The Dutch energy sector and a group of NGOs have signed an agreement on sustainable biomass used for co-firing in Dutch power plants. The deal effectively provides a green lane for FSC certified biomass in terms of meeting criteria for sustainable forestry.
The agreement includes criteria covering three main areas: Sustainable forest management, chain of custody and climate impact.
Under the deal, primary feedstock - material coming directly from the forest, such as woodchips – needs to originate in sustainably managed forests. For primary feedstock, the deal only allows “FSC certified, sustainable material or equivalent” to be used for co-firing in Dutch power plants in the future. Co-firing refers to the use of biomass together with fossil fuels. Secondary feedstock – such as sawdust, cutoffs etc. from sawmills - is only required to be of legal origin.
This agreement was reached between leading Dutch NGOs (Greenpeace, Nature & Environment, WWF and Friends of the Earth) and Energy Netherlands, a national industry association covering nearly all Dutch energy producers.
The deal is voluntary. However, companies that are members of Energy Netherlands must comply with the criteria set out in the deal.
Green lane for FSC
The wording of the deal implies that FSC certified material automatically fulfils a key part of the criteria – those that cover sustainable forest management. It is the only scheme mentioned in this way.
FSC Controlled Wood is accepted when it forms part of an FSC certified product, however there is no green lane for material with the Controlled Wood claim only. In practice, this means that FSC Mix products are accepted.
While the covenant explicitly mentions FSC as fulfilling these criteria, it does not exclude other schemes from being eligible.
The deal refers to “FSC certified, sustainable material or equivalent”, opening the door to other schemes that may also fulfil the criteria now or later.
A special committee set up by the agreement’s parties will clarify the exact meaning of “equivalent”.
Potential market impact
At this point, suppliers should benefit from FSC certification since this fulfils criteria for sustainable forest management without further evaluation.
This spells good times for FSC certified operations, but accentuates the problems for those who are excluded from FSC certification, notably smallholders. “I hope that the Dutch deal will speed up the process to adapt the FSC system to provide better access for small forest operations. This is something that FSC needs to address, and the biomass deal brings matters to a head," notes NEPCon Executive Director Peter Feilberg.
"If the FSC system is not adapted, there is a risk that the agreement will exclude small family-owned operations from the Dutch biomass market. FSC needs to consider alternatives such as risk-based approaches to certification or contractor certification models.”
The fact that the requirements for sustainable forest management applies to primary feedstock only may lower the deal’s potential impact considerably, Mr Feilberg adds. “This essentially creates a back door for non-certified wood pellets made from secondary feedstock such as sawdust and off-cuts from sawmills. However, buyers will still need to verify legal origin of non-certified products, and this may still steer the energy companies towards FSC products as the easiest option,” he explains.
Implications for US forest owners
The use of American forest products for biofuel in Europe is at the centre of on-going debate in the US. The US wood pellet production is expanding rapidly in response to demands from the European energy sector. Critical voices now accuse this growing trade of eroding the natural heritage of American forests through unsustainable logging practices.
The US NGO Dogwood Alliance finds the deal too soft, partly due to the extended deadlines for smallholders. The organisation states, “The timeline for implementing the FSC standards leaves the door open for continued forest destruction for several years”.
However, the deal includes a commitment by Energy Netherlands to support smallholders in the US in complying with the sustainability requirements. The energy companies have pledged to allocate 3 million EUR for direct support.
The Dutch deal thus bolsters an on-going push to get American family forests on board the FSC system. US smallholders manage vast areas and so far, there is limited uptake of FSC certification amongst them.
The deal is quite explicit when it comes to realising its goals. Operations larger than 500 hectares must fulfil the criteria straight away, while the deal takes a softer approach to smaller operations. Sourcing from smaller non-certified operations can continue until 2021. However, during this period companies need to work with the smallholders to ensure progress.
Each energy company must thus meet the following minimum targets for “FSC-certified or equivalent” inputs from operations smaller than 500 hectares:
|By 1 January||2016||2017||2018||2019||2020||2021||2022||2023|
In 2019 and 2022, the parties will evaluate the level of success in reaching these targets.
However , the question remains how this will this play out in practice, says Mr Feilberg. “There are serious challenges involved in transmitting data on the share of FSC material from forest operations below 500 ha throughout the supply chain. This type of information is not handled through the FSC Chain of Custody system today and a new method needs to be developed,” he observes.
A remarkable deal
“For all the question marks, this deal is quite unique. In essence, the Dutch energy sector has voluntarily adopted stricter sustainability requirements than those set up by the Dutch government,” remarks Mr Feilberg.
“However, the success of the Dutch deal hinges on the resolution of some rather tough challenges: First of all, there is no way of tracking material from operations larger than 500 ha in the system today. In addition, the FSC system is not well suited for small forest properties. Unless functional systems are set up to overcome these two key barriers, there is a risk that the Dutch deal will exclude a significant share of the forest owners from the sustainable biomass market in the Netherlands. There is also a risk that the Dutch energy sector will rely more on non-certified secondary feedstock.”
“The deal also marks a higher level of collaboration between the NGOs and the corporate sector, implying a long-term commitment by both sides. This is in itself a great achievement, and I hope this collaboration will prove fruitful.”