The results of the first auctions by RNP Romsilva are strong signal for the deepening of the wood resource crisis and the prices coming in 2022.
At the auction organised by the Valcea Forest District, the average winning price was 462 lei/m3 on stump, compared to the average price of 145 lei/m3 that was recorded for the 2021 harvest. These prices occur in the context of a halved offer of wood mass in 2022 compared to the harvest of 2021, as well as a deep uncertainty regarding supplementary blocks caused by the over-regulation of environmental assessments for forest management plans. These blocks could further reduce the volumes available on the market.
In the autumn of 2021, the price of firewood doubled compared to 2020, and if we start from prices for firewood on stump, in the forest, at more than 400 lei/m3, in 2022 we’ll reach absurd prices for firewood, much bigger than the price of valuable industrial wood in any European country.
And the exaggerated prices, together with the resource deficit, lead to diverting industrial raw materials to firewood, which greatly impacts the supply of the wood processing industry. An industry which contributes 7 billion Euros to Romania’s GDP, supports 150,000 jobs and contributes 3.5 billion Euros to the country’s trade balance.
The effects are the result of an artificial deficit
In Romania, the annual wood harvest is less than 65% of the forest growth. The unharvested volume which accumulates in the forest is about 25 million m3 each year. According to the National Forest Inventory, in the second cycle (2012-2017) the accumulation was 133 million m3. This is real wood, beyond any debate, that was inventoried between two passes on the same areas after five years.
The problem deserves a discussion from another angle as well. Wood provides cheap, accessible, renewable thermal energy, based on internal resources, at half the price the energy based on fossil fuels.
In this cold season, the average price of the Gcal produced by burning fossil fuels in Romania’s thermo plants is about 320 (plus VAT – source). At the same time, in Suceava operates the country’s most modern cogeneration plant, using forest as well as agricultural biomass for thermal and electric power, and the price for 1 Gcal is 142.73 lei (plus VAT – source). The price of 1 Gcal produced from biomass is almost 2.5 times lower than for 1 Gcal produced from fossil fuel.
Paradoxically, the Romanian State subsidizes heating with fossil fuel, while green energy from biomass has no support at all. We are in the awkward situation in which the rural population using more and more expensive firewood, about 3.5 million households, mostly in the poor areas of the country, get no subsidies at all.
But these people also pay taxes as well! Not only they receive no support, but SUMAL 2.0 makes it more difficult to access the wood resource on small forest properties and forest vegetation outside the forestry fund. These people have no access to essential firewood because of over-regulation.
Neither the EU, nor the NPRR forbid firewood
At the same time, in the public space is hotly debated a disinformation regarding the prohibition of using firewood by an EU directive.
Actually there exists no such directive. In the National Plan for Recovery and Resilience, Romania committed to reforms concerning environmental and biodiversity protection. We quote: “The reforms […] will ensure the sustainability and traceability of biomass, to prevent any negative impact of using bioenergy on biodiversity and forests, and to diversify the energy mix for heating and cooling, using other sources than forest biomass. […] The reform […] will diversify the energy mix for heating and cooling by reducing the quantity of forest biomass.”
Therefore, it is required a diversification of the energy mix. But apart from forest biomass there is agricultural biomass. There are heat pumps as well. Energy production need not divert valuable wood resource towards firewood, as it is currently happening. This greatly impacts the raw materials for the wood processing industry.
The utopia of transitioning to has heating of the 3.5 million households currently using firewood needs:
- At least 17 billion Euros invested in the expansion of the infrastructure. For every 200,000 homes, 1 billion Euros is needed.
- At least 17 billion Euros invested by the homeowners in the connection and internal appliances (heaters, etc.) – at least 5,000 Euros/home.
- Additional imports of natural gas, at least 3 billion Euros per year. Supposing we do have the money, where do we get the gas from?!?
- Moreover, wood provides renewable energy, while gas is a fossil fuel. Transitioning to gas wood ensue additional CO2 emissions – at least 13 million tonnes per year.
Until these investments are finalised, we should take all measures to ensure the required firewood. And on a longer term, modern cogeneration plants, using wood and agriculture biomass, are a solution for cheap, clean, local, renewable resource with additional economic and social effects.
How do we make available the green, renewable wood resource for energy and the industry?
The forests and especially the way we use the green, renewable resource at our disposition have an immediate and major impact in the National Plan for Energy and Climate. If we really want to reach the targets of fighting climate change, forests and wood-based industries are a part of the solution. We’ll discuss the issues at the fifth edition of the Forum of the Forests, Wood Industry and Green Economy, on December 14.
In the meantime, we ask the Ministry of the Environment, Waters and Forests to analyse the causes for the blocking the wood resource, and especially to act in a fluent, pragmatic manner to achieve conformity in the issue of environmental assessments for forest management plans. The proposals from the position paper submitted by the Romanian Wood Industry Association – Prolemn and the Federation of Romanian Pastures and Forest owners – Nostra Silva are a good place to start.
It’s the twelfth hour and urgent measures are required. The Environment Ministry must take responsibility for the failure of the forest policies over the past few years and to act without further delay. The wood industry and the entire sector provide all their know-how and expertise to help find solutions, including strategies and good practice examples from other European countries. The keyword, though, is urgency.