Community Research and Development Information Service - CORDIS

H2020

SafeWood Report Summary

Project ID: 718188

Periodic Reporting for period 1 - SafeWood (Novel bio-inspired environmentally-friendly process for producing durable and dimensionally-stable wood)

Reporting period: 2016-03-01 to 2016-08-31

Summary of the context and overall objectives of the project

Wood is a natural, renewable, reusable and recyclable material, thus having enormous potential to contribute positively to the EU’s 2050 goals, by enabling a high standard of living from lower levels of energy and resource consumption. Wood is the main source of financial revenue from forests, which cover over 40% of the EU’s land area and provide around three million jobs.
Although globally forest area continues to decrease, currently in the EU, only 60–70% of the annual increment is being cut, whilst providing around 430 million cubic metres per annum of timber resources. Consequently, European softwood is a sustainable resource, in contrast to imported tropical hardwoods.

To ensure a long and useful life in many end-use situations, timber—especially softwoods – needs protection from the hazards of fungal decay and weathering. The current approach to wood preservation is based on the principle of toxicity. Wood impregnation with biocides (containing creosote, arsenic, zinc, copper, chromium, etc.) prevents biological degradation, but the European directive on the use of biocides place severe restrictions nowadays on the active substances that can be used in wood preservation, above all arsenic, and their fields of application.
Wood treated with such preservatives is classified as hazardous waste. Furthermore, current treatments don’t have positive contributions to other critical properties of wood, such as dimensional stability or water absorption.

Recent research demonstrates that antifungal components and hydrophobic extractives produced by trees themselves can be effectively used as environmentally-friendly wood preservatives.
Such extracts are readily available as a by-product of the paper industry. Our SAFEWOOD bio-inspired approach is based on wood preservation as trees do it, the novel preservation process, in effect, converting sapwood to have characteristics of durable heartwood.

Within this SME Instrument Phase 1 project, a feasibility study has been undertaken to evaluate and analyse the potential of the innovation. This has been based on extensive investigation to support the process of decision making and define the business plan for reaching the targeted goals.

The overall conclusion from this study is that it is highly worthwhile to bring SAFEWOOD to market. The next step in this process will be to submit an SME Instrument programme Phase 2 application, which will be based on the positive results of the feasibility analysis and business plan resulting from this study.

Work performed from the beginning of the project to the end of the period covered by the report and main results achieved so far

The work of this SME Instrument Phase 1 project has involved eight tasks, the results being briefly summarised as follows.

Task 1 of the study involved development of a detailed businessmodel (BM) for exploitation of the SAFEWOOD results based on the approach proposed by Osterwalder. This approach encompasses work of previous authors by identifying nine basic model building blocks that, considered together, can adequately describe the main characteristics of a business model.
These identify
• Key partners,
• Key activities,
• The Value Proposition,
• Customer Relationships,
• Customer Segments,
• Key Resources,
• Channels,
• Cost Structure, and
• Revenue Streams.

From this starting point, a SWOT analysis was then undertaken to identify
• Strengths (characteristics of the business or project that give it an advantage over others),
• Weaknesses (characteristics that place the business or project at a disadvantage relative to others),
• Opportunities (elements that the business or project can exploit to its advantage), and
• Threats (elements in the environment that could cause trouble for the business or project).

Within Task 2 of this study, the market opportunities and user requirements for safe and environmentally-friendly wood preservatives have been evaluated in detail, based on literature and patent searches, personal interviews and questionnaires involving a broad range of stakeholders. These have involve both end-users of protected wood and companies operating sawmills and/ or existing wood impregnation plants.

Using the identified user requirements from Task 2 as an input, the work of Task 3 of the study has developed requirements and specifications for wood preservatives based on natural wood extractives and the associated impregnation process. The feasibility of implementation of each aspect has been considered in relation to the associated effort and cost to adapt results of previous work and develop the overall up-scaled commercialised solution. This work has included practical tests to determine the potential for further optimising process parameters and tall oil usage. These activities have resulted in definition of the detailed programme of work and estimated budget for the Phase 2 project.

Task 4 had the objective of identifying key partners for further development and commercialisation of SAFEWOOD. In the course of the study, a large number of organisations have been consulted, both in relation to the market study of Task 2 and with the objective of identifying the most appropriate partners for collaboration in the Phase 2 project as the system is up-scaled and brought to market. These organisations, encompass both large and small companies, academic and other research organisations and trade associations.

Within Task 5 of the study, identified revenue streams, together with associated projected costs have been integrated. This process has enabled financial ratios and investment indicators to be quantified. The results have been used as an input to Tasks 7 and 8 to define the comprehensive business plan including feasibility analysis.

Based on consideration of alternative protection mechanisms in Task 6 of the study, a strategy has been developed for protection of the SAFEWOOD Intellectual Property (IP), including that expected to result from the Phase 2 project.

Integration of the preceding tasks within tasks 7 and 8 of the study has resulted in a feasibility report detailing the methodology used, the evaluation criteria, the study findings and recommendations.
The market, technical, business, and economic and financial model viabilities have each been critically appraised in the study process.

The developed detailed business plan encompasses all aspects of the business planning process declaring vision and strategy alongside sub-plans covering Intellectual Property (IP) management, marketing, finance, operations and risk assessment, i.e., effectively providing a summary of these disciplinary plans.

Insignia offers wood processors the opportunity to produce and supply a viable, environmentally compatible, safe and sustainable alternative to tropical hardwoods and to compete with wood impregnated with hazardous chemicals. For manufacturers of wood products, SAFEWOOD enables the production of a diverse range of added value, high quality, reliable, dimensionally stable and durable end-products for outdoor use — it is a product that enables differentiation from the rest of the market.

Insignia will launch the SAFEWOOD solution in Scandinavia and the Baltic States, where 3.2 million cubic metres of impregnated wood is currently consumed per annum. This is used in a diverse range of applications; for example, in Sweden alone, around 400,000 m3 of impregnation-protected wood is sold annually as weather-boarding.

The overall European market for impregnated wood is estimated as being 6.5 million m3 per annum, of which around half corresponds to that used in the targeted sectors. In collaboration with licensees in each country represented, Insignia expects to capture at least 3.5% of this market (114,000m3) within 5 years following the launch of SAFEWOOD, rising to 7.0% (226,000m3) after a further 3 years.

Insignia will derive income in the following ways:
• Margin on sale of production plants to process licensees. The plant will be manufactured and installed by subcontractors to Insignia designs.
• Income from licensees based on their annual production. A 6% charge has been assumed.
• Additional revenue is also expected to result from sales of tall oil to licensees of the production process. (This possible contribution has not been included in the current business projection analysis.)
• Income from Insignia’s own-operated SAFEWOOD plant and production of value-added products.

Subsequently, SAFEWOOD will be rolled out across Europe and on a global basis via expansion of the network of licensees operating the process and marketing safe and environmentallyfriendly wood and associated end-products/ applications. This will result in a multiplicative effect on the revenue stream from additional licensee start-up franchise and production plant sales, together with revenue from ongoing operation of existing plants.

Insignia does not intend to reach its ambitious growth targets alone. Our strategy depends on a partnership concept where licensing is at the core — the long-term objective being to build a world leading materials brand based on sound technology, manufacturing excellence, global sales and distribution, marketing and logistics. This holistic approach will enable all participants to achieve superior returns on their investment. The local licensee will manufacture, market and sell durable and stable wood materials and associated products in their own markets, but also benefit from Insignia’s global sales and marketing initiatives to markets that increasingly source globally. The ultimate goal is to establish SAFEWOOD as a market leader both in geographical markets and specific segments.

Based on development and upscaling of the existing pilot plant, Insignia will operate its own impregnation plant with objective of benefiting from first-hand ongoing experience in process characteristics. This plant will be used for optimising the integrated process. In collaboration with product manufacturing partners, SAFEWOOD produced in this plant will be used to construct a wide range of example products as references for applications of the impregnated wood.

Insignia’s technology and production set-up will facilitate licensing. The integrated process—designed with licensing in mind—will undergo thorough internal and external testing, such that it is ready to be replicated by licensees. Insignia will invest considerably in building the SAFEWOOD brand. At the same time we shall be working continuously with optimising production processes and quality assurance. Thus, both branding and technology together form vital elements of Insignia’s immaterial assets of the licensing platform. For a licensee, this ensures reproducibility of product quality and thereby access to our global project sales. Partners will also benefit from global marketing efforts, as well as PR in local markets, since the products will meet the same standards irrespective of production site. Partners may also sell beyond their own capacity by calling on supply from other SAFEWOOD partners around the world. Insignia is seeking licensing partners who share our values of providing environmentally-friendly, safe and sustainable wood to the world.

Since potential licensees of the SAFEWOOD process and early adopter end-users of the protected wood will be involved in specification and evaluation throughout the Phase 2 project, it is expected that it can be quickly brought to market i.e., within around six months following completion of the project.

Growth in take-up of SAFEWOOD will be limited only by the S-shaped curve which applies for introduction of new technologies, with a slow initial acceptance followed by an accelerating pace. Insignia is conservatively targeting a revenue stream of 5.2M euro per annum within 5 years from completion of the Phase 2 project, growing to 7.0M euro after a further 3 years, leading to the creation of around 35 jobs, together with additional employment opportunities for subcontractors and licensees of the technology.

The Return on Investment for Insignia, including costs for both bringing the production process to market in the Phase 2 project and investment in the first production-scale plant, is estimated at around three years, corresponding to just one year from completion of the Phase 2 project. The payback period for licensees investing in plants will be just as rapid. Cost of plants are estimated at 54 euros per cubic metre of annual production capacity; based on a 10 years period of use, the corresponding depreciation is 5.40 euros/m3 per year. Since the process will add value of at least 100 euros per m3 compared to untreated timber, licensees can expect a payback of less than a year.

Progress beyond the state of the art and expected potential impact (including the socio-economic impact and the wider societal implications of the project so far)

Progress beyond the state of the art

It should be appreciated that this is a feasibility study, not an R&D project. Consequently, the current study, in itself, did not have the primary objective of advancing the state of the art.
Nevertheless, aspects of the work have related to advancement of the state of the art.

Within Task 3, tests have been undertaken to investigate the effect of various parameters of the SAFEWOOD process. In particular, sequencing of temperature and pressure for the overall process has been investigated. These tests indicated that, before starting the pressure stage, it is best that wood is heated so that at least part of its inner parts heat to a temperature of at least 100°C. It has been established that applying heat in this way greatly facilitates penetration of the preservative within the wood because, as the temperature rises, the viscosity of the tall oil-based preservative decreases.

Another important aspect of the process is that wood is also heated by means of vapour during the vacuum stage after the pressure impregnation. In this way, it has been found that it is possible to decrease the amount of wood preservative remaining on the surface layer of wood after the pressure stage, facilitating washing the surface of wood clean and avoiding staining before subsequent use of the wood. Furthermore, a 12% saving in tall oil usage is achieved.

The overall process cycle time is 23 hours. Although this is acceptable, it is considered that it can be reduced to around 18 hours with further optimisation of the process in the Phase 2 project.

As a further technical development, it is proposed that the programme of work for the Stage 2 project will include development of an advanced system for monitoring and control of the impregnation process. The approach will be based on chromatic signal processing. This involves application of novel signal processing techniques that have been successfully used in various industrial monitoring and control applications. The novelty of the approach involves determining the stage of completion of a complex process by interpreting measurements obtained from a limited number of sensors providing parameters indicative of the process. In the case of the SAFEWOOD process, sensors can include, for example, load cells that indicate the weight gain of wood during impregnation by the tall oil.

Although the approach is already well proven, having been successfully used in a diverse range of industrial control applications, it will be the first time that it has been applied in a timber impregnation process. Consequently, it is considered that this aspect will also result in intellectual property that will be the subject of an additional patent. The innovation, i.e., the proposed patent, can be generalised to relate to monitoring and control of processes for impregnation of wood with any type of preservative.

Socio-economic impacts

Insignia offers wood processors the opportunity to produce and supply a viable, environmentally-compatible, safe and sustainable alternative to tropical hardwoods and to compete with wood impregnated with hazardous chemicals. For manufacturers of wood products, SAFEWOOD enables the production of a diverse range of added value, high quality, reliable, dimensionally stable and durable end-products for outdoor use — it is a product that enables differentiation from the rest of the market.

The overall European market for impregnated wood is estimated as being 6.5 million m3 per annum, of which around half corresponds to that used in the targeted sectors. In collaboration with licensees in each country represented, Insignia expects to capture at least 3.5% of this market (114,000m3) within 5 years following the launch of SAFEWOOD, rising to 7.0% (226,000m3) after a further 3 years.

Benefits of SAFEWOOD compared to existing approaches for wood protection include:
• The process is environmentally-friendly, not involving use of biocides.
• The process is applicable to a wide range of wood types.
• In addition to protecting the wood, dimensional stability is improved.
• Strength of wood is maintained and colour is unchanged.
• The alternative thermally-modified wood process impacts on strength and colour of treated wood, whilst being of higher cost.
• Wood treated by the SAFEWOOD process has been positively evaluated by wood-product manufacturers and end-users.

SAFEWOOD provides numerous socio-economic benefits, which can be briefly summarised as follows:
• EU directives and national regulations are restricting usage of hazardous biocide based preservatives, thereby creating a demand for environmental-friendly alternatives.
• Crude tall oil, a by-product of the paper industry, has no other uses, is available in large quantities and at low cost.
• Increasing prices and restricted availability of non-sustainable tropical hardwoods.
• Increasing recognition of the importance of end-of-life recyclabiity/ reuse of preserved wood.

Related information

Record Number: 192964 / Last updated on: 2016-12-16
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