Project Description

AustroCel recently completed the world’s largest wood-based bioethanol plant. The €40 million production plant for advanced bio-ethanol fuel uses brown liquor, a by-product from the Sulphite Pulp Mill in Hallein, Austria, and has annual capacity of up to 35 million litres. Austrian oil company OMV blends the material into petrol, helping reduce CO2 emissions in the transport sector by up to 50,000 tons a year. This project was commenced following the launch of the REDII Directive in 2018, requiring fuel companies to add a certain portion of advanced biofuel to their products. Our majority stakeholder, the financial investor TowerBrook, and other private investors have supported the development of bio-ethanol from the very beginning, in 2018. The project was further supported by the Austrian central government and the Land of Salzburg, which granted about €3 million of subsidies.

Project Purpose

The main reason for this project is to derive the maximum resource efficiency from our main raw material, spruce wood (residual wood from sawmills). Brown liquor is a waste residual from our pulp production and would normally be incinerated, so by producing bio-ethanol, we add significant value to this residual side stream (+10% revenues), meaning we have improved our global competitiveness in the dissolving pulp industry. Moreover, we have finally reached our strategic objective of being a true bio-refinery, creating the Green AustroCel.

Project Evaluation

The bio-ethanol project was started up in late 2020, and is currently producing high-quality advanced biofuel at a rate of 25 million litres per annum (full capacity 35 million litres). The first deliveries have been made to OMV and successfully blended into petrol. The project was completed on time despite COVID, and within the budget. The payback for this strategic project is five years, which could be shortened as capacity can still be increased. A further benefit is that the concept of manufacturing bio-ethanol from brown liquor might also be used by other pulp mills in Europe which have similar production processes as AustroCel.