Location of biomass terminal
In the Botnia Atlantica region there is currently a surplus of forest biomass and also plans to build new biorefineries or expand existing ones. However, the high costs of the current biomass procurement systems and the insecurity in existing regulations have so far limited the investments in the area. It is thus important to reduce the cost of biomass procurement in order to enable competitive alternatives to fossil fuel and feedstocks. Read more here (final deliverables WP2).
Use of biomass terminals
One way to reduce the cost and environmental impact of long distance transportation of forest biomass is the use of bio hubs (biomass terminals). Biomass is transported to these biomass terminals where it is, stored, processed and finally reloaded to more environmentally friendly and efficient transportation modes. Intermodal reloading at terminals and storage of goods (e.g. forest biomass) have long been a well-known phenomenon in Sweden, while advanced upgrading is uncommon. In Finland round wood is intermodaly reloaded while bioenergy assortment are only stored at terminals.
Location of biomass terminals
The location of the biomass terminals is crucial for their success. Two of the most important factors when establishing a biomass terminal is the proximity to the area that generates the forest biomass and availability of suitable land for the establishment and geographic expansion of the terminals. Furthermore good connection to a high capacity and reliable railway system and proximity to major roads are also important. Other important factors that can be mentioned are: the availability competition and price of forest biomass; opportunities for product refinement; market for potential products expected profitability with respect to the market; sufficient expertise and experience in the organization (e.g. an experienced contractor hired for the day to day operation) and in-operations management; fulfillment of requirements for safety, health and environmental legislation; and anchorage and support from the local authorities must be ensured.
Modelling to improve location selection of biomass terminal
Modelling is defined as a description of reality in terms of mathematical formulas. We have investigated different methods that can be used to select the use and location of biomass terminals in a supply chain. We developed a model for locating terminals optimally based on available volumes of forest biomass assortments, infrastructure and transportation costs. Results from this model were compared with 23 other methods for terminal location that were clustered in 6 groups depending on main principle used in the method. The opportunity cost of each of those methods, i.e. the extra cost that is incurred if this method is used, was calculated and ranged between 0.31 – 3.55 million €. The optimal method was based on mixed integer programming and should be considered the best theoretical method to use.
Open terminals vs. closed terminals
We also studied the effect of open terminals on the logistics cost. Our results showed that if all terminals were open for all actors in the biomass supply chain the procurement costs to terminal could be reduced by 2-6 % and the transportation costs between terminal and biorefinery could be reduced with 7-9 % depending on assortment and transportation mode. There are also indications that the environmental impact could be reduced significantly when the transportation shifts from truck to rail.
Read more about characteristics of terminals in Botnia-Atlantica region here and in Scandinavian Journal of Forest research.
