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Switching from coal to wood pellets – a Kiwi case study

8 June 2022

As part of the upcoming Residues to Revenues 2022 event, large scale industrial heat or energy users Fonterra, Danone and the Canterbury District Health board will be outlining their recent major plant conversions to wood residues. Probably more importantly for those supplying or co-ordinating the harvesting and delivery of residues from local forestry or wood processing operations, they’ll be outlining what specific requirements they have as end users of woody biomass.

The programme planned to run in Rotorua on 26-27 July looks like it will be a sell-out. Registrations if keen to register for the event can still be made on the event website. Note, for those outside New Zealand, on-line virtual registrations to the event can also be booked.

Background to case study.

On 25 August 2020, Fonterra took a bold step in the use of renewable energy for milk processing at its Te Awamutu factory. A NZ$12 million investment had been completed during the prior months with numerous COVID-19 restrictions in place, to convert the site’s 43-megawatt coal-fired boiler to an entirely sustainable, renewable source of energy – locally sourced wood pellets. EECA supported this project with co-funding of NZ$200,000 through the Technology Demonstration Fund.

For the next seven months of the milk processing season the boiler ran continuously on a steady supply of wood pellets, reliably delivering 43 megawatts of steam to process 2.8 million litres of milk every day.

Benefits and insights

By switching to wood pellets and modifying the boiler to do so, the boiler’s thermal efficiency improved by approximately 4 per cent and carbon emissions from the boiler have been cut by 98.4 per cent – a reduction of 89,000 tonnes of carbon dioxide equivalent per annum based on the first year of operations using wood pellets. Sulphur dioxide emissions have also been reduced.

Kevin Liao, Fonterra’s Senior Energy and Utilities Engineer, was the Commissioning Manager for the project. He says the project delivers on both environmental and financial outcomes.

“The use of wood pellets has cut both the rate and concentration of particulate emissions from the plant to less than 10 per cent of the currently consented levels, which materially improves air quality and should make reconsenting much simpler in the future,” he said. Additionally, whereas coal ash contains toxic chemicals, the organic wood pellets create an organic ash stream that is rich in potassium. “This potassium is a valuable nutrient used to make potash which we are assessing for it to be recycled as a natural fertiliser for use on Fonterra farms,” he said.

Kevin Liao said the Fonterra fuel switching project was a case study with much wider application for other energy intensive industries across the economy looking to cut carbon emissions and increase operating efficiency.

“The new fuel supply chain has been smooth and reliable thanks to a long-term supply contract with wood pellet manufacturer, Nature’s Flame. “Changes required to the actual boiler itself were relatively modest. The main focus has been on boosting fan capacity in the boiler to increase combustion, improvements to the exhaust stack to capture fine particulates and covering the fuel reception area to keep the wood pellets dry.”Unlike coal, wood pellets are hydrophilic and do not perform well when wet.”

Operationally there have been a number of efficiency benefits in switching from coal to wood pellets. Whereas coal has approximately 30 per cent moisture content, the pellets contain just 10 per cent. As a result, the plant used to require seven to eight truck deliveries per day for coal, and now requires five to six for wood pellets.

The pellets are more uniform in size than coal, enabling delivery into the boiler to be more automated and consistent. Adjustments were required to conveyor belts carrying the pellets and a solution was required to manage additional dust from the pellets.

Looking to the future

Kevin Liao said while the fuel switching project stacked up commercially from the time it was commissioned, increasing carbon prices would increasingly advantage the wood pellet plant. He said that additionally, the long-term domestic wood pellet supply chain looks positive as more and more forestry is being developed both to absorb carbon and deliver for the timber market.

As the world becomes increasingly concerned about climate change and the environmental impacts of the products they consume, Fonterra’s Te Awamutu project has shown what can be achieved with the right vision and commitment. The plant is setting new environmental standards in a sector that has traditionally been viewed as difficult to shift to renewable energy sources. In doing so, it’s also future proofing the plant and delivering better economic performance for shareholders.

The full case study can be viewed here

Source: EECA

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