Wood Fuel Supply Chain Design Study for Reigate and Banstead Borough Council

1. Wood Fuel Supply Chain Design Study for Reigate and Banstead Borough Council Prepared by Julian Morgan-Jones and Bruce Norgrove for Raymond Dill and David Sowe R&B BC February 2008 DRAFT V0.1 15.02.08

2. Contents • Executive Summary • Engagement Objectives and Methodology • Background and Opportunity for R&B BC • Assessment of Local Demand • Assessment of R&B BC’s current production and supply capability and capacity • R&B’s Own Supply Chain Options and Costs • (Detailed design for selected option - TBD) • Recommendations and next steps DRAFT V0.1 15.02.08

3. Executive Summary • To be completed after draft discussions DRAFT V0.1 15.02.08

4. SEWF Engagement Objectives and Methodology Objectives • To identify R&B BC’s own wood fuel volumes, capability, capacity with the aim of developing a design for R&B BC’s own wood fuel supply chain and detailing the costs and benefits for doing this. Methodology • An assessment of background, known demand, R&B objectives for wood fuel was conducted in meetings with Raymond Dill and David Sowe and the SETG • Assessments of R&B own production capability and capacity was conducted in interviews with representatives from R&B BC’s Parks and Countryside department and with contractors used by them for managing parks and heath lands. Information on woodland management and potential wood volumes came from a separate study for R&B BC by Bioregional. • Assessment of recovered wood capacity and capability was conducted through interviews with BritaniaCrest Waste recycling • Analysis of findings was conducted with reference to forestry commission and other industry standards for each production and capability element • Options were presented and discussed with the study sponsors before finalisation of this document DRAFT V0.1 15.02.08

5. Background, Objectives and Opportunity There are a number of drivers supporting the increased use of renewable energy within the South East. Critical amongst these are rising fossil fuel prices, increasing awareness of energy security as a long term issue and climate change in the form of governments carbon reduction targets. These targets are increasingly being reflected in regional plans for housing and construction such as the South East Plan and specifically for the purposes of this study for the area know as the “Gatwick Diamond” as well as in local planning requirements and building codes. This applies equally to R&B’s own progressive planning policies for 10% of energy requirements of all new construction to be derived from renewable sources from March 2008. As early as October 2005, as part of R&B BC’s own sustainability objectives, Biomass was being seen as a key contributor to the increase of renewable energy within the region [1]. A critical enabler for biomass is the development of a supply chain to deliver this. The development of R&B BC’s own supply chain would from part of a wider supply capability for region. Over and above this it would help R&B BC to meet a number of its own aspirations and objectives while providing a additoinal benefits. Meeting R&B’s local objectives R&B’s vision for wood fuel is still in its formative stages. Work such as this report and others are contributing to the development of ideas and to a growing understanding of the possibilities and potential. In the mean time R&B are keen to see biomass and wood fuel contribute to current council objectives. Key amongst these are: • To provide a significant contribution to meeting council’s carbon the reduction targets: Biomass is a carbon neutral fuel that if used widely could contribute significantly achieving this whilst at the same time reducing the Borough’s reliance on fossil fuels and hence improving energy security by the use of a locally produced fuels. Biomass is increasingly being seen as the best land based investment for carbon reduction for large scale heating requirements. Council support for renewable energy through planning policy is already • To support local regeneration: Biomass supply is a local issue. If the large new housing and commercial developments within the Borough can be encouraged to utilize biomass as a heating fuel this will support regeneration of local woodlands and the diversification of local farmers to produce wood (in the form of short rotation coppice) as an energy crop. • To improve the Council’s image as an environmentally concerned, innovative, progressive organization: Wood fuel has traditionally lagged behind more “sexy” environmental technologies such as wind and solar thermal and photovoltaic. It is clearly a key environmental technology and this image is rapidly changing as more and more organizations realize the opportunity and value of wood heating particularly for local heating and power requirements. • To provide an income stream for management of Council owned woodland resources: Currentlythe council spendsin the order of £xxxx to manageand maintain its parklands essential H&S for trees. To date this is a net cost to the Council and rate payers. If the wood created as a by product of this had a market, this could be used to offset costs or expand council services. Moreover if the council were to install its own biomass heating systems it could use wood direct from council resources could to replace fossil fuels. [1] Sustainability Appraisal and Strategic Environmental Assessment of the Local Development Scoping Report Oct 2005 DRAFT V0.1 15.02.08

6. Background, Objectives and Opportunity Opportunities from using wood as a fuel As well as meeting local objectives the use of wood as a fuel provides other opportunities for the council. The development of the councils own capability to supply provides for The Ecological opportunity Household energy consumption is responsible for 17%of the total Borough’s Ecological Footprint [2]. While the technological potential for almost zero energy buildings exists, achieving it depends on lifestyles and institutions (for instance, the problem of split responsibilities between landlord, utilities and tenants). Use of biomass for heating and power together with other renewal technologies such as solar thermal provides a cost and environmentally effective compromise for new developments.[3] [2] SEI: The Ecological Footprint of Reigate and Banstead. Jan 2006 [3]Preston Regeneration: Sustainable Energy Feasibility Study. March 2007 DRAFT V0.1 15.02.08

7. Demand Assessment The table below shows the estimated known and potential demand within the R&B area by probability. This clearly shows a strong potential demand and hence provides confidence for establishing a local supply capability. DRAFT V0.1 15.02.08

8. R&B Current Capacity and Capability Assessment Note: Forestry Figures still need confirmation by Andrew Tolfts Wood Resource: Tonnes of wood @ 30% mc available from following Findings Summary The study has found that R&B can produce in the order of 693 tonnes of wood annually on a sustainable basis from its own resources. More could be produced in association with Surrey CC tree services but this needs further assessment. However the Countryside and Parks Team have neither the manpower, skills, equipment or additional budget to do this work internally. They currently rely on external contractors for managing woodland and the health and safety related tree work. Members of the department would like to bring contracted work in-house and expand the man power and capability of the team to perform these and other woodland/tree related functions and are keen to explore the opportunity wood fuel might bring to do this. The study also found a large potential supply of recovered wood from local waste recyclers. Woodlands 558 ha woodland, up to 500 tonnes wood per annum Arboricultural Approx 50 tonnes per annum in house - Much larger potential volume from Surrey CC street trees in local area Land and scrub clearance Approx 130 tonnes per annum during habitat restoration schemes Fuel Wood from waste recycling Up to 10,000 tonnes per annum from BritaniaCrest + more from 3 other local waste recyclers Capability Storage and processing 1.5 ha, 2 sites, no suitable undercover storage Equipment 2 small tractors for gang mowing in summer, 1 x small yard tractor, 1 x 4.5 tn trailer, no forestry or processing equipment, small brush wood chipper Manpower and budget In house team at full capacity. Arb. Contracted out at £100k p.a. and Forestry sub-contracted. Habitat and other done by Volunteers Skills The department currently has none of the skills in house required to harvest, extract or process wood for wood chip DRAFT V0.1 15.02.08

9. Cost / Benefit for R&B Supply Chain Options OPTION 1A – INVESTMENT IN AND UTILISATION OF IN- HOUSE R&B RESOURCES This assumes R&B invest in all the equipment and man time to support all process elements from harvesting of wood to delivery of chip.OPTION 1B – UTILISATION OF IN-HOUSE WOOD - FULL OUT-SOURCEOF PROCESS ELEMENTSAssumes the use of contractors under the management of R&B perform all processesharvesting of wood to delivery of chip. • Conclusions • Most financial benefit will be retuned from using R&B wood replace its own fossil fuel use. The “virtuous circle”. • A contracted out solution is the most cost effective way to provide a supply chain solution for R&B as it returns a margin through either external sales or internal use from year 1. • The in-house approach breaks even, even against gas and may have other benefits for the Parks and Country side team. • The in-house solution may benefit from use of the current H&S tree surgery budget as part of a holistic in-house solution • The in-house solution could benefit from access to more wood to achieve better economies of scale say through a tie up with Surrey CC or through setting up a tree station type operation, though land / space would need to be found for this. Notes: 1. Cost per tonne include annual costs: Man time, insurance, servicing, running costs DRAFT V0.1 15.02.08

10. Assumptions for Options 1A and 1B Assumptions for 1B only Assumptions for 1A only • As for 1A with the following amendments … • Stacking all timber at yard with undercover fuel store • Chipping seasoned timber directly into undercover fuel store using 16” crane fed chipper • Loading into trailers using telehandler or front loader and delivery to council or other users • No loss of rent from Pond Farm • Man Days: c.160 @ 120 per day • [not management] • Equipment:Motor manual harvesting equipment • Timber trailer with crane • 80hp tractor • 12” Handfed drum chipper • 15 / 20 cu.m High lift trailer • Storage Space: c.0.4ha [will work in new pond farm] No need for chip storage Assumptions for 1A and 1B • Motor manual harvesting and stacking in woodland • Immediate removal of all usable timber from woodland direct to the yard using tractor and forwarding trailer • Collection of stacked timber from Habitat management using tractor and forwarding trailer • Collection of timber from arboricultural arisings using existing vehicles or forwarding trailer • Stacking all timber at new pond farm (option 1A only) • Chipping seasoned timber directly into delivery trailer using hand fed drum chipper and delivery to council or other users using tractor and high lift trailer • Have not included cost/benefit of out/in sourcing Arboricultural contract • Have not included management: • Could be done either by council, forestry management company or other • Have assumed a loss in rent £10,000 per annum on 0.3 ha of storage space and 120m2 of barn space • Does not include standing value of timber DRAFT V0.1 15.02.08

11. Appendices DRAFT V0.1 15.02.08

12. In-House Processing Data DRAFT V0.1 15.02.08

13. In-House Annual Costs and Investment Data DRAFT V0.1 15.02.08

14. Sub-contracting costs for options analysis DRAFT V0.1 15.02.08

15. Summary R&B’s c.a. 2000t Other SEWF Membs 6000t Local Resources (17-50,000t) Mike Connick c.a. 5000t Other recyclers 30000t Farmers ESCO The Opportunity Landscape Supply Chain Brit. Crest 10,000t Simon Cox Preston 3000t Park 25 800t Demand (14,000t) Horley 2000+tonnes RAAS 350-2000t ESH 2500t Redhill TC 4247t Gatwick Diamond DRAFT V0.1 15.02.08

16. Potential Sites: New Pond Farm Access to Woodhatch Road Existing Buildings Glass Houses DRAFT V0.1 15.02.08

17. All within 2-3miles of Horley Wood fuel Hub Simon Cox Silage clamps Land Britania Crest 10,000t reclaimed wood Delivery vehicles Farmers ESCO (SEEDA funding) Harvesting, supply chain, boiler infrastructure The Horley Wood Fuel Hub and ESCO Opportunity DRAFT V0.1 15.02.08

18. Potential sites: BC & MF Moat Farm Britaniacrest DRAFT V0.1 15.02.08

19. Moat Farm Good Access to A217 Storage Bays Unused Land DRAFT V0.1 15.02.08

20. Development Area, BC & MF Development area? Moat Farm Britaniacrest Horley DRAFT V0.1 15.02.08