Burn The Forests, Save The Planet?

Good news for the American logging industry: Timber is back, with an assist from Europe’s anti-carbon crusade. Across the forests of East Texas and deep in the Florida swamps, trees are in rising demand as “biomass” to help utility companies in Europe meet their targets for so-called “renewable energy.” That basically includes everything except nuclear and fossil fuels—even wood pellets, made from compressed sawdust or trees run through a chipper. Last year, Europe imported more than 1.7 million tons of these pellets from America, for a market that the U.S. International Trade Commission describes as having been “virtually nonexistent” in 2000. Back then, Europeans still hoped they could meet much of their 2020 carbon-cutting and “renewable” goals with wind, solar and other more fashionable fuels. That hope proved unrealistic, even before austerity budgets started shaving subsidies from these perpetually emerging industries. In a 2003 directive, the EU put biomass on a list of fuels to subsidize and exempted it from carbon capping and taxing. Never mind that burning compressed wood—a leading source of “biomass”—usually produces less energy per kilo of CO2 than does coal. The EU’s emissions accounting follows the logic that in the long run we’re all biomass: Forests can regrow and reabsorb CO2, so their combustion is not only renewable but “carbon neutral.” European utilities generating wood-fired electricity have since 2005 been eligible for credits, which they can sell to companies overrunning their CO2 quotas. The only hitch is that land-use and conservation rules in most European countries make it either illegal or prohibitively expensive to clear-cut trees for industrial processing. Solution? Use wood from America. U.S. lumber consumption is still recovering from the housing crash. The Internet has also reduced demand for paper pulp and disrupted the economics of logging. Europe’s anti-carbon regime has reversed these trends by creating a whole new market for timber products. Europeans imported wood waste, scrap and pellets at $140 per metric ton in 2011, the Trade Commission reports, up from $52 in 2001. Producers are still ramping up capacity to meet European demand, which could easily double in the next decade if governments stay the regulatory course. Last week, Maryland-based Enviva, whose clients include German utility giant E.ON , EOAN.XE -0.15% announced that its new 500,000 metric-ton pellet plant near the Roanoke River is in full operation. Supposed conservationists in the Obama Administration have been following Europe’s lead. The Environmental Protection Agency has so far exempted biomass emissions from CO2 tallies, and since 2009 the Department of Agriculture has doled out millions in small loans and grants for wood pellets and other “advanced biofuels.” Some advance. The industrial revolution was fueled by a shift to higher-energy fuels like coal and, later, petroleum. Modern power plants and pellets mean wood can be burned more efficiently than 200 years ago, but it will still take an awful lot of forests to make this great leap backward. Remember when logging was bad for the environment? This Europe-driven wood-pellet boom is another reminder that the obsession with CO2 creates indifference to other environmental considerations. Taylor Scott International

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