This post includes an excerpt from the feature article in the October/November edition of Wood Bioenergy US (WBUS) that compares pellet announcements to realized investment.

Pellet plants in the U.S. today have two primary markets: domestic U.S. home heating and European industrial markets for electricity and cogeneration. While a surge of proposed domestic projects occurred in 2009 and 2010 to take advantage of pellet use from increased petroleum prices, most recent investments have supported pellet plants intent on exporting to the EU, especially the U.K. These projects are larger than their domestic counterparts, consuming hundreds of thousands to over one million tons of wood per year, versus the typical fifty to two hundred thousand tons per year for domestic plants.  To examine this exuberance for new pellet capacity, we look to the data to compare announcements to realized investment. How many announced pellet projects actually got built?  What has been the rate of success?

Since 2008, 50 domestic pellet plants began operations with a capacity to produce 2.3 million tons of wood pellets. In the same time frame, 14 export pellet plants began operating with a total capacity to produce nearly 4 million tons of wood pellets. Operating plants represent 53% of the domestic announcements and 25% of the export announcements since 2008. For domestic plants, 16% of those announced were canceled or shut down and 27% remain in some state of pre-construction development. For export plants, 19% of those announced were canceled or shut down, while 10% are under construction and 46% remain in pre-construction.

WBUS Market Update:  As of November 2013, WBUS counts 465 announced and operating wood bioenergy projects in the U.S. with total, potential wood use of 130.4 million tons per year by 2023.  Based on Forisk analysis, 301 projects representing potential wood use of 83.4 million tons per year pass basic viability screening.  To download the free WBUS summary, click here.