Alberta is calling; pellet producers are answering

A few months ago, the phone rang. It was Alberta, inviting me to visit and talk about pellets. Of course, I jumped at the chance. After all, this is a province that leads the country in forecasted economic growth, has attracted nearly $43 billion in private equity investment over the last decade, has the highest real GDP per hour worked of Canada’s largest four economies, is investing in people and local communities and supporting clean energy development.

It’s also Canada’s fastest growing province. According to Statistics Canada, as of Jan. 1, Alberta’s population was 4.8 million, an increase of 202,000 over the previous year – the largest increase on record. It also broke a national record in 2023 for interprovincial migration, with a net gain of 55,107 people.

Clearly it was time for WPAC to spend some time in this province, connect with our members and learn more about Alberta’s direction and opportunities for the pellet sector. The invitation from the Peace Region Economic Development Alliance (PREDA) to speak at their Value-Added Forestry Conference on June 27 in Peace River provided the ideal opportunity for my colleague Dr. Fahimeh Yazdan Panah, director of research and technical development, and I to hit the road.

We flew into Grand Prairie, the closest commercial airport to where the conference was being held. Our first stop was to visit WPAC member La Crete Sawmills. The town of La Crete is located in the southern end of Alberta’s Mackenzie County, an 81,000-sq.-km. area bordering the Northwest Territories to the north. With a population of just 21,600, the Mackenzie Region – an area larger than the Czech Republic – is Canada’s 2024 Forest Capital. Locally owned and established in 1989, La Crete Sawmills Ltd. began with four employees hired for the initial construction of the mill with a focus of marketing its products into Japan. Over the course of the last 25 years, their market has expanded to cover North America as well as overseas.

Today, with 160 dedicated employees, La Crete operates a two-line sawmill with two dry kilns, a planer, and a remanufacturing facility; with a total capacity of 110 million board feet. It also began operating a pellet plant in 2003 and today can produce up to 150,000 tonnes of pellets annually.

Our tour hosts included John Unger, recently retired president and CEO; Abe Klassen, newly recruited CEO who has a long history with the mill; and Barney Wiebe, sales director. John told us that since its inception in 1989, La Crete Sawmills has aimed to do good by people, communities and the world at large. The plant runs nine pelletizers and two drums, with 60% of their pellets sold in bulk for primarily for export; and 40% as bagged pellets primarily for domestic markets.

La Crete is the biggest pellet supplier to the Northwest Territories, with nearly 25,000 tonnes to support northern communities. They’ve been key to the transition to biomass in the NWT. Today, biomass is one of the main sources of primary energy in public buildings in Yellowknife. In fact, 33% of territorial government buildings in the city are heated with wood pellets, playing a significant role in reducing greenhouse gas emissions and saving money for taxpayers.

Forty per cent of La Crete’s production is domestic. Photo: WPAC

Enhancing Value Through Collaboration AND Innovation
Alberta’s forests are an important economic generator across the province, and especially in the northern part of the province. I was honoured to be invited to speak at the Peace Region Economic Development Alliance’s (PREDA) conference on June 27. Key topics included the management and reclamation of the boreal forest, the legislative framework governing timber rights in Alberta, career opportunities within the forestry industry and overview of the wood pellet industry across Canada with a focus on Alberta.

The event was sponsored by the Municipal Project Fund – Regional Partnership, with contributions from Northern Sunrise County and Lac Cardinal Economic Development. It aimed to bring together stakeholders from various sectors, including local governments, businesses, and community organizations, to discuss strategies for economic development and sustainability in the forestry sector.

Forest resources form the basis of the economy for many of Alberta’s rural and Indigenous communities and play an important role in the diversification of the provincial economy. An estimated $6.5 billion has been invested in forest product manufacturing operations in the past decade. The government is focussed on four key priorities to enable growth, diversification and innovation in the forest sector.  These include supporting forestry jobs by securing access to wood fibre, increasing fibre supply over time, maintaining the forest land base by investing in sustainable forest management, and ensuring an open and competitive process for companies to bid and purchase fibre.

An important part of Alberta’s wood products sector is its exports to Asia with easily accessible rail lines into B.C. and through to ports in both Vancouver and the Port of Prince Rupert. A key part of my presentation was providing an overview of Canada’s wood pellet sector and reinforcing the importance of the pellet sector. Alberta wood pellets make up over one-third of all wood exports to Asia.

The right ingredients for success

From our visit to Alberta, it’s clear that Alberta has the right ingredients for long-term success which bodes well for the long-term prospects for the pellet sector. Government policies committed to sustainable forestry, community stability,  and new innovations like Bioenergy Carbon Capture and Sequestration (BECCS), and a growing appreciation of the role of the pellet sector on all of those fronts.  It was also clear to us that our Alberta members are committed to answering the call when it comes to tackling climate change and providing not just the world, but also Canadians, with clean renewable energy.