Mitigating Supply Chain Risk – Part 2

/Mitigating Supply Chain Risk – Part 2

Mitigating Supply Chain Risk – Part 2

This series of posts focuses on four of the primary areas of risk in any biomass supply chain based on dedicated energy crops and the things that Genera is doing to reduce or remove these risks. Our first post focuses on land recruitment and availability. Today’s post highlights risks associated with successfully establishing the energy crops, a factor particularly pronounced in perennial crops. Future posts will highlight risk from climate (precipitation and environmental factors) and feedstock quality.

Once a biomass-based project has cleared the hurdle of recruiting landowners to participate, the next stage in the process is the establishment of the energy crop. Remember, if a crop is not successfully established, the risk of having an adequate supply for the biorefinery when it begins operations increases significantly as does feedstock costs. In some cases, this energy crop could be an annual like biomass sorghum or sweet sorghum. These crops can be planted and managed similar to traditional row crops. However, other energy crops are perennials and generally take a little more TLC during the establishment year. Once crops are established, particularly perennial crops, the maintenance and risk associated with their annual production is fairly low. Due to the sensitive nature of crop establishment, biomass users should engage a partner that is experienced in establishing the selected energy crops. Establishing crops like switchgrass, miscanthus, energy cane, and short-rotation woody crops requires significant experience and skill to ensure that establishment is successful. Some of the crops can be planted by seed while others are established using plant materials like roots or stalks. The diversity of establishment techniques and the intricacies of the procedures requires significant training and experience.

Perennial energy crops are sensitive to soil conditions such as moisture at planting and depth of planting.  Careful site preparation, calibration of planters and associated activities must occur or establishment failure can occur. Timing matters as well, as perennial energy crops are most susceptible to environmental and biological stresses in the initial establishment year. If an energy crop is well established the first year, the plants are typically hardy and resilient across a wide variety of environmental and biological stresses in subsequent years. Successful establishment of energy crops is critical to reducing risk in future years.

Whether you seek to use a single perennial or annual feedstock or a combination of feedstocks, a supply chain partner with on-the-ground experience in energy crop establishment will reduce risk associated with land control and long-term uncertainty in the biomass supply. Contact Genera Energy today to learn how we can make your project a success!

By Sam Jackson, VP of Business Development

2017-01-07T17:22:10+00:00Risk Management|