Biomass business plan progressing

Jane Howard

Representatives of the Cook County Local Energy Project (CCLEP) along with Mark Spurr of FVB Energy updated the Grand Marais Public Utilities Commission on the status of the biomass district heat project on April 10. “This project has gotten to the point where it’s looking like it might happen,” said Spurr.

Spurr said they have had “very strong interest” from potential customers along the proposed hot water distribution route. He said they expect the system to have a “relatively stable cost over the long term.” The average rise in fossil fuel prices among this customer base has been 6½ percent a year over the last 10 years.

A business plan will include information on fuel sources, operating costs, the economic benefits, and financing. Biomass proponents are looking at buying a lot in the Cook County/Grand Marais Economic Development Authority-owned Cedar Grove Business Park, which would be purchased at full price even though the PUC would own the utility.

Spurr said in Sweden, where biomass plants are abundant, systems operate very cleanly. According to Spurr, old systems used years ago in the U.S. were often too big and operated at low efficiency. The system proposed for Grand Marais would have an electromagnetic precipitator, which reduces potential emissions.

The proposed system would be sized with the potential for expansion in mind, but it would not be built so big that it would not operate cost-effectively. If it were “wildly successful,” Spurr said, they could install a second boiler. George Wilkes of CCLEP said the equipment being made today feeds automatically, allowing it to operate at peak efficiency all the time.

City Administrator Mike Roth said they would stay away from financing with general obligation bonds but could look instead for financing that would rely solely on the success of the system for repayment. City Councilor Tim Kennedy said the city’s bond consultants said they would need more than bonds to finance the project. Spurr said they could seek a combination of bonds and low interest loans.

The project might be ready by fall for a decision on whether to build or not.

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2013-05-11 digital edition

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