volume of wood resources is produced for energy generation, 20% ‐ for pulp and 76% ‐
for timber production.
Half of the district heating systems in Vidzeme region is using woody biomass – woodchips
(48%), wood logs (48%) and other products (4%). Three natural gas cogeneration plants and
few boiler houses in the two largest cities of the region ‐ Valmiera and Cesis, produce the
other 50% of the heat energy.
The prices of wood resources for pulp, timber and energy generation in Vidzeme follow
common practice (see Graph10). Though the prices differ in 2005‐2009 highest price is given
for resources for timber generation. According to the data from Latvia’s State Forests the
price for timber generation in 2009 was in range between €25 and €45, for pulp generation ‐
€28 and energy ‐ €13.
There are no detailed data available what the production costs are and what is the import
and export of the resources from the region. According to the national data wood processing
sector has the highest added value in the manufacturing (26.3%) in 2010. The share of
exports in the sales of wood processing in 2010 was 74.9%. Wood processing has
contributed the most to the growth; in 11 months of 2010, the production volume there has
been almost by 30% higher than in the respective period of the previous year.
18
Wood products in South Estonia Region
The region The South Estonian region consists of four regions: Põlva, Tartu, Valga and Võru county.
There are altogether 9508km2 of land area, 252 704 inhabitants and in average 48% of the
area is covered with forest. The report shall pay in mind that in Tartu to forest coverage is
38%, but in Valga for example 57%.
County/ Region: Põlva Tartu Valga Võru Total
Land Area (square kilometres) 2165 2995 2043 2305 9508
Total population 30889 150074 34048 37693 252704
Share of population, % 2% 11% 3% 3% 19%
Population density, pers. per sq.
Km
14,27 50,11 16,67 16,35 26,58
Forest coverage in region, % 53% 38% 57% 48% 48%
Forest area, sq.km 1141 1167 1156 1097 4561
Area with management plans, sq.
km
804 934 920 936 3594
Share of forest area from total
Estonianforest area, %
9,9% 13,6% 9,3% 10,5% 20,8%
19
Analysis
Harvested woody biomass from region The amount of woody biomass harvested in the region is continuously increasing in the
region reaching 2,11 million m3 of wood harvested per year. Also, woody biomass harvested
for the DH is increasing. The reason for a low growth is that the quote for harvested forest is
yearly increasing as Estonian forests are going older and more forest is needed to harvest.
Additionally, number of CHP plants and boiler houses are turned to the use of woody
biomass.Graph14.
Graph14 Regionally harvested woody biomass, 2005‐2009.
Biomass usage for heat energy purposes per ha of forest area Regional total woody biomass used for energy per ha forest available for wood supply
means that how large amount of the biomass harvested from the forest is used for heating
purposes. The higher the coefficient, the more biomass is used for heating in the region.
Graph15. As we can follow from the graph more biomass is exported out from the region or
used in timber and pulp industry. Reason is also that in years 2007, 2008 less energy in DH
network was produced and there was not more need for the woody biomass fuel.
20
Graph 15 Regional total woody biomass used for energy per ha forest available for wood supply
Another reason for using less woody biomass for district heating from local forests can be
that in South Estonian region was cheaper to import woodchips from north Latvia and
therefore more wood was used for pulp and timber purposes.
Regional use of woody biomass
Use of timber As there is no clear information available about the share of wood usage for timber and
energy production assumptions must be made. According to the Estonian statistics for year
2009 altogether 7,33 million.m3 of woody biomass was harvested from the forests, reused
and imported. For energy production 26% and for timber production 32% of wood material
was used. It is not possible to tell that 26% of south Estonian region woody biomass was
used for DH or 32% for timber industry because regions are very different in installed
capacity of biomass boilers and number of timber production companies.
Energy generation in District heating Although we can follow from Graph14 that amount of woody biomass harvested from forest
is increasing in years 2008, 2009 compared to previous years, the use of woody biomass in
region is decreasing in a year 2008 and slightly raising in year 2009. This shows mainly that
winter temperatures in years 2006/2007 and 2007/2008 years were higher than usual and
less wood was used for DH. The reason why the harvested woody biomass was increasing in
years 2008, 2009 was that there were number of cogeneration plants opened in Estonia – in
January 2009 in Väo 75MW and in Balti Electric Power station 3rd of August 2009. The power
plants started to buy the woody biomass fuel already earlier and therefore during two years
the amount of purchased woody biomass increased.
21
Graph16 Regional use of woody biomass of energy generation in District Heating
Used of pulp In south Estonian region all the pulp wood is exported.
Selling prices of the woody biomass
Selling prices of the woody biomass for pulp, timber and energy generation are shown
below. It s very clear that over the last years the prices of all woody biomass products are
raising because the use of woody biomass is increasing in all sectors like DH, pellet
production, paper mass production some years also timber production.
Graph17 Selling prices of woody biomass
The price for timber and pulp are in previous years and 2010, 2011 increasing fast. Mainly
because the need for timber and wood rests is at the moment increasing. Additionally,
timber and pulpwood is competing also with woody biomass for District Heating.
There are different factors that influence the market like opening biggest cogeneration plant
in Northeast Estonia and after that there was a shortage of dry biomass. Additionally,
production of woody wood mass is increasing rapidly and need for this material is increasing
fast and therefore lays pressure also to the prices of wood rests.
22
Also, for Estonia years 2007‐2009 were most hard because of over Europe economical crisis.
At the moment export of various timber material, OSB plates and other wood products
production is growing – in first part of the 2011 around 15‐40% depending on the wood
sector. As different products use more and more wood rests, also wood rests price for
energy production is growing.
Volume of biomass used for pellets, woodchips, and other fuels.
All the woody biomass fuel products are produced over the last years more and more. Vastly
is raising the need for pellets and also amount of woodchips are produced continuously in
growing trend. In years 2008 and 2009 also the local need for pellet fuel is growing as the
price for a pellet fuel slowly dropped during several years. The amount of pellets produced
in region is difficult to estimate and therefore statistics for Estonia is used.
Graph18 Volumes of produced energy products from woody biomass
Distribution of fuels in share of generated heat energy for district heating Most of the heat energy in district heating stations is generated with woody biomass, mainly
woodchips, and secondly with gas. As in year 2007 the prices for wood fuels largely
increased, then in year 2008 we can follow that less amount of woodchips were used.
Instead of that more gas and also various fossil fuels were used. After year 2008 when wood
biomass prices turned lower, also more woody biomass is used. Until today slowly the share
of woody biomass in district heating is increasing.
Close to half, 39% (in 2009) of the woodchips and most of the turf, 91% (in 2009) are used in
Tartu cogeneration plant where heat for city of Tartu is generated.
23
Graph19 Fuels used for DH in region
Heat energy production in region
In average also in Estonia the heat production/consumption is decreasing for district
heating. In the winter 2009/2010 the heat consumption raised because of very cold and long
winter.
Last two years have been colder in winter and therefore the heat consumption is rising also
in South Estonian region. Additional reason for especially Tartu region is that energy prices
are one of the lowest in Estonia and people are not so interested to save energy. Graph 20.
Graph20 District heating heat consumption in Estonia
24
Fuel prices in Estonia
Graph21 Fuel prices in Estonia taxes excluded
Energy prices in Estonia and in South Estonian region Electricity prices have been low in Estonia for years and also in South Estonia region. Reason
is mainly because most of the energy generated from oil shale is still cheap and it would be
continuously cheap, but last year’s taxes for generated waste have been rising. Additionally,
renovation costs for transmission lines are high during last year’s.
Graph22 Prices of heat and electrical energy
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Comparative study
Harvested woody biomass
In Östergötland County it is noticed that the regional use of woody biomass is largely
exceeding the removal from forest meanwhile the forest growth is much larger than the
removal from forest. This is a clear indication that there is a large potential to increase forest
harvesting. This could limit to some extent the need of importing woody biomass within the
region and thereby increase e.g. the availability on the market of non‐refined woody
biomass as fuels for the district heating.
In Vidzeme the situation is inverted. The removal from forest is larger than the regional use
and show that the region is exporting woody biomass. In Latvia the forest growth is larger
than the removal from forest. Increasing the forest harvesting may simply result in volume
increase for export.
In South Estonia region the removal from forest has been increasing but still the forest
growth is larger than the removal from forest. Since no data was available on regional use
for timber generation it is quite hard to determine if the regional use is lower than the
regional removal from forest. However one could tend to say that the regional use of woody
biomass is lower than the removal from forest since no woody biomass is used for pulp
generation in the region and all the volumes are exported.
In Vidzeme as in South Estonia region the regional use for pulp generation is non‐existent
meaning that the entire volumes are exported outside the region (mainly internationally).
On the contrary Östergötland has a domestic market for pulp generation due to the
presence of major paper mills in the county. Most of the volumes in Vidzeme and South
Estonia region are therefore used for timber generation and energy generation. However
the woody biomass used for energy generation is much lower than the woody biomass used
for timber generation representing (from 7% to 16% of the regional use). In Östergötland
county most of the woody biomass used is for pulp generation and for timber generation. A
smaller part is used for energy generation (approximately 15%).
Looking simply from the harvested woody biomass there is a clear tendency to say that the
volumes available for energy generation could be largely extended due to positive growth in
the three regions and to large export (Vidzeme and South Estonia region).
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District Heating
The energy produced by district heating companies has been increasing over the past years
in Östergötland while in south Estonia region and in Vidzeme it has been decreasing slowly
over the same period despite the longer and cooler winters. The increase is mainly due to
the fact of weather conditions (longer and cooler winters) but also an increased number of
customers. In South Estonia region the number of boilers has simply decreased. One should
not omit the fact that the regions have very different installed capacity. Östergötland has an
installed capacity of 2787 MW while in Vidzeme for instance the installed capacity is around
331 MW.
The fuels used in the district heating are quite different from region to region. For instance,
in Östergötland we can see that the main fuels are non‐refined woody biomass
corresponding to 40%(top and branches is the largest post), waste corresponding 37% and
recycled woodchips corresponding to 21% of all the fuel purchased. Whereas in Vidzeme
region the dominating fuels are natural gas (50%) and woody biomass (48%). In south
Estonia region the main fuels used are woody biomass (46%) and natural gas (26%).
As we see the use of pellets and briquettes is very limited or almost non‐existent in the
district heating of the three regions. The regions of south Estonia and Vidzeme are mainly
using mixtures of refined woody biomass like woodchips and non‐refined woody biomass
like top and branches referred as woodchips in the report. In Östergötland woody biomass is
used to larger extent than the other regions and is also using recycled woody biomass, which
is not used at all in the Vidzeme and south Estonia region. The infrastructure for the
collection and the usage of such product for energy generation are not developed yet.
Natural gas is a major fuel for the region of south Estonia and Vidzeme. Natural gas is not
used in the district heating of Östergötland County but on the other hands district heating
companies are using fossil fuels e.g. heavy oils, coal (20%). These are mainly used during
peak load e.g. during the winter when the temperatures drops considerably.
Furthermore, in the case of south Estonia region, it has been shown that the regional use of
woody biomass is exceeding the volume harvested for energy generation, while exporting
large amounts of woody biomass for energy and pulp generation. From this viewpoint it may
be some potential for using the harvested woody biomass for energy generation rather than
exporting the volumes outside the region. Nevertheless other factors are regulating the
import and export flows such as e.g. prices for the different assortments of wood products.
Another aspect that is a limitation for the use of the woody biomass within district heating is
configuration of the boilers. The boilers are dimensioned to use certain fuels. A gas
cogeneration plant hardly can switch to woody biomass. Furthermore the rational use of
woody biomass should be taken into consideration; This is particularly true in Latvia and
south Estonia region were the efficiency of the boilers is lower than in Östergötland.
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Prices
Prices of woody biomass
Looking at the price figures for the different assortments it becomes quite clear that the
prices for pulp generation and for timber generation are much higher than for energy
generation. This is true for the three regions. Except for the year of 2009‐2010 for south
Estonia region where the price for woody biomass in energy generation increased and
became more expensive than woody biomass used in pulp generation.
When looking at the prices of woody biomass for timber generation in Latvia and in Estonia
we can see that the prices for this biomass is respectively 35 €/m3 and 50 €/m3 while in
Sweden it is a higher reaching a price of 57 €/m3. The same trend is observed for the woody
biomass used for pulp generation. In Latvia and in Estonia the prices are 28 €/m3 and 25
€/m3 while in Sweden the prices are 32 €/m3.
However concerning biomass for energy generation the prices are lower in Sweden and in
Latvia than for Estonia. The prices are 12 €/m3 for Latvia, 16 €/m3 for Sweden and 29 €/m3
for Estonia. The higher prices for biomass for energy generation is much higher Estonia than
in Sweden and Latvia due to the fact to booming need of woodchips, and pellets production
and a reduced availability of raw material connected to this production.
The higher prices for the biomass used in timber and pulp generation gives the forest
owners an incitement to sell for pulp production or timber production rather than for energy
production (wood chips) for district heating (even if the profit generated from the different
assortments could not be investigated); except for Estonia were it seems more profitable to
use the biomass to pellet production rather than for pulp generation.
Commercial energy prices
In south region Estonia and in Vidzeme the prices for natural gas is around 31 €/MWh and
40 €/MWh. The woodchip prices are in south Estonia region and Vidzeme region
respectively 13 €/MWh and 10 €/MWh.
In Östergötland county the use of natural gas is inexistent. On the other hand the fuels used
by the district heating companies are waste, top and branches and recycled woodchips.
Waste generate profit, top and branches cost around 18‐19 €/MWh and recycled woodchips
around 10€/MWh.
In the three different regions the fuels purchased are the cheapest available taking into
account the fuel availability on the market but also technical boundaries of the boilers.
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Woody biomass is good fuel from a price perspective and is already widely used in the
district heating companies of the three regions. To increase woody biomass usage for energy
generation within district heating could be a challenge. This only way to increase the woody
biomass usage especially in Vidzeme and in south Estonia region could be to replace the
existing boilers using fossil fuels with e.g. biofuel boilers. The availability of woody biomass
would not be a restricting factor since in Latvia large amounts of woody biomass are already
exported and could be used instead within district heating. In Estonia too less woody
biomass is harvested in region for local use. In Östergötland, the challenge will rely more in
reducing the use of fossil fuel during peak loads.
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References
1. Svensk Fjärrvärme AB‐ Statistic 2005‐2009. www.svenskfjarrvarme.se
2. Energimyndigheten –S wedish energy Agency‐ Facts and figures Energy in Sweden 2010.
3. Skogsstyrelsen‐ Skogsstatitisk årsbok 2010‐ Swedish forest agency‐ swedish
statistical Year book of forestry 2010.
4. Renewable Energy in Östergötland (Förnybar Energi i Östergötland – Slutrapport),
Agro Öst, Lantbrukarnas Riksförbund (LRF), Länsstyrelsen Östergötland,
Regionförbundet Östsam. 2009
5. Timber Bulletin, ECE/TIM/BULL/61/2 – provisional, Forest Products Statistics, 2003‐
2007, Timber Section, UNECE Trade and Timber Division, United Nations;
6. JWEE 2007, UNECE/FAO Timber Section, 2008;
7. State Stock Company “Latvia’s State Forests”, www.lvm.lv.
8. Central Statistical Bureau of Latvia, www.csb.gov.lv.
9. Technological study. Report. Wood energy and Cleantech, 2011.
10. Statistics Estonia – www.stat.ee
11. Estonian Forestry results 2005‐2010
12. Estonian Forest and Wood Industries Association– EMPL
13. Forest resources investigation of Tartumaa( Tartumaa metsaressursi uuring), 2010.
14. Estonian private forestry centre, www.eramets.ee
http://energiaklass.emu.ee www.energiost.se www.ekodoma.lv
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