Enviva Receives Approval to Construct Wood Pellet Facility in Sumter County; Thanks Alabama Department of Environmental Management
Project Represents Initial Investment of $175 million, Creating Over 250 Jobs
BETHESDA, MD — December 2, 2019 — Enviva, the world’s largest producer of wood pellets, a renewable and sustainable energy source used to generate electricity and heat, issued a statement today thanking the Alabama Department of Environmental Management (ADEM) for its approval of a permit allowing Enviva to construct a wood pellet facility in Sumter County. This permit paves the way for 85 full-time jobs and an estimated 180 additional jobs in logging, transportation, and local services, as well as the creation of 300-400 jobs during construction of the plant. The facility will be located at the Port of Epes Industrial Park and represents an initial investment of $175 million and an expected annual economic impact in the region of approximately $180 million. Enviva expects the proposed wood pellet production plant in Epes to be the next facility in its strategic asset cluster in the Gulf region, which is expected to include other pellet plants in the states of Mississippi and Alabama, as well as a deep-water marine terminal at the Port of Pascagoula.
In early October, Enviva joined members of the Sumter and Epes communities for a ceremony where Governor Kay Ivey announced the completion of a state project development agreement with Enviva.
Enviva’s Chairman & CEO John Keppler issued the following statement:
“The decision by the Alabama Department of Environmental Management is not just about a new wood pellet plant in Sumter County, because Enviva is more than that. As I have said before, we are privileged to have been invited by the people of Alabama to invest in a remarkable community like Epes. We have received broad support – from Governor Kay Ivey, Commerce Secretary Greg Canfield, U.S. Congresswoman Terri Sewell, local officials like Commission Chair Marcus Campbell, and most importantly the residents of Sumter County. But we recognize this support is not simply given; it is instead something we must continue to earn, each and every day for decades to come. That is our commitment to Sumter County. More than a wood pellet plant, we will be a good neighbor and community partner you can count on for a long time to come.
This permit also comes at an important time. The urgency to address climate change has never been more acute. The United Nations Intergovernmental Panel on Climate Change (IPCC) – widely considered the world’s leading authority on climate science – calls for increased use of bioenergy like Enviva’s wood pellets in every one of their proposed pathways to limit the impact of climate change to less than 1.5 degrees Celsius. ‘A sustainable forest management strategy aimed at maintaining or increasing forest CO2 stacks, while producing an annual sustained yield of timber, fiber, or energy from the forest, will generate the largest sustained mitigation benefit,’ states the IPCC Special Report on Climate Change and Land. This is because scientific support for renewable wood energy is clear: bioenergy is a critical part of an all-in renewable energy solution to climate change. In September 2019, more than 100 forest scientists from over 50 universities joined the IPCC in embracing the environmental benefits of bioenergy like wood pellets, noting: ‘The long-term benefits of forest biomass energy are well-established in science literature.’ We look forward to continuing to help Alabama be a leader in renewable energy.”
Marcus Campbell, Chairperson of the Sumter County Commissioners applauded the decision: “I am pleased that ADEM recognized the overwhelming positive local support for Enviva and has issued their permit to construct a new pellet mill here in Sumter County. Enviva’s presence will mean so much to our area in terms of jobs and economic development. I look forward to working closely with Enviva as they build and begin operations at the new facility in the Town of Epes.”
The ADEM held a public hearing at the Livingston Civic Center on November 7, attended by hundreds, where residents and community leaders voiced their support for the new facility. The written public comment period ran from September 20 through November 15, 2019.
About the Epes permit:
In consultation with the ADEM, Enviva requested an air construction permit for the proposed Epes plant:
• The plant’s planned permitted capacity is expected to be 1,150,000 metric tons of wood pellets per year. The plant would initially be constructed to produce 700,000 metric tons per year, with the possibility to expand in the future to reach full production capacity of 1,150,000 metric tons of wood pellets per year.
• Enviva expects to be ready for construction in early 2020, subject to final investment approval. Based on experience, Enviva expects construction to take anywhere from 15-18 months.
• The sustainably sourced wood pellets from the Epes plant are expected to be transported by barge via the Tennessee-Tombigbee River to Enviva’s planned deep-water marine terminal to be located in Pascagoula, MS, where they would be exported to Europe and Asia.
• The plant would principally utilize a mix of softwood and mill residuals sourced from areas within approximately 75 miles of the plant. The rich fiber basket and supply in Alabama, along with favorable transport logistics and a great local workforce, are what makes this project sustainable and attractive.
Additional background information on the permits and Enviva’s operations:
• Enviva conducted due diligence to confirm that the plant’s sourcing area has commercially available low-value wood that meets its strict sustainability requirements in sufficient quantities to supply the plant up to the permitted production level.
• Enviva’s Responsible Sourcing Policy requires that it only source low-value wood from tracts that will remain as working forests.
Additional Background on Enviva and Renewable Wood Energy:
• At the multinational level, on August 8, 2019, the United Nations Intergovernmental Panel on Climate Change (IPCC), which continues to drive climate policies around the globe, released a Special Report on Climate Change and Land (the SRCCL). This report pointed out that a sustainable future depends on a diverse managed forest products industry that includes sawtimber, pulpwood, and bioenergy. This is a reiteration of IPCC’s long-standing view, as expressed in the October 2018 Special Report on Global Warming, that biomass and bioenergy must play a key role under every single pathway to achieve the goal of limiting climate change to 1.5 degrees Celsius. The International Renewable Energy Agency (IRENA), in its recently published Global Energy Transformation: A Roadmap to 2050 report (the “IRENA Roadmap”), not only reiterated IPCC’s view on the critical role of biomass, but also called for a tripling of the amount of modern biomass used for energy production from 5 percent today to 16 percent by 2050, as it laid out its own proposed global pathway to a carbon-neutral and renewable future by 2050.
• Bioenergy is part of an all-in strategy to limit dependence on fossil fuels, and encourage private landowners to grow more trees. Bioenergy offers a 74-85 percent lifecycle reduction of greenhouse gas emissions compared with coal. Power generation using bioenergy also provides a reliable and renewable source of energy that complements the intermittency of wind and solar energy, enabling a stable grid without reliance on fossil-powered backup.
• American forest inventories are increasing every year. Today, in the U.S. Southeast, private forest owners are growing 40 percent more wood than they remove every year. Only 2 percent of the working forests in the Southeastern U.S. are harvested each year, while the remaining 98 percent are in various stages of regrowth, continuing to grow and store carbon. Working forests thrive when managed sustainably. Enviva plays a crucial role in helping ensure the protection and growth of forests. Enviva does not source from forests that will be converted to another land use.
• U.S. Forest Service data show that forest inventory is increasing in the sourcing regions for all of Enviva’s plants; in fact, there is a clear upward trend during the period since Enviva started operations.
• The key to keeping forests as forests is strong demand for forest products – including the additional value of being able to sell low-value wood for bioenergy. Additional demand raises the value landowners can get from keeping their land as managed forests. Absent strong demand, landowners have the incentive to convert their land for a higher return. That could mean a farm, a housing development, or a strip mall.
• Enviva provides landowners with a key market for their low-value wood – including “thinnings,” tops & limbs, and other low-value trees that would otherwise not get used for lumber or other higher value products. Enviva plays a crucial role in helping ensure the protection and growth of forests.
• Enviva is certified to the stringent standards of the world’s foremost forestry organizations, such as the Sustainable Biomass Program (SBP), Forest Stewardship Council (FSC), the Program for the Endorsement of Forest Certification (PEFC), and the Sustainable Forestry Initiative (SFI). These independent forest certification programs provide a consistent, verifiable, and transparent framework for evaluating the sustainability of a company’s operations, from forest to product. Enviva believes that landowner certification of forestland is a good thing, and so it pays more for fiber from certified forests. Enviva engages in ongoing landowner outreach and education and makes direct investments to support certifications of forestlands. As Enviva continues to work to increase the total percentage of lands certified, it also ensures that non-certified fiber comes from responsible sources.
• Enviva has also developed “Track & Trace®,” an industry-leading sustainable sourcing program, which provides transparent, publicly available data about Enviva’s sourcing. Using Track & Trace®, Enviva works with its supply chain partners to verify and document the origin of all of its wood. As part of this program Enviva pays particular attention to land use change, use and effectiveness of Best Management Practices, wetlands, biodiversity, and certification status.
About Enviva Holdings, LP
Enviva Holdings, LP is the world’s largest producer of industrial wood pellets, a renewable and sustainable energy source used to generate electricity and heat. Through its subsidiaries, Enviva Holdings, LP owns and operates wood pellet processing plants and deep-water export terminals in the Southeastern United States. We export our pellets primarily to power plants in the United Kingdom and Europe that previously were fueled by coal, enabling them to reduce their lifetime carbon footprint by about 80 percent. We make our pellets using sustainable practices that protect Southern forests and employ about 1,000 people and support many other businesses in the rural South, where jobs and economic opportunity are sometimes scarce. Enviva Holdings, LP conducts its activities primarily through two entities: Enviva Partners, LP, a publicly traded master limited partnership (NYSE: EVA), and Enviva Development Holdings, LLC, a wholly owned private company. To learn more about Enviva Holdings, LP, please visit our website at www.envivabiomass.com and follow us on Facebook (www.facebook.com/envivabiomass) and Twitter (@EnvivaBiomass).
Cautionary Note Concerning Forward-Looking Statements
Certain statements and information in this press release, including those concerning future results of operations, acquisition opportunities, and distributions, may constitute “forward-looking statements.” The words “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” “should,” “would,” “could,” or other similar expressions are intended to identify forward-looking statements, which are generally not historical in nature. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effects. Although management believes that these forward-looking statements are reasonable when made, there can be no assurance that future developments will be those that management anticipates. These forward-looking statements involve significant risks and uncertainties (some of which are beyond our control) and assumptions that could cause actual results to differ materially from our historical experience and our present expectations or projections.