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Active Energy Group's new form is taking shape

The company has ceased working the low-margin, high-risk wood fibre assets in Ukraine and is focused on its CoalSwitch technology and its forestry management business in Canada
Active Energy has now identified the USA, Canada and Europe as the regions in which it wishes to operate.

Active Energy Group PLC (LON:AEG) is steadily persuading companies of the benefits of its CoalSwitch coal substitute.

CoalSwitch is made from waste wood normally left to decompose following forestry operations. This includes pulp and sawmill by-products such as bark, sawdust and thinnings, and wood which is over-age, under-quality, blow-down, beetle-kill, forest-fire damaged, or industrial waste.

The aim is to roll CoalSwitch out where AEG can source high volume feedstock.

Research, development and testing have taken place over the past two years with the help of the University of Utah, which has included both burn and handling tests.

Two separate affiliate companies

Advanced Biomass Solutions (ABS) is one of two affiliates set up by AEG in a recent reorganisation.

ABS holds all of the CoalSwitch activities and will handle future projects related to the group’s biomass coal replacement technology.

The division will also oversee the development of PeatSwitch, the engineered soils derivative of CoalSwitch.

The other affiliate, Timberlands, houses the forestry management business controlled by AEG.

The Timberlands division has a joint venture with three native Métis Settlements of Alberta, Canada, to commercialise more than 300,000 hectares (around 750,000 acres) of assets and also a preliminary forestry management contract with the Province of Newfoundland.

The company recently announced it is amending its application to the province of Newfoundland and Labrador, to focus exclusively on forestry opportunities and the development of one or more dedicated CoalSwitch plants.

Following a meeting with key officials, the company noted that the province continues to support the process through to final approval and highlighted that they were complementary to the company's continuing commitment and work carried for the process.

Active Energy’s former executive director, Richard Spinks, has decided to relinquish his board responsibilities to focus solely on his role as managing director of the Timberlands subsidiary.

The move, which is effective from 1 November, aims to ensure the Canada opportunity gets the required energy and focus required.

"Timberlands and Active Energy have already made a tremendous investment in the province over the last two years and Timberlands is working harder than ever to bring to fruition these common commercial goals for both the group and the province,” Spinks said.

“I believe that based upon the recent meetings, a long-term relationship between both the province and Timberlands has been established and is set to grow further,” Spinks said.

Focus on Canada and Europe

Having sloughed off its wood fibre assets in Ukraine, Active Energy has now identified the USA, Canada and Europe as the regions in which it wishes to operate.

The company’s most recent joint venture agreement was with an American renewable energy group, with power plants in the states of North Carolina and Georgia.

The agreement between Active and Georgia Renewable Power LLC (GRP) envisages the installation of the company’s CoalSwitch facilities into operational plants. It will also see the new partner develop organic waste fertiliser products and use the CoalSwitch and PeatSwitch technologies for complementary sales of biomass.

Initially, it is planned that CoalSwitch will be installed at the Lumberton plant, in North Carolina. It is expected that it will be put in place before the end of the year, and, will be followed by installations in Georgia over the next 36 months.

It is anticipated that up to 100 tonnes per hour of CoalSwitch facilities will be installed.

"This is an important development for Active Energy, which we believe will result in a significant increase in CoalSwitch and PeatSwitch production capacity in the US, the diversification of AEG's activities in terms of both geography and feedstock, and additional revenue streams through biomass trading,” said Michael Rowan, Active Energy chief executive.

"This agreement will shorten the timescales for large-scale commercialisation of our CoalSwitch and PeatSwitch products and will also allow AEG to benefit from the experience and the presence of our partner GRP, thus strengthening our capabilities in the next operational phase of our business plan.”

Another key partnership is its joint venture (JV) company, AEG CEE, which received market certification and environmental clearance by the Polish government for its ‘SuperFuel’ product back in June.

The AIM-listed alternative energy group said testing by the Polish government laboratory showed that the new fuel met requirements under new AntiSmog legislation for the certification of solid fuels, and thus allowed its use both domestically and in Polish/EU coal plants due to its high calorific value, low sulphur content, low ash content, and low SOx and NOx emissions.

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