December 2011 Biomass Power & Thermal

INSIDE: ETHANOL PLANTS LOOK TO BIOMASS TO REDUCE INPUT COSTS

December 2011

Digging In Business was Brisk in 2011, Despite Regulatory Uncertainty Page 24

Plus: Industry Leaders Discuss Priorities for 2012 Page 30

U.S. Department of Veterans Affairs Embraces Biomass CHP Page 42 www.biomassmagazine.com

DECEMBER 2011 | VOLUME 5 | ISSUE 12

INSIDE ¦

FEATURES 24 PROJECT DEVELOPMENT Digging In Bioenergy companies enjoyed robust growth in 2011 and expect it to continue in 2012 as people learn more about the benefits of biomass power and thermal.

By Matt Soberg

OUTLOOK

30 Industry Insight Biomass energy leaders discuss the trials and tribulations of 2011 and their expectations for the new year.

By Lisa Gibson

INNOVATION

36 Stover for Power—Not Just Biofuels

36

Ethanol producers are discovering opportunities for gasifying corn stover to generate heat and power.

By Kris Bevill

INITIATIVE

42 Honoring Sustainability The U.S. Department of Veterans Affairs is investing in combined-heat-and-power projects to reduce its carbon footprint.

By Matt Soberg

DEPARTMENTS 04 EDITOR’S NOTE Federal Policy Holds Key to Significant Progress in 2012

By Rona Johnson

06 INDUSTRY EVENTS 08 POWER PLATFORM Waking the Sleeping Giant

By Bob Cleaves

12 ENERGY REVIEW Controlled Spontaneous Reactor

By Bruce C. Folkedahl

13 LEGAL PERSPECTIVE Biomass 2012: International Growth and Domestic Obstacles

By Kate Bechen

14 BUSINESS BRIEFS 16 FIRED UP 48 MARKETPLACE 49 ADVERTISER INDEX

DECEMBER 2011 | BIOMASS POWER & THERMAL 3

¦EDITOR’S NOTE

Federal Policy Holds Key to Significant Progress in 2012

RONA JOHNSON Editor rjohnson@bbiinternational.com

As is our tradition, the December issue of Biomass Power & Thermal is an opportunity for us to reminisce about the passing year, and to ponder what the new year might bring. It’s clear when you read the Outlook and Project Development features in this month’s magazine that most biomass businesses had a good year, and that federal policy will be the main thing holding the biomass industry back in the new year.

While developers are eager to start producing biomass energy, they are being hampered by a lack of funding. The problem is that the financial community is mainly waiting for the U.S. EPA’s boiler Maximum Achievable Control Technology final, final rules and the agency’s decision regarding the treatment of biogenic emissions. Then there’s the Energy Title in the Farm Bill, which is supposed to be reduced by $23 billion over the next 10 years.

I don’t believe the entire Energy Title will be wiped out, but there may be some reductions. How that plays out is anyone’s guess at this point. In the meantime, it is up to the biomass industry to tell lawmakers about programs such as the Biomass Crop Assistance Program and the impact it has made and will continue to make in rural America. As I’ve said before, it will create economic opportunities not just for landowners but for custom harvesters, truckers, equipment suppliers, not to mention the indirect benefits for restaurants, grocery stores and other main street businesses in communities where the biomass is being produced, collected, delivered and processed.

Then there’s the Rural Energy for America Program, which according to Sen. Amy Klobuchar, D-Minn., will likely be retained in the Farm Bill. Klobuchar, who is a member of the Senate ag committee, spoke on Nov. 7 at a conference in Fargo, N.D. Let’s hope she’s right.

The good news is that the renewable energy industry is not sitting back waiting for the outcome. In October, the Agriculture Energy Coalition was formed to fight for a strong bipartisan Energy Title in the Farm Bill. The coalition sent a letter to leaders of the House and Senate ag committees, urging them to support agand forestry-based energy programs and policies in the new Farm Bill. The letter mentions BCAP, REAP, the Biorefinery Assistance Program and the Biobased Markets Program, and the fact that they have helped finance thousands of renewable energy projects across rural America. “Programs are generally over-subscribed and show no signs of abating even as the economy has slowed,” the letter states.

The letter also points out that the total outlays for the Energy Title amount to less than 1 percent of all the programs authorized in the 2008 Farm Bill.

As you can guess, the Biomass Power Association, American Biogas Council, Biomass Thermal Energy Council, the 25x’25 Alliance and many others are members of the coalition.

For more news, information and perspective, visit www.biomassmagazine.com Associate Editors Associate Editor Lisa Gibson conducted a Q and A with Biomass Thermal Energy Council’s Charlie Niebling and Biomass Power Association’s Bob LISA GIBSON Cleaves. The industry leaders discussed opportunities and challenges their industries have faced in 2011 and what they need to succeed in the new year.

Associate Editor Matt Soberg talked to biomass businesses about their successes in 2011 and what they expect to see in 2012.

He also wrote about MATT SOBERG the U.S. Department of Veterans Affairs efforts to reduce its greenhouse gas emissions 30 percent by 2020.

4 BIOMASS POWER & THERMAL | DECEMBER 2011

Kris Bevill, associate editor with Biomass Power & Thermal’s sister publication Ethanol Producer Magazine, writes about a growing trend in the ethanol KRIS BEVILL industry involving the gasification of corn stover to generate energy and displace fossil fuels.

EDITORIAL EDITOR Rona Johnson rjohnson@bbiinternational.com ASSOCIATE EDITORS Anna Austin aaustin@bbiinternational.com Lisa Gibson lgibson@bbiinternational.com Matt Soberg msoberg@bbiinternational.com COPY EDITOR Jan Tellmann jtellmann@bbiinternational.com

ART ART DIRECTOR Jaci Satterlund jsatterlund@bbiinternational.com GRAPHIC DESIGNER Elizabeth Burslie bburslie@bbiinternational.com

PUBLISHING & SALES CHAIRMAN Mike Bryan mbryan@bbiinternational.com CEO Joe Bryan jbryan@bbiinternational.com VICE PRESIDENT Tom Bryan tbryan@bbiinternational.com VICE PRESIDENT, SALES & MARKETING Matthew Spoor mspoor@bbiinternational.com EXECUTIVE ACCOUNT MANAGER Howard Brockhouse hbrockhouse@bbiinternational.com SENIOR ACCOUNT MANAGER Jeremy Hanson jhanson@bbiinternational.com ACCOUNT MANAGERS Marty Steen msteen@bbiinternational.com Chip Shereck cshereck@bbiinternational.com Bob Brown bbrown@bbiinternational.com Andrea Anderson aanderson@bbiinternational.com Dave Austin daustin@bbiinternational.com Kelly Kilgore kkilgore@bbiinternational.com CIRCULATION MANAGER Jessica Beaudry jbeaudry@bbiinternational.com ADVERTISING COORDINATOR Marla DeFoe mdefoe@bbiinternational.com SENIOR MARKETING MANAGER John Nelson jnelson@bbiinternational.com

Subscriptions Biomass Power & Thermal is free of charge to everyone with the exception of a shipping and handling charge of $49.95 for any country outside of the United States, Canada and Mexico.

To subscribe, visit www.BiomassMagazine.com or you can send your mailing address and payment (checks made out to BBI International) to Biomass Power & Thermal Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You can also fax a subscription form to (701) 746-5367. Back Issues & Reprints Select back issues are available for $3.95 each, plus shipping. Article reprints are also available for a fee. For more information, contact us at (701) 746-8385 or service@bbiinternational.com. Advertising Biomass Power & Thermal provides a specific topic delivered to a highly targeted audience. We are committed to editorial excellence and high-quality print production. To find out more about Biomass Power & Thermal advertising opportunities, please contact us at (701) 746-8385 or service@bbiinternational.com. Letters to the Editor We welcome letters to the editor. Send to Biomass Power & Thermal Letters to the Editor, 308 2nd Ave. N., Suite 304, Grand Forks, ND 58203 or e-mail to rjohnson@bbiinternational.com. Please include your name, address and phone number. Letters may be edited for clarity and/or space.

Please recycle this magazine and remove inserts or samples before recycling TM

COPYRIGHT Š 2011 by BBI International

DECEMBER 2011 | BIOMASS POWER & THERMAL 5

¦INDUSTRY EVENTS Pacific West Biomass Conference & Trade Show January 16-18, 2012 San Francisco Marriott Marquis San Francisco, California With an exclusive focus on biomass utilization in California, Oregon, Washington, Idaho and Nevada—the Pacific West Biomass Conference & Trade Show will connect the area’s current and future producers of biomass-derived electricity, industrial heat and power, and advanced biofuels, with waste generators, aggregators, growers, municipal leaders, utility executives, technology providers, equipment manufacturers, investors and policy makers.

(866) 746-8385 www.biomassconference.com/pacificwest

International Biomass Conference & Expo April 16-19, 2012

The Golden Gate to Biomass With an abundance of biomass resources and renewable incentives, the Pacific West provides ample opportunities for developers. Attendees of the Pacific West Biomass Conference & Trade Show will have access to biomass industry stakeholders involved in every aspect of biomass-based power, thermal and fuels.

The BBI International event, produced jointly by Biomass Power & Thermal and Biorefining Magazine, will be held Jan. 16-18 at the San Francisco Marriott Marquis in San Francisco.

The Pacific West event zeroes in on biomass utilization in California, Oregon, Washington, Idaho and Nevada. These states have a variety of incentives to boost biomass energy production and lower greenhouse gas emissions.

California mandates that load-serving power companies generate 33 percent of their power from renewable sources by 2020. The state is well on its way to meeting that goal by having the most biomass power facilities in the U.S. It also leads the country in the number of wastewater treatment facilities that employ anaerobic digestion, with 50, according to the American Biogas Council.

That number is expected to increase in response to Senate Bill 489, which was recently signed by California Gov. Jerry Brown. The bill allows small-scale biomass and biogas projects (1 megawatt or less) to qualify for the state’s Net Energy Metering program, which will help development of new biogas projects utilizing agricultural residue, municipal solid waste and wastewater.

Energy crops are also emerging in California. Two power plants are studying the feasibility of burning sorghum as an alternative fuel. If the testing is successful it will be the state's first production-scale effort to generate power from an energy crop, according to Chromatin Inc., the company supplying the feedstock to Constellation Energy, a power company headquartered in Maryland.

California isn’t the only state in the Pacific West with renewable energy goals. Washington’s renewable portfolio standard (RPS) calls for the state to produce 15 percent of its electricity with renewable sources by 2020 and Nevada has a 20 percent by 2015 goal. Oregon also aims to reduce its greenhouse gas emissions, and has directed utilities to meet 25 percent of their electricity production using renewables by 2025.

Oregon’s ambitious RPS has prompted biomass power project developers to stake out sites in the state. One of those sites, Klamath Falls, Ore., could be home to two biomass power facilities. Klamath Falls Bioenergy recently completed an application for site certification with the Oregon Department of Energy for a 37-megawatt plant, and Iberdrola Renewables is also in the early stages of developing a 35-megawatt biomass power facility.

Also in Oregon, HM3 Energy Inc. is building a demonstration facility in Troutdale, Ore., to torrefy wood biomass. The company plans to build a commercial plant in Prineville, Ore., which could be the first large-scale torrefaction facility in the U.S. Torrefied biomass is an ideal feedstock for coal-fired power plants looking to cofire with or convert to biomass.

Biofuels production also got a boost in the Pacific West in July when USDA Secretary Tom Vilsack announced Biomass Crop Assistance Program project areas in California, Oregon, Washington and Montana. Landowners who opt to produce camelina for biofuel production in eligible areas could receive assistance through the BCAP. These are just a few of the many biomass-related programs, projects and incentives in this region. To learn more, plan to attend the Pacific West Biomass Conference & Trade Show. Register today at www.biomassconference.com/pacificwest.

01/16

6 BIOMASS POWER & THERMAL | DECEMBER 2011

Colorado Convention Center Denver, Colorado Organized by BBI International and coproduced by Biomass Power & Thermal and Biorefining Magazine, this event brings current and future producers of bioenergy and biobased products together with waste generators, energy crop growers, municipal leaders, utility executives, technology providers, equipment manufacturers, project developers, investors and policy makers.

It’s a true one-stop shop—the world’s premier educational and networking junction for all biomass industries. Presentation ideas are being accepted online through Dec. 23.

(866) 746-8385 www.biomassconference.com

International Fuel Ethanol Workshop & Expo June 4-7, 2012 Minneapolis Convention Center Minneapolis, Minnesota Now in its 28th year, the FEW provides the ethanol industry with cutting-edge content and unparalleled networking opportunities in a dynamic business-to-business environment.

As the largest, longest running ethanol conference in the world, the FEW is renowned for its superb programming— powered by Ethanol Producer Magazine. Presentation ideas are being accepted online through Feb. 10.

(866) 746-8385 www.fuelethanolworkshop.com

International Biorefining Conference & Expo November 27-29, 2012 Hilton Americas - Houston Houston, Texas Organized by BBI International and produced by Biorefining Magazine, the International Biorefining Conference & Trade Show brings together agricultural, forestry, waste and petrochemical professionals to explore the value-added opportunities awaiting them and their organizations within the quickly maturing biorefining industry. Contact a knowledgeable account representative to reserve booth space now.

(866) 746-8385 www.biorefiningconference.com

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¦POWER PLATFORM

Waking the Sleeping Giant

BY BOB CLEAVES

I recently had the privilege of speaking at a threeday meeting of the Electric Power Research Institute in Austin, Texas. The topic was biomass (what else?).

For those readers not familiar with EPRI, it’s the nation’s leading collection of scientists, engineers, academicians and industry representatives who spend lots of time thinking about the generation, delivery and use of electricity. Unlike many of us in the “merchant” world of independent power production, EPRI is 90 percent comprised of utilities—think Duke Energy Corp., Southern Co., American Electric Power Co. Inc. and Tennessee Valley Authority. In other words, it’s a sector of the economy with lots to say about the future of energy, and the political (and economic) clout to get it done.

Dave O’Connor, EPRI’s go-to guy on biomass, organized the conference and asked me to speak. EPRI doesn’t lobby, but figured I would provide an unvarnished view of how politics is shaping the biomass sector. As I sat waiting my turn at the podium, I heard that biomass represents one of the best opportunities for renewable base-load generation, particularly in the Southeast; that members were looking at cofiring, torrefaction, retirement of smaller coal plants; and that biomass is a way to complement local economies and provide jobs while also providing a disposal option for material that would otherwise generate methane in landfills. All good, except that in their perspective, regulatory uncertainty is causing a “chilling” effect on investment in the sector. Boiler Maximum Achievable Control Technology and carbon are their biggest concerns.

8 BIOMASS POWER & THERMAL | DECEMBER 2011

The old adage—“be at the table or run the risk of being on the menu”—couldn’t be more appropriate as biomass is considered by federal and state policymakers.

Like all of us on the merchant side of power generation, utilities seem to appreciate the opportunity of biomass. What we need now is their help. Before the U.S. EPA are two issues that directly affect our industry— revised boiler and Non-Hazardous Secondary Materials rules, and how the Tailoring Rule will regulate biogenic emissions. Many regulated utilities have yet to speak out on these important issues.

For too long, the sector has been balkanized into landowners, utilities, merchant developers and owners, paper mills, and the utility sector. To be sure, we serve different constituencies with sometimes conflicting views on national energy or tax policy. Despite these differences, we share the fundamental belief that biomass energy is critically important to our economy, our environment, and the health of our forests and farms. For that reason, we are coming together like never before. It’s now time for all of the nation’s utilities to join our effort in providing scientific support on the carbon benefits of biopower and to work with EPA on achieving sensible, science-based MACT and solid waste regulations.

Author: Bob Cleaves President and CEO, Biomass Power Association www.USABiomass.org

Way Beyond Don’t just let the chips fall where they may. Bring us on board for your next biomass project.

All fuels. All technologies. All industries. All services.

Together we will find your solution.

Learn more at www.burnsmcd.com/bmcdbiomass Ron Jones

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¦THERMAL DYNAMICS

Putting Biomass Thermal on the Front Burner in DC

BY STEPHEN GUNTHER AND ELLEN ABRAMOWITZ

In recent months, renewable energy and energy investment have reemerged in the policy debate in Washington, D.C. Both Sen. Lamar Alexander, R-Tenn., and Senate Energy and Natural Resources Committee Chairman Jeff Bingaman, D-N.M., voiced their intentions in early October to address how the government should invest in energy. While Bingaman plans to hold a hearing on U.S. investments in clean energy in the coming weeks, Alexander intends to scrutinize permanent energy subsidies and focus investments in research for solar technologies, batteries, green buildings, carbon capture and storage, fusion, nuclear energy and biofuels. Once again, the importance of renewable thermal energy, specifically biomass, appears overlooked in the energy debate.

To raise awareness on Capitol Hill of the importance of biomass thermal energy, the Biomass Thermal Energy Council and numerous renewable energy and environmental groups such as the Biomass Coordinating Council and the Pellet Fuels Institute are hosting a Biomass Thermal DC Summit on Nov. 16. This unprecedented event will unite the nation’s biomass thermal businesses and educate policy makers about the considerable potential of biomass thermal energy in meeting America’s growing demand for clean, reliable and domestic energy sources.

The summit seeks to build upon the progress of numerous nonprofit organizations, community members, and businesses, in promoting biomass thermal energy. Nearly 20 biomass thermal-related groups and associations have already indicated their support for the summit, and the list continues to grow. As part of the summit, these organizations and their member companies will engage policy makers and demonstrate industry support for upcoming key legislative issues, such as energy provisions in the 2012 Farm Bill. Also, the summit will present the perfect venue for businesses and individuals to nurture or develop relationships with their members of Congress.

10 BIOMASS POWER & THERMAL | DECEMBER 2011

Strengthening relationships with one’s senators and representatives is especially important given the opportunity to grow the newly formed Congressional Biomass Caucus. It was only five months ago, that supporters of biomass thermal energy witnessed this significant accomplishment. The Congressional Biomass Caucus was founded to support the development of biomass and elevate this effectively forgotten renewable resource’s profile in Congress. As of mid-October, the caucus roster stood at 13, and the upcoming summit will help to grow support and membership. Strong constituent-torepresentative relationships and direct appeals are two of the most effective methods for increasing the size of the caucus and influence; the summit will facilitate both.

Aside from displaying broad industry support, the summit will host several networking and informational activities for attendees, including a morning orientation on constituent-to-Congress communication “best practices,” a public biomass briefing with industry experts, and coordinated congressional and federal agency outreach.

The summit will conclude with an evening congressional reception.

It is BTEC and the participating groups’ goal that the summit will serve as a milestone for our often federally neglected industry. On Nov. 16, we will again place biomass thermal energy on our political leaders’ “front burners.” Your support and attendance will make our coalition even more effective. If you’re interested in joining us in Washington, D.C., visit http://biomassthermal. org/events/thermalsummit.asp for additional information. For other inquiries on the summit, its activities, and potential event sponsorship, contact Stephen Gunther, BTEC policy and governmental affairs fellow, at Stephen. gunther@biomassthermal.org.

Author: Stephen Gunther Policy and Governmental Affairs Fellow Ellen Abramowitz Education and Outreach Fellow Biomass Thermal Energy Council www.biomassthermal.org

¦ENERGY REVIEW

Controlled Spontaneous Reactor

BY BRUCE C. FOLKEDAHL

Last month, we highlighted an old technology that is resurging as a potential answer to technical issues involved in processing biomass into a suitable cofiring boiler fuel. It is called torrefaction. The largest impediments to the utilization of biomass as a cofiring fuel with fossil fuels in larger-scale utility boilers are the handling and conveyance properties of the biomass material. Torrefaction may provide an answer.

The Energy & Environmental Research Center and other entities have developed and patented various systems. The EERC’s technology is called the controlled spontaneous reactor (CSR). The CSR was initially a type of torrefaction technology designed for high-moisture, low-rank coals where moisture and volatiles were driven off at lower temperatures, leaving an appropriately sized char that burned, releasing more heat, then reignited above the coal burners, yielding lower-nitrogen-compound pollutants. The EERC has now adapted the technology for biomass in order to convert higher moisture and low-density biomass into char biomass materials that have similar physical properties as crushed coal particles and blend effectively with coal in a cofiring scenario for conventional large-scale utility boiler systems. The added major benefit of upgrading biomass instead of coal, of course, is the lower carbon footprint that results (lower net greenhouse gas emissions) compared to coal.

The CSR technology is a fluidized-bed technology that utilizes a proprietary fluidization plate to effectively control the velocity profile across the bed for well-controlled sizing of the produced fuels. The CSR is an atmospheric system that can be utilized as a stand-alone torrefaction system. Another rendition of the technology may be to integrate it with an existing boiler and utilize available low-grade heat, such as the exiting flue gas, to provide heat for the torrefaction process. If no source of low-grade heat is available, a portion of the biomass

12 BIOMASS POWER & THERMAL | DECEMBER 2011

feed material is consumed to produce the required heat, lowering the overall efficiency of the process.

One of the major advantages of the CSR over other torrefaction technologies is its ability to handle a wide variety of feedstocks. The fluidized-bed system is forgiving for a range of biomass sizes from several centimeters to a few millimeters. The system can be operated in an optimized mode for a specific biomass’s physical and chemical properties, such that the produced fuels have consistent and improved grindability and handling properties along with low moisture, low volatiles, and a much-improved heat content. Additionally, because of its design, the system acts as a classifier to remove tramp metals (unwanted nails, fence wiring, machinery parts or other metals that can be associated with wood resources) and other unwanted materials carried in with the feedstock.

In conclusion, although biomass is simply very, very young coal, it does not have the high density and heating properties that coal has, which contributes to a significant economic challenge. Torrefaction may be one solution for processing biomass into a usable fuel for utility boilers. The EERC’s CSR technology, a pseudotorrefaction system, and several other torrefaction systems in development around the globe might provide solutions for cofiring. Torrefaction systems appear to have a lower cost and smaller design footprint, they allow for a wide range of biomass feedstock types, and they produce a consistent fuel product. Several different demonstrations are ongoing with limited reportable insights at the moment. Stay tuned for more factual torrefaction results in the near future.

Author: Bruce C. Folkedahl Senior Research Manager Energy & Environmental Research Center (701) 777-5243 bfolkedahl@undeerc.org

LEGAL PERSPECTIVE¦

Biomass 2012: International Growth and Domestic Obstacles

BY KATE BECHEN

In 2012, expect to see the continued development of the biomass industry in the European Union and other areas of the world. Currently, the U.S. leads the world in biomass power capacity, but that is beginning to change. The North American wood pellet industry has become a major supplier to the EU. The volume of EUbound wood pellet shipments in 2010 was double that of 2008, with the Netherlands, the U.K. and Belgium leading the demand. From 2008 to 2009 the EU’s gross electricity production from biomass increased more than 10 percent, with Germany, Sweden and the U.K. leading the way. The U.K., in particular, is focusing its efforts on developing its biomass capacity. October saw the U.K. propose subsidies to business customers (to be followed by households after the program was established) who use renewable energy technology for heating. While the program’s rich subsidy was scaled back (from 2.7 pence per kilowatt hour (kWh) to 1 pence per kWh), the efforts show clearly that the political will is in place to continue to support the biomass industry. The U.K.’s proposals included as a key goal the development of “cheaper” renewable generation, focusing specifically on the conversion of coal plants to biomass and cofiring plants.

But the U.K. is not the only place to see recent movement in the biomass space that is expected to continue throughout 2012. India, Japan and Brazil have also added biomass power capacity with additional projects in development phases. In addition, biogas is expected to see significant growth in Italy, France and Spain. China, in particular, has set ambitious goals for its biomass industry. By 2015, China wants to have 13 gigawatts of biomass power capacity, which is a 160 percent increase from its 2010 capacity. This means China anticipates adding 500 to 700 biomass power plants by 2015. With a biomass reserve equivalent to 500 million tons of coal, from sources such as straw, algae, methane, fallen timber and manure, China may very well emerge as the new high-growth country in the biomass space.

The U.S. biomass industry is growing, though it will continue to face significant challenges during 2012. But first, some success stories. Several new biomass plants are under construction (not just in the development stage) including 100 megawatt (MW) plants in Texas and Florida and smaller 50 to 75 MW plants in New Hampshire and Florida. Several more plants are in the development phase, with construction expected to begin in 2012.

Most of these plants are located in rural areas where jobs are needed the most. New plant construction and job creation will go a long way to garnering the political support needed to move the industry forward.

What the biomass industry can’t control is the price of natural gas and oil. Further, the inability to establish an acceptable definition of “biomass” has torn the industry’s focus away from developing its supply chain and establishing its presence as a cost-effective alternative to fossil fuels. In addition, we are seeing a shift toward investment in smart grid and energy efficiency technologies, which may result in a focus away from biomass projects, at least in the short term. Energy service providers are focusing more on smart grid technologies, as a result of commercial customer demand for real-time energy management capabilities, through the acquisition of battery storage and consumer-driven energy management technologies.

In 2012, the biomass industry needs to focus on the positive economic benefits it brings to communities and the importance of energy independence. Further, while establishing a biomass definition is important, let’s not allow that debate to divert precious time and energy away from the development of a cost-effective supply chain and establishment of biomass as an alternative energy source to fossil fuels.

Author: Kate Bechen Attorney, Michael Best & Friedrich LLP (414) 225-4956 klbechen@michaelbest.com

DECEMBER 2011 | BIOMASS POWER & THERMAL 13

Business Briefs PEOPLE, PRODUCTS & PARTNERSHIPS

Madison college receives grant from Thermo Fisher Scientific Madison Area Technical College in Madison, Wis., has received a $10,000 Thermo Fisher Scientific Inspire Grant to support student participation in Renewable Energy for International Development.

The course, which is offered through Madison College and the Consortium for Renewable Energy Technology, examines energy and economics in developing countries with special consideration to renewable energy sources. The class combines eight weeks of online instruction with 10 days of study and hands-on work in Costa Rica. Students design and install working renewable energy systems that can be applied in developing countries. The Inspire Grant provides six $1,500 scholarships, as well as a $1,000 stipend that will be given to a program participant from Costa Rica to offset their expenses to attend related workshops in Madison.

GE introduces gas engine for small biogas projects Expanding the company’s lineup of biogas engines for a wider range of power outputs, GE has introduced its Waukesha 1-megawatt APG1000 gas engine that can utilize a broader variety of biogases, including from landfills, wastewater treatment plants and agricultural waste.

The Waukesha unit’s expanded biogas capabilities are the result of an 18-month redesign and testing initiative that includes modifications to the combustion chamber, a new spark plug design, and a new fuel control system that simplifies engine start-up and operation. For example, the engine’s greater fuel tolerances allow it to handle fluctuations in the thermal quality of the biogas with little or no manual intervention. These modifications address the unique operational challenges of using biogases and were validated at both landfill and digester biogas-to-energy project sites.

by agricultural waste, pulp and paper waste, energy crops and refuse-derived fuel.

These power plants operate around-theclock providing a consistent, sustainable flow of renewable energy. The biogas produced can be utilized to generate electricity in a GE Jenbacher, or a similar engine. Alternatively, the biogas can be used to fuel incumbent processes such as kilns, fractionation towers or existing engines and turbines. Fuel cost is reduced or eliminated as the gasification plants are small enough to be located adjacent to biomass supplies.

Blythe takes over at B&W Mechanical Handling Andy Blythe was appointed managing director of U.K.-based B&W Mechanical Handling Ltd. He joined the company in early May succeeding Andrew Mitchell, who Andy Blythe will is focusing on his own initially focus on consulting business but improving B&W's presence in the will maintain strong ports and terminal links with B&W. Blythe sector and other brings his vast experi- high-end markets. ence in aggregates, minerals and the bulk handling industry with a proven track record in business expansion and strategic development.

With B&W, Blythe’s initial focus is to improve the strong presence in the ports and terminals sector as well as expand into other high-end markets that need the same technologies.

Nortrax expands Morbark territory into eastern New York

Reliable Renewables joins CEA Consumer Energy Alliance welcomes Reliable Renewables LLC as its newest affiliate member. Reliable Renewables develops owns, and operates modular biomass gasification power plants of 2 to 5 megawatts. The power plants are fueled

14 BIOMASS POWER & THERMAL | DECEMBER 2011

PHOTO: MORBARK

New Dealer for Continental Biomass Industries Continental Biomass Industries Inc., a manufacturer of portable and stationary biomass processing and recycling systems, has announced that McCourt & Sons Equipment Inc. is an exclusive dealer for CBI’s product line and will provide equipment, parts and service for Texas, Arkansas, Louisiana, Oklahoma and Mississippi.

Established in 1997 and family owned and operated, McCourt & Sons has more than 65 years of combined industry experience.

GROWING BUSINESS: Nortrax and Morbark are expanding their reach to include 10 counties in eastern New York.

Morbark Inc. has signed an agreement with Nortrax Inc., a Morbark forestry and recycling dealer, to expand its territory to include eastern New York State. The expansion added 10 New York counties to an already established Nortrax northeastern territory of Maine, Vermont and New Hampshire. Nortrax has been a steadfast Morbark dealer for more than 20 years.

With excellent product support, as well as an extensive equipment and parts inventory, the expansion of the Nortrax-Morbark partnership into eastern New York state will greatly benefit regional Morbark customers.

Morbark names new president Morbark Inc., a manufacturer of forestry, sawmill and wood recycling equipment, announced the appointment of

BUSINESS BRIEFS¦

cals. The NPEP program also works to identify environmentally preferable alternatives and fosters technology transfer. To date, NPEP partners have been successful in removing more than 40 million pounds of potentially hazardous material.

James W. Shoemaker Jr. as president. Shoemaker replaces Lon Morey who will remain as the chairman of Morbark’s board of directors. Prior to his appointment, Shoemaker served as Morbark’s vice president of operations and board member. He joined Morbark in 2003 as the manager of operations and has held numerous positions in the company. Prior to joining Morbark, Shoemaker served 25 years with the Jervis B. Webb Co. managing operations, accounting and supply chain.

PHOTO: BANDIT INDUSTRIES

Bandit Industries receives EPA award

REWARDING EXCELLENCE: Terry Howard (left to right), Dianne Morey, Kelly Zielinski, Janet Haff, Louie Jensen and Lee Hohlbein of Bandit Industries accepted an award from the U.S. EPA for reducing hazardous chemicals in the workplace.

Wood chipper manufacturer Bandit Industries received a National Partnership for Environmental Priorities achievement award from the U.S. EPA. The award was given to the company for efforts in reducing hazardous chemicals in the workplace, specifically with the reduction of mercury.

Bandit was one of only three organizations in Michigan to receive the award.

Bandit’s proactive replacement of mercury thermostats resulted in approximately three pounds of the dangerous metal being removed from the company grounds. The old thermostats were then securely packaged and sent to a recycling facility. These reductions were achieved as part of the NPEP program, a voluntary reduction program in which companies, municipalities, federal facilities and tribes partner with the EPA to reduce and/or recycle toxic chemi-

Davidson joins Vecoplan Matthew Davidson has joined Vecoplan LLC as a product engineer. Davidson brings three years of practical experience from Crowder Construction Co., where he was a Matthew Davidson mechanical project en- has joined Vecoplan gineering manager and and will design and develop turnkey two years experience as shredding systems a mechanical engineer- for the recycling ing intern with Square industry.

D, to his new position at Vecoplan. Davidson’s responsibilities will include coordinating the design and development of turnkey shredding systems for the recycling sector. He will also oversee the manufacture and implementation of his projects once the engineering phase has been completed, in order to ensure continuous quality control.

VIC hires Carter as electrical engineer Vecoplan Integrated Controls, a North American manufacturer of industrial control panels and plant-wide integrated control systems, has added Ron Carter to its electrical engineering team. Carter brings more than 20 years of experience to his new position at VIC. His background includes both practical experience from stints at Commonwealth Brands, Lucent Technologies and R.J. Reynolds Tobacco Co. Carter’s responsibilities will include coordinating the design and development of individual control panels and turnkey controls integration for manufacturing

plants. In order to ensure continuous quality control, he will also oversee the manufacture and implementation of his projects once the engineering phase has been completed.

Rodman named to NECA's Renewables and Distributed Generation committee Steve Rodman, president of Rodman & Rodman P.C., has been named to the Northeast Energy and Commerce Association's Renewables and Distributed Generation committee. Steve Rodman will NECA is a nonprofit serve on the NECA's trade association serv- Renewables and Distributed Generation ing the electric power committee to raise industry. Its Renewawareness of the ables and Distributed benefits of renewable energy.

Generation committee is dedicated to increasing awareness of the benefits of renewable/clean energy and to facilitating growth of the industry in the Northeast. Rodman & Rodman is a CPA firm with a dedicated "Green Team" Renewable Energy and Clean Technology Practice, where Rodman is a client adviser and advocate in the provision of expert green energy tax advisory, accounting services, and business strategy for alternative energy producers and investors through all stages of their project and business life cycle. The Green Team offers its services for companies in the biomass, wind, solar, geothermal, landfill gasses, municipal solid waste, hydroelectric and hydrokinetic sectors of the renewable energy industry.

They also assist startup projects with the Section 1603 program.

SHARE YOUR INDUSTRY NEWS: To be included in the Business Briefs, send information (including photos and logos, if available) to Industry Briefs, Biomass Power & Thermal, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You may also e-mail information to rjohnson@bbiinternational.com.

Please include your name and telephone number in all correspondence.

DECEMBER 2011 | BIOMASS POWER & THERMAL 15

FiredUp Biomass Bonanza Georgia has a lot to offer biomass-to-energy projects

The 2011 Southeast Biomass Conference & Trade Show held Nov. 1-3 in Atlanta hosted 325 professionals and 60 exhibitors and boasted a strong regional focus.

Jill Stuckey, director of the Center of Innovation for Energy at the Georgia Environmental Finance Authority, started off the event by addressing Georgia’s biomass potential and the economic benefits that new industry could bring to her state.

‘We plant [trees] in nice little straight rows, and if we want more trees to be planted we are going to have to find uses for them.’

—Jill Stuckey, director, Center of Innovation for Energy, Georgia

According to Stuckey, there are four main factors driving interest in biomass-to-energy projects in Georgia: the economy, international mandates, environmental concerns and the need for greater energy security. “I’m in economic development, so when I hear the word ‘jobs’ my ears perk up,” she said. Georgia ranks second in biomass supply. Only Oregon has more biomass. However, Stuckey noted that Oregon’s forests are largely comprised of redwoods, which are unlikely candidates for energy conversion.

While Georgia has vast forest resources, the logging industry and infrastructure within the state is suffering from a 25 percent unemployment rate. “We want to do something about that,” Stuckey said. “We want more forests in Georgia, so we have to find good uses for those trees.”

We grow trees like other states grow commodity crops, Stuckey said. “We plant [trees] in nice little straight rows, and if we want more trees to be planted we are going to have to find uses for them,” she continued. In 1995, foresters in Georgia were harvesting about 51 million tons of biomass. “Today we are down to 39 million tons … and they are growing 38 percent faster than we utilize them,” she said.

Although forestry is the source of Georgia’s primary biomass resource, the state is working to expand into other areas. As industries like pellet manufacturing continue to grow, Stuckey stressed that Georgia is working to develop vast and reliable sources of biomass materials. In addition to looking at the cultivation of faster growing trees, energy crops such as miscanthus are also being considered. “We are the biomass leader of today,” Stuckey said.

“But we want to be the biomass leader of tomorrow.”

Stuckey also addressed the types of biomass-related industries that are locating in her state, including pellet manufacturers. “I think the future is great for the pellet industry,” Stuckey said, noting that demand from Europe could grow to 30 million tons annu-

16 BIOMASS POWER & THERMAL | DECEMBER 2011

PHOTO: BBI INTERNATIONAL

Environmental Finance Authority

BIOMASS BUSINESS BACKER: Stuckey is interested in biomass energy development to help lower Georgia's 25 percent unemployment rate in the logging industry.

ally by 2016. By 2026, that number could grow 100 million to 300 million tons. Regarding the electrical industry, Stuckey noted that the price is currently high, limiting the amount of biomass-based electricity that utilities are willing to purchase. However, that could change as torrefaction technologies become more advanced. The future of drop-in biofuels development also looks strong in Georgia. “The jet fuels industry is really really pushing in this area,” Stuckey said. “We are working [on about] four biomass-to-jet-fuel projects right now … We are very excited about that because we have the busiest airport in the world. We utilize about 1 billion gallons of jet fuel in Atlanta every year.”

Regarding Stuckey’s organization, she spoke of a unique “onestop-shop” she has developed to simplify the process of gathering relevant federal and state regulatory information. Professionals representing a wide range of regulatory issues all meet face to face.

Companies are scheduled in one-hour intervals to explain their projects to this group of state and local officials, who then answer questions regarding permitting, regulation, and any services they might be able to offer to expedite the development of a project.

“We want you to get that shovel in the ground sooner rather than later,” Stuckey said. —Erin Voegele

PHOTO: BBI INTERNATIONAL

FIREDUP¦

PELLET PUSHERS: Kang, Williams and Najera, left to right, discussed the pellet industry and opportunities for growth during a general session panel at the Southeast Biomass Conference & Trade Show.

Southern Comfort Manufacturers emphasize pellet potential in the Southeast.

“It’s pretty obvious to see why pellets are in the Southeast,” said Mike Williams, director of strategy and planning for The Westervelt Co., showing a map of the wood resources in the region to attendees of the Southeast Biomass Conference & Trade Show.

The first general session panel discussion, “Producers’ Perspective: A Manufacturers Roundtable on the Southeast’s Growing Pellet Industry,” revolved around the region’s capacity for making and exporting pellets. The topic was fitting for a regional show, confirmed by the preceding keynote speaker Jill Stuckey, director of the Center of Innovation for Energy at Georgia’s Environmental Finance Authority. “The pellet industry is king,” she told a crowd of about 330 attendees. “It’s happening and people are making money.”

The Westervelt Co.’s Westervelt Renewable Energy is taking advantage of that opportunity, having just broken ground on its 280,000-metric-ton-per-year pellet plant in Aliceville, Ala., on Oct. 25. The company has a pellet business plan that specifies production of 1 million metric tons at multiple mills in the Southeast, using wood from its 520,000-plus acres, as well as third-party wood, Williams said.

“Competition is good,” he added. “We welcome competition.

We just want good, well-thought out competition.” Williams said he personally expects about 9 million metric tons of pellet exports by 2015 from eight ports in the Gulf of Mexico and the Southern Atlantic coast. The total tonnage for 2011 is about 1.2 million.

Enviva makes up a large portion of that, with its 726,000 metric tons per year from four plants. “The potential is enormous,”

said Pete Najera, vice president of operations for Enviva. The company exports its pellets, but Najera said more and more U.S. utilities are coming through its offices inquiring about biomass fuel. In fact, Enviva recently signed a contract to supply Dominion Virginia Power with 1 million tons of wood chips.

“Everything we do is about meeting the customers’ needs,” he said. The company’s five golden rules of pellet production are safety first, production of quality pellets, achieve total production volume, maintain material process flow, and excellent equipment and facility maintenance. “An accident at one plant hurts us all,” he said.

The company also has a 50,000-metric-ton-per-year pellet plant in Belgium, having started its pelleting business in Europe.

Georgia Biomass, Waycross, Ga., also began in Europe, producing 750,000 metric tons per year for RWE, its parent company and one of the top five integrated utilities in Europe, according to Sam Kang, managing director of Georgia Biomass.

The pellet mill uses about 1.5 million metric tons on its 300plus acre site. The plant was developed to complete the supply chain for RWE, Kang said. “We’ve created a lot of jobs along the supply chain,” he added. Kang agreed with the other panelists that demand will increase, but added that RWE is unsure how much and when.

“Anything and everything you want to know about the industrial pellet industry is right here in these three brains on the stage,” moderator Seth Ginther, executive director of the U.S. Industrial Pellet Association, said of the highly informed panelists.

—Lisa Gibson

DECEMBER 2011 | BIOMASS POWER & THERMAL 17

¦FIREDUP

Military Might The military has been especially active in the push to develop biobased jet fuel. However, the U.S. Department of Defense’s interest in biomass-based energy sources is not limited to biofuels. Biomass-based power is also part of the department’s plan to source 50 percent of its energy needs from renewable resources.

Chris Tindal, director of operational energy for the U.S. Navy, spoke about the military’s goals and biomass-based energy and fuels initiatives at the 2011 Southeast Biomass Conference & Trade Show in Atlanta. Tindal’s presentation was part of a general session panel, titled “Exploring the Military’s Quest for Greater Biomass Derived Energy.”

While the Navy will be sourcing 50 percent of its energy needs from renewables by 2020, Tindal spoke about two specific energy segments the military must address: operational CAPTIVE AUDIENCE: Attendees at the Southeast Biomass Conference & Trade Show in Atlanta energy and shore energy. Operational energy, learned about the military's plan to source 50 percent of its energy from renewables. he said, is the energy used to power ships, planes and forward deployed troops. Liquid fuels are primarily used aiming to complete a demonstration of the Great Green Fleet in for these purposes. Alternatively, shore energy comprises things like 2012, he said. The fleet includes a carrier striker, two submarines, two base operations, where other types of renewable electricity, such as destroyers and a cruiser, as well as the aircraft associated with the carbiomass-power, can be deployed. rier. The goal is to have all nonnuclear components of this fleet fueled Although the Navy has been particularly vocal in its support for with biofuels. The Navy’s ultimate goal is to actually have the Great biobased jet fuel, Tindal also spoke briefly about some of the shore Green Fleet deployed overseas by 2016. energy initiatives that are ongoing. For example, a base in Albany, Ga., Tindal also spoke about the need to develop global biofuel currently sources more than 20 percent of its power from a landfill sources. “Obviously, the Navy and Department of Defense are a gas project that became operational earlier this year. The military has global force—and this force is everywhere,” he said. “It’s just not in also actively been developing waste-to-energy facilities. One such plant the waters around the United States. When we go overseas, we would in Portsmouth, Va., actually produces enough electricity to power the like to refuel on biofuels … Whether we’re in India, Singapore or entire base. Excess energy is then sold to the grid.

Australia, we want to be able to do that. We can’t afford to have a Regarding biomass-based liquid transportation fuels, Tindal tanker following [our ships] around the world just to fill them up on spoke about the Navy’s plans to sail the Great Green Fleet. We are biofuels.” —Erin Voegele

Powerful Panel Biomass conference panel features experienced biomass power developers.

Just weeks before the Southeast Biomass Conference & Trade Show, American Renewables held a groundbreaking ceremony for its 100-megawatt (MW) biomass power plant in Gainesville, Fla. Josh Levine, vice president of project development for American Renewables, spoke about developing the plant during the conference panel “Southeastern Biomass Power Producers’ Roundtable.”

Attendees were anxious to hear what Levine and his fellow speakers, Marvin Burchfield, vice president of Decker Energy, and Raine Cotton, CEO of Southeast Renewable Energy, had 18 BIOMASS POWER & THERMAL | DECEMBER 2011

to say about the successful development of their biomass power projects.

The Gainesville Renewable Energy Center will power about 70,000 homes through a 30-year power purchase agreement (PPA) with Gainesville Regional Utilities. Sitting on a 131-acre site leased from Gainesville, the GREC will run on forestry residue, urban wood waste, and mill residue.

Addressing the well-known concern of over-development of biomass facilities that local resources can’t sustain, Levine said, “If

PHOTO: BBI INTERNATIONAL

Department of Defense has lofty renewable energy goals.

FIREDUP¦ you are waiting for a flood of biomass energy in the Southeast, you can put the waders back in the closet.” Even if that flood came, however, Levine said the region has more than enough fuel to support it. The GREC will operate under strict forest stewardship standards.

Having begun construction in March, the GREC should be operating in 2013.

“I see three main issues [for developing biomass power in the Southeast], and the first is policy,” Levine said. “It is very difficult being in this business and not knowing what’s coming down the pike.” The second major development issue he named was natural gas prices, and the third was regulatory uncertainty. He referred to the boiler Maximum Achievable Control Technology rules and the EPA Tailoring Rule as examples.

One challenge Levine focused on that was also a major topic in Cotton’s presentation was biomass opposition. Opponents can file baseless appeals, and that process needs to be more realistic, Levine said.

One of Cotton’s presentation slides read, “If trees could scream, would we be so cavalier about cutting them down? We might, if they screamed all the time, for no good reason.” The fierce biomass opposition is based on incomplete or entirely incorrect information, Cotton said, displaying a photo of what current and determined opponents are certain is a smoke stack

spewing white smoke. But it’s steam, he explained. The industry needs to do better public outreach. “We do, as an industry, need to step up,” he said.

Ill-informed opponents can file an appeal and not even show up at the hearing, he explained. They know the time required for an appeals process can be devastating for a project.

Southeast Renewable Energy is developing three 15.2 MW biomass plants in South Carolina, spread across the wood basket.

The plants have 30-year PPAs with Santee Cooper, an electric utility that was happy with the fact that the facilities were spread out, Cotton said.

Rounding out the panel was Burchfield, who talked about Decker Energy’s already-operating biomass plants, expanding on Cotton’s statement that the wood-to-energy industry is not a new one. “I believe we are in a mature industry,” Burchfield said. “Not only do I believe that, I can prove it.”

He showed photos of cabins using wood for energy in the 1800s, as well as boats. Specifically, he referred to Grayling Generating Station, Decker’s 37-MW biomass power plant in Grayling, Mich., operating since 1992. The U.S. has more than 7,000 MW of biomass power, 2,180 of which is stand-alone, he cited.

With three experienced biomass developers, the much-anticipated panel didn’t disappoint. —Lisa Gibson

Hot Technology In a move that displays solid confidence in a plasma gasification technology patented by Bend, Ore.-based InEnTec, Waste Management Inc. has transitioned from a joint venture investment with the company to an equity position.

The switch comes two years after the companies formed S4 Energy Solutions, the brand under which they have built a municipal solid waste (MSW) gasification plant at the Columbia Ridge Landfill in Arlington, Ore. The 25-ton-per-day facility is now complete, says Wes Muir, Waste Management spokesman. It has approval to begin operations, and the companies are currently ramping up production, he adds.

The Plasma Enhanced Melter (PEM) technology was patented by the company’s founders in 1995, based on U.S. DOEsponsored research that began four years earlier. The process uses plasma gas to super heat waste materials that have been fed into a closed chamber. The extreme heat—between 10,000 and 20,000 degrees Fahrenheit—rearranges the molecular structure of the waste and transforms organic materials into syngas for conversion into electricity or liquid fuels such as ethanol or diesel. In the next stage, inorganic materials are recycled into other products.

Waste Management is now one of the company’s largest shareholders, says Karl Schoene, president and CEO of InEnTec. According to paperwork filed with the U.S. Securities & Exchange

PHOTO: INENTEC

Waste Management invests in InEnTec’s plasma gasification technology.

ATTRACTIVE INVESTMENT: Waste Management Inc. is now one of InEnTec's largest shareholders.

Commission, the equity position is valued at $22.5 million.

Waste Management has additional investments in thermal conversion technology companies including Enerkem Inc., Terrabon Inc. and Agilyx. Separate from its demonstration project venture with Waste Management, InEnTec has contracted with Fulcrum Bioenergy Inc. to provide its PEM technology for conversion of MSW into 10.5 million gallons of cellulosic ethanol at Fulcrum’s proposed Sierra BioFuels plant to be located near Reno.

— Anna Austin DECEMBER 2011 | BIOMASS POWER & THERMAL 19

¦FIREDUP

Mississippi’s Methane Model With help from the Tennessee Valley Authority, the Golden Triangle Regional Landfill in northeastern Mississippi has commissioned a landfill gas-to-electricity system, the first of its kind to operate in the state.

The system employs a GE Jenbacher Gas Engine that generates nearly 1 megawatt of electricity, enough to power about 700 homes.

The TVA, a government-owned power utility, is purchasing the power from the 4-County Electric Power Association distribution system under the TVA‘s Generation Partners program. Generation Partners supports homeowners and businesses that install smallscale renewable generating sources such as landfill gas systems, solar panels or wind turbines on their property. Participants are able to defray the cost of their renewable systems and lower their monthly energy bills through the revenue they receive from the sale of the green power to TVA. TVA pays 12 cents per kilowatt-hour above the retail electric rate for solar and 3 cents above retail for all other renewable sources.

Additionally, new participants receive $1,000 to help offset start-up costs.

The project has several benefits beyond the capture and use of methane. Jimmy Sloan, executive director of the Golden Triangle Regional Solid Waste Authority, says the system will also provide a new revenue stream that will be used to help keep landfill fees low.

It was actually the second phase of a bigger project, according to Sloan. “The first phase was installed to destroy methane gas and secure carbon credits,” he says. “Then this project grew from that.”

Planning began in March 2010, and the project was approved by the GTRSWA board the following May. Once GTRSWA was accepted as a member of Generation Partners in October 2010 and had the contract in hand, it self-developed the project, Sloan says.

PHOTO: GOLDEN VALLEY REGIONAL SOLID WASTE AUTHORITY

The state’s first landfill gas-to-energy project goes on line.

METHANE TO MEGAWATTS: A landfill gas-to-energy system at the Golden Valley Triangle Regional Landfill is the first of its kind in Mississippi.

Construction began in May 2011 and it was completed by the end of September.

The cost of both phases of the project was $3.5 million, according to Sloan.

Because this landfill gas-to-electricity system is the first in Mississippi, it will serve as a model for the state, and surrounding states, Sloan says.

According to the Mississippi Department of Environmental Quality’s Landfill Methane Outreach Program, the state has 16 candidate landfills for economically viable landfill gas-to-energy projects. Across the U.S., the U.S. EPA estimates there are 575 landfills that hold potential for the development of projects, on top of the 550-plus already operating or in development. —Anna Austin

Mor Biomass Machines Morbark holds Demo Days to showcase its biomass equipment.

Themed “Equipment Productivity,” biomass equipment specialist Morbark Inc.’s fourth annual Demo Days in Winn., Mich., drew more than 300 people from 15 counties.

Ed Dodak, assistant sales manager for Morbark, says the event had a great turn out, with lots of interaction between vendors, dealers and customers. Those attending were able to tour the Morbark factory, attend training seminars and see live demonstrations of forestry equipment.

Dodak says 13 different machines were demonstrated, one of which was Morbark’s new 3800 XL Horizontal Grinder. “What’s unique about it is we can convert it from a grinder into a chipper, so it can produce chips in addition to mulch,” he says. The conversion takes only a few hours. In addition, Morbark has made 20 BIOMASS POWER & THERMAL | DECEMBER 2011

feeding technology improvements to the grinder to increase production capacity and operating efficiency.

Regarding sales for biomass equipment, Dodak says 2011 started out with an increase in sales from the previous year, but have been on a roller coaster since then. “They’ve been up and down the past two years,” he says. While part of it may be because of uncertainty surrounding biomass energy policy, a big part of it is obtaining funds. “A lot of guys are having a hard time getting money,” Dodak says.

Morbark has a financing department to try to help customers find an affordable way to buy used and new equipment.

—Anna Austin

FIREDUP¦

A Tough Row to Hoe BCAP funding is once again on the chopping block.

Facing what could be its final funding obstacle, the fate of the Biomass Crop Assistance Program lies in the hands of those crafting the 2012 Farm Bill. Despite Congress’s drastic budget cutting efforts, however, there may still be hope for BCAP. U.S. Secretary of Agriculture Tom Vilsack recently shed some light on his hopes for the Farm Bill, stating that BCAP and the Rural Energy for America Program are two of his priorities.

In an Oct. 24 speech at John Deere Des Moines Works in Ankeny, Iowa, Vilsack pointed out that a proposed $23 billion in cuts to the Farm Bill over the next 10 years means priorities must be clear.

“And though these numbers are by no means final, it is a reminder to all of us that if we want this legislation to accomplish a lot, we have to understand that there will be considerably less funding in which to do it,” he said. “We simply need to do more with less.”

In the case that BCAP funding is cut, project areas announced to date will remain fully funded, according to USDA Farm Service Agency Chief of Staff Todd Atkinson. “There will be no reduction in funding there because we entered into those contracts with money in-hand, we just wouldn’t be able to expand acreage,” he says.

Over the past six months, BCAP has announced multiple project areas in several U.S. states to grow biomass crops such as miscanthus, camelina and switchgrass, for which farmers would receive annual establishment payments. About half are for biomass-based heat and power, the remainder for liquid biofuel, Atkinson says.

While the annual establishment payment component of BCAP is going seemingly smoothly, Atkinson says the rushed timeline for participation—for example, four months for miscanthus and 45 days for camelina—was because of the foreseen funding issues. “The program is funded by the Commodity Credit Corp., so it’s not subject to appropriations,” he explains. “The underlying statute functions similar to conventional crop programs; you go from one fiscal year to the next, rather than the length of the Farm Bill. Since the House zeroed the program out and the Senate decided not to act, it meant we had up until the end of the fiscal year 2011 to obligate the funds that were made available for 2011.”

If BCAP were functioning how it was originally intended to, Atkinson adds, FSA would still be seamlessly working with farmers, signing them up and educating them. “But the budget challenges have created these uncertainties,” he says. “The existing climate is that there are some significant funding challenges, and lawmakers and policymakers are looking at everything.”

On the matching payment portion of BCAP, which was implemented before the annual payments, Atkinson says FSA has issued an interim rule that would require it to evaluate applications for project areas first. “That’s because of these funding limitations,” he says.

“After those applications, we would look at matching payments. As an interim rule it’s effective immediately, but there’s a 60-day comment period which ends Nov. 14 and the public is invited to comment up until the closing date.”

Matching payments aren’t ending, Atkinson emphasizes. “We’ve just prioritized the establishment of the annual payments to grow new biomass first. Should funding be remaining, we would consider the matching payments to harvest existing biomass.”

There are some in Congress who are working diligently to keep BCAP and REAP alive. Sen. Richard Lugar, R-Ind., and Rep. Marlin Stutzman, R-Ind., have introduced Farm Bill reauthorization legislation, the Rural Economic Farm and Ranch Sustainability Act, or REFRESH, which includes key components of the existing Farm Bill, including the two programs.

REFRESH provides nearly $1.3 billion in mandatory appropriations for five different clean energy programs with significant additional discretionary funding authorizations. It would annually provide $55 million dollars for BCAP with an additional $150 million a year in discretionary funding, while working to improve the program in several important respects, and $70 million for REAP and an additional $80 million annually in discretionary funds. It also extends REAP to assist our nation’s rural schools with energy efficiency programs, and includes complementary loan guarantee financing for biorefineries by continuing the Biorefinery Assistance Program for two more years.

—Anna Austin DECEMBER 2011 | BIOMASS POWER & THERMAL 21

PHOTO: OFFICE OF CLEVELAND MAYOR

¦FIREDUP

GASIFYING GARBAGE: Cleveland's Ridge Road Transfer Station currently presses 3,000 tons of municipal solid waste per day.

Educational Expedition Cleveland, Ohio, officials visited Japan recently to learn more about a gasifier they hope to use.

Following a September trip to Takasaki, Japan, local officials from Cleveland, Ohio, are now more confident in the benefits and efficiency of a system they hope to implement in their city.

Cleveland’s plan would use gasification technology to convert municipal solid waste (MSW) into about 15 megawatts of power for Cleveland Public Power customers, and would also include the development of a plant that would compress the MSW into pellets for the gasifier, as well as a curbside recycling component. Heat from the gasification process would also be used in pellet production to help sterilize the raw material.

Cleveland’s existing Ridge Road Transfer Station currently processes 3,000 tons of MSW daily during its 253 days of operation annually. It represents an opportunity for Cleveland to advance progress toward its 15 percent by 2015 advanced energy portfolio standard.

Japanese gasification equipment vendor Kinsei Sangyo Co. Ltd. could be the perfect fit for Cleveland’s project, having several systems in operation already. “We went to see the technology,” says Ivan Henderson, commissioner of Cleveland Public Power and assistant director of Public Utilities. Henderson was joined by Cleveland Mayor Frank Jackson; Kevin Kelley, city councilman and chair of the Utilities Committee; Matt Zone, city councilman and chair of the Sustainability Subcommittee; and Valarie McCall, chief of government affairs.

“Councilman Zone and myself have seen it in action … and we wanted to share the experience with the mayor and the utilities committee chairman,” Henderson says, adding that the intent was to showcase the equipment at the vendor’s location, as well as in use for a customer.

So the group visited BML Corp., a large medical technology 22 BIOMASS POWER & THERMAL | DECEMBER 2011

company in Takasaki that processes millions of blood samples every day and produces a considerable amount of hazardous waste. The company gasifies that waste stream with Kinsei Sangyo equipment, producing heat for the facility, Henderson explains. The operation is in a densely-populated urban area with an abundance of urban gardens and is able to operate within Japan’s emission limits.

“I believe it was successful,” Henderson says of the trip. “It really helped demonstrate the technology.” Some who participated in the trip wondered if it is indeed feasible and came back confident it is, he adds.

Besides seeing the system, the Japan expedition also aimed to meet Kinsei’s local government requirements, and explore a sister city relationship, along with other potential development opportunities, according to Maureen Harper, chief of communications for the mayor’s office.

Cleveland’s project is estimated to cost about $180 million, including the pellet facility, recycling component and gasification system, but project information will be updated again at the end of the year, drawing from new knowledge and experience, such as the Japan trip. The city applied for air permits in March and is expecting a draft from the U.S. EPA soon. A design report is also being produced, and the results from a request for information across all aspects of the project from 125 businesses were expected to be prepared by November.

“We’ll evaluate the results of that process and then we’ll determine what our next steps are,” Henderson says. He adds that facilitating a trip for local government officials to witness the system of a potential bidder in action was a crucial step in the development process. —Lisa Gibson

FIREDUP¦

A Biogas Friendly Bill PURPA Plus bill allows states to make their own decisions about renewable energy.

Since the Public Utility Regulatory Act was passed in 1978, power utilities have been required to pay an “avoided cost” rate to certain types of small power production, cogeneration facilities and other types of qualifying facilities. That rate is typically the cost of the cheapest type of energy the utility has in its portfolio—usually coal—and that’s a price with which small renewable energy providers cannot compete.

More than 20 years later, PURPA is doing something it was never intended for—limiting individual states’ ability to make their own decisions about incentivizing small distributed renewable energy. A new bill introduced in the Senate Energy & Natural Resources Committee, however, could change that.

PURPA Plus, which is intended to encourage distributed generation of renewable energy, would remove the avoided cost restriction and let states set their own prices, according to Patrick Serfass, executive director of the American Biogas Council. In many cases, PURPA makes small renewable energy generation unfeasible.

For example, if a biogas producer has to turn on his facility’s lights or use power for something else, he’s probably paying a retail rate, Serfass says. “If he is selling any power back, he is getting a small fraction of that rate, so he’s not even getting paid the same rate he’s being charged. In most cases, they only have to pay you for the cost of avoiding the same amount of electricity from coal.”

PURPA Plus is a way for states to raise that price to incentivize distributed renewable electricity generation. “Generally in the energy

industry it makes the most sense to produce your own electricity where you need it because it costs money to move it some place,” Serfass explains. “If you have a locally available resource, and people who need energy locally, why not produce and use it there? That’s where distributed generation comes in. If states want to encourage that, not only does it create business for those companies and jobs, but also increases the amount of electricity the state produces without having to upgrade transmission systems.”

The most important component of PURPA Plus is that it allows states a choice, and it is at no cost to taxpayers, Serfass says.

“It’s a gateway for states to create more incentives, one of which could be a feed-in tariff. That would allow biogas projects to compete with other traditional energy sources on a level playing field.”

Though it’s less of a priority, the ABC would like to see PURPA Plus tweaked so that the cap is raised from 2 to 5 megawatts.. “Over half of current biogas projects are less than that, but a lot of larger projects in the works are between two and five,” Serfass says. “A slightly larger project could have a big impact on the industry.”

The ABC is urging its members to write their senators to request support of the bill. “With the current Congress being focused on cutting our federal budget and reducing costs everywhere, this bill is important because it doesn’t cost taxpayers any money,” Serfass reiterates. “It’s a really valuable piece of legislation.”

—Anna Austin

DECEMBER 2011 | BIOMASS POWER & THERMAL 23

ÂŚPROJECT DEVELOPMENT

EARTH MOVING: A groundbreaking ceremony was held at the Gainesville Renewable Energy Center in Gainesville, Fla., in October. Once it's completed, the GREC will be one of the largest biomass power facilities in the U.S., producing 100-megawatts of electricity a year.

PHOTO: GAINESVILLE RENEWABLE ENERGY CENTER

24 BIOMASS POWER & THERMAL | DECEMBER 2011

PROJECT DEVELOPMENTÂŚ

Digging

In

Despite regulatory uncertainty, renewable energy businesses did well in 2011 and expect continued success in the new year.

BY MATT SOBERG

DECEMBER 2011 | BIOMASS POWER & THERMAL 25

¦PROJECT DEVELOPMENT

A

s the need for renewable energy and energy efficiency grows in the U.S., businesses providing technology and equipment for new projects are in the best position to gauge the future of the biomass industry. With their finger on the pulse of biomass, these companies are optimistic about prospective opportunities in 2012.

Companies, such as Metso Corp., Eisenmann, and ProcessBarron, provide essential technologies, products and services to biomass project developers. These companies are in the trenches, and witness first-hand the flow of interest from potential investors.

Representatives from these companies report that biomass business and interest was solid in 2011 and ample opportunity exists for 2012 if the right pieces of the puzzle fall into place. These opportunities stem from a combination of aggressive developers who understand the need for less reliance on fossil fuels and to reduce emissions, the benefits of using biomass to produce energy and the impending shift toward using alternative fuels. Also, governments at the state level, through renewable portfolio standards are embracing renewable energy development as a job creation tool.

Trends are evident, including increased interest in cogeneration and anaerobic digestion. Although woody biomass is still the most common feedstock, some developers are turning to grasses and municipal solid waste.

The optimism is not without a bit of caution, however, as these grassroots leaders await pending decisions from the U.S. EPA regarding emission regulation and possible future mandates from government at all levels. The pending EPA reconsideration of the boiler Maximum Achievable Control Technology regulations looms large in the eyes of potential investors looking into biomass projects. In addition, the question of whether the federal government will step in with specific mandates, similar to those set in Europe places uncertainty on the industry.

Despite the guarded optimism, the economic trends are pointing in the right direction and the biomass industry’s future looks promising.

Mounting Megawatts Showing how well business has been for Metso Corp., which provides renewable energy technology and products, the company will soon be the first in the U.S. with 250 megawatts (MW) of biomass boiler technology under construction at any one time, according to Robert Deneault, general manager of capital sales for Metso Power in North America. Metso has three large projects utilizing its fluidizedbed technology including the Gainesville Renewable Energy Center in Gainesville, Fla., developed by American Renewables, the Nacogdoches Power LLC biomass project in Sacul, Texas, owned by Southern Power, a subsidiary of Southern Co., both using bubbling fluid bed technology (BFB), and the We Energies/Domtar Biomass Energy Project in Rothschild, Wis., owned by We Energies and using circulating fluid bed technology (CFB).

“Metso had a fantastic year in 2011,” says Deneault, who is in charge of sales in North America. Through new equipment sales, Deneault is in the perfect position to evaluate Metso’s business performance. “The company was very fortunate to work with good projects that included strong developers who fully embraced Metso’s proven fluid bed technologies as vital to the success of their projects,” he adds.

Through the past few years, Deneault recognized a trend toward developers embracing cogeneration projects. Combined heat and power helps facilities, such as paper and pulp mills, to create renewable power and thermal from the same amount of fuel, thereby receiving a better return on investment.

Another trend noticed by various company representatives, some developers are waiting on projects due to the uncertainty created by emission regulations and mandates, Deneault says. Many are waiting to see what will happen with the pending boiler MACT rules, which are boiler standards set by the U.S. EPA that, although currently stayed, are under a period of reconsideration with proposed finalization by April 2012.

Despite the hesitation, Deneault believes that there will be a second wave of biomass projects once emissions standards and regulations are determined.

“We need stability in the regulations,” he says. “We will see a more robust commitment from plants to utilize biomass when there is a commitment from governments who enact renewable portfolio standards that direct the use of biomass.”

Metso provides numerous services and Scandinavian-derived technology that include material handling equipment, plant automation systems and air pollution control systems, but the company is best-known for its BFB boiler technology. Many developers are interested in the BFB technology because of its beneficial emissions, efficiency and fuel flexibility.

AD ACTIVITY: Eisenmann has installed more than 80 anaerobic digestion systems worldwide, and is Metso is proud of the Gainesville currently providing the technology for a 3.4-megawatt facility in South Carolina for W2E Organic Power.

Renewable Energy Center developed by American Renewables, which includes a 100-MW Metso BFB boiler. It bring to the U.S. once it is comfortable with the technology’s perforwill be the largest BFB boiler in the world with the lowest emissions, mance.

Deneault says. “This is an industry watershed kind of boiler,” he says, Mandate Momentum adding that the construction groundbreaking occurred in October.

Eisenmann President Mark West says his company noticed an In Texas, Metso is supplying a 100-MW BFB boiler to the Nacoguptick in the biomass industry in 2011 due to renewable portfolio doches Power biomass project, with commercial operation planned for standards enacted by state governments nationwide. “A lot of states the spring of 2012. Rounding out the 250 total megawatts under construction, the company will supply a 50-MW, CFB boiler for the We En- are not waiting for the federal government to act,” he says. “At the ergies/ Domtar Biomass Energy Project. Commercial operation of this state level, the states can’t afford to wait. They see biomass as a way of creating jobs that they must take advantage of now.”

Wisconsin plant is scheduled for 2013.

Over the past year, business has been strong for Chicago-based Metso is also breaking into gasification technology, through a Eisenmann, a supplier of environmental products and services, with the small commercial plant in Scandinavia, which the company plans to

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¦PROJECT DEVELOPMENT company involved in various projects. West specifically notes two projects as good examples of Eisenmann proprietary technology including the W2E Organic Power anaerobic digestion facility in South Carolina and the Wild Turkey Distillery wet electrostatic precipitator project in Kentucky.

West saw a common interest in renewable energy and energy efficiency across the industry in 2011. Energy has been relatively inexpensive in the U.S. of late, and West believes the cost will eventually increase due to overseas demand.

When it does, the biomass industry will benefit on a private level, he says.

The biggest obstacle for developers was obtaining financing to proceed with projects.

While developers were able to obtain power purchase and waste agreements, most were not sufficient in duration or stability to satisfy investors. Developers are not waiting for a mandate, however, some financiers are waiting for the government uncertainty to clear.

Thinking prospectively, West believes his company will see a number of projects receive funding in 2012. “Things will start to shake loose with the economy, and when they do, there are good opportunities and investments available for biomass projects,” he

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says. Once the ball starts rolling, the biomass industry will receive the momentum it needs to take business to the next level.

Eisenmann has experienced increased interest in anaerobic digestion (AD), installing more than 80 systems worldwide that also incorporate material handling and feedstock preprocessing equipment.

The company is providing AD technology for the 3.4-MW W2E facility, which is expected to be operational in 2012 and will process 48,000 metric tons of waste per year.

“As the first of its kind in the United States, the Columbia facility marks a new way to reduce greenhouse gas emissions, while providing an alternative source of energy to the electrical grid,” according to Eisenmann.

The company’s wet electrostatic precipitator technology enables clients to meet current emissions and regulatory requirements.

The precipitator is a pollution control system that removes multiple pollutants from system exhaust.

With an eye on emissions regulation, the Wild Turkey Distillery has utilized an Eisenmann wet electrostatic precipitator dual field system to provide air pollution control that produces near-zero opacity on emissions.

The whiskey distillery in Lawrenceburg, Ky., requires the application of appropriate amounts of heat in the form of steam from multiple sources of energy. “Whatever the biomass fuel combination selected by the facility, the plant has multiple fuel options available while always maintaining environmental compliance,” according to the company.

Although wind and solar projects are popular and sometimes are more appealing to environmentalists, biomass waste and waste streams will gain increased momentum, West adds. Waste is constant. It is a matter of providing education on biomass and getting people to understand and embrace its benefits.

Massive Material Management “We are committed to the biomass world as technology and interest is as high as it has ever been,” says Cliff Moss, vice president, director of materials handling for ProcessBarron. Specializing in design and installation of material handling systems, the company provides services and products

PHOTO: PROCESSBARON

PROJECT DEVELOPMENT¦

BUILDING UP BIOMASS: ProcessBarron has recently been involved in designing and supplying biomass handling systems for projects at Eastern Illinois University, the University of Missouri and Frito-Lay.

from the ground to the boiler to the ash handling at the end of the process.

Business in 2011 was good for ProcessBarron, a company with 30 years of experience in boiler-related products and services. “We specialize in providing equipment around the boiler that will keep the boiler running reliably,” Moss says. The company has recently designed and supplied material handling systems for Eastern Illinois University, the University of Missouri and Frito-Lay. The company specializes in fuel, ash and air handling solutions for the biomass industry.

The project at Eastern Illinois, in Charleston, was a showcase system installation for ProcessBarron, according to John Saucier, the company’s system design and project manager.

The biomass gasification facility will annually consume about 27,000 tons of woods chips to provide power and thermal to the university. ProcessBarron was provided a small plot of land on campus, and from there, it designed and installed the entire material handling system including a travelling screw reclaimer. The facility itself was designed to aesthetically mimic the surrounding buildings on campus.

Five years ago numerous feasibility studies were done to pursue biomass projects, but similar studies have fallen off lately. Being highly driven by mandates, Moss notes that developers may be waiting to see what the government is going to do with the boiler MACT regulations, which is a similar trend noted by other companies.

Similar to Metso, ProcessBarron is seeing certain trends in the industry, including cogeneration projects that contain the necessary infrastructure oftentimes for feedstock transportation purposes. In addition, the company is seeing a trend toward developers looking into

advanced technologies such as gasification. Regarding feedstocks, wood is king, but the company also sees some developers leaning toward municipal solid waste and other feedstocks to create bioenergy.

An overwhelming theme that resulted from the discussions with all the industry leaders was that biomass is booming, and developers are persevering through uncertainty to make their projects happen.

Author: Matt Soberg Associate Editor, Biomass Power & Thermal (701) 746-8385 msoberg@bbiinternational.com

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¦OUTLOOK

30 BIOMASS POWER & THERMAL | DECEMBER 2011

OUTLOOK¦

I

ndustry nsight

Key leaders in the biomass power and thermal industries discuss their sectors’ outlooks for 2012, drawing from experiences in 2011.

BY LISA GIBSON

DECEMBER 2011 | BIOMASS POWER & THERMAL 31

¦OUTLOOK

A

s 2011 comes to a close, the biomass industry can look back on a fairly active year, not necessarily all positive, and look ahead to a more advantageous one that brings recognition to its benefits and merit.

With portions of the Maximum Achievable Control Technology (MACT) rules stayed and further changes expected, a delay on implementation of the EPA Tailoring Rule for biogenic emissions, and pending revisions of certain waste definitions, the biomass industry is suspended in a realm of political uncertainty.

But what does 2012 hold in store? Could research to better understand biogenic emissions prove that biomass is indeed a clean replacement for fossil fuels and warrant more reasonable emission guidelines? Will development opportunities, support and funding sources grow for power and thermal applications?

Charlie Niebling, chairman of the Biomass Thermal Energy Council board of directors, tells Biomass Power & Thermal what he expects in the biomass thermal industry in the year ahead, while Bob Cleaves, president and CEO of the Biomass Power Association, makes his predictions for the biomass power industry.

Here’s what they had to say:

Opportunities Where do the best opportunities for biomass power/thermal currently lie and why?

Niebling: The best opportunities lie in providing residential, commercial and industrial heat consumers, who currently use heating oil or propane, with a cost-effective alternative heating fuel. Biomass fuels are less than half the heating cost of oil and propane. Cost savings is the single-most important factor driving market penetration for biomass thermal.

Cleaves: Our members are engaged in development projects across the country.

Conventional wisdom continues to be that the Southeast has the greatest opportunities, and the recent 100-megawatt Gainesville, Fla., project is probably the most dramatic illustration of such potential. That said, in the past 24 months, we have seen projects undertaken in Texas, New Hampshire, Wisconsin and the Pacific Northwest. While different, all of these projects are being undertaken in renewable portfolio standard (RPS)-friendly states and where biomass is welcomed.

Do you see this changing in 2012 and why?

Niebling: I don’t see this changing in 2012 as long as oil and propane prices stay high.

Cleaves: In the near term, given the effect of natural gas on pricing and the lack of electricity generally, we see new projects as being “opportunistic” in nature, meaning in regions where fuel is competitively priced and where local markets value energy diversity, rural economic development and sustainable forestry.

32 BIOMASS POWER & THERMAL | DECEMBER 2011

Policy Which current or developing policies (state and federal) can/do help spur project development and how?

Niebling: Unfortunately there is little policy developing at the federal level in support of biomass thermal. Biomass thermal is not recognized with investment tax credits (ITC) similar to solar thermal or geothermal.

Expansion of tax credits seems unlikely in the current fiscal climate but BTEC continues to advocate for tax parity with other renewables, for both residential and commercial/industrial entities. The greatest need is to help build the market with demand-side incentives such as ITC’s or demonstration project grants through USDA, U.S. DOE or other agencies. At the state level, we are seeing some progress, particularly in the Northeast U.S. where heating oil is prevalent. Massachusetts is expected to unveil supportive policies during 2012 for small-scale biomass thermal. New York is funding a statewide biomass thermal “roadmap” strategic planning effort. New Hampshire is considering amending its RPS to include thermal renewables; if this moves forward New Hampshire would be the first state with a fuel/technology neutral renewable energy standard.

Cleaves: We would like to see the Section 1603 Treasury Program extended. We also need the production tax credit (PTC) extended beyond 2013, and we need parity with other

PHOTO: BBI INTERNATIONAL

OUTLOOK¦

ENERGIZED: Niebling and Cleaves shared their legislative insights with attendees of the 2011 International Biomass Conference & Expo in May during a panel moderated by BBI International's Tom Bryan (left to right), participating were Mary Rosenthal, executive director of the Algal Biomass Organization, Niebling, Cleaves, Norma McDonald, vice chair of external affairs and co-chair of legislative and regulatory affairs for the American Biogas Council, Bob Dineen, president and CEO of the Renewable Energy Association and Joe Jobe, CEO of the National Biodiesel Board.

technologies on the applicable rate. We also need Congress to enact legislation governing boiler MACT and the solid waste rules so that U.S. EPA has the necessary time to craft regulations that are achievable, affordable and based in science and common sense. At EPA, we are

cautiously optimistic that the agency will “get it right” on the carbon equation.

What can the industry do in 2012 to help craft and/or change policy that would be more beneficial to biomass power and thermal?

Niebling: Continue to advocate the cost saving/job creating advantages of displacing fossil heating fuels with renewable fuels such as biomass. Continue to work together through organizations such as BTEC and its regional affiliates in the Northeastern and Midwestern

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¦OUTLOOK states. Also, focus organized advocacy at the state level where state legislatures are showing increased support for biomass thermal.

Cleaves: Ultimately, we need a national energy policy that promotes carbon-friendly, renewable technologies such as biomass. To achieve that goal, we need federal and state policymakers to fully appreciate the carbon benefits of biomass.

Supporters Which congressional leaders have supported and helped the biomass power and thermal industries the most? How? Niebling: In the U.S. Senate, Sens.

Jeanne Shaheen, D-N.H., Olympia Snowe, R-Maine, Jeff Bingaman, D-N.M., Debbie Stabenow, D-Mich., Ron Wyden, D-Ore., Lisa Murkowski, R-Alaska, Bernie Sanders, I-Vt., Mike Crapo, R-Idaho, and Mark Begich, D-Alaska, have shown the greatest interest in biomass thermal. These members

have introduced and reintroduced legislation to advance biomass thermal, or raised the profile of this technology through their committee assignments. The current membership of the House Biomass Caucus is a good proxy for those members who support biomass thermal along with other forms of biomass energy.

Cleaves: A majority of House members, from leadership to the rank and file on both sides of the aisle, have shown tremendous support for our industry. A recent example was the vote on HR 2250 (the EPA Regulatory Relief Act allowing more time for better Boiler MACT rules), which received bipartisan support on its passage.

Who do you see taking the lead in your industries in 2012?

Niebling: Pretty much the same group, although BTEC continues to recruit and educate new champions in both the House and Senate.

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Cleaves: We see members primarily from forestry and agricultural states continuing to take a lead in 2012. They understand the need for Congress to enable, not stifle, private investment in our rural economies.

Financing What are the best financing options and mechanisms for developers in the biomass power and thermal industries today?

Niebling: There are limited options underwritten by the federal government that are accessible for biomass thermal projects.

For example, U.S. DOE loan guarantees are not available to small-scale thermal projects.

These projects do qualify for grants from the USDA Rural Energy for America Program, and they qualify for loans or grants through USDA Rural Development’s Business and Industry Program.

Cleaves: The 1603 and Investment Tax Credit programs are undoubtedly the singlemost successful financing program in the history of our industry. It has unleashed more than $1 billion in private capital—an amount not seen in our sector since the early 1980s.

Are there any financing options on the horizon for 2012 or beyond that you believe could play a major role in the growth of our industry?

Niebling: At the state level, one program that holds great promise is PACE, PropertyAssessed Clean Energy, which allows communities to float bonds to finance residential or commercial renewable energy investments, with the loan being paid through property tax assessments. States must first enact the program, and communities must agree to adopt it. Another innovative approach mostly applicable to larger projects is financing through energy service contracts, where future energy savings are used to pay off the upfront capital cost through a third-party intermediary. The large upfront capital cost of these systems remains an impediment to more rapid market growth, and creative financing will be more important in the future.

Cleaves: We would like to see extension of the PTC, and the extension of in-service dates that are sufficiently extended to facilitate the development cycles of biomass, which are sometimes five years or more.

OUTLOOK¦ Action What benefits of your industry sector will you be emphasizing in order to gain support from Congress in 2012, and why?

Niebling: Jobs, jobs, jobs; rural economic development; energy independence and security—these are the key talking points for biomass thermal going forward.

Cleaves: It’s all about jobs. Biomass is base-load power, and job intensive. The payback for the public’s support of this industry is immediate and meaningful.

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Outlook What is your outlook on the biomass power and thermal industries in 2012 and what, if any, major developments or happenings do you expect?

Niebling: With continued high oil and propane costs, I expect robust growth in this sector in 2012—with or without support from government. I expect commercial- and industrial-scale heating and combined-heat-and-power projects to get real traction in 2012. With these larger projects will come critical mass in the marketplace that will enable greater access by residential consumers, too. High capital cost of fuel switching will continue to be our greatest challenge.

Cleaves: We continue to be optimistic about the industry. Natural gas markets and shifting political winds in Washington, D.C., have forced all renewable technologies to rethink how we present our benefits to policymakers and the market generally. Fundamentally, and this is particularly true with base-load forms of renewable energy like biomass, it’s all about energy diversity at an affordable price for the ratepayer while providing economic benefits and other ancillary benefits like healthy forests. We are confident that this message is a compelling one.

What factors are affecting your industries now, and do you see them continuing or changing in 2012?

Niebling: I do see political support for biomass thermal growing as our elected leaders come to more fully appreciate the economic and environmental benefits of reducing our reliance on imported fossil heating fuels. I see a challenging transition from getting projects done without the benefit of public grants (stimulus funding) that is drying up at the federal and state level. However, I think the understanding of favorable payback economics is growing. Hopefully with a strengthening economy and stronger consumer confidence, we will see homeowners and businesses investing capital again in projects that will save them lots of money in the future—and strengthen their community at the same time.

Cleaves: We would like to see greater regulatory certainty at EPA, and anticipate that 2012 will see clarity on Boiler MACT, the solid waste rule and the Tailoring Rule.

Author: Lisa Gibson Associate Editor, Biomass Power & Thermal lgibson@bbiinternational.com (701) 738-4952

DECEMBER 2011 | BIOMASS POWER & THERMAL 35

¦INNOVATION

36 BIOMASS POWER & THERMAL | DECEMBER 2011

INNOVATION¦

Stover for Power—

Not Just Biofuels Partnering to produce energy from stover could be an attractive option for corn ethanol plants.

BY KRIS BEVILL

I

n mid-July, right around the time the area’s corn crop was beginning to mature and farmers could start looking ahead to the season’s harvest, a number of ethanol producers, farmers and researchers gathered for a daylong meeting at the University of Minnesota to discuss ways to best use the aftermath of the harvest. Corn stover has long been pegged as a potential feedstock for cellulosic ethanol, but this group focused instead on a more immediate application—energy generation. An increasing number of studies are showing that in order for farmers to maintain high corn yields, some of the stover will need to be removed from the fields. For corn-based ethanol plants, this represents an opportunity to displace at least some of their fossil fuel consumption with a renewable resource readily available from their existing corn suppliers. Researchers also believe that it represents an opportunity for new partnerships in the power generation sector.

Power Island Biomass gasification technology is not new and is relatively easy to install. It has been used effectively to produce heat and power for varyingsize facilities for generations. While it’s not as widely deployed in the U.S., facilities in Europe and Japan often install combined heat-and-power (CHP) systems. The reason for this, of course, is that those countries do not possess the same abundant supplies of cheap fossil fuels as can be found in the U.S. When every strategic move can be boiled down to dollars and cents, it just makes economic sense for U.S. facilities, including ethanol plants, to use the cheapest fuel available to them. In 2008, when natural gas prices soared to painful levels, gasification of biomass was an attractive option for ethanol producers seeking to reduce the cost of their highest input after corn. But in the past couple years, natural gas has regained the lead as the most affordable, widely available fuel for U.S. ethanol producers. As a result, the few producers who had installed

DECEMBER 2011 | BIOMASS POWER & THERMAL 37

¦INNOVATION biomass gasification systems in 2008-’09 idled their equipment and switched back to the cheaper option. During the conference at the University of Minnesota, researchers proposed a new strategy for ethanol producers to use renewable resources such as corn stover to power their facilities and still profit. They believe that by partnering with entities that have an appetite for short-term losses, ethanol producers can afford to gasify enough corn stover to power their plants and be electricity producers as well.

Wind as an Example University of Minnesota extension production economist Doug Tiffany is part of a group of renewable energy researchers who analyzed technologies to gasify biomass for steam and electricity generation at ethanol plants. They identified technologies and possible feedstock options fairly quickly, including corn stover, syrup and distillers grains. Many ethanol plants already have power islands that house the power generation units for the facility that could be updated to also produce electricity for sale back to the grid. But the researchers soon found the difficult part of this concept would be to make the improved power island an economic benefit for the ethanol plant. They also needed to find a way to finance the construction of these new islands. They found their inspiration in the wind.

Wind power projects are notoriously expensive to construct and require years of operation to repay the investment. Therefore, those projects require hefty investments up front from parties who have an appetite for tax losses. Power island projects using stover at ethanol plants are expected to experience similar situations regarding up-front capital and sustained losses. Because ethanol plants generally are smaller companies with a group of owners who cannot utilize long-term paper losses, Tiffany suggests modeling corn stover power islands after wind projects by bringing in partners who take on the losses and also have the experience and capability

to handle the day-to-day business of power supply contracts. The power island can be siphoned off from the ethanol plant and function as its own entity, allowing the plant to use waste heat produced from the gasification of biomass to power its operations, but protecting its owners from the inherent first few years of loss. “Here’s a distinct business and it would have some opportunities for depreciation and use of provisions in the tax code and might be in a better position to negotiate with power companies than an ethanol plant itself,” Tiffany explains. “It may be attractive to investors and it may be more attractive to bankers if they’re dealing with investors who own the power island. And it may be a very good deal for the ethanol plants themselves, especially if they’re rewarded for ethanol that uses steam that came from biomass or electricity that came from biomass.”

Major electric companies are an obvious choice to partner with for such a project. Companies such as Florida Power & Light Co. and Xcel Energy Inc. have invested in wind projects and have enough passive income from other operations that can be shielded from taxes by showing losses on renewable energy projects, such as wind. Oftentimes, these companies participate in wind projects by taking a 99 percent share of the valuation of equipment and earnings for the first 10 years, which are the years of largest losses, according to Tiffany. After the first decade, majority ownership flips back to the landowners.

Aside from the tax benefits, power companies may be interested in partnering to produce this form of renewable energy as a way to meet environmental standards. Energy policy in the U.S. is currently fragmented. Some states have initiated renewable energy standards and many expect that a future nationwide energy standard will include requirements for renewable energy generation. Also, companies currently investing in renewable energy stand to benefit from the positive publicity of being an early adopter of this technology. Additionally, ethanol plant power islands serve

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38 BIOMASS POWER & THERMAL | DECEMBER 2011

as a more reliable source of electricity than wind projects, which often produce power only about 35 percent of the time, Tiffany says. “This could run 95 percent of the time. We’d only be stopping the generation of power for repairs and times of the year when there isn’t quite as much demand,” he says. “In that way, this would be power that would be more attractive for power companies to manage.

That’s why we were attracted to this whole concept. These ethanol plants are running basically year-round. They have a constant demand for steam or thermal energy and they could be using biomass and be a reliable source of renewable energy. This is a perfect marriage. The ethanol plant and the power island essentially need each other. The power island needs to have a place to discharge the heat, and drying the distillers grains or doing some cooking at the ethanol plant is a way to use that heat. FRONT-RUNNERS: The Frontline Bioenergy gasifier at Chippewa Ethanol enables the plant to utilize The corn stover is out there. We need to corncobs and other biomass sources for power when natural gas prices skyrocket. see some businesses get organized, the farmers themselves, and say they can be contracted to bring in this biomass. That still has to happen, but A power island at a 50-million-gallon-per-year (MMgy) ethanol what we’re trying to do is to jump ahead a little bit and determine plant could produce up to 25 megawatts of electricity, enough how some of these things might come together.” to service up to 25,000 people, he says. And with ethanol plants Tiffany says that while power companies are certainly prime already located in rural areas, partnering with those smaller mupartner targets for ethanol plant power generation projects, he’s nicipalities is an option that makes good sense. A handful of also seeing increased interest from municipalities in smaller ethanol plants have done this already, but are using natural gas communities that might be willing to take some losses in or- to power the generators and capturing waste heat for process der to become part owners of their own reliable power supply. heat.

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PHOTO: CHIPPEWA VALLEY ETHANOL CO. LLLP

INNOVATION¦

¦INNOVATION Simple Economics Vance Morey, professor of bioproducts and biosystems at the University of Minnesota, admits that ethanol producers are not likely to switch from natural gas to biomass as long as natural gas prices stay low. Not unless they entertain the option of becoming electricity producers as well as users. “The key is the ability to generate electricity and get more efficiency out of the process,” he says. “There are two things that I think will make that happen: if the price of natural gas goes up biomass starts to get more attrac-

tive, and if we eventually go to some type of carbon credits and low-carbon electricity.”

Chippewa Valley Ethanol Co. LLLP in Benson, Minn., was one of the first ethanol plants to adopt biomass gasification when it installed a gasifier at its 48-MMgy plant in 2008. But plant engineer Andy Zurn says the monetization of carbon played a secondary role in the plant’s decision to utilize area biomass. “Value for low-carbon ethanol is icing on the cake,” he says. “Our primary focus is hedging against the cost of natural gas. If the economics relative to natural gas make

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sense, we’ll run the gasifier and spend those energy dollars in our local community. The carbon markets, if they come along, that’s gravy.”

CVEC installed a Frontline Bioenergy gasifier in 2008 and used it to fire corncobs for cogeneration in 2008 and 2009.

The first year’s harvest was a small, grassroots production, Zurn says, but in 2009, the operation was expanded to include more farmers and more acres. With the help of a 50-50 funding promise from the USDA’s Biomass Crop Assistance Program, CVEC agreed to pay farmers $80 per ton for their cobs, a generous offering in order to convince first-time cob harvesters that participation would be worth their effort.

Area farmers signed up and made good on their end of the bargain, but when it came time to pay, BCAP’s funding was cut and it backed out of the project. “We went to get our money from BCAP and they said they weren’t funding it,” Zurn says. “CVEC already had an agreement with these farmers. We already had the corncobs.” CVEC settled on paying farmers $60 per ton for the cobs—$20 less than the farmers expected, but $20 more per ton than CVEC had originally planned on contributing—in order to make up at least somewhat for the federal government’s failure. Rightly, CVEC is leery of participating in any future BCAP projects and would likely pay farmers outright for their cobs in future harvests. “If you don’t trust that it’s going to be there for you, why are you going to do all the work to set up and get the whole logistics supply chain arranged?” Zurn says. “It fooled us once in 2009. We’re not going to play that game again.”

Despite the less-than-expected payout, Zurn says Minnesota farmers would likely participate in cob harvests again.

“These farmers are businessmen,” he says. If there’s additional money to create a new supply stream, which is corncobs in our world, and it doesn’t hurt their business, it just makes good business sense.”

But CVEC doesn’t plan on asking for cobs again until the economics of fuel sources demands it. The plant is set up to switch between biomass and natural gas pretty simply and the biomass gasifier has been

INNOVATION¦ shut off since gas prices took a nose dive two years ago. CVEC doesn’t currently possess the capability to produce additional electricity for a power partner and the low cost of natural gas doesn’t justify the use of cobs to displace fossil fuel right now, Zurn says. In the future, if the plant expands its gasification abilities and entertains the option of becoming a renewable energy generator, switching fuel sources to respond to the lowest cost would be less of an option.

Power purchase agreements may require a specific feedstock to be used and deviating from that protocol could void the contract.

CVEC may be interested in producing excess power in the future, Zurn says, but that would likely happen only after the plant has met its own power needs for a couple of years and ensured that its system is up to par.

cused on establishing energy grass sources near the Chancellor plant and said it plans to gasify the grasses while scientists perfect the complicated task of producing cellulosic ethanol from them.

Zurn says CVEC isn’t really worried about potential feedstock competition from cellulosic producers. “Cellulosic ethanol is coming along so slow and there’s a variety of different uphill battles for the cellulosic folks,” he says. “We recognize there will be more demand for biomass, but will it be five

years from now? Ten years from now? We think that if we can get the local biomass supply system set up, there’s probably going to be room for all of us. The whole ethanol world is stacked up against the fossil fuel world. If fossil fuels are dirt cheap, renewable energy is going to be pretty hard pressed without any incentives.”

Author: Kris Bevill Associate Editor, Ethanol Producer Magazine (701) 540-6846 kbevill@bbiinternational.com

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Cellulosic Considerations University of Minnesota researchers believe that of the three gasification options most readily available at ethanol plants—distillers grains, syrup and corn stover—stover is hands down the best candidate for energy production. But is that still the case when considering stover as a feedstock source for cellulosic ethanol production? How do the two compare?

Morey and Tiffany say that using corn stover as an energy source could provide ethanol producers with some needed experience in handling the biomass. “We wouldn’t use nearly as much of it as would be needed for cellulosic ethanol, but this would be the time for us to learn the lessons on how to put together businesses and maybe removal rates and enforce all these things,” Tiffany says.

“Some people have some experience collecting stover for feed or livestock bedding, but not large amounts,” Morey adds.

“I think developing this is a way of getting more people producing stover and starting to develop the technologies and markets for that. It’s an interim step.” Producers seem to agree with this approach as well.

Poet LLC used some of the stover it collected in Iowa last year to feed the gasifier at its 100-MMgy plant in Chancellor, S.D. In August, Poet entered into a project fo-

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ÂŚINITIATIVE

WASTE TO ENERGY: The Iris Glen landfill gas-to-energy cogeneration system at the VA facility in Mountain Home, Tenn., saves about 11,500 metric tons of carbon dioxide annually.

PHOTO: U.S. DEPARTMENT OF VETERANS AFFAIRS

42 BIOMASS POWER & THERMAL | DECEMBER 2011

INITIATIVEÂŚ

Honoring Sustainability The U.S. Department of Veterans Affairs is elevating its reliance on renewable energy by investing in combined-heat-and-power projects nationwide.

BY MATT SOBERG

T

he U.S. Department of Veterans Affairs understands the need for national energy security and to reduce greenhouse gas (GHG) emissions and is quickly becoming a leader in renewable energy generation.

Doubling the mandate imposed by President Obama and Congress, the VA adopted an internal goal of securing 15 percent of its electricity from renewable sources by 2013. While not quite there yet, the department is well on its way with biomass combined heat and power (CHP) playing a large role in its plans.

VA invested $826 million to improve its energy infrastructure in 2010, pursuant to the American Recovery and Reinvestment Act of 2009. A total of $487 million was devoted to renewable energy projects, including biomass-fueled cogeneration systems.

Behind the renewable push, the VA started the Green Management Program, a VA-specific initiative designed to achieve necessary government mandates and internal goals of the department, says Director C.J. Cordova.

DECEMBER 2011 | BIOMASS POWER & THERMAL 43

PHOTO: U.S. DEPARTMENT OF VETERANS AFFAIRS

¦INITIATIVE

METHANATION GENERATION: Generators at the VA facility in Mountain Home, Tenn., are fueled by processed waste methane.

With the help of U.S. DOE funding, VA commissioned 75 feasibility studies, performed by the National Renewable Energy Laboratory, specifically focused on CHP. Since 2010, five VA biomass plants are being constructed and developed with plans to be operational by 2013.

From the studies, VA initiated biomassfueled CHP projects at the Togus VA Medical Center in Augusta, Maine; the Battle Creek VA Medical Center in Battle Creek, Mich.; the Canandaigua VA Medical Center in Canandaigua, N.Y.; the Chillicothe VA Medical Center in Chillicothe, Ohio; and the White River Junction VA Medical Center in White River Junction, Vt. In addition to biomass, the VA also has biogas-fueled CHP systems receiving landfill-derived methane at the James H. Quillen VA Medical Center in Mountain Home, Tenn., and the Alvin C. York VA Medical Center in Murfeesboro, Tenn.

With all of its work on renewable energy, VA is well on its way to meeting the additional 25 percent by 2025 federal mandate.

Green Management Program The VA leads the federal government in sustainable practices, and to do so, it relies upon the Green Management Program. The program was formed to organize and aid the VA in meeting federal mandates, such as the Energy Policy Act of 2005 and the Energy Independence and Security Act of 2007.

“The most important VA commitment is to care for veterans and their families, and the Green Management Program advances this commitment by ensuring a healthy and sustainable environment, lowcost energy, and clean air for current and future generations,” Cordova says. The five focus areas are energy efficiency and renewable energy, fleet, environment, sustainable building and GHG management.

Notwithstanding federal mandates, the VA is considered a safe-zone where energy security is of utmost importance in case of emergency or catastrophe. Embracing renewable energy provides fuel diversity. Biomass plays into this equation

44 BIOMASS POWER & THERMAL | DECEMBER 2011

by providing a locally derived sustainable fuel, according to Frederick Thielke, management analyst for the renewables program.

This inherent function of VA facilities as a refuge may increase the urgency for the department to embrace alternative fuels. If a catastrophe hits, it is important for the facility to continue to operate.

For the VA to have a diverse fuel supply means it can have continuity of operations, Thielke says.

The department’s ambitious goals are honoring veterans through prospective sustainability. As an additional internal goal, the VA intends to reduce GHG emissions 30 percent by 2020. “The VA is meeting these goals and targets by: aggressively implementing energy and water conservation measures; increasing the use of renewably fueled on-site electricity, steam, hot water and chilled water; tuning-up buildings to improve energy efficiency, comfort and indoor air quality; and increasing the use of alternative fuels in VA fleet vehicles,” according to the Green Management Program.

By counting as a renewable fuel, reducing GHG emissions and helping the department manage energy prices through fuel diversity, biomass supports VA renewable initiatives, according to Thielke.

PHOTO: U.S. DEPARTMENT OF VETERANS AFFAIRS

INITIATIVE¦

COUNTING ON COGENERATION: The James H. Quillen VA Medical Center in Mountain Home, Tenn., is one of several VA facilities utilizing biomass-based energy.

Combined Heat and Power Feasibility The VA began conducting renewable energy studies to determine which fuels best suited various locations. “We expect this to lead to exciting opportunities for VA to reduce its environmental footprint,” Secretary of Veterans Affairs Eric K. Shinseki said in April 2010. Findings from the studies help VA determine the ideal locations for renewably fueled energy plants, while ensuring cost savings.

The studies viewed renewable fuels such as methane gas from landfills, agricultural waste such as decaying trees and landscape waste, scrap wood and other biomass. In addition, the studies assessed potential cogeneration technologies for existing facilities.

DECEMBER 2011 | BIOMASS POWER & THERMAL 45

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“In conjunction with the investments in clean energy generation and other environmental projects through our Green Management Program,” Shinseki says, “these assessments will help VA continue to lead in going green.”

Through the feasibility studies, the VA learned that CHP provides an efficient solution for energy, operation and cost.

The research determined which facilities would be the most ideal for investigating CHP based on fuel availability, specific plant characteristics and local utility rates.

Each facility is unique, and to determine whether biomass would work for a specific facility, the VA approached renewable energies in a systematic way, including prescreening for renewable resources, Thielke says. “The 75 CHP feasibility studies showed that hospitals are an excellent candidate for CHP if the fuel resources are available,” he adds.

Cordova and Thielke mention the Battle Creek VA Medical Center as an example of applying biofueled CHP. “With the help of the NREL, we wanted to know electricity rates for various fuel sources to try to determine whether CHP was economical in Battle Creek,” Thielke says.

The next step included investigation into technology application and feedstocks.

VA then took the NREL recommendations and worked directly with the facility to determine the scope of the design.

After all of the work was planned, the project went to the bidding process approximately one year ago.

DeMaria Building Co. is providing general contracting services and Nexterra Systems Corp. will provide a biomass gasification system that will produce 28 million Btu (MMBtu) per hour, and supply the center with 2 megawatts of power and 14,000 pounds per hour of saturated steam. The system will allow the VA to cut emissions 80 percent, which is approximately 14,000 tons per year or the equivalent of removing 3,500 cars from the road annually, according to Nexterra.

VA is utilizing biogas from landfills to create bioenergy at the center in Moun-

INITIATIVEŒ tain Home, Tenn., which is fueled with processed waste methane. This facility alone contributes 0.5 percent to VA’s renewable energy goal and saves approximately 11,500 metric tons of carbon dioxide annually. To put that in perspective, 1 metric ton of carbon dioxide equals emissions from 112 gallons of gasoline, according to VA. VA is hoping to get biomass projects up and running, analyze their performance, and use that information to determine whether it makes sense to utilize biomass for future projects.

ash management equipment that processes large stones, Bolewski says.

It was important for the biomass facility to be aesthetically pleasing and match the surrounding buildings, Bolewski says. The purpose of the design was to mimic the existing brick facade.

In case of a catastrophe, the facility can hold and take care of multitudes of people and is considered a safe haven. Canandaigua

is a 1-million-square-foot facility including its entire campus. If other fuel sources are cut off for any reason, the facility can utilize biomass reserves in case of emergency.

Author: Matt Soberg Associate Editor, Biomass Power & Thermal (701) 746-8385 msoberg@bbiinternational.com

CHP Construction Construction of the CHP biomass project at the Canandaigua VA Medical Center started in April. Contractors were finishing up foundations and boiler equipment was arriving on-site at the end of October. The target date for completion is May with construction closeout in June.

The CHP facility will produce 345 kilowatts of capacity and 22,000 poundsper-hour of high-pressure steam. All energy produced will be utilized on-site. The facility has the ability to utilize multiple fuel sources. Biomass had a significant cost advantage to natural gas, which has now diminished, but biomass provides other benefits, according to Steve Bolewski, the VA network energy manager on the Canandaigua site.

The boiler will consume approximately 15,000 tons of wood chips annually, with 400 tons per week in the winter and 150 to 180 tons in the summer. All chips will be stored on-site in a below-ground bunker with a four-day supply capability at peak times of the year.

The woody biomass comes from a 60mile radius of the facility, which is in the middle of an emerald ash borer quarantine region. This results in ample biomass supply, since wood cannot be shipped outside the quarantine boundary.

The facility is designed to be state-ofthe-art with a unique approach to the equipment. The design incorporated techniques that avoid screening and maintenance of the system. It utilizes oversized boiler and

DECEMBER 2011 | BIOMASS POWER & THERMAL 47

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