Energy Plantation: Wood Pellet or Wood Charcoal Production?

Energy plantations are starting to develop and large-capacity wood pellet production is emerging in line with the development of these energy plantations. It could be that now is the right momentum as predicted several years ago by the author in the following article. It is also possible that the Covid-19 era which has lasted for about 3 years has slowed down this momentum. The vast area of ​​industrial plantation forests (HTI) in Indonesia allows for the creation of energy plantations for large-capacity wood pellet production along with additional products such as animal feed and food (honey). The production of wood pellets as biomass fuel or carbon neutral fuel is mainly made or produced in the context of the energy transition towards the net zero emission era.

Viewed from the business side, the production of wood pellets is demand driven because efforts to achieve the net zero emission target require industries, especially coal-fired power plants, to carry out gradual decarbonization through cofiring biomass fuel (wood pellets) with coal. The target, which is getting closer in time, with various efforts that require planned programs and large costs, does require serious and sustainable efforts. Not only in the power generation industry, especially coal-fired power plants, but also other industries such as the iron and steel industry. Coal-fired power plants contribute 40% of CO2 concentration globally, while the iron and steel industry contributes 9% globally.

In the current power generation industry, more than a third of global electricity production still uses coal. That portion must drop to 4% by 2030 and 0% by 2040 if the world is to limit global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit) and prevent the devastating impacts of the climate crisis. Developed countries should be able to reach zero coal faster because they have a stronger financial position than developing countries, most of which still rely on coal. The world has 6 years from now to reduce coal use in power generation to less than 4% by 2030, and a number of countries have taken rapid steps to eliminate coal use, which can be read here.

Meanwhile, in the decarbonization of the iron and steel industry, the fact is that currently it is still far from achieving this goal because the construction of blast furnaces - basic oxygen furnaces (BF -BOF) is still being carried out, which should be EAF (Electric Arc Furnace) or currently only around 30% globally the iron and steel industry uses this EAF. Even the International Energy Association (IEA) highlighted this critical issue to achieve the Paris Agreement's net-zero target by 2050. The CO2 intensity in this industry has only decreased slightly so that the use of renewable energy is becoming increasingly important and accelerated.

Currently, large energy plantations have begun to be created in the context of the energy transition. The main production of energy plantations is wood pellets which can be said to be carbon neutral fuel. Almost none of these energy plantations are designed for charcoal production, even though the need for charcoal is also projected to be very large. The difference is that wood pellets will be used in power plants while charcoal is for the iron and steel industry. The production process for wood pellets is biomass compaction / densification while charcoal is carbonized or pyrolysis. In the future, a number of these energy plantations could be designed for wood pellet production while other energy plantations are designed for wood charcoal production. Given that the agreed time target for net zero emissions is not long away, the creation and utilization of energy plantations for these things will automatically not be long away.