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October 23, 2012

Wood Pellets and Freight Railways are 'Fast Track' to Mississippi's Fiscal Recovery



Getting Southeast Mississippi “out of the woods” during the economic downturn may be as simple as marketing pellets that are by-products of the abundant forestry in the region.

Indeed, Europe’s growing enthusiasm for wood pellets as a form of upgraded biomass for residential and commercial heating, as well as for power production, could translate into an economic boon for struggling Wayne County, Mississippi. What’s more, it could create local and regional jobs in the transportation industry, because freight transport by rail would be the easiest and most economical way to get wood pulp and pellets to Gulf of Mexico ports, such as the Port of New Orleans, for international shipping.

Joseph Sean Dunlap director of the Wayne County Economic Development District, which is based in Waynesboro in Southeast Mississippi, recently told the Mississippi Business Journal, “We have had some positive economic things going in our direction in forestry with four international companies looking at this area. Because we’re in one of the major wood baskets of Mississippi, we’re seeing interest from people who make wood pellets. We have traditional timber facilities operating, but now are seeing opportunities in alternative energy.”

Global markets exceeded 12 million tons of annual wood pellet production in 2010 and that number could grow to over 100 million tons by 2020. Europe is currently the largest market for pellets.

 Indeed, according to the European Pellet Council, wood pellets—made from dried and densified sawdust, shavings or wood powder—currently represent the most economic and energy efficient way to convert biomass into a fuel with high energy density and consistent quality. For this reason it is one of the fastest growing forms of upgraded biomass in Europe and worldwide.

"We're blessed with trees and we want to get them to market," Dunlap explained. "Mississippi has two counties that are 50 percent to 70 percent covered in forest, but they can't get the timber out economically without rail."

Bulky, low-density materials like wood pulp and pellets are too expensive to ship by truck. Therefore, according to a recent report in Scientific American, Dunlap, along with partners, wants to build a 90-kilometer (56-mile)  freight rail link that would restore direct service from Chicago all the way to the Gulf of Mexico.

Without such a link, regional suppliers would have to ship their products far to the east or west to get the goods to Gulf ports. "Those 56 miles might as well be 5,000 miles to them," Dunlap told Scientific American, calling the plan "the missing link in the economic spine of east Mississippi."

Such economic dreams—and high diesel prices—are creating a comeback for freight rail in the United States.

Double-stack trains beat dieselToday, diesel prices are nearly four times higher than they were in 1999. Therefore, based on a 2009 study by the Federal Railroad Administration, depending on the route and the commodity carried, railroads are 1.9 to 5.5 times more fuel-efficient than trucks.

Fuel savings for an entire long-distance freight line are particularly impressive. Depending on the type of the freight and the distance hauled, a single cross-country intermodal double-stack train can replace 280 trucks and save up to 80,000 gallons of fuel. (Intermodal freight is hauled in containers moved by truck, rail, barge, or container ship. On intermodal double-stack trains, the containers are stacked two containers high, doubling the amount of trucks this type of train can replace.)

According to Oak Ridge National Laboratory, on a BTU per ton-mile basis, rail is 1.7 times more efficient than domestic waterborne commerce. Some of the gain can be attributed to technological and efficiency improvements: Railroads have adopted electronic controllers in locomotives, including advanced sensors and fault diagnostics; improved diesel fuel mixture and combustion as well as cooling systems that maintain optimal engine temperature; replaced binary switch DC motors with AC traction motors that respond to load, with variable voltage/frequency output, and better control/communication systems.

Hybrid locomotives, which carry a 1,200 amp-hour battery bank and use regenerative braking, also have been introduced. Indeed,  GE engineers are designing a hybrid diesel-electric locomotive that will capture the energy dissipated during braking and store it in a series of sophisticated batteries. That stored energy can be used by the crew on demand—reducing fuel consumption by as much as 15 percent and emissions by as much as 50 percent, compared to most of the freight locomotives in use today. In addition to environmental advantages, a hybrid will operate more efficiently in higher altitudes and up steep inclines.

Further, as rail privately invested $40 billion in new infrastructure over the past five years, the trucking industry has suffered high fuel and labor prices—the two largest costs—which have forced it to contract since 2005. Accordingly, rail has gradually taken market share away from trucks since 1999. The migration from trucks to rail is particularly evident for shipping distances longer than 800 kilometers (nearly 500 miles). The longer the haul, the more of a fuel efficiency advantage rail has over trucking.

Although the expansion of freight rail in recent years has been almost exclusively privately financed, a little government support could go a long way. Adding one lane to a mile of highway can cost $15 million or more and take a decade to complete, whereas adding a typical mile of rail line costs $2 million to $4 million and can be built in a few years, according to Scientific American.

Under the MAP-21 transportation bill signed into law on July 6, 2012, a national plan for freight policy will be developed jointly by federal, state, and business participants. The U.S. Department of Transportation is investing more than $953 million in freight improvement projects, including $354 million for port facility upgrades. Additionally, up to $35 billion in loans and loan guarantees are available for railroad rehabilitation and improvements.

"We don't want a handout—we want a hand up," Dunlap told SA.




Edited by Brooke Neuman


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