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Bio-Energy from Trees Mark Ohrenschall Con.Web, September 26, 2002

Electricity/Ethanol Plant Proposed in Oregon, Using Wood Wastes as Fuel

A proposed bio-energy plant in northeastern Oregon would produce both electricity and ethanol from wood residues gathered in overstocked forests.

This novel venture would annually generate 15 megawatts to 20 MW of power and 15 million to 20 million gallons of ethanol, according to Marc Rappaport, president of Sustainable Energy Development, who is spearheading the project near La Grande, OR. Rappaport said he hopes to break ground for the plant next spring.

It would also help open up forests grown increasingly thick over the years by fire suppression, selective logging, drought and insect infestations--which have combined to increase the risk of big wildfires. A U.S. Forest Service official in eastern Oregon praised the proposed bio-energy plant as a means to increase thinned acreage and provide a local market for smaller wood.

"The big paradigm is we produce electricity and ethanol and reduce greenhouse gases, all at the same time," said Rappaport.

Even with these prospective benefits, he acknowledged this as a "complicated and difficult" project. Among the issues are financing for the $80 million-plus venture, potential environmental sensitivities and markets for the ethanol and electricity. An Oregon state energy official thinks cost is the main hurdle.

Electricity and Ethanol Production
Burning wood to generate power is "fairly old technology," said energy facility analyst John White of the Oregon Office of Energy. It heats a boiler that creates steam that drives a turbine that connects to a generator. But making ethanol from wood is original; White said a number of such facilities have been proposed around the country, but none are operating. The basic concept involves a biochemical process in which cellulose (from wood or agricultural byproducts) is converted into sugar, which ferments into ethanol.

Rappaport declined comment on the technological details of his proposed electricity/ethanol facility, although he generally described the technologies as proven, patented, relatively innovative and low-carbon dioxide emitting.

Rappaport said he helped put together a 22.5-MW wood-fired plant in southern Oregon, built some 20 years ago, and more recently participated in a working group mulling the problem of fuel-loading in Northwest forests. He also mentioned the U.S. Department of Energy's exploration of cellulose-to-ethanol production as other background to this venture.

Wood wastes--an estimated 300,000 tons annually--would provide the fuel source. "The material we would be using has no commercial value ... We're not looking at standing timber," said Rappaport. Both private and public lands, such as the nearby Wallowa-Whitman National Forest, could supply the wood

White called OOE "very supportive" of the project. "Potentially this may be a new industry in Oregon, based on our availability of a lot of waste wood. It's of course a very sensitive issue environmentally. There are some who would not want any kind of extraction of biomass from the forest. My personal view is that there are forests out there that would benefit from a program of thinning," to reduce the chance of monstrous fires of the type that charred Colorado and Arizona this summer. "We see a real connection here between possibly, eventually, doing something right for the forest and at the same time produce a resource which could be used to produce useful energy, instead of just burning it up in a wildfire."

In an April 2001 study for OOE, the Virginia-based Sampson Group wrote, " ... we are convinced that the potential for breaking through the forest health-biomass energy gridlock is as promising in Eastern Oregon as anywhere in the West," although more detailed studies are needed. "Improved forest inventories on private lands, major changes in federal forest policies and better economic analyses of energy facility locations are all indicated."

Local Support
The ethanol/electricity plans have found favor in the local community, according to Rappaport and assistant planner J.B. Brock of the Union County Planning Department. "There's pretty much broad-spectrum support for it," said Brock, for reasons including economic development and reduced fire hazard. The county is reviewing plans for the 60-acre industrial park site earmarked for the bio-energy plant.

"I think there's been real good support for it," agreed Kurt Weidenmann, district ranger for the La Grande Ranger District in the Wallowa-Whitman National Forest. "We'd like to see it get in and start operating."

Forest Service officials and Rappaport have had "fairly active discussions" the past couple of years about a bio-energy plant, Weidenmann said. "It's sorely needed here in northeast Oregon." Such a plant would furnish a local market for "low-value, small diameter" wood that now must be transported to the Columbia River. The OOE study also listed a viable local market as a major obstacle for biomass energy linked to forest thinning, along with reliable fuel supplies.

The bio-energy plant also would allow the Forest Service to expand local thinning operations, which currently cover about 7,000 acres a year. "For all practical purposes there's an unlimited supply of biomass that we could supply this plant," Weidenmann said.

Financial Issues
Rappaport estimated a two-year construction period, and a total cost that could exceed $80 million. He declined comment on financing, although he indicated private sources were being lined up for the project. He has inquired about OOE's Business Energy Tax Credit and Energy Loan programs, according to White; federal money could be another option.

"The principle barrier is financing," White said. "Because it's new it's a) more expensive--we haven't really optimized the process--and b) a lender is uncomfortable when there is not something already operating out there."

As for markets, Rappaport said ethanol could be used as an alternative vehicle fuel anywhere on the West Coast, although he acknowledged logistical issues.

Meanwhile, "We've had some conversations with a couple of utilities" about potential power sales. "I think people need to know we're going to be more real" before making commitments. Oregon Trail Electric Consumers Cooperative is prepared to deliver the electricity to Bonneville Power Administration lines, he said, opening a wide range of potential power buyers. Rappaport said he anticipates charging a green premium for the electricity, comparable to wind-generated power. Northwest Power Planning Council figures show the energy cost of wood-fired combustion, using conventional technology without cogeneration, ranges from 5.2 cents per kilowatt-hour to 6.7 cents/KWh, according to White.

"This is definitely just an initial phase," said Rappaport. "If we prove what we think we can do, I think there'll be considerable opportunity for replication of what we're doing ... Anyplace a community has a problem and wants power and ethanol, we'll be able to provide solutions, and facilitate forest restoration on a sustainable basis."--Mark Ohrenschall