Biomass Supply Chain Modeling for Optimization of Delivery Logistics to a Forest
Biorefinery
Jose MELENDEZ
PhD Student
Introduction
For several years the forest industry in Canada has seen their earnings and profit margins
dwindled and reduced; and have been forced to contemplate new innovative ideas which will
allow the industry to once again to prosper. The development of biorefining options has shown
that if correctly implemented, may help this industry recuperate and prosper. However the
production of multiple value-added products (biorefinery concept) implies a more complete
utilization of current renewable feedstocks, and will most likely put a strain on the feedstock
delivery supply chain.
Currently used forest feedstocks and their supply chains were designed with the purpose of
supplying biomass for the production of specific products such as timber and woodchips for pulp
and paper. To effectively transform the industry a systematic analysis and redesign of the
biomass supply chain must be carried out to establish needed changes to optimise harvesting
and transportation of high or specific quantities of low value biomass. This involves the review
and use of state of the art harvesting and transportation technologies so that a maximum
sustainable biomass quantity may be extracted from each hectare of forest at a minimum cost.
Additionally new feedstocks must be identified and included in the redesigned supply chain to
increase raw material availability since current demand of biomass feedstocks has increased
significantly over the last few years, due to a number of factors, including the world`s demand for
bioenergy from renewable sources.
All potential carbon feedstocks (sugars, starches,
lignocellulosic and waste materials) need to be evaluated to determine the best feedstock
procurement strategies that will result in significantly reduced costs such that the biorefinery
strategy becomes economically viable.
The increased demand for low cost biomass sources for multiple projects will create a low
supply/high demand scenario, in which biomass availability on a long term basis will have a
significant impact on biorefinery implementation and survival. Therefore, procurement of biomass
feedstocks on a long term basis must be analyzed and strategies created which will increase
available resources in the biomass supply chain which may then be utilized to secure biomass
availability by `winning the auction` for a supply contract.
To evaluate multiple feedstocks, it will be necessary to characterize their composition to
determine the amounts of valuable components (cellulose, hemicellulose, lignin, etc) according to
predetermined criteria. Afterwards a quantitative examination of available resources for the
province of Quebec and if possible for Canada may be done.
Once the feedstock characterization and supply chain have been designed, it will be possible to
create several different feedstock delivery scenarios which will be then evaluated to determine a
finite number of possible solutions according to the established criteria. This will lead to the
1
design of an optimization model which may then be evaluated using a practical case study.
Overall Objectives
General Objectives
To calculate under what conditions do biomass procurement strategies result in significantly
reduced costs such that the biorefinery strategy is economically viable and allows for
securement of biomass supply in a competitive market.
.
Specific objectives
1. To evaluate existing and new feedstock sources and the biomass harvesting &
procurement supply chain that will lower procurement costs and secure availability
2. To compare the usage of finite VS infinite amounts of biomass, and illustrate how
procurement of lower amounts reduces procurement costs and secures availability
3. To examine how process flexibility in terms of feedstocks allows to reduce procurement
costs, and also out-bid competitors to secure biomass supply.
Potential Benefits
It will ultimately come down to “winning the auction” for biomass supply:
The project will illustrate how optimization of biomass procurement supply chain
using multiple feedstocks and emerging technologies will increase profit margins
in a biorefinery
The usage of finite amounts of biomass according to market demand of a
product and the production process will reduce procurement costs (less
biomass, lower costs), and increase profit margin which will help secure biomass
supply.
Strategies to reduce biomass procurement costs will be shown to not only allow
a biorefinery to “pay less” for biomass supply, but they will allow them to beat-out
their competition in an auction by increasing how much they can actually pay.
Methodology
To evaluate biomass procurement strategies which will ultimately create favorable conditions
for the implementation of a biorefinery, the following methodology will be considered:
1. Seek out and qualitatively analyse all biomass sources that may be used by a forest
biorefinery; understanding their main physical and chemical characteristics.
2. Determine the best uses of all biorefinery feedstock sources according to the process’
physical and chemical requirements for the feedstocks.
2
3. Characterise the strategic, tactical and operational aspects of a biomass supply chain for a
biorefinery so as to understand the current way of thinking (base case scenario)
4. Utilize supply chain model optimization of the base case scenario to perform a critical
analysis of current practices, and determine ways in which the current process may be
improved.
5. Develop a biomass procurement strategy utilizing new feedstock sources and compare it to
the base case scenario to establish the potential economical and operational benefits it will
bring about.
6. Survey existing and emerging technologies used in the biomass procurement supply chain:
forestry best practices, genetic engineering, harvesting technologies, densification and
concentration of biomass, transportation and pretreatment technologies. Establish the
potential benefits (economical and production) that these may bring to the supply chain.
7. Analyse different procurement configurations which involve the use of multiple feedstocks
and emerging technologies that will create added value in the existing supply chain.
8. Identify the best scenario for biomass procurement for a biorefinery using the created
supply chain model and optimization methods, which will help “win the auction” for biomass
supply.
9. Develop an overall biomass procurement strategy that will secure feedstocks for a
biorefinery on a long term basis at the lowest cost possible.
10. Verify and validate the created model and procurement strategy by implementing in a
specific case study (biomass procurement supply chain for mill in Quebec)
Preliminary Results
To come
Figure
To come
Future Work
To come
References
WOOD, S.M. and LAYZELL, D.B. "A Canadian Biomass Inventory: Feedstocks for a Bio-based
Economy," BIOCAP Canada Foundation, Queen's University, Kingston, Ontario 2003.
BRADLEY, D. "Canada Report on Bioenergy 2009," Climate Change Solutions; , Otawwa, Ontario
2009.
3
STUART, P.R. "The Forest Biorefinery: Survival strategy for Canada's pulp and paper sector?,"
Pulp & Paper Canada, vol. 107, pp. 13-16, 2006
CHAMBOST, V. et al. "Guided tour: Implementing the forest biorefinery (FBR) at existing pulp and
paper mills," Pulp & Paper Canada, vol. 109, pp. 19-27, 2008
MABEE, W.E. et al. "Assessing the Emerging Biorefinery Sector in Canada," Applied
Biochemistry and Biotechnology, vol. 121-124, pp. 765-778, 2005.
SOKHANSANJ, S. et al. "Development and implementation of integrated biomass supply analysis
and logistics model (ISBAL)," Biomass and Bioenergy, vol. 30, pp. 838-847, 2006
RENTIZELAS, A.A. et al. "An optimization model for multi-biomass tri-generation energy supply,"
Biomass and Bioenergy, vol. 33, pp. 223-233, 2009.
SODERHOLM, P. and LUNDMARK, R. "The Development of Forest-based Biorefineries:
Implications for Market Behavoir and Policy," Forest Products Journal, vol. 59, pp. 6-16, 2009
EKSIOGLU, S.D. et al. "Analyzing the design and management of biomass-to-biorefinery supply
chain," Computers & Industrial Engineering, vol. 57, pp. 1342-1352, 2009
SATHRE, R. and GUSTAVSSON, L. "Process-based analysis of added value in forest product
industries," Forest Policy and Economics, vol. 11, pp. 65-75, 2009
4