Tuesday, February 7, 2012

Current biomass and biogas projects under development in Saskatchewan

A. What are the type and scale of projects currently going forward in Saskatchewan?

There are currently 5 biomass and biogas projects under development in Saskatchewan which have been publicly announced. There are other projects under development for which details have not been publicly announced.

1. 35 MW biomass plant at Meadow Lake

Meadow Lake Tribal Council (MLTC) has signed a deal with SaskPower for a 35 MW biomass project and received a power purchase agreement (PPA). The new Meadow Lake-area biomass energy facility is scheduled to reach COD in 2014.

The MLTC has signed a deal with SaskPower with the intent to create a new biomass power generation facility in the area creating 300 jobs, 25 of which will be permanent jobs at the facility.

SaskPower Energy and Resources Minister Rob Norris explains the biomass centre will be a greener way to generate power for the company's grid. The biomass procedure will provide a use for the material cast off from the forestry industry.

“We know that as a growing province we are going to need more energy,” said Norris. “It helps us work with another partner ensuring that Saskatchewan has energy security and at the same time work closely with the first nations.”

The proposed facility is expected to create enough energy to power 36,000 homes for a full year.

2. Prince Albert Biomass cogeneration project at pulp mill

The CEO of SaskPower, the utility purchasing the excess generation and the general manager of P.A. Pulp, the generator, have announced that the two companies intend to have the biomass cogeneration power facility at a pulp mill in Northern Saskatchewan delivering electricity to the grid by late May 2012. Details have not yet been released regarding the generation capacity of the biomass cogeneration plant.

Dale Paterson of P.A. Pulp, said that when negotiating the contract for the recent sale of the pulp mill, part of the agreement was that the mill would provide “green energy” to SaskPower’s grid. “We’re working to generate green energy by (some time in) May,” said Paterson. “We started in September and we‘re about halfway there now. $5 million dollars has been spent on the project (so far) and another $5 million will be spent (in the coming months),” Paterson added. Paterson explained that the pulp mill’s biomass boiler and a turbine will be producing the power generated at the mill. About 21 people who were previously employed by the mill are being hired to provide maintenance on the cogeneration project, Paterson said. The power will be used to operate the mill itself and the excess power will be sold to SaskPower. As well, producing energy is integral to getting the mill ready to produce dissolved pulp in about a year and a half (the third quarter of 2013), as the energy produced on-site will provide much-needed heat for construction crews undertaking the work, explained the mill’s general manager. “We’re very happy to be working cooperatively with SaskPower to have this (project) operational (by May),” Paterson said.

In speaking with Robert Watson, the CEO of SaskPower, Mr. Watson reiterated that the corporation signed an agreement with Paper Excellence (the company that purchased the mill) regarding the co-generation project. “We’ve had meetings with them regarding the timeline and the technical issues involved,” stated Watson. In terms of the technical issues, Watson explained that the distribution of the power must be fine tuned—meaning, the excess energy generated by P.A. Pulp can’t just be pumped onto the grid heedlessly - rather, it needs to be “balanced” or specific areas would be affected and blackouts could occur. “We’re going to accommodate them when they are ready,” said Watson, in reference to the mill’s plan to be producing power by late May. “We have told our employees that we will be accepting power generated at (P.A. Pulp) onto our grid. We need the power, so we are willing to take it (once the mill is able to generate it), said Watson. Watson said that utilizing cogenerated power projects, such as the one with P.A. Pulp, is a cost-effective means of obtaining power. When asked if the Crown corporation had other cooperative projects underway in the province, Watson said there were a few, such as one at Potash Corp’s Cory Potash mine, east of Saskatoon.

It is expected that other mining companies planning to build mines in Saskatchewan such as BHP Billiton, Vale and K & S are also considering onsite cogeneration facilities at their mine sites.

3. Nipawin Biomass Cellulose Ethanol project overview

Developer: Nipawin Biomass Ethanol New Generation Co‐operative Ltd. (“Nipawin Biomass”)

Location: Town of Nipawin in North-East Saskatchewan, Canada

Type of facility: Biomass cellulose ethanol plant

Strategic Partners:

1. Saskatchewan Research Council (“SRC”)
2. Fulcrum BioEnergy, Inc.
3. Shore Gold Inc.

Feedstock: The facility will process non‐merchantable waste timber and local farm fibre (flax/straw) into ethanol. The facility will require approximately 200,000 oven dried metric tonnes of cellulosic fibre per year, approximately two‐thirds of which would come from forest residue supplied by Shore Gold Inc. and the remainder from farmers in the local area. Shore Gold Inc., a mining company developing a nearby diamond mine have entered into an MOU with Nipawin Biomass to deliver the excess trees to the facility to be converted to ethanol. First Nations people and businesses will be involved in the clearing, removal and transportation of the waste wood.

Pre-feasibility Study complete? Yes.

Proposed capacity: 75 million litres/year

Estimated capital budget: $30-50 million CAD

Proprietary technology: Nipawin Biomass and SRC have jointly developed a proprietary conversion technology which will process synthesis gas from waste wood and farm fibre, such as flax fibre or straw, into ethanol and other alcohols.

Why this project is important: The facility will be among the first in the world to convert cellulose into ethanol. The catalytic conversion process developed by Nipawin Biomass and SRC is being integrated into California-based Fulcrum Energy Inc.’s proprietary process for converting municipal solid waste into ethanol. Fulcrum is on track to complete their first plant in 2013 in Nevada and will become one of the first companies to commercially produce ethanol from municipal solid waste.

Current status of project: Nipawin Biomass and SRC signed an agreement in fall 2011 to help complete the cellulosic ethanol plant. The agreement outlines the next series of development requirements for engineering support to advance the design for the Nipawin Biomass cellulose ethanol facility. SRC is currently undertaking this work and a report is expected in 2012.

Next steps: Once Fulcum completes their first plant in Nevada, Nipawin Biomass aims to follow closely behind Fulcrum and to be ready to begin construction of their facility in Saskatchewan within a few months of completion of the Nevada facility.

4. City of Saskatoon Landfill gas project

The City of Saskatoon, through its electric utility - Saskatoon Light & Power and the Environmental Services Branch, is developing a Landfill Gas Collection System at the City Landfill Site. Collected LFG will be piped to a Power Generation Facility adjacent to the landfill. The LFG will then be used to fuel internal combustion engines. The engines are coupled to electrical generators to produce power that will be fed to Saskatoon Light & Power's electrical grid. This project has the potential to reduce annual greenhouse gas emissions by over 90,000 tonnes per year (equivalent to removing over 16,000 vehicles from our roadways) and provide enough power for up to 2,600 homes. The capital cost of the project is $10 million and will be operational by 2012. The project is partially funded (50%) by the Governments of Canada and Saskatchewan through the Canada-Saskatchewan Provincial-Territorial Base Funding. Detailed design of the facilities is underway. A competitive procurement process for construction of the project is currently underway. It is expected the facilities will reach COD in 2013.

5. City of Regina Landfill gas project

The City of Regina is currently collecting and flaring landfill gas and has plans to connect a generator in the near future.

B. Are there any projects in Saskatchewan that involve refining value added production like bioplastics and food additives?

I am not aware of such projects but I know of plastics manufacturers in Saskatchewan recycling plastic waste for reuse and new production.

C. Is the government of Saskatchewan doing anything to encourage development of the emerging biomass/biogas sector?

Yes, the government controlled monopoly utility SaskPower has committed to providing up to 25 MW of Power Purchase Agreements to biomass and biogas projects every year in the province through the Green Options Partners Program.

SaskPower has also committed to providing PPAs for First Nations biomass and biogas projects such as the 35 MW First Nations PPA in Meadow Lake and the cogen PPA in Prince Albert. It is anticipated that with the cooperation of the newly created First Nations Power Authority in Saskatchewan many new biomass First Nations projects will move forward in the near future supported by PPAs from SaskPower. The government of Saskatchewan has also publicly expressed support for First Nations energy projects.

D. Are there any notable collaborations between the oil and gas industry (or any other "traditional" industry) and the biomass industry?

Paper Excellence, a Dutch company is selling electricity to SaskPower generated from their biomass plan producing cellulose fiber for manufacturer of cloth and other clothing items.

Veresen Inc. owns and operates four, 5 MW waste heat power generation units located adjacent to compressor units on the Saskatchewan segment of the Alliance pipeline.

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