SITING NEW BIOMASS PROJECTS:
LESSONS LEARNED FROM THE PAST
Lawrence J. Golden, Esq.
Pullman & Comley, LLC
Hartford, Connecticut
Ten years ago two wood-to-energy plants proposed to be constructed in Connecticut were in the midst of protracted permitting hearings. Together, these plants were to have provided 45 megawatts of indigenous, renewable energy to the regional grid, reduced deliveries of wood waste to landfills and established a market for silvicultural harvests. The plants were never built.
This paper will describe what happened and why. The lessons learned from the past will hopefully assist project developers, host communities and environmental groups in forging strategies which can lead to the siting and permitting of appropriate new biomass projects which will provide energy and environmental benefits to New England in the future.
I. The Projects.
In the late 1980’s, legislation and regulatory decisions in Connecticut encouraged the development of independent power projects which would sell capacity and energy to the electric company. The goal was to achieve greater energy security and reliability by having smaller, dispersed generating facilities which utilized a variety of fuels. In particular, the state sought to foster the development of renewable energy projects which would use local fuel sources and provide environmental and economic development advantages over fossil generation.
As a result two companies actively pursued the development of wood-to-energy plants. Killingly Energy Limited Partnership (“KELP”) sought to build a 32 MW plant in Killingly, on the eastern border of Connecticut.[1] Bio-Gen proposed a 13 MW project in Torrington, in western Connecticut. The projects intended to utilize wood from forests, recycled wood (e.g. pallets) and demolition debris. Both projects would use direct-fire technology.
II. Project Benefits.
A. Energy Reliability and Capacity. The projects would be fueled by indigenous, renewable resources. Fuel would not be subject to disruption by international events and the price of wood would be relatively stable compared with oil and natural gas. The plants, together with other independent projects, would avoid the need for construction of a combined cycle utility plant.
B. Waste Disposal. Much of the waste wood which would be burned would otherwise have been disposed of either in landfills or in unpermitted sites. Landfill capacity, particularly for bulky wastes, was (and is) scarce. Moreover, land disposal could result in contamination of groundwater. Owners of fuel-grade wood waste would be paid for their product, rather than having to pay a tipping fee for disposal.
C. Value Added to Woodlands. Many of southern New England’s woodlands are small parcels of privately owned land. There is currently little economic incentive for owners to utilize forest management techniques to produce healthier growth. Some of these lands are lost to development because they do not yield an economic return. The wood plants offered to provide a market for silvicultural harvesting from these wood lots, and would have increased their value as open space.
D. Economic Development . Money for fuel would be spent within the region instead of being exported to distant states or countries. Jobs would be created in the wood fuel and delivery industry (owners, loggers, recyclers, transporters). Significant tax revenues would go to the host municipality.
III. Opposition and Support Groups.
Many different types of independent power projects were proposed during this period, including those fueled by coal, gas, hydropower, municipal solid waste, tires and wood. The wood plants attracted the most vigorous and broad-based opposition.
The KELP plant was strongly opposed by the Town of Killingly and its land use agencies, together with a regional governmental agency. In addition, a local citizen group, a nearby medical supply manufacturer and a Rhode Island municipal water supplier also opposed the project.
The Bio-Gen plant was opposed by the City of Torrington and its land use agencies. In addition, a citizen group and local hospital, together with the American Lung Association and the Connecticut Fund for the Environment, actively opposed the project.
Legislators from both eastern and western Connecticut took the lead in trying to stop both plants. A series of legislative enactments played a critical role in the eventual decision by the developers not to build the facilities.
The opponents were well financed, with the host municipalities appropriating significant sums to fund lawyers and consultants to oppose the plants in the permitting process. Some of the largest law firms in Connecticut were retained to oppose one of both the power plants. Local media outlets (newspapers, radio) also joined in opposition.
There was little support for the wood plants at either the local or state level. Small groups of citizens in both towns organized to support construction, but they were greatly outnumbered by opponents. At the state level, there was some support from policy-makers who favored development of renewable resources, but this support was muted in the face of significant political opposition from legislators and local officials.
IV. Basis of Opposition.
Opponents raised a wide variety of issues, some reasonable and some not. Given the nature of the permitting process, opponents know that any one issue which “resonates” can kill a power plant project.
A. Air Emissions. Concerns were raised over emissions of ozone precusors (NOX and VOC), particulates and the relationship of wood smoke and asthma. The intervention of the American Lung Association gave this issue much credibility. The municipal water company claimed that deposition of particulates would contaminate its reservoirs. The medical supply manufacturer argued that emissions would compromise its sterile working environment and cause it to relocate. The use of demolition debris as a source of fuel was a lightening rod for opponents raising air emission issues.
B. Water Use. The larger KELP plant proposed to use “wet cooling” technology and would draw on Class A water supplies. Opponents believed that forcing the plant to utilize “dry cooling” would render it uneconomic, and focused on this issue as a way to kill the project. This was the first time that a non-nuclear power plant’s source of cooling water became a significant issue in Connecticut, and served as a harbinger of battles a decade later with the new generation of merchant plants.
C. Wood Storage. Concerns were raised about management of wood piles, including the danger of fires and fugitive emissions (dust control).
D. Traffic. Truck traffic was a key consideration for both projects. Wood would be chipped at off-site recycling facilities and transported by truck. Concerns were raised about the number of trips, noise, safety and dust. Opponents wanted to restrict truck routes to avoid travel through residential and congested areas.
E. Forest Management. Opponents claimed the wood projects would lead to "clear cutting” and improper forest practices. They wanted suppliers to comply with strict management regulations. (Many states, including Connecticut, have since enacted forest management acts which regulate wood harvesting practices.)
F. Cooling Tower. Cooling tower emissions and concerns about fogging on nearby highways were issues raised by some opponents.
G. Radioactivity. With much fanfare and an “expert” witness, opponents claimed that trees had been contaminated with radioactive fallout from above-ground nuclear tests in the 1950’s and 1960's, and that combustion would release these contaminants into the air.
H. Loss of Local Control. In Connecticut, the siting of most types of power plants is regulated by a state agency (the Connecticut Siting Council), with only limited review by local zoning and inland wetlands agencies. At the time, these municipal agencies were only afforded 30 days to review an application, and any decision could be overturned by the Siting Council. This loss of control angered many in the host communities. (As a result, the statues have been amended to provide for a 65-day review period plus a additional 65-day consultation period. However, the Siting Council may still override a local decision.)
V. Regulatory and Judicial Proceedings.
A. Approval of Energy Contracts. At the time, private power projects had to obtain approval of their electricity purchase agreements from the Department of Public Utility Control (no longer needed under electric industry restructuring). Both KELP and Bio-Gen received approval from the DPUC.
B. Connecticut Siting Council. The Connecticut Siting Council approved the siting and location of both projects following extensive hearings. In each instance the state agency overruled orders from local land use commissions which either rejected the projects or attached rigorous conditions to approvals. Opponents appealed the Siting Council’s decisions to court.
C. Department of Environmental Protection . These projects required a variety of permits from the DEP, including a permit to construct a source of air emissions, water diversion and water discharge permits and a solid waste permit. The DEP held over 20 days of hearings for each project. Final decisions were never issued due to the termination of both projects.
VI. Termination of the Projects.
Near the close of the DEP hearings in the spring of 1992, the DPUC reopened the energy contract proceedings. The purpose was to “revisit” the pricing for both projects, since new projections of the region's need for capacity and energy had raised questions as to whether these facilities were now “needed.” This move by the DPUC raised serious legal issues, since under federal law the energy contracts and their prices were protected from interference by state utility commissions.
At this point, both projects had spent more than four years in the state permitting process. While they could probably obtain legal relief from a “repricing” of their energy contracts, this would take additional time and money. The projects looked to the legislature to resolve the impasse.
The projects jointly prepared a plan whereby their energy contracts would be “bought out” by the electric company. This would enable the developers to receive a return on their investment, and yield ratepayer savings in light of declining estimates of energy and capacity costs. Under the plan, the host communities would be reimbursed for their expenses in opposing the projects, and the sites would be given to the electric company. With the support of the governor and legislative leaders, the buy-out bill was passed and the development of the projects was terminated.
VII. Lessons to be Learned
A. Support of Host Municipality. A project must have political and legal support from the host municipality (and adjoining towns). Local leaders and the public must believe the power plant will be beneficial to their community, and regulatory bodies must give the required approvals. The project’s developers should commence a dialogue with local officials and the public well in advance of the formal approval process. Developers must be prepared to make modifications in response to legitimate public concerns. State override of land use agencies should not be counted on. In fact, with the advent of electric industry restructuring the Siting Council has been more deferential to local concerns, believing that if a community does not support a particular project then another developer will propose a more acceptable project somewhere else.
B. Mitigate Environmental Impacts. The plant should be designed so as to mitigate environmental impacts to the maximum feasible extent. For example, new gasification technology may result in greatly reduced air emissions. Dry cooling will mitigate water use problems. Transportation impacts can be lessened by water or rail options. Not only will regulators be more accepting of such a project, but the number of intervenors and opponents who participate in the regulatory process will be reduced.
C. State Policy-Makers Must Support the Project. The KELP and Bio-Gen projects were undone in large part because key state legislators vigorously opposed the projects and crafted “environmental legislation” whose purpose was to impose insurmountable development barriers.[2] Moreover, while development of renewable resources was (and is) a state policy objective, few in state government were prepared to articulate this policy in the face of specific environmental concerns raised by politicians or regulators. There is clearly a need for a strong “renewable resources advocate” to remind policy-makers and the public that there are important benefits of renewable projects which outweigh their impacts.
D. Select a Good Site. Many land use and environmental concerns can be mitigated by selection of a good site. In addition to the usual criteria (e.g. access to the transmission system), attention should be paid to the fuel transportation and traffic issue, for this quickly becomes a rallying point for opponents. A good site does not guarantee local acceptance,[3] but a poor site will virtually assure significant local opposition.
E. Emphasize the Economic Development Benefits of Using Wood as a Fuel. A wood to energy project is different than most others in that there is a significant local economic benefit in gathering and recycling (or chipping) the wood fuel. Those who log, harvest, chip and transport the wood can form an important base of support.
F. Link the Wood Project with Open Space Preservation. By providing a new economic value to woodlands, a wood to energy project can help preserve open space. This issue, which is so important to people in New England, should be emphasized by project proponents.
VIII. The Future.
Biomass projects are more important than ever. Many states in the region have enacted aggressive renewable resource portfolio standards, and officials are rightly concerned about over-dependence on natural gas. This is the best opportunity in many years for the development of renewable energy. The reality for New England is that biomass is our most readily available and economic renewable resource. The KELP and Bio-Gen projects were lost opportunities, but new technologies and strategies will hopefully lead to renewed biomass power plant development in the future.
