Statkraft and Södra to build advanced biofuel pilot plant in Norway

Statkraft and Södra have announced that they are going to build a biofuel plant in Norway, through their joint venture Silva Green Fuel AS (Statkraft 51%, Södra 49%). The plant will produce advanced (second generation) biofuel from forest feedstock. The plant will be located in Tofte in the Norwegian municipality of Hurum. Expected investment costs are NOK500 million (US$ 59.53 million).

The Danish-Canadian company Steeper Energy will deliver the technology. Construction will start in February next year and completion is scheduled for 2019. Enova SF, a wholly-owned entity of the Norwegian Ministry of Petroleum and Energy, will finance around 25%.

The purpose of the plant is to test technology for continuous production of advanced (second generation) biofuel that may directly replace current fossil fuels, as well as testing various types of raw materials. Initially, the plant will use feedstock from the forestry industry, but all biodegradable material may potentially be used.

Södra and Statkraft formed the joint venture company Silva Green Fuel AS in 2015 to establish future commercial production of advanced biofuel based on forest raw materials. The capacity of a full-scale production line will be between 100 and 150 million litres of biofuel each year. Initially, the product is intended for heavy road transport. However, the aim is to qualify the biofuel for use in the aviation industry.

The market potential is considerable. If ten production lines were built in Norway and Sweden, they could produce up to 1.5 billion litres annually. This corresponds to 13 per cent of the fuel used for road transport in these markets.

President and CEO Christian Rynning-Tønnesen, said:

"Advanced biofuels will be important for the transition from fossil to renewable energy consumption in the transport sector. As Europe's largest supplier of renewable energy, Statkraft is championing an industry development that will contribute to the green shift."