Biomass plants look to state to keep the furnaces burning BY ERIK EISELE THE CONWAY DAILY SUN
TAMWORTH — Several of the state’s wood-burning power plants are losing money fast and looking to the state for help, but what advocates call a short-term solution to save hundreds of local jobs others call a corporate subsidy. The managers of four small biomass plants — in Alexandria, Bethlehem, Bridgewater and Tamworth — are asking lawmakers to do something before their plants go under and take with them as many as 500 jobs. “We’re on the edge right now,” said Russ Dowd, plant manager at Pinetree Power’s 20-megawatt biomass facility in Tamworth. “We’re hoping for a hot summer.” Electricity prices are low, he said, and his plant doesn’t have a contract with an electric utility to buy its power. Instead it sells electricity into the grid at whatever the price energy is at that day. But the daily market price isn’t high enough right now to keep his plant or the others afloat. “We’re in a short-term pickle,” said Michael O’Leary, manager a 15-megawatt plant in Bridgewater. His plant did fine selling into the daily market from 2007 to 2010, he said, when energy markets were stronger, but today cheap electricity from out-of-state natural gas facilities has flooded the energy market. “We’re running and losing money.” And if they go under, O’Leary and Dowd both said, the impact will go far beyond plant grounds. Pinetree Tamworth has 22 employees, Dowd said, but there are also roughly 100 other jobs directly connected to the plant, “in the woods, driving trucks, directly related to the forest industry.” Bridgewater has similar numbers, according to O’Leary: 19 employees at the plant, and between 80 and 100 people who make their living supplying the plant with wood. Together all four plants support between 400 and 500 jobs, Dowd and O'Leary said. Together with the managers of the other two vulnerable plants they are focusing efforts on the governor’s office, the executive council, state senators and House representatives, trying change the laws to bring them back to profitability. “I don’t think there’s anybody in this economy that
wants to see jobs going away,” Dowd said. But what they want to do makes some major players nervous. “They’re looking for a subsidy” said Martin Murray, spokesman for Public Service of New Hampshire, the state’s largest electric utility. “Someone has to pay for that. We’ve paid for that in the past.” And Murray isn't the only person with concerns about their efforts. "New Hampshire electric customers would be in essence subsidizing again," said state Sen. Jeb Bradley, whose district includes Tamworth and who is on the Senate Energy and Natural Resource Committee. "There's a cost to that." The four biomass facilities are looking for lawmakers to do two things: get them three- to five-year contracts with New Hampshire utilities so they can stop selling their power on the daily market, and make changes to the rules governing renewable energy certificates. The contracts, according to O’Leary, will enable the plants to get through the down market, preserving the jobs. “Within three to five yeas market conditions will turn around,” he said. “We’re not asking for 20 years. Give us three more years.” The price the utilities would pay would be above the daily market price, he said, but it would be in line with other prices utilities pay for power. And it would ensure the jobs don't disappear. “We’re asking them to make a little bit more of a long-term decision,” he said. But it's selling electricity at higher than market rates that raises eyebrows. “If they want to sell us their energy at the market price, we will buy it,” Murray said, but anything beyond that would mean PSNH customers would have to pay a premium for that power. “We don’t believe that’s fair.” O’Leary contends, however, that PSNH’s own plants don’t operate cheaply enough to survive at the daily market prices. The only reason they are viable, he said, is because PSNH customers pay a higher price for PSNH power. “They could not exist at current short-term pricing,” he said. “If there was an easy solution to this challenge see BIOMASS page 12
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