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2012 Charlotte Regional Meeting [Enviva] John Keppler
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August 2012


Company Overview

• Worldwide Biomass Markets

The Wood Pellet Business
– Operations
–  Benefit to Landowners and Communities

Sustainability & Certification







Established in 2004
Enviva’s mission is to become the preferred partner and
supplier of sustainably sourced wood pellets and other
processed biomass to serve power generation and industrial
customers seeking to decrease their dependence on fossil
fuels and reduce their carbon footprint.


 Enviva 2012 Capacity (MTPY)

  2012 Capacity                            775K MT 


 Enviva 2013 Capacity (MTPY)

  2013 Capacity                            1,775K MT 


 Enviva 2014/15 Capacity (MTPY)

  2014/15 Capacity                   ~5,000K MT 


Enviva also operates a 50k MT CHP pellet plant in Belgium.






 Worldwide biomass markets



 Wood Pellets Are an Increasingly Important Fuel Source For Utilities & Power Generators

Enviva procures wood from timberlands and other 
forest resource owners and processes it into wood 

Wood pellets provide power generators with a "drop
in”alternative to coal:
Similar physical properties to coal
Reduces overall carbon footprint of generation by
  ~ 80% compared to coal

 High energy density and uniform shape enhance
transportation and storage economics

  Wood Pellet vs. Coal Attributes


Wood Pellets


PRB Coal

Median Heat content
(BTU/ lb)





4 - 10%

< 10%

26 – 30%


0 – 2%

< 13.5%

4.6 – 5.7%


0 – 0.15%

< 1.0%

< 1.0%






  • EU 2020 Goals have aggressive, binding renewable energy and carbon compliance requirements
  • Wood pellets provide utilities with attractive carbon neutral operational alternative to meet obligations
    • Base load, firm capacity, dispatchable
    • Low-cost, High return alternative
    • Existing conventional generation can be converted 
  • Currently available supply insufficient to meet huge demand growth
    • Europe is natural resource constrained
    • worldwide industry lacks installed manufacturing capacity
    • Few "enterprise" operators

source: McKinsey Analysis, Poyry                                                                                          Note: Analysis includes capital investments and excludes regulatory support



  • Asia is key export market after Europe
  • Pricing expectations vs. cost realities gap will narrow
  • Shipping differential is about $20
    • $20 higher from South East of the US to Asia than from West Coast
    • $20 higher from West Coast to Europe than from South East to Europe.
  • Southeast fiber remains competitive due to lower delivered fiber costs, operating costs, and infrastructure


  • Potential large US demand, even 1 percent coal displacement in the US would be approximately 17 million metric tons per year; however…
  • No national environmental / carbon policy so market is fragmented
  • Application of EPA BACT and other requirements increase cost of compliance for sub 600MW generators and fully-depreciated assets; fuel switches possible
  • State level mandates provide one-off opportunities for utilities


The wood pellet business 


Companies like Enviva aggregate and process wood fiber into solid wood pellets and
store, terminal and distribute this energy commodity to major power generators much 
like the conventional energy supply chain does for coal and oil


  • Abundant, sustainably harvested
    forests and timber resources
  • Strong growth to drain ratios that
    have exceeded one for decades
  • Well-developed logistical
    infrastructure (waterways, rail and
  • Proximity to international export
  • Operating cost advantage
    Established forest monitoring and
    best management practices
    Wood basket proximity to inland
    waterways and export ports


  •  Enviva’s wood biomass sources include:
    • Processed residues, (chips, bark and sawdust by-products).
    • Unprocessed residues, (tree tops, branches, stumps, and other forestry debris remaining after the primary biomass or tree trunk has been processed and shipped from the forest).
    • Low-grade wood fiber and round timber.
  • Unprocessed residues most likely go unused as a resource without demand from companies like Enviva.
  • Ratios of processed, unprocessed and round timber vary according to economic environment, location, local resources, etc.





  • Enviva’s fiber supply team has over two centuries combined forestry experience
  • The wood pellet industry is stable and growing
  • We enter into long-term offtake agreements with our customers and provide consistent, ratable supply (and fiber demand)
  • We sourcing over 1 million tons of green fiber per facility in the mid-Atlantic region
  • Enviva encourages supply chain growth and inspires confidence
    • Enviva supports the implementation of BMPs, continuing education for loggers and promotes sustainable forest practices to ensure responsible fiber extraction
    • A broad, stable supply chain is good for us and good for the region


 Southampton Virginia Example

  • $90 million in capital investment
  • Direct Impacts of Plant Operation
    • 70-80 jobs and over $76 million annual expenditures in wages and supplier contracts
    • Includes more than $30 million in wood purchases
    • Average Enviva salary in Southhampton: $35-40k (30% - 50% above avg.)
  • Indirect Impacts in Southampton County

    • $40.9 million and 157 jobs in the county
      • Among those:
      • $13.1 million and 92 jobs estimated for county logging industry
        • Estimated based on 945,000 annual green tons of wood
      • $5.0 million and 42 jobs estimated for county trucking industry
  • During the construction phase, over 300 jobs created with construction contractors

County estimates that net impact is over $120MM per year and 234 new jobs in the county

Source: “Economic Impact of Biomass Manufacturing Plant in Southampton County, VA.” Study by Chmura Economics and Analytics, Prepared for Enviva December, 2011.




  •  Kyoto Protocol
    • EU Member states have signed and ratified Kyoto Protocol, a part of the United Nations International Framework Convention on Climate Change
    • Signed in 1997, effective in 2005, collective commitment between developed
      countries to reduce GHG
  • RED (Renewable Energy Directive)
    • EU Mandate: Renewable Energy Directive (RED): Adopted April 2009, sets a common framework for the promotion of renewable energy sources (RES).
    • Mandate that by 2020:
      • 20% energy sourced from renewables
      • 20% decrease in energy usage
      • 20% decrease in GHG
  • European NREAP (National Renewable Energy Action Plans)
    • As part of RED mandate, each of the 27 member states must lay out an NREAP which maps path to meeting RED goals. Includes mix of renewable energy sources (RES), support mechanisms to encourage investment and final RES goals.


European member states importing biomass for power generation view US as transparent and relatively low risk; however, these same countries deem forest certification as a means to ensure sustainable forest management and to avoid the threat of deforestation.

 Customers are increasingly concerned about not only whether they will receive a wood pellet but also whether they will receive environmental credit for that pellet



EU and Country-Specific Sustainability Qualification / Compliance

EU and countryspecific requirements lay out framework for sustainability qualification Enviva’s strategy is well structured to meet sustainability requirements Certain third party auditors have been selected to certify biomass providers Enviva has obtained the appropriate certifications from those third party auditors to meet sustainability requirements


Enviva fiber sourcing and processes are certified sustainable; however only ~20% of our raw material is certified

Sustainable Forestry Initiative (SFI)
SFI Certified Sourcing Certification (April 2011)
SFI Chain of Custody Certification
(March 2012)

Forest Stewardship Council (FSC)
FSC Chain of Custody Certification (April 2012)

Programme for the Endorsement of Forest Certification (PEFC)
PEFC Chain of Custody Certification
(March 2012)

Green Gold Label Certification (GGL)
(March 2012)


Fiber from certified forests facilitates market access and ensures continued growth of forest-to-energy market

American Tree Farm
System (ATF) (SFI)

accepted by SFI and PEFC

Sustainable Forestry Initiative

accepted by PEFC

Programme for the
Endorsement of Forest
Certification (PEFC)

Forest Stewardship Council



 John Keppler
Chairman & CEO

Enviva LP
7200 Wisconsin Ave, Suite 1100
Bethesda, MD 20814 USA





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