Pellet promotion in the Finnish sawmilling industry: The cost-effectiveness of different policy instruments

Abstract

a b s t r a c tThe demand for wood fuels is increasing as several countries have targets for different types of wood-based energy, e.g. pellets. Sawmills are a source for wood fuels since they can refine their by-products into energy products. We present a model of a profitmaximizing sawmill, and analyze the production and investment decisions of thirty large-scale Finnish sawmills. The model allows the investigation of required policy incentives that enable sawmills to realize the production targets set for pellets. We analyze the policy costs of the investment, production and input subsidies. We found that the production subsidy is an efficient policy instrument.

Revisión Sistemática de la Literatura en la Planificación de la Producción de Aserraderos

“…En el estudio realizado por Venn et al (2021) se presenta un modelo que permite evaluar el desempeño financiero de distintas oportunidades de inversión, mientras que en Mäkelä et al (2011) las oprtunidades de inversión son estudiadas teniendo en consideración los costos políticos para alcanzar los objetivos productivos de los aserraderos.…”

A Review of the Wood Pellet Value Chain, Modern Value/Supply Chain Management Approaches, and Value/Supply Chain Models

“…The basic steps in the pellet production process (from raw materials to pellets) include (i) drying, (ii) grinding, (iii) conditioning, (iv) pelletizing, (v) screening for fine separation, and (vi) packaging/storing of final product [22,[24][25][26][27]. Raw materials for pelletization in many countries worldwide are mainly wood shavings and sawdust from the wood processing industry [25,26,28].…”

“…However, very few studies specifically described the value chain [8,18,47]. The value chain of wood pellet manufacturers includes the determination of the value associated with each stage of the supply chain, which includes raw material procurement, inbound logistics of raw materials, processing of raw materials into pellets, and outbound logistics to the end consumer [24]. Procurement includes the location of raw materials, the species of raw materials in existence for wood pellet usage, and the original state of these accessible materials (i.e., roundwood, wood chips, sawdust, or wood shavings).…”

“…There were three studies Journal of Renewable Energy 9 found specifically on wood pellet value chain analysis [24,30,113]. Other sources found were five feasibility studies for actual biomass and wood pellet production facilities [117][118][119][120][121] and three university theses on wood pellet production and feasibility [122][123][124].…”

In search of sustainable competitive advantage in the wood products industry: Evidence from China and Finland

“…The potential for the Finnish sawmills to collaborate with energy firms to co-produce bioenergy products appears to be particularly strong in the integrated wood biorefinery segment. Such collaboration would present a promising opportunity for making higher value-added products along with an increase in flexibility of production and product assortment, and thus help companies gain sustainable competitiveness (Mäkelä et al 2011;Toppinen et al 2013).…”