Cascading, RED III and a sequence for allocating residues

The cascading principle

Cascading means using wood first for long-lived products, then reuse and recycling, and only at the end for energy. The order in the revised Renewable Energy Directive (RED III, Directive (EU) 2023/2413, Article 3(3)) is: wood-based products, extended service life, reuse, recycling, bioenergy, disposal. A German life cycle and exergy study of multifunctional wood cascade chains (2017) found a life-cycle resource efficiency of 46% against 21% for the non-cascaded case, most of the saving coming from avoided primary production in forestry. That is a ratio of 46 / 21 = 2.2. Note the scope: the study concerns chains where the same fibre serves several material uses, mostly post-consumer wood, not sawmill residues directly.

Sawmill residues are by-products: the main wood is already in a long-lived product. The cascade question is therefore about the second step. A chip that becomes pulp and then paper is the first step of a chain; sawdust turned into pellets is a one-step energy route.

What RED III says (verified text) and what it means (interpretation)

Verified from the Directive:

• Binding EU 2030 target of at least 42.5% renewable energy in gross final energy consumption, with an endeavour towards 45%.
• Industrial grade roundwood is defined (saw logs, veneer logs, pulpwood and similar).
• Member States may derogate from cascading for security of energy supply or where local industry cannot use the biomass at higher added value.
• No direct financial support for energy use of saw logs, veneer logs, industrial grade roundwood, stumps and roots.

Interpretation (not legal advice): the support ban targets primary roundwood, not sawmill co-products, so nothing in the verified text prohibits burning sawdust, bark or shavings. The cascading principle is, however, a policy argument for steering clean chips to material uses. Not verified in the portal: the Article 29 thresholds and greenhouse-gas saving percentages, the transposition deadline and national transposition. Check the consolidated text and national law before taking compliance decisions.

A six-step sequence for allocation (the author's own synthesis)

This is a practical heuristic, not a published or validated model.

1. Fix the internal heat demand. Kiln drying and building heat first; bark and low-grade fractions are the natural fuel. A bark-only heating plant at a Finnish sawmill (2013) covered all of its heat and steam.
2. Segregate by quality. Clean chips, bark-containing chips, sawdust, dry shavings, bark.
3. Offer clean fractions to the highest material use. Pulp, panels, other products; growing media for bark.
4. Offer the remainder to pellets or briquettes.
5. Allocate the rest to energy, internal first, then external, with efficiency (heat only, CHP, district heat) as an explicit criterion.
6. Review at least annually against policy and market signals, then repeat steps 1-5.

It is "sequential" because each step depends on what remains from the previous one and the decision is repeated as prices, volumes and rules change.

Rule-of-thumb criteria

The portal's sources give no numerical thresholds; each mill must calibrate with its own prices.

Worked example: allocating one week of residues (qualitative)

A hypothetical mill produces clean chips, sawdust, planer shavings and bark. Its kilns are currently fired partly with bought fuel.

• Step 1: the bark and the wet sawdust go first to the kiln boiler until the bought fuel is replaced.
• Step 3: clean chips go to a pulp mill under a contract, because the net price after transport exceeds their energy value.
• Step 4: dry shavings go to a pellet plant.
• Step 5: any surplus bark goes to a district-heat customer.

If the pulp mill cancels, the clean chips fall to step 4 or 5: contract security is a criterion.

Key points

• Cascading orders use as products, reuse, recycling, then energy; the German 2017 study found 46% vs 21% resource efficiency for cascaded chains (mainly post-consumer wood).
• Verified RED III points: 42.5% target, cascade priority, no direct support for energy use of roundwood; Article 29 thresholds and national transposition are not verified.
• The reading that by-products are not banned from energy use is an interpretation, not legal advice.
• The six-step sequence (heat, segregate, material, pellets, energy, review) is a heuristic, not a published model.
• Contract security and buyer proximity decide whether a fraction can move up the cascade.