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Arbaflame to build €20 million pellet factory in Norway

Arbaflame is now building its first commercial full-scale factory for the production of the company’s patented wood pellets. The new factory located at Grasmo outside of Oslo will have an annual production capacity of 70,000 tonnes of pellets, which will be delivered to the French energy company Engie’s coal power plant in Rotterdam.

“We are now building our first full-scale factory. This marks that we are industrially in the process of being a fully-fledged alternative to the coal-fired power plants in the world looking for a carbonless and bio-based energy solution,” says CEO of Arbaflame Bjørn Halvard Knappskog.

The pellets factory is built on Norwegian developed technology and will deliver on the contract Arbaflame recently signed with Engie on the annual delivery of up to 70,000 tons of pellets. The factory will cost €20 million to build and has received funding from Enova of €8 million.

“We are now facing an industrial race with the establishment of several factories in the years to come. We have a mutual intention with Engie to get up to 200,000 tonnes of delivery as quickly as possible, and then gradually increase to a capacity of up to 1.8 million tonnes, which is the amount needed for 100% renewable conversion,” says Knappskog.

“For us, it has therefore been important that the world’s first factory be built in Norway, both because it gives us valuable proximity to the project and expertise, but also because the technology was actually invented and developed here,” says Knappskog.

Arbaflame’s steam-treated pellets have virtually the same properties as coal, are water-resistant and have high energy density. The special properties mean that the cost of converting the coal power plant is significantly reduced, which is a great advantage compared to alternative bioproducts such as white pellets.

“It is a victory for the Norwegian forest industry and its renewable aims that, with Norwegian feedstock produced at our new factory, we will reduce CO2 emissions at the coal-fired power plant in Rotterdam by approximately 140,000 tonnes a year,” says Knappskog.

Arbaflame has already conducted successful tests at 15 coal-fired power stations around the world, and recently received €19 million EU funding through the Horizon 2020 program to establish a demonstration facility at the same power plant in Rotterdam.


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