Energetic Willow_in Romania_presentation_no movie

124.06.2014
Energetic Willow in Romania
Globalization, Sustainability and Technology
Carstoiu Tudor
Fuertbauer Anna November 28, 2014

 The Triple Bottom Line
 Social Factors
 Environmental Factors
 Economic Factors
 Energetic Willow
 EU Policies
 Preconditions in Romania
2
AGENDA
Introduction1
Concluding Remarks3
Impact on the Triple Bottom Line2
November 28, 2014 Globalization, Sustainability and Technology

 Energetic Willow
 EU Policies
 Preconditions in Romania
3
AGENDA
Introduction1
Concluding Remarks3

Background
ENERGETIC WILLOW
4
• Search for green energy sources intensified
• New political measures to support renewable energy supply
• Research for unconventional energy sources
• Solar, wind, and heat pump already a great success
Increasing
awareness of
environmental
problems and
climate change
Biomass
• Alternative solution
• Plants or plant-based materials
• Directly burned for heat
• Indirect use as biofuel
• Wood, hemp, corn, willow, bamboo, palm, sugar cane
2 31

Willow as a biomass
ENERGETIC WILLOW
5
• Specifically grown for energy supply  best energy results
• Popular in the Northern Hemisphere
• Different types according to local climate conditions
• Maximize output/ hectare with low input
• Short-rotation energy crops
 no long time scale (conventional forestry)
 harvested each year
 safe and secure energy source
Willow
2 31

Salix viminalis
ENERGETIC WILLOW
6
Salix viminalis
• Belongs to the SRWC group (Short Rotation Woody Crops)
• Originally from Sweden (50,000 ha)
• Prefers cold areas and moist soil
• 4900 kcal/kg caloric value
• Very robust and resistant to various diseases
 can even be planted on swamp land
• 3 – 3.5 cm growth/ day
2 31
• Growth in ~ 80 days  2.5m

Salix viminalis
ENERGETIC WILLOW
8
Salix viminalis
2 31
• Plantation-life of 25-30 years
• Special care only during the first year
• Then it grows fast without special intervention
• Investment of 2000€/ha
• Profit of 2800€/ha beginning the second year
 low-cost, “risk-free”, not labour intensive
• Profitable even in small areas for energy
independence

https://www.youtube.com/watch?v=lvXqPqnGP-A

Salix viminalis
ENERGETIC WILLOW
10
• Traditional agriculture machines
• In winter after leaf fall (November – March)
 better exploitation of the stock of labour and machines
• 40-60t/ha dry material
 depends on water availability, plant density, light, temperature
• Rods, billets or chips
• Water content decreases by 14-16% within months  no artificial drying
• Chips may lose energy content due to fast composting
Harvest
2 31

Salix viminalis
ENERGETIC WILLOW
11
• Mechanically or hydraulically compressed
 compact product with a high caloric value
(even higher than beech wood)
• 60% cost savings compared to gas heating
• 40% cost savings compared to wood heating
• Low production costs, huge demand
 1 t of briquettes instead of 1.5-2 t of wood
that still requires work before burning
Briquettes
2 31

• 2003: direct subsidies for farmers
that cultivate biomass
• 45€/ha if production is covered by
a processing contract
• Total limit 1.5m ha, raised to 2.0m
ha in 2006 (and then pro-rate
deduction)
• Romania was a strong user
• Energy crop was a controversial
issue  bonus is stopped now
• But still eligible for the general
single farm payment if following
certain rules and conditions
12
Shortage of fossil fuels, environmental concerns  RES  but still some inconveniences 
intervention  energy independence and environmental protection
EU POLICIES
EC Regulation No. 1782/2003
2 31

• 2003: direct subsidies for farmers
that cultivate biomass
• 45€/ha if production is covered by
a processing contract
• Total limit 1.5m ha, raised to 2.0m
ha in 2006 (and then pro-rate
deduction)
• Romania was a strong user
• Energy crop was a controversial
issue  bonus is stopped now
• But still eligible for the general
single farm payment if following
certain rules and conditions
• 2020:
 20% of energy production with
renewables
 20% reduction of CO2 emissions
• Each Member State submitted a
National Action Plan
 set share of renewables in
transport, heating and energy
production
 support mechanisms
 cooperation with other Member
States
13
Shortage of fossil fuels, environmental concerns  RES  but still some inconveniences 
intervention  energy independence and environmental protection
EU POLICIES
• Includes other mechanisms to
support the growth of energetic
willow  training, investment
support
• Rural Development programs 
support investment and
infrastructure
• “Health check” of the CAP (2008)
 shift money from direct aid to
Rural Development program (10%
cut)
 reinforce renewables programs,
co-financed by the EU in regions
with low GDP
EC Regulation No. 1782/2003 CAP (Common Agricultural Policy) European Directive 2009/28/CE
2 31

The ongoing modernization of agriculture and the vast availability of land are great
preconditions
PRECONDITIONS IN ROMANIA
14
• 9.4 million ha arable land  about 1 million ha remain uncultivated (called fallow, decreasing
from 3 million some years ago)
• Almost half a million ha of degraded land (not producing anything)  2% of the total area of
the country
 may find some productive use sooner or later
• The county with most degraded land is Alba(with 43,376 ha); second, Cluj (with 33,452 ha)
• Reason: Three strong waves of emigration
 1989: After the revolution
 2002: Limitation of visas in Schengen countries
 2007: Entrance in the EU
Land availability
Structural change in
agriculture
• Development from subsistence agriculture to activities that are more lucrative
• Agriculture is modernizing at a quite fast pace
 Agriculture (6-7% of annual GDP) brought 18.5 billion Euros into the economy in 2013, the
best result in history and a plus of 28% compared to 2012
2 31

Know-how about energetic willow is already present and there are incentive to share it
15November 28, 2014 Globalization, Sustainability and Technology
Building on the
shoulders of giants
• Vertical organization of industries in the first world ‘matters’ not just for the growth of the first
world but also for the growth of other nations
• The leading know-how in this sector is found at the Swedish company SalixEnergi Europa AB
 more than 30 year of experience
• Incentives to create win-win solutions  expansion of the market for energy willow and thus
the use of this of this source of biomass at a larger scale strongly depends on how fast the
diffusion takes place
• The core complementary asset (land) is not that easy to acquire or manage at a very large scale
 fragmented markets  division of inventive labour
• Owner of the technology has a strong interest in convincing many firms to invest in the different
varieties of energetic willow
 Licensing the technology and spreading the know-how to other players
• SalixEnergi Europa AB has signed license and distribution agreements for certain energy willow
varieties with three Romanian companies: S.C. Rebina Agrar S.R.L., S.C. Agrifarm S.R.L.,
Kontrastwege S.R.L. … but also several others around Europe
2 31

Know-how about energetic willow is already present and there are incentive to share it
16November 28, 2014 Globalization, Sustainability and Technology
Building on the
shoulders of giants
2 31

Despite the good soil conditions, energetic willow is not yet widespread
17
• Favourable conditions for the cultivation of energetic willow in riverbeds and unused flood
plains
• Large general good groundwater supply, especially in the Danube Meadow and the Danube
Delta
• Where needed, irrigation also an option, as Romania has quite high groundwater level in many
areas
Soil conditions
Infant industry
• Short rotation coppice are still at the beginning in Romania
• In 2010, only 49 test plantations were realized
• In 2012, about 850 ha of energetic willow existed
• Long way until saturation, many options available
2 31

Also Romania needs to implement the EU “20-20-20” directive
18
• Romania has to use 20% renewable energy by 2020
• Renewable sources energy production rate is insignificant compared to the rest of the EU
 only 1.14% of the total electric energy production
Renewables in
Romania
Legislative
framework
• Law 220/2008 regarding the production of renewable energy was introduced in 2008
 not applied until recently due to the strong tensions caused
• Secondary requirements had to be added in order to solve the technical problems associated
with wind and photovoltaic energy, caused by discontinuity of natural forces
• Introduced a state aid scheme for green certificates
• Energy suppliers that use biomass receive two certificates for every MW/ hour produced
• Power stations that use energetic plants like willow get a free certificate
• Stimulation of the production of renewable energy started enthusiastic, but bureaucratic
labyrinth  investors needs a lot of patience
2 31

The Romanian National Program for Rural Development (P.N.D.R.) provides further
incentives for cultivating energetic willow
19
• Together with the European Union program Phare, it invests around 10 billion Euro in rural
development
• Grants for energetic willow crops are on the rise through the measures
 112: Installing of young farmers
 121: Modernization of agricultural tools
• Economically underdeveloped areas have priority
P.N.D.R.
2 31

 The Triple Bottom Line
 Social Factors
 Environmental Factors
 Economic Factors
20
AGENDA
Introduction1
Concluding Remarks3

TBL: Social, environmental, economic
3BL: People, planet, profit
THE TRIPLE BOTTOM LINE FRAMEWORK
21
• Is an accounting framework for the three pillars of sustainability
 company's responsibility lies with stakeholders rather than shareholders
 coordinate stakeholder interests instead of maximizing shareholder profit
• Many organizations have adopted the TBL framework to evaluate their performance in a
broader context
• Interest in triple bottom line accounting has been growing in both for-profit, non-profit and
government sectors
• Became the dominant approach to public sector full cost accounting in 2007
• Growing number of financial institutions incorporate a triple bottom line approach in their
work
• Similar, UN standards apply to natural capital and human capital measurement to assist in
measurements required by TBL, e.g. the EcoBudget standard for reporting ecological footprint
The Triple Bottom
Line
2 31

22
The Triple Bottom
Line
2 31

23
• Fair and beneficial business practices toward labour/community/region
• Reciprocal social structure  well-being of corporate, labour and other stakeholder interests
are interdependent
• “Give back" by contributing to the strength and growth of the community
 E.g. health care and education
• Quantifying this bottom line is relatively new, problematic and often subjective
Social
Environmental
• Benefit the natural order as much as possible or at the least do no harm
 minimise environmental impact
• Reduce the ecological footprint
 careful consumption of energy and reduction of manufacturing waste
• A business which manufactures and sells a problematic product should bear part of the cost of
its ultimate disposal
2 31

24
• The "profit" aspect needs to be seen as the real economic benefit enjoyed by the host society
• Often confused to be limited to the internal profit made by a company or organization which
remains the starting point
 real economic impact the organization has on its economic environment
• Not simply traditional corporate accounting profit + social and environmental impacts
2 31
Economic

What are the possible impacts of planting energetic willow in Romania?
TRIPLE BOTTOM LINE
25
Triple Bottom Line
2 31

Social Factors
TRIPLE BOTTOM LINE
26
• Productive use for the large amount of unused land
 Additional income by renting or producing themselves
 Revival
Give use to land
Support areas with
low economic
development
• Special impact on land with low economic value
 Helps people that live in areas with low economic development where families own lots of
land but are nevertheless poor
• Productive use
 price of abandoned land increases
2 31

Social Factors
TRIPLE BOTTOM LINE
27
• Jobs for unskilled labour
• Harvesting in winter (usually less work during this period)
• New jobs at willow-selling units
• Agricultural machinery used all year long
Better use of
resources
Diversification
• Additional income source for traditional farmers (not labour intensive)
 Risk diversification
 More robust than most other crops
2 31
Energy
independence
• Save alternative energy source for small villages
• Heating of municipal buildings
 Save money and reduce hard labour required for transforming wood

Environmental Factors
TRIPLE BOTTOM LINE
29
• Real alternative to coal, natural gas and oil and other biomass
 1000kg of dry energetic willow = 700kg high-quality black coal
• High calorific value of 4900 kcal/kg  higher than oak (3460 kcal/kg)
• First step towards a green, sustainable and independent energy supply in Romania:
Planting 20,000 ha  1,000,000 tonnes of pellets  heating source of 4,900,000 Gcal/year 
heat for more than 145,000 apartments
Green energy
source
Low carbon fuel
• Co2 emissions close to zero
• Only some emissions occur during harvesting,
transport etc.
• Absorbs emissions during its growth
• Natural cycle maintained due to the short
rotation  decomposing vs. burning
2 31

TRIPLE BOTTOM LINE
30
CO2 emission and
reabsorption
timescale
(wood pellets)
2 31

TRIPLE BOTTOM LINE
31
• Protect forests and countervail deforestation in Romania caused by the need for a cheap
energy supply
• Energetic willow as a low-cost, viable alternative even for countries with huge forest areas
• Same output on smaller area (due to the high energy willow output per hectare)
• Growing demand for biomass  secure sufficient supply by planting more efficient alternatives
Stopping
deforestation
2 31

TRIPLE BOTTOM LINE
32
Phytoremediation
• Treatment of environmental problems with plants instead of excavating and disposing
contaminated material
• Energetic willow can take up high amounts of heavy metal without losing its vitality
• More efficient than other plants  hyper-accumulator:
Concentrates metal  higher metal content in the plant then in the soil
• Ions permeate into roots and are then transported to the whole plant body
2 31
• Cheap alternative wastewater treatment
• Save costs compared to biological treatment
• Bringing it in contact with contaminated water  slow but constant purification
• High evapotranspiration capacity of 15-20l/m2/day  clean 20-30 tonnes of sludge per hectare
• Flooding plant with wastewater even leads to a faster growth of energetic willow

Economic Factors
TRIPLE BOTTOM LINE
33
2 31
Low investment,
sustainable profits
• Traditional agricultural equipment can be used with just slight adaptations
• Initial planting costs about 1,500 – 2,500 €/ ha (only once for a harvest of 25-30 years)
• Starting from the second year, harvest of about 40-60t/ ha  annual profits of about 1500-
1600 €/ ha with only minor costs (200€/ ha) and little care required
• Kontrastwege SRL (energetic willow business)
 yearly turnover of about 200,000 €
 owns the distribution license in Romania for various types of salix viminalis
 started with 146 ha in 2011, now 240 ha
 profit per ha of willow is twice the profit they would get from a ha of corn
 customers are usually small farmers or guesthouses in rural areas that use it for in-house
heat production
 Also large biomass power stations are important clients (demand is expected to increase)

Economic Factors
TRIPLE BOTTOM LINE
34
2 31
Efficient use of
roadsides
• Plantation along roads  effective against snowstorms and car accidents
• County of Arad (Romania)
 first test on a 20km long route between Semlac and Nădlac
 now investment of about 112,000€ in the expansion of the project to an area of 67 ha
 price of 50€/ t, harvest of 40t/ ha  costs recovered after the first harvest in two years
• Positive impact on society’s security for no cost
Unused land
becomes profitable
• The plant can be cultivated on land that is otherwise unused, creating value where there is
none
• Under favorable conditions (intensive irrigation) production can reach up to 60 t / ha

Economic Factors
TRIPLE BOTTOM LINE
35
• If willow is cultivated on sufficiently large areas (1,000-1,5000 ha)  investment in a pellets
plant feasible
 cheap alternative energy source for cities
 central heating of their houses can be installed
• If no pellets plants available  more economic to use copped energetic willow
• Low cost of producing one kWh of energy
 all end-users can save money by using energetic willow for heating
 wood, gas and diesel can be successfully replaced
Cheap energy
source for cities
2 31

36
AGENDA
Introduction1
Concluding Remarks3

Energetic willow is a proven economic resource with great profitability, stability and a long
term perspective
CONCLUDING REMARKS
37
• Obvious positive impact for the
environment
• Strong social potential due to its
contribution to rural development
• Geopolitical conditions (the need
for energy independence) support
the development of energetic
willow
• Demand is expected to increase
 trend of continuous increasing
cost of traditional sources like oil,
gas and wood
 multiple uses of energetic willow
Energetic willow
2 31
POSITIVE ARGUMENTS NEGATIVE ARGUMENTS
 High fertility and yield  Lack of integrated bio-energy consumer market
 High environmental tolerance  Necessity of fast utilization after harvesting
 Long exploitation of plantations  Energy overproduction
 Low labour consumption and advantageous year
schedule on labour demand during cultivation
 High volume of biomass
 Improvement of local economy  High moisture content in fresh harvested
biomass
 Reduction of unemployment  Threats resulting from monoculture cultivation
on large agricultural areas
 Diversification of energy resources  Unexpected weather and climate changes
 Low capital consumption during vegetation  Damages caused by diseases and pests
 High energy effectiveness
 Reduced consumption of conventional fuels
 Environmental friendly biomass utilization for
energy purposes
 Exploitation of lie fallows
 Efficient assimilation of heavy metals
 Possible cultivation on soils unusable for other
crops
 Possible reclamation of deteriorated lands
 Constant price increase in fossil fuels
 Increase of ecological awareness of the society
 Financial support from EU and local institutions

3824.06.2014
Thank you for your attention!
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