Wood pellet market 'explodes' in US

Wood pellet manufactures across the US are increasing capacity as the global market for this renewable energy source expands.

Between 2008 and 2010 exports from the US to Europe rose from 85,000 tonnes to over 600,000 tonnes a year.

Speaking about the US wood pellet market Peter O'Keefe, a partner in Franklin Pellets, said: 'It's exploding.'

Franklin Pellets, based in Franklin, Virginia, US, is considering converting part of the International Papermill into a pellet plant.

And O'Keefe predicts that the southeast of the US will continue expanding. 'We're excited about the potential of the US market and believe in the long run it is moving our way,' he says.

Europe's demand for wood pellets can be largely attributed to the nation's 2020 renewable energy targets. In 2010 Europe consumed around 11 million tonnes of wood pellets. This is expected to reach 50-100 million tonnes throughout the coming years.

'The infrastructure for coal doesn't have to be changed dramatically for pellets because they're almost like ground-up coal,' O'Keefe explains. 'That's why it is attractive to use to co-fire with coal.'

Demand for wood pellets in Asia is also on the rise. However, imports from the US are limited, according to Stan Elliot of Bear Mountain Forest Products, a manufacturer of forest-based products, located in Portland, Oregon, US. Instead, Canada, British Columbia in particular, is supplying this demand due to low transportation costs and better shipping facilities than the US.

But while the US ramps up production capacity and its exports continue to rise, domestic demand looks to remain fairly low, for the near future at least. As John Belcher, owner of Belcher Enterprises, explains: 'I wouldn't say [the market] is good at all in this area. Up north where they use more heat it's more beneficial.'

Image source: Franklin Pellets

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