January 20, 2010 / 1:05 PM / 10 years ago

RWE builds US biomass unit to fuel European plant

* RWE to produce wood pellets in Georgia, United States

* RWE to ship them to Europe and fire them in power plant

* Move is part of plan to cut carbon dioxide emissions

BERLIN, Jan 20 (Reuters) - Germany’s RWE (RWEG.DE), Europe’s fifth-largest utility and top carbon emitter, is planning to cut its emissions in the EU by building a biomass facility in the U.S. to produce wood pellets for burning in a Dutch power plant.

The German power company will build a plant in Georgia for 120 million euros ($170 million) that will produce 750,000 tonnes of the wood pellets a year, RWE management board member Leonhard Birnbaum said on Wednesday. The company will then ship the pellets to the Netherlands and fire them in the Amercentrale plant owned by its Dutch unit Essent, Birnbaum said.

Coal-centred RWE, based in Essen in northern Germany, is Europe’s largest polluter and is seeking to cut carbon dioxide emissions, which contribute to global warming, as the 27 states of the European Union make emitting the gas more and more expensive.

The facility in Georgia is one of the first to make wooden pellets in the U.S. for shipping to Europe. There is another facility in the south of the country and several smaller ones in Canada.

The pellets produced are enough to fire a power plant with a capacity of 100 megawatts. That compares with an overall capacity at the Amercentrale plant of 1,245 megawatts. (Reporting by Vera Eckert, Tom Kaeckenhoff and Peter Dinkloh, writing by Peter Dinkloh, editing by Will Waterman) ($1=.7040 Euro)

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