Poised For Growth Drax and the Bioenergy Sector

Transcription

1 Poised For Growth Drax and the Bioenergy Sector Pete Madden President and CEO, Drax Biomass Inc. 4 th Annual Wood Bioenergy Conference and Expo April 5, 2016

2 Agenda About us Our journey from coal to biomass Building a world-class supply chain Drax Biomass the latest piece of the puzzle Looking ahead 2

3 Drax Group 3

4 Our biomass transformation the early years Start of co-firing blending biomass with coal through existing coal milling equipment Investment in wood yard for processing local energy crops Investment in 400MW direct injection facility Further investment in R&D to burn high proportions of biomass through Drax Power Station R&D for direct injection of biomass independent of coal milling equipment Launch of energy crop programme Launched biomass sustainability programme Investment in 100,000t pa straw pellet plant Extensive trials confirm unit conversion readiness Installation and operation of pilot direct injection facility Investment in purpose built biomass train wagons Installation and operation of second direct injection facility Completion of 400MW cofiring facility 4

5 Our biomass transformation recent milestones st Unit converted April nd Unit enhanced co-firing May nd Unit converted October rd Unit high biomass burn July rd Unit conversion awaiting EU State Aid Clearance 5

6 Drax Power Station today Screening building Rail unloading 6

7 Success required Drax to solve a logistical challenge Challenge Convert 3 of the 6 units at Drax to 100% = c7.5m tonnes Biomass p.a. This requires c25k tonnes Biomass per day delivered, considering delivery restrictions. 7

8 UK overland transport our first hurdle Partnered with Lloyds Register to design custom biomass railcars Load capacity 30% greater than coal cars Automated bottom doors to control flow and limit spillage Designed for existing commuter lines Close engagement w/network Rail Secure key rail paths from ports Upgrade signaling system Increase rail speed 225 railcars purchased to date Efficient, responsive and secure 8

9 UK ports - our global points of entry >$400m invested in Northern Port retrofits Biomass discharge and storage facilities Rail loading facilities Monitoring, controls and conditioning Auto-sampling Strategic investments offer flexibility Tyne first deep-sea facility for biomass Hull... short-haul transfers from European markets Immingham east-coast entry, world s largest Liverpool west-coast entry Handling capacity=12m MT/yr by mid-2016 Flexible, resilient, future-ready 9

10 Achieving scale at sea Pellets well-suited for existing cargo fleet Transport via standard bulk vessels Minor modifications required for some Panamax vessel - CO2 fire suppression Seaborne freight a highly-efficient means to move bulk commodities around the world Utilize deep-water ports capable of handling largest vessels Up to 60,000 MT per vessel Engaging with Int l Maritime Organization to further streamline biomass shipping Fuel-efficient, cost-effective, reliable 10

11 Building out the US supply chain Drax Biomass 11

12 Drax Biomass operations Pellet facilities Sited in healthy wood baskets NE LA, SW MS 450k MT/yr capacity at each plant Custom designed for high-quality pellets Robust safety and monitoring systems Port facility Northernmost deep-water port on Miss. River 2m MT/yr handling capacity (scalable to 3m) Multi-modal receiving facilities Robust safety and monitoring systems Designed for quality, managed for dependability 12

13 Sustainable forestry core to Drax Biomass Our objectives: Provide evidence of sustainable forest management Demonstrate that harvesting rates can be sustained Quantify delivered Greenhouse Gas savings Our approach: Competent, experienced procurement team Dedicated Sustainability Manager Audit program for onsite operations Independent audit by 3 rd party (NSF, SCS) Our certifications: SFI Certified Sourcing SFI, PEFC TM, FSC Chain of Custody Sustainable Biomass Partnership certification (underway) 13

14 New opportunities on the horizon Key trends Industrial demand for wood pellets is forecast to increase out to 2020 The market is oversupplied in , however the market may tighten due to a supply response reducing capacity and a jump up in demand in 2018 Industrial pellet supply & demand outlook, by region (million MT/year) 25 Proposed Capacity Under Construction Capacity Operational Capacity North America Asia Europe 14

15 Putting the pieces together Pellet-fueled bioenergy offers a cost-effective, reliable and low-carbon alternative to coal Drax has successfully transformed into a predominantly biomass-fueled generator and we stand ready to do more Drax Biomass Inc. has the technical expertise, capacity and sustainability practices to support future investment in bioenergy 15

16 Thank you