Timber operators in southern Laos are under increasing pressure from Government policy & public sentiment to evolve their strategies in the midst of global and ASEAN trade certification and regularisation. There appears to be limited succession planning in place to meet this need from within the timber industry. Biomass however represents a promising potential to bridge this gap – especially within the southern provinces of Laos where land is fertile and abundant. With a clear mandate develop it’s renewable energy sector, the Government of Laos is suitably poised to help bring forestry related players inline with the greater energy strategy of Lao PDR.
Savanakhet Timber Industry
Logging in Laos is concession based, with felling conducted outside of the rainy season (June – October) due to inaccessibility to concession sites. Replanting felled trees is currently only recommended practise, and un-enforced.
Whilst traditional logging concession are fast becoming a thing of the past, much of the logging is still conducted under the guise of clearing land for project needs (mining & Exploration; Hydropower). As such there is an acute need for the Provicial Government to deploy projects which better leverage on sustainable deployments (such as biomass) by utilising land concessions as the underlying asset.
There are 36 known timber processing mills operating in the Province. These operate throughout the year from logs collected during the logging season. They are primary as well as secondary mills – processing plywood and veneer. Almost all are held within the control of one consortium.
Currently, the group is able to collectively produce 100,000 tones of wood waste annually. Some of the waste stock is reused as energy for wood curing, while a small quantity is sold to Thai buyers at USD30/tonne. It is assumed that the Thai’s are using the material as fuel briquettes for cooking. The possibility to access this waste stock has been welcomed by the consortium players.
Whilst there has been previous reports of biomass plants proposed for the Province of Savannakhet, it is understood from provincial officials that none have been effectively deployed. This does not include power plants for private or specific industrial applications and not connected to the grid.
Accordingly while both Provincial government and the Electricity authority (EDL) indicate support of renewables in principle, guidelines for tariff structure are yet to be formalised. Henceforth an important consideration is the Power Purchase Agreement with EDL as early stakeholders. It is expected that a benchmark rate of USD 0.13-0.15 /KwHr for biomass can be achieved.
A proposal is being drafted for submission by HDPG, which calls for a 350 Ha biomass concession, on a site suitably located to feed into the EDL grid. The proposed design will include allocation for a 5 Ha power production plant and an adjacent 345 Ha feed plantation. In so far as can be made commercially viable, the project will consider the potential of collecting externally sourced biomass fuel, such as excess wood chips, rice husk etc. which is available to the local context.
A feasibility study to determine feed and optimal power plant design will be follow immediately on award of concession, with a phased or modular pilot plant planned for commissioning within 3 years of concession being granted.
Candidate crops currently being studied and in order of preference are:
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