1. Cross Laminated Timber Demand Forecast in the Pacific Northwest
Presenter: Cindy Chen &
Authors: Indroneil Ganguly, TODD BEYREUTHER, MATT HOFFMAN, SKIP SWENSON
INTRODUCTION AND BACKGROUND
RESULTS AND CONCLUSION
Introduction
This study presents end-use specific demand forecasting Cross Laminated Timber (CLT) panels in the Pacific Northwest (PNW) and predict the volume of finished CLT product in medium/tall wood buildings within Washington, Oregon, Idaho, and Montana.
Within the demand modeling exercise this study factors in ‘risk/hurdles’ of CLT adoption for various applications within the building construction sector.
End use applications of CLT considered in this paper include, 3/5/7/9 ply vertical wall, horizontal floor and roof diaphragms systems.
This study uses an innovation diffusion model to forecast the adoption and uses of CLT over the next 20 years.
Results
The following graphs illustrate key outcomes of the study, as well as projected CLT demand increases for both multifamily and office buildings based on end uses and building types.
End Use Specific CLT Innovation Diffusion Forecast in the PNW
Building Height Specific CLT Innovation Diffusion Forecast in the PNW
Data Source and Methodology
Two types of data is utilized for this study.
New building construction forecast data
Data to parameterize the industry innovation diffusion model for innovative wood based building material.
The data used for this study was obtained from CoStar and the Northwest Power and Conservation Council (NWPCC). The NWPCC’s 7th Power Plan includes the Commercial Building Stock Assessment (CBSA) and the Residential Building Stock Assessment (RBSA), which are used in this study to establish trends and characteristics in our target office and multifamily building typologies.
Parameters used in the CLT diffusion model includes:
Purchase probability is a function of the difference in the perceived utility obtained from the new generation product (CLT) from that of the previous generation product.
Purchase probability of CLT at any point is also a function of information dissemination defined by parameters
Finally, prior beliefs about the characteristics of the product gets revised after firms’ initial usage of the product denoted by the coefficient.
Forecasts for CLT demand are based on two CLT adoption scenarios:
Conservative
Best case scenario
Background: Housing construction forecast data
Combined Projected Market Demand for CLT: conservative scenario and best case scenario
CLT adoption diffusion forecast vs best case scenario for all building construction in the Pacific Northwest
A realistic demand estimate for CLT demand (green section), based on end use specific demand estimates, and the additional demand associated with the best case scenario projection (green + yellow). In the best case scenario projections, all the building types and material end uses follow a low-low diffusion curve trajectory. Given the best case scenario assumes no initial risks associated with either the building codes or the engineering and the design aspects, the difference between the realistic projection and the best case scenario is the largest in the earlier phases.
Figure 2: Projection of large office building floor area (moderate)
Figure 1: Projection of multifamily building floor area (moderate)
Background: Assumptions used for end use specific CLT adoption risk for building construction
Codes and Standards
Design and Engineering
Manufacturing and Construction
Expert 1 Rankings (CALCULATED AVERAGES)
Code Acceptance
Jurisdiction Acceptance
Architectural Design
Seismic Engineering
Fire Engineering
Acoustic
Engineering
Vibration Engineering
Manufacturing Experience
Construction Experience
Availability
Cost
Floor diaphragm CLT
bare section
3 ply 2 1 3
5 ply
7 ply
9 ply
composite concrete section
wood composite section
6 ply
8 ply
10 ply
Wall CLT
Color Coded Legend
no risk to adoption
low risk to adoption
medium risk to adoption
high risk to adoption
Conclusions
The predicted annual volume demand for CLT in 2035 is 6.6 million cubic feet
Represents less than 5% of the annual wood volume currently being exported to China, Japan, and Canada from the western states of the U.S.
Will lead to reduction in log exports and generate regional sawmilling jobs.
Demand of wide spectrum of wood types leading to optimal utilization and reduced waste.
Just the 4+ story construction market could support at least four mid-sized CLT plants producing 20,000-50,000 cubic meters per year each.
Increase in demand for small diameter timber
Economic incentives for forest health management (ladder fuel reduction and thinning operations)
Stochastic reduction in: wild forest fire incidences; insect infestation; disease propagation
Reduced prescribed burns and improved air quality
Dynamicity and Adaptability of the model to:
changes in the enviro-political shifts
changes in regulation and risk factors
Improved understanding of the market once the industry is better oriented to the product and its applications.
The adoption potential for each of the end use applications of CLT is categorized by the risk/challenges associated with these two summary metrics. For example, an end use application will be labeled ‘Low-High’ when the building codes and standards risk associated with adoption of CLT is low, but the design and engineering risk/challenges associated with specifying CLT for the end use application are high.