“I could sell everything to Europe if I wanted to,” says Joann Birchem, co-owner of two northern Minnesota companies: Mountain Timber Wood Products in Mountain Iron and Forest Valley Wood Products in Marcell. Birchem is talking about the wood pellets that her companies produce. Using wood pellets for fuel is increasingly popular in Europe. But in the United States? “It’s underutilized here,” Birchem says. “Big time.”
To develop the U.S. market, Birchem is working with a partner. A European partner. Madrid, Spain–based CGC Biomass, a major distributor of wood pellets for fuel in Europe, has taken a 25 percent stake in Birchem’s firms. Birchem and CGC plan to build the market here, then expand to Europe.
Wood pellets used for fuel are derived mostly from compressed sawdust. The low moisture content (6 percent or less), consistent pellet size, and easy transportability are some of the reasons why the use of wood pellets is growing in the biomass fuel market. But it’s their low cost and high performance that proponents most often point to. “With the efficiency of the wood pellet BTUs,” Birchem asserts, “you’re often spending only half the money” of other common fuel sources.
“Soft woods actually offer more BTUs than hard woods in pellets,” Birchem says. Even more attractive, from a pellet producer’s point of view, is that larger mill operations leave behind or mark as waste the soft-wood trees and tree byproducts, like tamarack and pine pulp, used to make pellets. Pellet makers and mills aren’t competing for raw material.
Europe certainly has warmed up to wood pellets. “In Sweden and Denmark, they even use them to heat schools and government offices,” Birchem says. “Those countries have done an incredible job of incorporating alternative fuel sources.” And while wood pellet use is widespread in Europe, user nations are not all tree-harvesting countries. Italy “does not have a lot of the right trees for this,” she says.
All this suggests a big overseas market for Minnesota pellets. Still, Birchem and her Spanish partner have chosen to focus on the domestic market, given the immensely favorable production capacity and the growing interest here in alternative energy sources.
Birchem believes that “it’ll take three years” to establish enough awareness of wood pellets as fuel in order to develop the U.S. market. “After that,” she adds, “we can look more towards the international level.” (Such domestic consciousness raising wouldn’t help only Birchem’s operations: There are actually about 60 pellet mills in the U.S.)
What should Americans know about this kind of fuel? For one thing, Birchem says, it’s not that different from existing heating technology. “You don’t even need special venting on pellet stoves,” Birchem says. “It’s the same sort of venting you find on common gas fireplaces . . . . And the cost is so often only half of what we pay for other fuels. That’s the kind of information we need to make more known.”
The Forest Valley facility is currently undergoing an upgrade while producing pellets. The Mountain Timber facility is expected to begin construction in October, with the plant due to come on line about six months later.
