Reducing dependence on fossil fuels has been one of the great issues of the 21st century for businesses and governments. Officials with a British power company think they have an answer to reducing carbon emissions, thanks to wood produced in Louisiana and Mississippi.
Officials with Drax Group recently held an open house for their Amite BioEnergy wood pellet plant in Gloster, Mississippi, a little over an hour north of Baton Rouge. The event drew a range of officials, from local county commissioners and legislators, to state forestry leaders. The plant has been in production for several months, and on average, 57 truckloads of wood pellets are heading down the highway, bound for the Port of Greater Baton Rouge. At the port, the pellets are placed in large storage domes until they are transported by ship to the United Kingdom. There, they are used as fuel in power plants, instead of coal.
Dorothy Thompson, CEO of Drax, said the company views the Gloster pellet plant, along with an identical plant near Bastrop in Morehouse Parish, and the port storage domes as being almost one facility that works together. “It’s a cluster that works together,” she said. About 150 people total work at the three facilities.
The wood pellets are formed from soft pine, low-quality trees that are harvested as part of trimming the stock of quality wood. Previously, the trees normally would have been scrap. Drax brings in wood from a 50-mile radius around the pellet plants.
The trees go through a multistep process that strips the bark from logs, shreds the trees into chips, breaks the chips down into wood fiber, then presses the fiber through steel dies until the shiny pellets are produced.
The Gloster and Bastrop mills are capable of producing 450,000 tons of wood pellets a year. Ironically, once the pellets are shipped to the power plants, they’re smashed into sawdust so they can be burned as fuel. “We really just form the pellets to transport them,” said Pete Madden, president and CEO of Drax Biomass. “It doesn’t make any sense to transport trees.” After all, lumps of coal are pulverized to dust in order to be burned as fuel.
Drax is made up of three businesses: the renewable fuel operations in Louisiana and Mississippi, a power generation business that produces about 8 percent of the United Kingdom’s electricity and a retail business selling electric power to business customers that generates about $1.8 billion in annual revenue.
Between 60 and 70 percent of Drax’s power is generated by burning wood pellets, Thompson said. Wood pellets produced at the company’s plants in Louisiana and Mississippi, along with material purchased from outside vendors, generates roughly 20 percent of the company’s power.
“People didn’t think it was possible to have wood pellets have equal efficiency to coal, but we’ve been able to achieve the same output,” she said. That output, along with the “very, very high carbon taxes” that the U.K. applies to businesses for burning fossil fuels, means wood pellets make good economic sense for Drax.
“Wood pellets are carbon neutral, so we get a break for using renewable resources,” Thompson said.
Alex Swift, the Gloster plant manager, said biomass is the fourth-largest energy resource in the world behind coal, oil and natural gas.
Swift worked for Drax in the United Kingdom for 12 years before moving to lead operations at the Gloster plant 18 months ago. He joked that he became an LSU football fan last season. “If you would have asked me five or six months ago, I would have argued that football was soccer,” he said. “I’m on the fence now.”
Drax has spent a total $350 million on the two pellet plants and the domes at the port.
According to figures provided by the Port of Greater Baton Rouge, Drax pumped in $517,409 in revenue during 2015. This includes rents and fees. Through the first four months of the current year, the company has generated $230,151 in revenue.
“It’s been great for the revenue stream,” said Jay Hardman, the port’s executive director. “It’s been great on the tonnage side, and it’s not a displacement, it’s a new industry.”
Along with the truck traffic from Mississippi, Hardman said a 45-car train rolls down from Morehouse Parish every 10 days to drop off pellets from the Bastrop plant. Those pellets are stored in a dome until a deep-draft ship picks them up, bound for the United Kingdom, once every three weeks or so. “They’re a consumer of these low-grade trees, and there’s not been a big demand for them since the pulp and paper industry tapered off,” he said. “I can’t say enough nice things about Drax.”
Follow Timothy Boone on Twitter, @TCB_TheAdvocate.