Bord na Móna to seek approval for €60m US wood pellet plant

State energy company Bord na Móna will shortly seek Government approval for its plan to spend €60 million building a wood pellet factory in the US, it is understood.

Last September, the State company announced that it wanted to spend €60 million building a plant in Georgia that would turn willow trees into pellets to be exported to the Republic as fuel for electricity generators.

Such a move requires approval from Minister for the Environment Denis Naughten. Bord na Móna is likely to seek this backing shortly.

The company said that it was working on the business case for potential investment in a wood pellet manufacturing plant in the US.

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“This is in line with company strategy as our future requirement for biomass will be in excess of 1.5 million tonnes per annum,” it said.

“As soon as the business case is finalised, it will follow normal procedure and be submitted to the Minister for approval.”

Responding to a Dáil question on the issue from Green Party TD and leader Eamon Ryan, Mr Naughton confirmed that his approval, "given with the consent of the Minister for Public Expenditure and Reform" was required.

“At this juncture there has been no formal request for ministerial consent in respect of this project,” he said.

When it announced the Georgia plan, Bord na Móna explained that there was a shortage of biomass – wood and plants burned as fuel – in the Republic, forcing it to look abroad for supplies.

Patrick Madigan, head of the the company's recently launched bioenergy division, said that it could take 12 months to finalise its plans in Georgia and a further year to build the factory on a 50-acre site.

The facility will produce 300,000 tonnes of pellets which Bord na Móna will use and supply to Irish customers. The State company will ship the material to the Republic – 30,000 tonnes at a time.

Bord na Móna, established to exploit the Republic’s peat bogs, has to stop using peat to generate electricity by 2030.

It will ultimately replace this with biomass, which it has been using along with peat to fire its power plant in Edenderry, Co Offaly.

It has also held talks with State company the ESB, to supply it with biomass.