Bengt Hillring

Rural development and bioenergy - experiences from 20 years of development in Sweden.

Abstract Activities have been going on for a number of decades in Sweden in the field of job creation, rural development and development of local economies through the use of bioenergy. This paper relates the experience of different strategies of rural development projects over a 20-year period based on the rapid development of biofuel use, especially wood fuel use in Sweden. A successful strategy for people and companies involved, has been to specify the products and services opposed to bulky raw material production and to integrate them into the companies operations. Another success factor has been size rationalisation. Systems thinking with respect to the market and in different environmental values in the environmental cycle have also been successful. In the future, there will probably be room for different niche companies that can meet the needs of the market that the strongly rationalised companies cannot. This study calls for new studies of direct employment effects and multipliers. Continued internationalisation of the biofuel market will give greater competitiveness and press down prices among local producers. The strong competition will mean that the survivors will be those who are flexible and have activities and products integrated and apply systems thinking where contact will be with different parts of the chain and not only with the production of the raw material.

Price trends in the Swedish wood-fuel market

Abstract The state of the market for wood fuel, mainly used in district heating, in Sweden has been surveyed, enabling trends in market prices to be established. This market has grown significantly during the past 15 years to around 36–43 PJ (10–12 TW h) per annum. During 1984–1994, the current price was stable at Swedish Krona (SEK) 28/GJ (SEK 100/MW h,

National strategies for stimulating the use of bioenergy: policy instruments in Sweden

US 4/GJ). This is equivalent to a price drop of almost 50% in real terms. Short-term prices continue to fall, reflecting the fact that high energy taxes on fossil fuels cause wood fuels to be highly competitive in the district heating market. The increase in the use of wood fuels during recent years has not increased the market price as supplies have increased. Significant quantities of sawdust and other by-products from the wood-processing industry, as well as smaller amounts of imported wood, have reached the market at a low price, resulting in additional price drops. In the future, the use of wood fuels is expected to continue to grow to include the use of short-rotation energy forests. At the same time there has been a significant increase in the use of wood fuels which have been mechanically processed to improve their quality. These include briquettes, pellets and powders which command higher prices in new markets. This increasing use of wood as fuel has not increased market prices, which are expected to remain stable in real terms, reflecting the ample supply of wood fuels and a forecasted stability in the competing prices of fossil fuels.

International wood-fuel trade – an overview

Abstract This study examines strategies of national energy policy, focusing on measures taken from the 1970s onwards for increasing the use of bioenergy in the Swedish energy system. Emphasis is given to analyses of how administrative policy instruments such as the Building Act, which regulates the use of natural resources, and the Wood Fibre Act have affected the woodfuel market for the district heating sector. The government can influence changes in three principal areas of the energy system: energy use, industrial structure, and energy production. The tools the government may use to exert its influence are: support to research and development, support to demonstration and information dissemination, administrative policy measures, and economic incentives. These instruments may be applied separately or in combination. Knowledge about how these instruments affect the development of the energy sector is fragmentary; it derives more from empirical observation than from analysis. A systematic evaluation of the separate and combined instruments that have been used would increase the possibility of correctly assessing the national energy policy. Nevertheless, practical experience and the analyses that do exist indicate that: (1) research and development are necessary prerequisites for developing the energy system even though results can not always be achieved in time to meet the need for fast results; (2) economic policy measures are comparatively easy to administer, and energy taxation has largely met its goals. With investment support, markets can be skewed and development can be hindered if existing technology is subsidised; (3) administrative policy instruments are cumbersome to administer and frequently do not achieve their purpose.

The Swedish wood fuel market

Biomass is becoming a strategic resource of energy. Fuel-wood and charcoal, together with other biofuels such as bagasse, provide 10-15 % of the world total annual primary energy consumption. They are mainly used for the production of thermal energy in both developing countries (DgCs) and developed countries (DdCs). In DgCs the energy derived from wood-fuels is used for cooking and heating by the household and small-scale commercial sectors. Their large-scale industrial utilisation worldwide is much smaller but is a strategic option to fulfil the Kyoto agreement displacing fossil fuels and to mitigate greenhouse gas emissions. In fact, many DdCs already use a significant share of biofuels in their energy supply. The market expansion of biofuels is the result of a combination of factors such as new energy and environmental policies, high international fossil fuel prices and low production and transportation costs. Some OECD countries have developed quite large new markets for different types of biofuels such as charcoal, wood-fuels and wood pellets. There is a growing interest in the international trade, because the trade can provide biofuels at lower prices, in larger quantities and of better quality than domestic alternatives. The first signs of an international market price for wood-fuel are emerging in Europe. Since international trade has been recently established the official statistics do not fully record the trade movements. However, the Food and Agriculture Organisation (FAO) of the United Nations and the European Forestry Institute (EFI) have made some efforts to revise existing data from main sources of information which have been used in this report. Special studies carried out by different actors have also been used. It has been estimated that cross-border trade in solid biofuels (including wood-fuels) in Europe has reached a level of almost 50 PJ/annum. This report gives a brief overview over the trade in wood-fuel at international and European level. The results show that there are some “hot” trade spots and trails in Europe, in South-East Asia and in North America.

Wind energy potential in southern Sweden—Example of planning methodology

In Sweden, wood fuels are traditionally used in the Swedish forest products industry and for heating of single-family houses. More recently they are also become established as an energy source for district heating and electricity production. Energy policy, especially the energy taxation system, has favoured wood fuels and other biofuels, mainly for environmental reasons. There is now an established commercial market for wood fuels in the district heating sector, which amounts to 45 PJ and is growing 20 per cent annually. Price levels have been stable in current prices for a decade, mainly because of good access to wood fuels. Price levels are dominated by production costs on a market that is largely governed by the buyer.

Regional prices in the Swedish wood-fuel market

This study presents a planning model for Swedish activities in the field of wind power. Models and results of calculations of the land-based wind energy potential with the Wind Atlas Analysis and Application Programme, WAsP, are described and analysed in a geographical information systems (GIS) called the ArcView® GIS system. One county in southern Sweden was chosen as a case study to present the methods used. The results from that case study indicate a great wind energy potential but there are nevertheless many factors limiting that potential. The study calls for a further development of planning tools in the field. Important areas for the future are the development of knowledge in market issues, wind power technology, environmental issues, and public opinion on constructing wind turbines.

Price formation on the Swedish woodfuel market.

This paper analyses, through a statistical survey, the regional distribution of prices on the commercial wood-fuel market for district heating plants and the pellets market for single family houses. The existing market watch of the national Swedish wood-fuel market has been developed for both refined and unrefined wood-fuels.

Incentives for co-firing in bio-fuelled industrial steam, heat and power production—Swedish experiences

Abstract The Swedish woodfuel market has grown rapidly in the past ten years. Government policy has strongly supported this development and environmental taxes on fossil fuels have been introduced. This has favoured untaxed biofuels, i.e. woodfuels, in the district heating sector where the market has grown very rapidly. This study on price formation is based on the earlier knowledge of the market and shows that the woodfuel market has seen a dramatic increase combined with falling prices. Unrefined wood fuels demonstrate an annual volume increase of 13% while real prices have fallen at an annual rate of 5% during the first half of the 1990s. Total taxes paid by the district heating sector have increased during the period studied and of which taxes for fossil fuels have increased dramatically during the past ten years. However, tax as a share of the total fuelmix supplying the district heating sector has been stabilised over time. The primary reason for this development is the replacement of the highly taxed fossil fuels in the supplied fuels with untaxed biofuels. Companies have reacted very quickly and rationally from an economic point of view to the rising costs of fossil fuels, substituting an increasing share with biofuels. For the future, many utilities have the capacity to adapt to new changes in costs resulting from either changes in fuel prices, changes in fuel taxes or changes in prices on heating or electricity markets.

Estonian‐Swedish wood fuel trade and market integration: a co‐integration approach

Various combinations of co-firing of biofuels and fossil fuels can be used as an efficient method to rapidly introduce biofuels into existing energy systems. They also offer effective utilisation of local, small fuel resources, used mainly by larger plants. This study analyses different factors and incentives that influence co-firing in bio-fuelled industrial production of steam, heat and power and case studies illustrating Sweden’s experience in plants in the field. The greatest emphasis in this note is on non-technical factors that affect the incentives for co-firing. The study calls for a range of driving forces to introduce co-firing, such as technological, economic and financial factors, fuel resources and environmental matters. The results show that co-firing has been very efficient and beneficial for the economies of the companies studied. Moreover, the companies have achieved this with moderate investment costs and still have the flexibility to meet future changes in fuel prices and other market conditions. However, there are restrictions in combustion technology for co-firing. High activity in co-firing in some countries, especially in the Nordic countries, is indicated in this study. The already existing high activity in co-firing is expected to increase. New environmental legislation for recycling systems, landfill fees and international agreements to lower emissions of greenhouse gases will increase the supply of different fibres and fuels that can be used. This will promote the future development of co-firing.