April 27, 2013

Federal effort to boost Maine's wood pellet industry sees strong returns

By Matt Hongoltz-Hetling mhhetling@centralmaine.com
Staff Writer

As the sun sets on an $11.4 million federal effort to boost Maine’s wood pellet industry, early returns seem to indicate that the investment was a sound one.

click image to enlarge

School Administrative District 74 Superintendent Ken Coville shows off a wood-pellet boiler at Garret Schenck School in Anson.

Staff photo by Erin Rhoda

The money helps drive Maine toward a stronger sustainable forestry economy and reduced dependence on foreign oil, according to one expert.

The U.S. Department of Forestry spent the money in the Fuels for Public Buildings grant to help bring 24 biomass conversion projects to fruition in schools, hospitals and public buildings across the state.

In central Maine, the grant has funded projects at schools in Phillips, Anson, Oakland and Waterville; and municipal buildings in Strong, Thorndike and Gardiner.

The last project, which is scheduled for completion in Ashland on May 7, will also serve as an education center, which grant administrators hope will help to keep the ball rolling by stimulating the creation of more biomass boilers in the state.

Future Metrics, a Bethel-based company owned by economist Bill Strauss, has been hired by Northern Maine Community College and the federal government to audit the grant-funded projects.

It will take a couple of months to gather the data and produce a report, he said, but he already has a strong feeling about what the bottom line will be.

“I can tell you in very general terms, it’s been a real good payoff,” he said.

Forestry industry boost

Strauss said an investment in a biomass boiler has a “huge multiplier effect” for the public.

“The obvious one is the supply chain,” Strauss said. “You’re creating jobs for the people who are harvesting and transporting the wood.”

According to Robert Fitzhenry of the U.S. Forest Service, during the construction phase, an estimated 335 full-time jobs were created or retained.

There is also a potential for the United States to develop a market to build biomass boilers. Most of Maine’s boilers came from Europe, although local companies have assembled and installed them.

In addition, he said, the $1.2 million that is being pumped into Maine’s forestry industry to buy wood pellets will support 13 full-time forest worker jobs.

Fitzhenry said the program does more than reduce taxpayer heating costs. It also has a ripple effect that stimulates the market for low-value wood, he said.

Maine’s forestry industry has long been focused on the high-value part of the tree — thick trunks and hardwood that can be converted into lumber and wood products.

The wood that’s left behind, treetops, remnants, and small trees culled during woodlot thinning, has much less value.

“Our view is the higher those low-value markets rise, and the more sustainable fuel sources we tap for energy, the better off forest owners, woods-workers and Maine forests are,” Fitzhenry said.

Scott Kinney, 43, and his brother Kevin, 45, have been logging the Maine woods for decades. They use automated equipment that makes it easy for them to harvest the smaller wood, so they are well-positioned to take advantage of the increased wood pellet market.

Kinney said he has seen an improvement in the market since grant-funded biomass boilers began to come online.

“These grants have been wonderful,” he said. “It gave us the diversity of another market for the biomass.”

The increased demand for wood pellets, he said, has given him a steadier source of revenue and allowed him to do jobs for owners of small wood lots who have a hard time finding someone willing to work their land.

“If I didn’t have the increased market to be able to get rid of the supply that was available, those jobs wouldn’t be feasible to me,” Kinney said.

Kinney said he is also aware of positive changes that go beyond his own finances.

(Continued on page 2)

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