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Renewable Energy (not wind or solar)

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May 28, 2009 – Comments (13) | RELATED TICKERS: WOOD

Everyone always mentions "wind" and "solar" when talking about renewable energy.

Another renewable energy source that ppl never seem to mention is wood.

Wood biomass has by far the fastest payback than wind and solar.  I've done a study on replacing our natural gas fired boilers with wood fuel boilers and the payback was only 4 years when NG was at $9/decatherm.    

On average, wood chips will cost you about $27/ton, which translates to around $2/decatherm.  Now when compared to 2008 natural gas prices, you can see how astronomical the savings are. 

For example, Central Michigan University saved almost $2 million dollars in 2008 by using their wood boiler.  Natural gas would have to be near $2 before they started losing money using wood.

Now of course using wood waste is not as convenient as NG. For instance, it doesn’t come through a pipeline.  Instead there is a need for trucks to dump loads of wood chips into silos.   Some other disadvantages are:

It has a combustion efficiency of 70% compared to NG's 80%.....

Wood boilers have a higher investment cost that conventional boilers...

There is a need for storage .....

But when it comes down to it, it has by far the quickest pay back for large applications such as universities.  It is considered "carbon neutral", it improves forest health and reduces forest fires (think California), and it reduces greenhouse gas emissions.

The majority of businesses do not care about the environment, but rather the bottom line.  Wood energy offers the good publicity for using a renewable resource, and also increases the bottom line.  It's a win win.

Clearly, a university downtown NYC would not be a candidate for something like this due to the lack of available resources.   But when you look at Michigan, a state that spends almost $20 billion dollars per year on energy that is almost ALL imported from other states and countries, there are some great opportunities.

If they were to use their abundant surplus amount of wood to power their state, they would create a ton of jobs and save a lot of money.  Hell, maybe GM should have been powering their factories using wood; saving themselves some much needed money, while also providing jobs for the local economy.

I think wood as a renewable source is often overlooked; especially considering the amount available here in North America.

 

BRLXF.PK

This is a ticker I requested the other day.  It is a CANROY and is traded on the TSX.  Boralex owns, manages and operates six wood-residue thermal power stations, located in northeastern United States.

13 Comments – Post Your Own

#1) On May 28, 2009 at 6:19 PM, portefeuille (99.50) wrote:

Boralex links: 1,2

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#2) On May 28, 2009 at 6:25 PM, Bays (30.25) wrote:

Thanks portefeuille...

I probably should mention:

Disclosure...

I do not own BLX at this time... but have been digging in their financial reports for the last two days.

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#3) On May 28, 2009 at 6:31 PM, portefeuille (99.50) wrote:

but have been digging in their financial reports for the last two days. 

I have done so for the last 10 minutes, so you are way ahead!

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#4) On May 28, 2009 at 6:40 PM, Bays (30.25) wrote:

All my spreadsheets only obtain information on stocks listed on Yahoo and Morningstar. 

Have you ever heard of the SMF add-in?

So for companies like this I actually need to do all the work myself to pull out the information and try to give them a value.   Haha I dont know how they did it before computers... or better yet... before calculators

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#5) On May 28, 2009 at 6:44 PM, stan8331 (97.12) wrote:

Interesting.  On the face of it, it makes more sense to me than cellulosic ethanol because you're avoiding the conversion process and avoiding all the serious problems inherent with alcohol as a fuel.  If (BIG if, of course) there's a practical way for it to scale, using this sort of process for electricity generation and using natural gas as fuel for internal combustion engines could be a winning combination. 

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#6) On May 28, 2009 at 8:42 PM, UKIAHED (36.11) wrote:

Stan8331 -  If (BIG if, of course) there's a practical way for it to scale, using this sort of process for electricity generation

it is already happening all over the country.  Here is a link to just one company.  i believe that the problem is getting the cellulose to the plant on a continuous basis.  I know one of our Northern Ca plants (Redding) had trouble getting the feedstock once the logging industry ran into trouble (environmental and financial).

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#7) On May 29, 2009 at 6:01 PM, stan8331 (97.12) wrote:

That's what I was thinking - the weak link is being dependent on the physical transport of large quantities of the wood.  The further you have to haul the fuel to get it to the plant, the less economical an option it's going to be.  The question is, are there enough sites with a plentiful nearby fuel supply to allow it to be adopted on a widespread basis...

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#8) On May 29, 2009 at 6:06 PM, portefeuille (99.50) wrote:

That's what I was thinking - the weak link is being dependent on the physical transport of large quantities of the wood.  The further you have to haul the fuel to get it to the plant, the less economical an option it's going to be.

If shipping oil around the globe is an "economical" option, then that should not be a problem either ...

 

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#9) On May 29, 2009 at 6:09 PM, portefeuille (99.50) wrote:

If shipping oil around the globe is an "economical" option, then that should not be a problem either ...

... or bananas if you think the pipeline thing is the real issue.

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#10) On May 29, 2009 at 6:29 PM, stan8331 (97.12) wrote:

The competitor isn't oil or bananas - it's existing conventional powerplants.  If you have to haul the wood in trucks over long distances, it can't help but make it a tougher proposition to compete on price. 

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#11) On May 29, 2009 at 6:38 PM, UKIAHED (36.11) wrote:

I have to agree with Stan8331 on this - the energy density of oil (or Nat Gas for new power plants) is a bit higher than with wood or bananas!  This makes the transportation a big issue in a comparison with existing fossil fuel plants vs woodcycle plants.  I wish that this was not the case... :(

But a pipeline for bananas - now that would be something to see... :) 

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#12) On May 30, 2009 at 2:21 PM, UltraContrarian (31.35) wrote:

You could wrap the bananas in plastic and drop them into existing water supply systems.  Then put a "banana trap" at the entrance to each house.  It may be necessary to go with mini-bananas to avoid clogging problems.

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#13) On June 16, 2009 at 3:24 PM, Bays (30.25) wrote:

lol

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