Have you thought much about the wood pellet industry lately?
In you live in Colorado, chances are the answer to this question is no. For Confluence Energy CEO Mark Mathis, that’s part of the problem.
It started back in 2008 when his industry was being celebrated as an alternative fuel source that would help curb global warming.
“When oil is $147, it was a popular thought,” he says. “But now that oil and other fossil fuels have come off. People have lost interest in using some of those renewable fuels.”
Since then Mathis has continued to manufacture pellets for wood burning stoves and other biomass applications. But he’s also moved into making products for the oil and gas industry—and they have nothing to do with energy production.
Instead, his Eco-Sponge is designed to clean up oil and solvent spills.
In this product, microbes in Eco-Sponge consume unwanted hydrocarbons creating what Mathis calls a “composting process on steroids.” This and other Confluence products now represent about 50 percent of his business. And that’s helped Mathis be successful in what he calls a “flat industry”
“We had a good year last year,” he says. “We bought an additional facility that for all intents and purposes makes us the largest wood pellet manufacturer west of the Mississippi.”
Pellet Demand Varies By Region
In other parts of the country, demand for wood pellets is different.
Compared to Colorado, companies are seeing sharper demand in New England, according to Virginia-based Pellet Fuels Institute. Executive Director Jennifer Hedrick says companies on the coast—particularly in the southeastern U.S.—are also seeing growth exporting to Western Europe. Policy changes are behind that growth.
“There are requirements within governments…that they have to have a certain percentage of their energy come from renewables and for many, pellets are very attractive.”
Because of this demand, industrial wood pellet production from southern states is expected to grow dramatically over the next four years.
But in landlocked states like Colorado, exporting pellets is too cost prohibitive. So without price or policy changes, Confluence Energy CEO Mark Mathis anticipates more diversification.
The company also makes pet bedding and recently launched a residential absorbent.