Tipperary Energy Agency Limited

Agreed Minutes

South East and Mid West Wood Fuel Producer GroupPreliminary Meeting

Chaired by Tipperary Energy Agency Ltd

28thSeptember 2011

Venue: Brú Ború, Cashel

Time: 10:00

Attendees:

Name / Company / Business Type
Paddy Phelan / Tipperary Energy Agency / Energy Agency
Michael Bell / Tipperary Energy Agency / Energy Agency
Nicholas Garvey / Garvey Woodchip Supplies / Wood Chip
Darren Bailey / Bailey Woodchip / Wood Chip
Eddie O Keefe / Ballynoe Agri / Wood Chip
Brian Maher / Tipp Wood Chip / Wood Chip
Nicholas Roberts / NRWF Ltd / Wood Chip
Michael Maher / Ecocell Energy / ESCO provider
Noel Gavigan / Irish Bio Energy Association / BioEnergy Association
Jim McNamara / Laois Sawmills / Wood Pellet
Jim Dudley / Imperative Energy / ESCO provider
Item / Description / Action
1.0 / Welcome
The meeting was chaired by Paddy Phelan of Tipperary Energy Agency Ltd
2.0 / Meeting Context
Tipperary Energy Agency (TEA) convened this meeting of wood fuel producers in the South East and Mid West regions of Ireland to assist businesses in the wood energy supply chain to fulfil their potential and to address the common issues being encountered by suppliers and consumers in the sector. The establishment of a suppliers group has been shown in more mature markets to improve cohesiveness, quality and customer confidence in the sector.
3.0 / Tipperary Energy Agency’s involvement in the Wood Fuel Producers Group
The TEA isa partner in two projects focused on further developing the wood energy sector. Regional Bio Energy Development (RBBD) is an INTERREG IVC funded project running from Jan 2011 to June 2012, which is focused on the South East region of Ireland.
FOREST is an Intelligent Energy Europe funded project running from June 2010 to Nov 2012.In Ireland FOREST is focused on building long term sustainable supply chain partnerships in the wood energy supply chain in the Mid West region. Assisting in the establishment of a wood fuel suppliers group is one of the aims of both RBBD and FOREST.The TEA will be assist in the initial establishment of the wood fuel producers group, after this the group must be self organising.
4.0 / Purpose of the Group
The TEA presented some of the barriers which had been reported by fuel producers and consumers through extensive research into the wood energy supply chain.
Ultimately though the purpose of the group is for its active members to define.
5.0 / Issues for The Group to overcome
A number of issues were discussed and potential solutions, which the group can deliver upon are listed below:
Wood log regulation
Purchasing Wood

Difficulty in accessing finance in order to buy this or next years wood
No credit available from sellers of wood
Inability to purchase wood in 6-8mths means wet chip may be supplied
State wood supply is volatile and unreliable
Coillte are moving to buy private forestry.
Coillte currently for sale.
The group agreed that as a group buying power would improve
The group agreed that the private sector forestry pulp wood must be tapped
Innovative methods of purchasing wood from growers or growers groups are to be explored.
EG purchase Box wood, stake wood and pulp wood (the box and stake wood to be paid for immediately & the pulp wood to be collected and paid for six months after harvest) this would alleviate cash flow difficulties for wood fuel producers
Need to move away from price per tonne for pulp wood

Wood Fuel Quality Assurance Scheme

Members agree that it will be of value to the sector
Agreement that members should strive to achieve accreditation
There is a perception that the WFQA is too complex and costly for the producers.
The RBBD and FOREST projects will assist wood fuel producer group members in attaining accreditation in part.nership with WIT and Irbea.
VAT inequity between fuel sold and heat sold.

Lack of knowledge of key decision makers

Those procuring heat systems are not educated as to how to correctly specify wood energy systems
Many potential users of wood heat are un aware of wood energy
Some potential users of wood heat have a negative image of the sector due to:
Perceived poor quality of fuel
Stories of wood fuel shortages
Lack of cohesive group to represent sector

Contracts and Price

At present 3 to 5yr contracts being entered into by wood fuel producers are inflexible and financially unsustainable.
For the sector to grow and be sustainable for actors in the supply chain a transparent index which is composed of relevant tracked indices is needed, which can be adopted by suppliers and their customers.
There are cases where boilers are not being well maintained, if this is the case the fuel supplier must beware as fuel will not burnt efficiently
Currently ESCO and Heat Supply contracts are being signed at extremely low prices / kWh (margins for wood fuel suppliers are non-unexistent)

6.0 / Summary key items for the group to action
Price per tonne of wood chip delivered is too low. Indexing to be addressed.
Sector must move to price per KWh where possible when buying pulp wood and selling wood chip / pellets
Wood chip producers must address moisture content issues
Group needs to meet with private sector growers and harvesting contractors to come up a method of buying pulp wood in time to dry it before chipping. (In the absence of bank working finance)
The group must decide upon developing a brand.
The group must work with private sector growers groups to move away from public sector forestry
The group must source finance
7.0 / Committee
All those present were appointed as members of the committee
At the next meeting a chair, secretary and treasurer will be elected from within the existing committee.
Committee members to encourage potential clients to attend the seminar in hotel Kilkenny on the 9th Nov 2011. Client to Business Network on wood fueled heat.
8.0 / Actions for before next meeting on 9th Nov
TEA to circulate minutes to those present for agreement
Once agreed the minutes will be circulated to TEA’s full list of wood fuel producers in the south east and mid west.
Each member to review the TEA’s list of wood fuel producers to ensure it includes all known producers in or supplying into the region
Each member to encourage any relevant contacts to join and attend the next meeting as any producers not within the group will be at a disadvantage
Meeting room to be organised and invitations sent out for next meeting / TEA
TEA/ALL
ALL
ALL
TEA
9.0 / Next Meeting to be held at 15:30 at Hotel Kilkenny after the RBBD Business to client wood energy marketing event on 9th November.

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