Groups urge government to immediately disclose how much subsidies are propping up Drax Group, BC’s largest wood pellet producer

April 14, 2022

VANCOUVER — The BC government must immediately disclose how many logs from publicly owned forests are turned directly into wood pellets at mills owned by the  Drax Group, BC’s biggest wood pellet maker, says a forest industry union, conservation and public policy organizations. 

The groups are also calling on the province to disclose the total subsidies to logging operations that supply Drax’s plants in BC.

New research by the Canadian Centre for Policy Alternatives, BC office shows that logging across BC is poised to fall precipitously over the next three years as logging companies run out of commercially desirable trees to cut down. Yet, despite growing shortages, the government continues to subsidize logging operations that deliver “lower quality” logs to Drax and other pellet makers by giving the logging companies even more trees to cut down, the groups say.

“The pellet industry is one of the lowest value, poorest job-generating enterprises of any in the forest industry yet millions of logs are trucked to wood pellet mills thanks to government subsidies,” says Gary Fiege, president of the Public and Private Workers of Canada (PPWC).

“There’s no future in that. We need to scale back the number of trees we’re logging and then do all we can to add value and generate jobs with the wood we have left.”  

 Thirty-five members of PPWC Local 9 and 20 staff recently lost their jobs when Drax Group purchased the sales contracts of Pacific Bioenergy, a competitor based in Prince George, and then Pacific Bioenergy immediately announced it was closing its operations.

Drax owns or has a financial stake in more than half of the province’s wood pellet mills, and will soon employ Diane Nicholls, who is set to leave her post as BC’s Chief Forester to become a company vice president.  

“The pellet industry in BC is set to expand in a big way,” warns Michelle Connolly, director of Conservation North, an organization dedicated to protecting primary forests in the interior of the province. “The only way they can do this is if the BC government continues to allow the logging of primary forests for this purpose. And this has to stop.”

Disclosure of the number of logs consumed by Drax and other wood pellet makers is essential given the government’s announcement last year that it is deferring logging in some of the province’s old-growth forests, says Torrance Coste, national campaign director for the Wilderness Committee. The announcement was immediately condemned by the forest industry, which said that thousands of jobs would be lost as a result.

Coste notes that in the last 20 years alone, more than 40,000 direct jobs were lost in the forest industry due almost entirely to industry over-cutting and the annual export of millions of unprocessed raw logs from the province.

“The proposed old-growth deferrals have become the bogeyman, but the real problem is  the industry’s over-cutting and raw log exports, plus the undisclosed huge number of logs being consumed by wood pellet mills—a forest and job killer if ever there was one,” Coste says.

Trends over the past 15 years show that not only has too much forest been cut, but that the best remaining forests in the province were hit the hardest, says Ben Parfitt, resource policy analyst with the Canadian Centre for Policy Alternatives and author of the recent research.

“What we are left with are vastly depleted forests including the interior temperate rainforest, which scientists warn is on the verge of ecological collapse, and steadily declining forest industry jobs. And much of what is being cut is going straight to wood pellets,” Parfitt says.

“Government must be transparent about its subsidies to Drax and the wood pellet industry more generally. It’s time to stop sending our forests and forest industry jobs up in smoke,” he adds.

Along with the Science Alliance for Forestry Transformation, a group of BC’s top forest ecologists, the CCPA has co-produced a video explaining how the subsidy program works, which can be accessed here.


For more information and to arrange interviews please contact:

Joel French at 780-893-9379 or [email protected]