Lukas Schirnhofer, CEO of Polytechnik, Austrian company and one of the world’s leading biomass to energy technology providers, reveals in an exclusive interview for the Balkan Green Energy News portal, one completely new perspective of biomass utilization and potentials. With the new models in sustainable energy and development in place, it becomes clear that biomass today comprises very diverse range of fuels and each type has its own potential for a given application.
Being one of the world’s leading suppliers of biomass to energy technologies, could you tell us what are the trends in utilizing biomass potentials worldwide? How does Polytechnik fit into those trends?
The wood industry, being the biggest consumer of biomass in the world, is setting trends in lowering costs and becoming more competitive on the global stage. Of course biomass comes from all sorts of industries and Polytechnik has built plants in almost all of them. By no means are we putting the emphasis on the wood industry but the examples of good practice are the easiest to show there.
Trends show that utilization of low quality biomass fuel that cannot be used any more in a cascade approach becomes more important. Raw material is a commodity and the only way for production of any kind to be competitive in the global market is by utilizing its production residues, reducing the energy share in the final product and avoiding dependency on third parties. The circular economy or zero waste production is major trend today regardless of the industry – from the wood to the food industry.
Utilizing natural byproducts and residues which have reached the end of the life cycle have proven to be a good development policy instead of burning high grade residue or fuel (i.e. sawdust, dry wood) that can be transformed into another valuable product i.e. in the wood industry pellets or briquettes. Polytechnik has long term experience and know-how in combustion of low grade biomass fuels whilst keeping up output and guarantee levels. It is important to differentiate between waste and residue. Waste has no additional values while residue is a highly sought commodity.
What does it take for a small family business to become a company with a global footprint and thousands of successfully realized projects? What is the secret of Polytechnik’s success?
This family owned business owes its success both to its openness to innovation and continued technological development, but mostly to its outstanding qualified employees. It is our goal to gather in Polytechnik people who are professionals, intellectually curious and passionate for their work to be a part of our team and work together as partners for many years. The employees are regarded as members of the extended family. This has in turn created an environment of motivation, loyalty and team spirit. Employees are the firms human capital.
We have gone from two to 250 in a single generation. In the beginning, back in 1965 and the early seventies, the use of biomass for energy production was still not on the public radar, despite the oil crisis, but we believed in our technology, because the basic idea behind it was both simple and inspiring. Polytechnik then optimized its combustion technology to make it economically viable to use wood residues and other organic waste materials from various production as sources of fuel.
Photo 1: Polytechnik supplied Christchurch hospital at Burwood, New Zeland with two boilers with capacity of 2 MW and 4 MW respectively
The philosophy behind biomass – based on our corporate credo which can be summed up as “think locally act globally” – is now spreading around the world, with over 3,000 Polytechnik systems in operation. Frankly it takes a lot of work, travel and effort to be successful, you don’t sell more than three thousand specialized systems from your desk. The longer we have been producing combustion systems, the more we have come to respect fire as the main element involved. Each of our automation related developments has been concerned with taking system safety to another level.
Definitely another answer to your question is to be where the demand is and to create solutions that serve the demand. It’s our curiosity and the desire to constantly improve our product and performance that drives us to be one step ahead. As my father, the founder of Polytechnik, considered to be a pioneer in the sector would say, “I am a technical specialist with a desire to make the best of the space available to me. If our systems can contribute to us leaving behind a world that is at least similar to the one I was able to experience as a child, I will be satisfied”. Finally, the purchase of the product does not mark the end, but rather the beginning of our relationship with the customer. Our customers are always repeat customers.
Which industries do Polytechnik’s major clients come from? Which industries do record the highest energy efficiency when applying biomass technology? What about district heating companies?
The company has clearly grown with the wood working industry. This sector was our first but it is not the only client today. Obviously the reason for this sector being in need of our products was the abundance of waste material/residue. And while at the beginning the need was to safely, economically and efficiently dispose of this natural waste material while satisfying the production needs for energy, today this industry has greater appetites.
New business opportunities through cogeneration plants, energy efficiency and other incentives have increased the appetites of investors. Besides, the average age of the energy systems (boilers) within the wood working industry, for example in Southeast Europe, is 25-30 years, which means that efficiency can be improved by at least 25%. Plus the range of residues that can be burnt is more flexible.
The need for reinvesting, modernizing and installing energy efficient, cost reducing solutions is real, only the mindset of the decision makers sometimes still remains a question mark. Highest energy efficiency is the demand of utility companies and also district heating companies. In these cases all savings or life cycle planning mostly depend on the efficiency levels and feedstock consumption. Maximizing the benefit from a given technology is the key while lowering fuel quality dependency and feedstock supplier risk. These operators are realizing that by burning local, carbon neutral, often subsidized domestic fuel is the only way to reach full independency from global trends and prices, while maintaining high quality service, sustainability and employing the local workforce, while reducing emissions.
Due to emissions restrictions it becomes more and more important for district heating companies to diversify their energy portfolio where biomass should have a significant share to be considered. Just looking on the control side with our fully automatic systems we can increase efficiency by at least 5-10% as opposed to the industry standard. Utilizing the modern technology of biomass solid fuel combustion we are erasing stereotypes which depict biomass as dirty, inefficient, complicated, or labor intensive.
Biomass today comprises very diverse range of fuels and each type has its own potential for a given application. Natural residues or by-products or waste produced in the food industry, paper/pulp industry, dairy and poultry/broiler farming can all be applied. Energy crops such as mischantus, poplar, willow should also be considered. We all have to be aware that it is not feasible for every district heating company or industry to switch to biomass. The necessary conditions have to be met for this transition.
In any case examples from Austria, Germany and the Nordic countries have shown both good and bad practice of utilizing biomass. The eastern European and Asian markets with their well-established network of district heating systems are increasingly converting to biomass. Utilizing low grade biomass the savings on feedstock can be between 20-40%.
Recently you celebrated 50th anniversary of Polytechnik. What are Polytechnik’s development and investment plans in the coming period?
First thing: continuity. It is important to our customers. We want to follow a way of sustainable growth in our current markets and to invest in new markets and new technologies such as gasification and utilization of untreated agricultural biomass fuels.
Photo 2: It is not just the technology supremacy of Polytechnic biomass to energy solutions, but aesthetic one as well
The supply of turnkey plants, which allow new users, once fully trained, to operate their systems with the flick of a switch, has been the underlying sales success and worldwide hit. We want to continue this in the future. Having everything under one roof has enabled us to venture successfully into new markets. Our biomass-fired systems developed into core elements of our customers operations. We have become their equal partner.
Second word: innovation. Polytechnik will continue innovating and growing. Currently the company reinvests around 3% of its turnover for R&D. Once we establish a presence, the customers rely on us for stability and support. Biomass has a future because it is available everywhere in the world. It is sustainable and local. Long transport chains are not needed, and international dependency on raw materials, often the cause of many political conflicts, is reduced.
Currently the export rate is almost 100%. To keep this rate of growth we are planning on expanding our production facilities by more than 10.000 m² by 2020. Appreciation of the company’s performance has spread far beyond our customers. In 2014 the Austrian Ministry for Industry and Commerce awarded the Austrian Coat of Arms to Polytechnik in recognition of our outstanding contribution to the national economy. At the moment we are the only company from the energy and renewables sector in Austria to have this honour. Other significant awards include: the State Quality Award (1991), Daphne Prize for Environmental Technology (2002) and the Hidden Champions Award (2014). This is proof that the company is headed in the right direction.
In the Balkans, biomass is the most significant renewable energy source, due to abundance of forests and agricultural areas. However, the potential is almost untapped. What are the major obstacles, according to your opinion and do you see some light at the end of the tunnel?
One major demand of a vibrant biomass market is the constant fuel supply chain and a competitive environment of the fuel market. The increasing investment opportunities and the maturity of boiler systems that are currently under operation will create a demand that will speed up the process getting the biomass energy market out of its baby shoes.
To elaborate on the points let’s start with the maturity of the operating boiler systems. A boiler plant is the heart of energy production facility in any industry or public utility. If the age of these plants is on average 25-30 years, then it is safe to say that these systems have reached the end of their life cycle. They are expensive, inefficient, labor intensive, dirty and poorly maintained, while there is no clear replacement or refurbishment planned. So of course the potential is there. The biomass market will develop with demand and is precisely why biomass-burning plants that are able to operate efficiently and reliably, within emission limits, for a wide variety of biomass quality are the only real solution. This is where Polytechnik, arguably the only organization to handle such a wide range of fuels, has claimed the place as technology leader.
In a developing market such as the Balkans area, it is the chicken and the egg situation. To avoid this the right technology has to be applied otherwise the market will never develop while one side waits for the other to develop capacities or demand. This is especially the case for biomass to heat projects, not such much the industrial sector. Next we have the investor state of mind and the support of the financial sector. Typically the boiler plant is somewhere in the back of some factory, away from anyone’s view. It is a place where energy comes from and often the user has no information on the energy needs, fuel consumption and potential savings. Somehow the energy is taken for granted, a remnant from the era of abundance in the past.
This is a commodity which greatly impacts the competitiveness of a product and needs more attention. Our sales and support staff have been working to develop this state of mind, to raise awareness and help investors understand that an investment in the boiler plant is a long term investment with long term gains, not something to be taken lightly for the short term gain of a lower initial investment.
In most cases, especially in high energy demand sectors, the burning of low grade biomass and investing in a more advanced system evens out with a standard equipment and high grade fuels within 2-3 years. Due to the poor investment climate, Polytechnik is prepared to be a full partner from the design, build and financing phase. With our team of experts we can find a technical solution and provide support in finding the financing either through international banks and/or European grants/funds.
Which projects from Polytechnik portfolio do you find most interesting to share with Balkan Green Energy News readers from innovation/efficiency/alternative types of biomass point?
Well it is really hard to single out a project because almost every project is unique. Polytechnik has experience burning over 100 types of biomass, while the plant types and applications are very diverse. An unconventional project which I could single out would be the utilization of chicken litter from broiler production as biomass fuel to become not only CO2 free as chicken meat farms but also become much more competitive due to the utilization of waste as a fuel source. The chicken litter is an unexpected source of energy although it does usually require additional treatment to reduce emissions depending on country limits. We have just completed 6 different plants in the UK where the customer also installed mini CHP modules to produce electricity.
Another interesting project was a plant built for a cosmetics industry which uses it’s natural byproducts from production in a mixture with wood chips to produce heat and electricity for it’s production plant.
A final example, for now, would be the utilization of the brewing by product in the beer industry. This has mostly two components, a dry one called malt dust and a wet one called spent grain. Now these fuels are not really suitable for biogas production but are great for burning. Breweries usually need steam for the production process. These sorts of consumers are highly energy dependent and usually burn natural gas. Now imagine a circular economy of using your byproduct to produce the very energy you need while being completely independent from others are reducing costs significantly. For example these by-products would have zero market value, hence zero cost of burning in a plant, while other fuels have market based prices. The savings are immense.
In most cases efficiency is not the only prerequisite but mainly it is the burning of the production residues which would otherwise be considered as waste and deposited in such a way at significant costs. So the idea is to apply the zero waste principle in a circular economy setting to be fuel and energy independent while being energy efficient and environmentally friendly.
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