Tag Archives: forest biomass

Mongabay: Enviva bankruptcy fallout ripples through biomass industry, U.S. and EU

Tractor-trailers each loaded with 40 tons of wood chips waiting at Enviva’s pellet mill in Ahoskie, North Carolina, which opened in 2011. “There’s no way Enviva is coming out of Chapter 11, [bankruptcy]” a former Enviva employee and whistleblower told Mongabay. “Their manufacturing equipment is not fit for the service it’s required to deliver. Only two of its 10 plants (one in Florida, one in Georgia, neither built by Enviva) are hitting their maximum achievable targets for pellet production.” Image courtesy of Bobby Amoroso.

In this story, I continue my coverage of Enviva, the Maryland-based company that claims to be the world’s largest producer of wood pellets for industrial-scale energy. The pellet maker has been a dominant force in the industry in the Southeastern United States, especially my home state of North Carolina, since it opened its first pellet mill more than a decade ago. A couple of years ago, it topped $1 billion in annual revenue, its stock price rising above $87 a share. Enviva boldly planned major expansions in the Deep South and predicted pellet production to go from 6 million metric tons annually to 13 million metric tons by 2027.

That was then.

In the spring of 2024, Enviva found itself in Chapter 11 bankruptcy, having lost hundreds of millions of dollars in 2023 from a variety of circumstances — some beyond its control, many of its own making. It’s stock price is below 50 cents a share and Wall Street analysts, once bullish on forest biomass energy, are now warning investors away. This story continues my explanation of why Enviva is failing, with additional insight from an exclusive source who continues to provide an invaluable look beyond Enviva’s public statements and required disclosures as a public company.

A new angle to my coverage is how forest advocates have been shifting their attention to Washington, D.C., because of the Biden Administration’s Inflation Reduction Act and the billions provided to incentivize renewable energy. Enviva, in desperation, is eager to convince the Environmental Protection Agency and other government offices, that is produces an legit renewable energy source and climate mitigation strategy amid the climate crisis. No rigorous, independent research supports that claim in the timeframes needed to slow the rate of global warming. But Enviva is angling for millions in US tax subsidies to help it pay for new plants in Alabama and Mississippi.

As my story explains, there is a lot at stake not only in Enviva’s future as a major supplier of wood pellets to the UK and EU, but also the future of forests desperately needed to remain standing as yet our best and most effective defense against erratic weather and accelerating global warming.

Mongabay: Study — Burning wood pellets for energy endangers local communities’ health

This wood pellet manufacturing plant in Ahoskie, North Carolina was Enviva’s first in the state, opening in 2011. Wood feedstock – pine and hardwood – arrives at the plant already chipped from native forests within a 50-mile radius of the plant. The chips are dried and then pressed into pellets. According to a new study in Renewable Energy, wood pellet production emits more than 55 hazardous air pollutants, along with tons of volatile organic compounds and particulate matter. Many of the pollutants can be harmful to human health. Image by Justin Catanoso.

The interesting thing about the facts that are the heart of this story of mine: it all sounds so familiar. Burning forest biomass causes enormous amount of emissions and hazardous pollutants from both the manufacturing process and the burning-for-energy process? Don’t we know this already?

Well, yes and no. Forest and public health advocates have been decrying for as long as I’ve been covering this issue the harmful impacts from every process that is the wood pellet industry — from clearcutting native forests that reduce carbon sinks and degrade biodiversity, to emissions from drying wood before its pressed into pellets, to pollution from the transportation sector to move pellets from one place to another, and finally, enormous emissions from burning these pellets instead of coal.

Because so much is assumed — and obvious (like the obvious health hazards of smoking cigarettes for years) — we assume, too, that there are rigorous scientific studies that prove what so many assume. This may be true in Europe, but it has not been true in the United States — until the 2023 publication of the study that is focus of my story.

This research is enormously important given the growth of the wood pellet industry and the growing interest across the United States to start burning wood for energy and claim — erroneously — that it’s a legitimate climate solution. There is no legitimate science that supports that industry claim. I am glad Mongabay continues to cover this issue closely. Sadly, this important study was not covered by any other news media.

Mongabay: Enviva, the world’s largest biomass energy company, is near collapse. Here’s why.

Forest biomass protestors outside Enviva’s Raleigh, North Carolina, offices. Across the UK, EU and Japan, forest campaigners have consistently protested the local and global impact of the world’s largest producer of forest biomass — wood pellets — for industrial-scale burning in former coal-fired power plants. Ultimately, the company’s own grave operational problem at its plants appear to be behind its financial collapse. Image by Kimala Luna courtesy of the Dogwood Alliance.

I was in the air on a Delta flight to Bozeman, Montana, on November 9, 2023, when I received a text message from a source: Enviva‘s stock was collapsing and the company had warned in a financial disclosure what it “may not be able to continue as a going concern.” I didn’t exactly see this coming, but ultimately, having written in May about Enviva’s unexpected financial tanking in the first quarter, I wasn’t fully surprised.

As I read the breaking news coverage from the environmental and business press about the near fall of the world’s largest producer of wood pellets for industrial-scale burning for energy instead of coal, I saw an enormous gap — even in The Wall Street Journal. All the stories recited the staggering losses and the new, interim CEO’s positive spin on a desperate situation. But none of the stories could explain why a billion-dollar company with long-term contracts around the world, and where demand for pellets is at a record high, had lost more than $250 million this year and exhausted a $570 million line of credit.

That’s the only story I wanted to write, and it’s linked here. Enviva’s travails are acknowledged — in carefully shrouded accounting language — in its public filings with the Securities and Exchange Commission. But I am fortunate to have as a source a former Enviva maintenance manager at two of its 10 Southeastern US mills. I interviewed him once I got settled in Montana and again when I returned to North Carolina. Based solely on his experience at Enviva over two years — 2020-20222 — he was able to explain the plausible whys and hows behind the staggering losses. This source, still unnamed for reasons of privacy and security, was my whistleblower in December 2022 in a story that reverberated globally.

This story quickly attracted international attention, too. In fact, it ranked as the No. 1 best-read story on the Mongabay website in November with more than 85,000 readers; that’s a lot. Better still, by year-end, my report made the list of 10 Most Read Stories of 2023, ranking sixth. As yet, though, it’s not clear yet what the ultimate ramifications of this downfall will be on the highly subsidized global market for forest biomass and the countries that have come to rely on this scientifically denounced form of energy in a climate crisis.