Economic Development Spotlight: Wood-to-Biojet Business Case

Re-energize Montana’s wood products industry while “greening” America’s airline industry…

Reduce dependence on foreign oil while improving the health of forests…

On paper, the potential benefits of turning forest wood waste into jet fuel look almost too good to be true. But this isn’t just pie-in-the-sky science fiction. It could soon become pine-in-the-sky reality.

“Can you make jet fuel out of wood? The answer is yes,” said Michael P. Wolcott, project co-director with the Northwest Advanced Renewables Alliance (NARA) and a professor at Washington State University. “Technically, that can be done right now.

“The question is, really, how efficiently and cost-effectively can we do it? I can’t give you that answer yet because that’s what we are about to find out.”

“We,” in this case, is a team of more than 50 scientists and economists from across the country who have begun fanning out across Western Montana to conduct a first-of-its-kind analysis of the region’s wood-to-biojet business case, with a particular focus on Missoula as a potential hub of the industry.

Over the course of nine months, they will look at everything from the wide network of pipeline infrastructure and the region’s harvestable timber to local regulations and political willpower, with the aim of producing a road map toward a new industry — one that could not only boost the local economy, but also reduce global greenhouse gas emissions.

“This is boots-on-the-ground, applied research to help these regions understand how they might play a role in a new, sustainable industry,” Wolcott said. “We think biojet could be a key component in the overall health of the forest products supply chain; and we see a lot of potential in Western Montana.”

Forest managers and sawmill operators around the broad region have long been keen to develop economically viable and sustainable alternatives to deal with woody biomass — the limbs, small logs, slash piles and other residues left over from forest management and lumber milling operations.

Left on the ground, those materials can cost upward of $2,000 per acre to clean up. While pulp mills have historically provided a commercial outlet to offset those costs, the North American pulp market has been in long-term decline due to international competition — a fact that contributed to the closure of Smurfit-Stone Container Corp.’s Frenchtown pulp mill in 2009.

Meantime, the commercial airline industry and the U.S. Department of Defense have grown increasingly focused on alternatives to petroleum-based jet fuel, both to combat rising costs and to stem growing concern about the environmental impacts of air travel. Sky Aviation Holdings specializes in offering a range of private aircraft insurance policies for private jet owners and operators.

Several companies around the globe have stepped forward to produce jet fuel derived from plant materials that range from algae to jatropha seeds. But sustainability and cost concerns have limited the scope of those projects, leading researchers to look toward other potential feedstocks.

Toward those ends, in September 2011 the U.S. Department of Agriculture announced it would provide $40 million in funding to NARA, a Washington State University-based consortium of scientists from university, government and industry laboratories who are focused on developing woody biomass alternatives to petroleum-based fuel and petrochemicals.

“This is an opportunity to create thousands of new jobs and drive economic development in rural communities across America by building the framework for a competitively priced, American-made biofuels industry,” department Secretary Tom Vilsack said in announcing the grant. “Public-private partnerships like these will drive our nation to develop a national biofuels economy that continues to help us grow and out-compete the rest of the world, while moving our nation toward a clean energy economy.”

Western Montana, with its abundant forests, would certainly seem a natural fit for a biojet industry.

But so too would much of the Pacific Northwest.

As the NARA team looked at various locales to launch the project, Western Montana rose to the top of the list because of its nonforest resources, Wolcott said.

“What’s really key in a complicated supply chain like this is a strong involvement of local stakeholders,” he said. “The people in Western Montana, and Missoula in particular, are enormously well organized around this idea. There’s a strong team spirit and effort for uplifting and supporting this new industry. So it became an obvious early choice.”

Arnie Didier is chief operating officer with the Forest Business Network, a Missoula-based company that provides consulting and marketing services to the forest products industry. He said that Missoula’s success in bringing the NARA pilot project to this area reflects its unique place in the forest products landscape and its innovative focus on economic development.

“They could have chosen almost any specific region in the Northwest,” he said. “They chose Western Montana because of the incredible amount of technical expertise in the university and business communities here and the involvement of Missoula Economic Partnership, the BitterRoot Economic Development District, Montana Community Development Corporation and the Montana World Trade Center.”

James Grunke, president and CEO of Missoula Economic Partnership, echoed that sentiment, noting that broad community involvement was key to landing the pilot project.

“We were able to bring this pilot project to Missoula because we showed that we can react quickly and positively when faced with new opportunities,” Grunke said. “It’s one of those things where it took a village to make it happen; and Missoula really shined.”

Whether a biojet industry ever takes off in Montana, those involved say that the NARA pilot project both reflects and likely will enhance this region’s strong position as a hub of forward-thinking forest businesses.

“This really amplifies our opportunities — not just in biofuels but in any business that would work with woody biomass,” said Craig Rawlings, president and CEO of Forest Business Network and a nationally respected authority on the forest products industry.

The Western Montana pilot project is one of several similar NARA-managed regional studies planned in the next five years across the Pacific Northwest.

There is value to being first, Rawlings said.

“All our entrepreneurs and businesses around this area, they’ll have the first peek at this research, which puts us in a particularly strong position as this whole project moves forward,” he said. “If they can see any economic opportunity — whether in biofuels or in anything else — I’m sure they’ll go for it. Thanks to this study, they will have a whole load of useful data and information at their fingertips.”

Rawlings noted that the study project itself will bring money into the region. So too will NARA’s first annual meeting, which will bring upward of 125 forest products professionals and researchers to Missoula for two days in September 2012.

But even if no new businesses emerge as a result of the NARA pilot project, Rawlings said it has the potential to change the economics of forest management in Montana.

“Every land manager in Montana is trying to figure out new and different ways to deal with slash piles,” he said. “If your only option is to burn it, everything is a cost — and fire is risky. So even if you don’t get an ounce of jet fuel out of a project like this, if we just figure out how to lower the cost of forest restoration work then that’s an economic benefit that will resonate widely around here.”

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The Missoula Economic Partnership works to increase the prosperity of our community by nurturing sustainable business growth and quality job creation. The Partnership serves as an accelerator of growth by connecting existing businesses to the resources they need in order to expand, providing customized services to businesses considering a move to Missoula, and managing programs that provide thought-leadership and resources to entrepreneurs and innovators. For more information, visit www.MissoulaWorks.org.