Regulators hit pause on biomass

Board suspends hearings to get info on alternatives to $208-million project
By BRUCE ERSKINE Business Reporter
Fri, Jul 30 - 6:11 AM

A regulatory hearing on Nova Scotia Power Inc.’s application to build a $208-million biomass energy project in Port Hawkesbury has been put on hold pending a review of other renewable energy projects.

The decision was reached Thursday after testimony from John Antonuk of Liberty Consulting Group in Pennsylvania at the provincial Utility and Review Board.

Antonuk, a board consultant, told a hearing in Halifax that there needed to be "a full and fair comparison of alternatives" that would allow the electrical utility to meet provincial renewable energy targets.

Nova Scotia Power applied to the board for a capital work order to build the biomass project in April, the same month it issued a request for proposals for other renewable energy projects.

The deadline for those proposals was July 15.

Antonuk said it didn’t make sense to proceed with the application until there was an opportunity to compare it with the other renewable energy proposals the power company solicited.

"The door to a proper evaluation of alternatives from the perspective of customer interests over the coming decades is just opening. It would be wrong to see this hearing as beginning the process of closing it."

Nova Scotia Power planned to own the biomass plant and NewPage Port Hawkesbury Corp. planned to operate it.

The facility, which would use an old NewPage burner valued at $80 million, would burn 650,000 tonnes of wood waste a year to generate enough electricity to power 50,000 homes.

Half the waste wood would come from NewPage’s sawmill and papermaking operations.

The rest would be harvested, with half of that coming from Crown lands under a 25-year deal NewPage negotiated with the province.

Nova Scotia Power and NewPage representatives agreed with board chairman Peter Gurnham’s decision to put off a decision on the plan pending analysis of the other renewable energy proposals.

Critics of the biomass plan argued during four days of hearings that it wouldn’t help reduce greenhouse gases or the burning of coal.

It was also suggested there wasn’t adequate waste-wood supply to feed the system, which might result in increased clearcutting of Nova Scotia’s forests.

On Thursday, the Ecology Action Centre in Halifax, Sierra Club Atlantic and the Margaree Environmental Association called on Premier Darrell Dexter and Energy Minister Bill Estabrooks to intervene during the hearing process to provide details about provincial forest biomass policy and project regulations.

"The coalition has serious concerns that the (board) does not currently have a clear policy mandate from the government of Nova Scotia to adequately rule on the use of forest biomass as part of meeting the province’s ambitious renewable electricity targets," the coalition of environmental groups said.

The coalition said it shared "significant scientific concerns" about the carbon neutrality of large-scale forest biomass as a source for renewable electricity and asked that the biomass proposal be put on hold until the province’s natural resources strategy is complete in the fall or early next year.

http://www.thechronicleherald.ca/Business/1194325.html

NSP process criticized

U.S. consultant questions how well utility did its homework regarding biomass project
By BRUCE ERSKINE Business Reporter
Thu, Jul 29 - 6:32 AM

Nova Scotia Power Inc. hasn’t done its homework on its planned $208-million biomass energy project in Port Hawkesbury, says a U.S. renewable energy consultant.

"I have a number of material concerns regarding the due diligence and prudence employed by NSPI with regard to estimating the long-term capital and operating costs of the proposed project," said Barry Sheingold, of New Energy Opportunities Inc. in Massachusetts, in testimony Wednesday at a Utility and Review Board hearing in Halifax.

NSP plans to partner with NewPage Port Hawkesbury Corp., a subsidiary of Ohio-based NewPage Corp., on a biomass facility that would burn 650,000 tonnes of wood waste a year to generate enough electricity to power 50,000 homes and help the utility meet provincial renewable energy targets.

NSP would own the plant, which NewPage would operate.

Half of the waste wood would come from NewPage’s sawmill and papermaking operations.

The rest would be harvested, with half of that coming from Crown lands under a 25-year deal NewPage negotiated with the province.

Sheingold, who was certified as an expert witness after being questioned by NSP lawyer Dan Campbell on his familiarity with Canadian law and with Nova Scotia’s energy regulations, said the power company should have conducted a competitive bidding process for other renewable energy proposals, including wind, at least a year ago so that evaluation results would have been available to the board at the time the biomass application was filed.

"I would suggest that the board staff work with NSPI and an independent evaluator on an expedited basis to achieve an agreed upon scope of (independent evaluator) work with a timetable for delivery of the independent evaluation for filing in this proceeding and a process for review by interveners," he said.

Utility company officials declined to comment on Sheingold’s testimony, saying they would let the hearing process proceed.

Sheingold appeared as a witness for the provincial consumer advocate’s office.

Prior to his testimony, consumer advocate office lawyer Bill Mahody questioned a NewPage panel on the potential impact its parent’s $3-billion debt might have on the biomass project.

A September 2009 filing with the U.S. Securities and Exchange Commission tabled at the hearing disclosed that NewPage Port Hawkesbury was one of the guarantors of $1.7 billion in secured notes issued by NewPage Corp. to repay a term loan.

Chris Hooper, vice-president of operations with Cerberus Operating and Advisory Co., a NewPage affiliate, confirmed the $3-billion debt figure but said he wasn’t aware of any discussions with the utility about the potential impact of NewPage debt.

Power company spokeswoman Patty Faith said NewPage’s debt wouldn’t affect NewPage assets bought by the utility, which said earlier in the hearing that it would continue to operate the plant regardless of what happened to the paper company.

Bill Stewart, NewPage Port Hawkesbury’s director of woodlands and strategic initiatives, was also questioned about a letter sent to the board this week by Anthony Mee, owner of the Great Northern Timber Group of Companies, which has wood fibre processing operations in Liverpool and Sheet Harbour.

Mee said the biomass project would hurt his business, which has developed export sales for under-utilised hardwood and softwood fibre.

Stewart said he was surprised by the letter and called Mee on Wednesday to offer to meet with him to discus the supply issue.

Hearing testimony is scheduled to wrap up today. The board plans to travel to Port Hawkesbury on Friday to tour the proposed biomass plant site.

http://www.thechronicleherald.ca/Business/1194277.html

How much power in the wind?

Hydro plant owner says NSP doesn’t know
By BRUCE ERSKINE Business Reporter
Wed, Jul 28 - 7:03 AM

One of Nova Scotia’s small independent power producers can’t believe Nova Scotia Power Inc. hasn’t done any studies on integrating alternative energy into its grid.

"I thought it was absolutely extraordinary that they haven’t done any studies," Neal Livingston, owner of Black River Hydro Ltd., said Tuesday in an interview.

Livingston’s 220-kilowatt hydroelectric plant near Mabou has supplied electricity to the provincial utility since 1984.

On Tuesday, he grilled Nova Scotia Power on behalf of the Margaree Environmental Association at a provincial Utility and Review Board hearing in Halifax on a proposed $208-million biomass energy project in Port Hawkesbury.

The power company would own the plant NewPage Port Hawkesbury Corp. would operate it.

It would burn 650,000 tonnes of wood waste a year to generate enough electricity to power 50,000 homes and help Nova Scotia Power meet provincial renewable energy targets.

Half of the waste wood would come from NewPage’s sawmill and papermaking operations. The rest would be harvested, with half of that coming from Crown lands under a 25-year deal NewPage negotiated with the province.

Livingston said he pushed the power company eight years ago to hire experts to create a model of how much renewable wind power it could take on its system as an alternative to greenhouse gas-producing fossil fuels.

"They haven’t spent a dime on it," he said, suggesting that the electrical utility is more interested in profits than in the environment.

"Biomass is, in some ways, the most profitable thing for them to do. They’re in the business of making money, and with a big biomass plant, they can make more money."

The proposed plant would increase greenhouse-gas emissions rather than reduce them, he said.

"It’s not going to reduce coal burning and they haven’t done any work to figure out how much wind they can put on their system."

Livingston said the provincial utility is using a wind integration study paid for by the provincial Energy Department.

"I think, in the last month, we’ve gone backwards 10 years relative to the province having any significant impact on pushing the utility to do anything," he said, pointing to a recent government rollback on mercury emission targets.

Nova Scotia Power said the targets would result in rate hikes.

Robin McAdam, the power company’s executive vice-president of sustainability, said the utility couldn’t draw any conclusions about wind power integration until it had wind facilities in place.

The company is in the process of setting up wind power data-gathering models, said Mark Savory, vice-president of technical and construction services.

McAdam said he didn’t think the biomass plant would increase provincial greenhouse-gas emissions.

"I don’t see how it can."

But he couldn’t say to what degree the plant would contribute to a reduction in the burning of coal, an issue he said would be determined by price.

Livingston also questioned whether Nova Scotia Power would take over Crown forest leases NewPage holds if that company failed.

The province is capping forest biomass generation at 500,000 tonnes above the current level and will review biomass as a source of electricity after 2015.

The hearing continues today. It is scheduled to move to Port Hawkesbury for a tour of the proposed plant site Friday.

http://www.thechronicleherald.ca/Business/1193996.html

Dartmouth wind turbine manufacturer has momentum

ROGER TAYLOR Business Columnist, Halifax Chronicle Herald
Wed, Jul 28 - 7:03 AM

Two million dollars isn’t what it used to be, especially for a growing Nova Scotia renewable energy company with customers all over the globe.

But it’s a beginning, and Seaforth Energy Inc. of Dartmouth — a wind turbine manufacturer with a specialty in integrating renewable energy projects — will be able to use the $2 million it’s raised recently to scale up operations in order to deliver on backlogged orders for its turbine.

Jonathan Barry, president of Seaforth Energy, says the focus on filling orders not only makes current customers happy, it helps to strengthen the company’s credibility with future customers.

The primary markets for Seaforth turbines are in the United Kingdom, Italy and the United States.

"The up-and-coming markets are Israel and, we’re hoping, depending what happens this fall, Ontario, if they bring in a new feed-in tariff. That will be a big market as well," he says.

Countries and provinces with good wind conditions and a feed-in tariff system, which obliges utilities to buy renewable electricity, are considered favourable markets for Seaforth’s AOC 15/ 50 50-kilowatt turbine, the company president says.

"We’re an all-Canadian product. We manufacture the blades and the controllers right here in Nova Scotia. The towers, we’ve worked with Cherubini (Metal Works) locally on towers and we’d love to work with them some more, but the towers can come from a variety of other sources. So it’s a cost and a shipping consideration, depending on where you’re sending it. And then the drive train is all assembled in one place; it’s actually done for us with a partner in Montreal."

Typically, he says, the various parts are all brought to the location where it is to be erected and the turbine is assembled on-site.

Innovacorp, the Nova Scotia government agency, seems to believe the prospects for Seaforth Energy are very good. Innovacorp contributed $500,000 of the $2 million from its venture capital fund. In exchange, it has taken an equity position and a seat on the Seaforth Energy board.

The rest of the $2 million in funding has come from the Business Development Bank of Canada, Seaforth Engineering Group and private investors.

Barry says his company’s 50-kilowatt turbines are a fraction of the size of the three-megawatt turbines being installed on Dalhousie Mountain, Pictou County.

"Size-wise, our turbine would go on a (30- to 36-metre) tower and it would have a rotor diameter of 15 metres. A large turbine would have a rotor diameter nowadays, probably, of 60 to 80 metres," the Seaforth Energy official told me in an interview Tuesday.

But the smaller turbines put out a significant amount of power and aren’t made to be put up in a typical backyard, says Barry.

"As an experienced wind company, we’d tell you to be cautious about putting wind turbines anywhere near residential areas or homes . . . because they’re machines, at the end of the day."

The AOC 15/ 50 is designed for institutional, commercial, industrial, agricultural and remote applications.

Creating wind turbines is an exciting growth area for the company, says Barry.

But Seaforth Energy isn’t only a turbine manufacturer. The company’s renewable energy systems integration group provides design, engineering, installation and maintenance of renewable energy systems for residential, commercial and institutional clients.

For example, although its turbines are not part of the new Halifax farmers’ market project, Seaforth Energy worked on a renewable energy aspect of the renovated building in the Halifax seaport district. The company has also done a lot of work at Universite Sainte-Anne in Church Point, Digby County, but there are more renewable energy contacts to be announced soon.

This was the first round of financing, says Barry, and more capital will be needed as the company grows.

http://www.thechronicleherald.ca/Business/1194027.html

Biomass may emit more CO2 than coal, URB told

By BRUCE ERSKINE Business Reporter
Tue, Jul 27 - 4:53 AM

An electrical problem interrupted a Utility and Review Board hearing in Halifax on Monday on a proposed $208-million biomass energy project that critics say is bad for the environment.

"It’s kind of ironic," said Jamie Simpson of the Ecology Action Centre, who submitted a brief to board chairman Peter Gurnham before the power problem. It outlined the Halifax centre’s reservations about biomass as a way to reduce the province’s dependency on coal as an energy source.

"We certainly don’t oppose biomass energy per se, but we think it needs to be looked at much more critically than it is right now," Simpson said in an interview, suggesting that the proposal would hurt, rather than help, the province’s environment.

"We would actually see an increase in the amount of greenhouse gases that Nova Scotia is producing, not a reduction."

Nova Scotia Power Inc. has applied for approval of a plan that would see NewPage, an Ohio company that owns a paper mill in Port Hawkesbury, burn 650,000 tonnes of wood waste a year to generate electricity.

The utility says the plan would help it meet provincial renewable energy standards while generating enough electricity to power 50,000 homes annually.

NewPage said half of the waste wood would come from its sawmill and papermaking operations.

The rest would be harvested, with half of that taken from Crown lands under a 25-year deal NewPage negotiated with the province.

Some Nova Scotia sawmill operators, hit hard in recent years by downturns in the lumber sector, say the project would be good for business.

But critics say the jury is still out on whether biomass energy is as sustainable as its proponents suggest.

"There’s a common perception out there that forest biomass energy is carbon neutral but new research being done shows that forest biomass is a much more complicated issue than originally expected," Simpson said.

"In fact, on a per-energy-unit basis, you actually produce more carbon dioxide when you burn wood than when you burn fossil fuels, even coal."

He said a recent study by the Manomet Center for Conservation Sciences in Massachusetts underscores the need to know more about biomass energy before establishing government policy.

"Based on that research, the Commonwealth of Massachusetts has decided to overhaul their renewable energy standard," said Simpson, who suggested that Nova Scotia should do the same.

"If we were to look at the science that’s emerging on this topic, then we would most certainly revise our renewable energy standard and change the definition of renewable forest biomass."

Retired Dalhousie biology professor David Patriquin said the Nova Scotia Power-NewPage project would harm the environment.

"Plants of this type increase carbon emissions, they don’t reduce them," he said, adding that the project would also hurt the province’s nutrient-poor soil.

"Between the two of those things, this project is not sustainable, by definition."

Kelly Cantwell, the power company’s director of renewable energy, acknowledged Monday that the utility doesn’t have a lot of biomass expertise. However, she noted that the government has supported the project.

In its renewable electricity plan released in April, the province said it is taking a cautious approach to the development of biomass for electricity production.

It is capping new forest biomass generation at 500,000 tonnes above current uses, among other limits, and will review biomass as a source of electricity after 2015.

The hearing continues today. It will move to Port Hawkesbury for a tour of the proposed biomass plant site Friday.

http://www.thechronicleherald.ca/Front/1193940.html

N.S. regulator opens hearing on proposed biomass facility

By THE CANADIAN PRESS
Mon, Jul 26 - 5:44 AM

Nova Scotia's regulatory agency begins hearings today on a proposal to build a biomass-fuelled power generation facility that would help move the province closer to its renewable energy targets.

Nova Scotia Power, a subsidiary of Emera Inc., and Newpage Port Hawkesbury Corp. want to burn 650,000 metric tonnes of wood a year to fire a steam generator.

They say it will produce about three per cent of the province's total electricity needs.

The applicants maintain the $200-million project will create 150 new forestry jobs and help Newpage maintain 550 jobs at its Cape Breton mill.

The plan is opposed by a coalition of environmentalists and woodlot owners who fear it will lead to an increase in clear cutting and deplete biodiversity and carbon storage.

Jamie Simpson, a forester with the Ecology Action Centre, says he finds it hard to believe the harvest could be sustainable.

The provincial government is demanding 25 per cent of Nova Scotia's energy supply come from renewable resources by 2015.

http://www.thechronicleherald.ca/Front/9017366.html

NDP sets a bad power precedent

RACHEL BRIGHTON | Just Business
Sun, Jul 25 - 4:53 AM

Three years after the passage of the Environmental Goals and Sustainable Prosperity Act and an agreement to meet the national standard for mercury emissions from coal-fired power plants, the mercurial NDP government has turned on a dime.

The "dime" was the higher power rates forecasted by Nova Scotia Power to offset the cost of burning cleaner fuel to comply with the law.

After meeting privately this month with business, community, environmental and university groups, government determined the public would happily accept higher levels of the neuro-poison for several more years in exchange for lower power bills next year.

By pushing the agreed mercury cap back four years to 2014 — beyond the next election — the NDP judged it could avert the backlash that would have been triggered by steep power rate hikes.

Nova Scotia Power was seeking rate increases of 12 per cent for residential customers and 18 per cent for industrial users.

In its defence, the NDP has set an even lower cap on mercury emissions for 2020, to compensate for breaking its word on the 2010 cap.

The reason for the mercury cap, set by Canada and agreed to by Nova Scotia, is that coal-fired power plants are a leading contributor to mercury levels in Canada.

Whether the power utility could have achieved the mercury reductions for less money remains an unan-swered question because the premier intervened before the utility’s case could be examined by the Nova Scotia Utility and Review Board in the fall.

The rapid turnaround on this issue, following pressure from the business community, stands in contrast with the widespread business support for the proposed biomass joint venture between Nova Scotia Power and NewPage Port Hawkesbury Ltd.

That project has received resounding support from regional business groups and development agencies.

The biomass project is being put forward so the utility can meet another set of legislated targets, for renewable energy.

As an industrial expansion, the biomass project offers its own rewards, in the forms of jobs and investment.

In contrast, the mercury caps appear to come with an unpalatable cost, with no economic sweetener to make the medicine go down.

It was probably a mistake to create the environmental legislation in such a way that it could be broken down into popular and less popular parts by the utility.

For example, the latest conservation measures were approved with little controversy, whereas the mercury-reduction commitments were couched within a broader rate proposal that spooked business and forced government to change its mind.

The utility may have anticipated that government would fail this test of nerves.

Many Nova Scotians will be relieved that government did change its mind on the mercury cap, but cherry-picking environmental commitments sets a bad precedent. So does changing the law on the basis of backroom discussions. That leaves the impression that people who supported the law have been hoodwinked.

Instead of playing off the environment against economics, which is what happened this week, government and business should discover how environmental health can generate economic wealth.

Rachel Brighton is the publisher of the regional magazine Coastlands and a former business editor and journalist.

http://www.thechronicleherald.ca/Business/1193594.html