Getting on the grid
Nova Scotia's biomass power sector flickers in the distance

by David Lindsay
Representatives for Nova Scotia Power Inc. (NSPI) said by early February at least 10 applicants had come forward to express interest in developing small biomass projects to generate electricity for the utility. The proponents responded to a request for proposals (RFP) issued Dec. 18, 2008. The deadline for providing notice of intent to submit proposals was January 22, the same day NSPI presented a workshop in Halifax outlining interconnection requirements, procedures, timelines, and costs.
"The next step would be to indicate their intention to interconnect to the grid," said Margaret Murphy, NSPI's manager of public affairs. "That would be by mid-February. By July it would be a more complete project description."
The RFP calls for a total of approximately 10 MW of electricity from independent power producers using clean biomass, which is defined as including forestry or agricultural residues; wood from underutilized and otherwise unmarketable species; dedicated energy crops; liquid fuel derived from biomass; or combustible organic material (e.g., untreated lumber) separated from municipal solid waste. NSPI will also consider proposals to burn biogas derived from organic waste.
A draft RFP for biomass power, issued in October 2008, called for a total of 25 MW, based on one large project of about 20 MW, plus a total of 5 MW from several projects of less than 2 MW. But feedback on that document indicated it was onerous for proponents in the latter category, so a decision was made to examine the two types of projects separately.
"We created the distinction because we wanted to encourage small, community-based projects," Murphy said.
The December '08 RFP is specific to "distribution connected projects," which rely on the existing network of power lines throughout the province. While there is no stated size range, technical limitations for this kind of connection effectively restrict the RFP to small-scale projects.
"It depends where it's located; it depends on the lines in the area and how much space there is on the lines," Murphy said. "Distribution lines simply can't take large projects. It's generally going to be limited to 1 MW. You might in some cases be able to stretch it to 2 MW, but in some cases it may be less than 1 MW. It all depends on the lines in that area."
System impact studies will be done by early June to determine these limits for the various proposed sites. In the spring there is also expected to be another RFP calling for an additional 50 MW of biomass power from larger projects requiring "transmission interconnection," which involves power lines capable of carrying extremely high voltage.

TARGET
NSPI currently has an installed capacity is 2,337 MW, and relies primarily on coal to provide power for its 460,000 customers. But under provincial regulations the utility is compelled to purchase more renewable power from independent producers, to help reach the target of 10 percent new (post-2001) renewables by 2013, which should make a total of about 20 percent renewable power.
Jim Verboom, of Verboom Grinders in Truro, N.S., is one of the few operators in the province currently producing biomass. Though he has no intention of becoming a power generator himself, as a potential fuel supplier he has followed the RFP process carefully.
"It seemed to be good up front, at face value," Verboom said, though he suggested it may be a bit of a hard sell, given the challenges faced by forest industry players who are already selling power to the utility.
"New proponents would have to be a little bit skeptical if they don't deal fairly with the existing guys."
He said with rates determined on the basis of this competitive RFP process instead of a standing offer, the opportunity to get into the business may be less than enticing.
"The conflict is, the URB (Nova Scotia Utility and Review Board) is telling them to get the cheapest power they can, and the government is telling them to cut back on their carbon. That's kind of where it's at, and I don't know who's going to budge first. They do have a pretty tight timeline. They've got until 2013 to hit these targets. The power company is going to be pretty pressed to get these plants built by then."
Verboom said these initiatives in Nova Scotia look timid compared to Ontario, where a government commitment to stop burning coal by 2013 has lit a fire under the biomass sector.
"Ontario Power has done some experiments and they've gone quite well. They're planning to blow pellets through their existing facilities. Nova Scotia is looking more toward fine ground biomass rather than pelletizing. Ontario has gone gangbusters. Part of me thinks if Nova Scotia doesn't get moving and speed up a bit, they're going to blow right by us."

FEASIBILITY
Steve Talbot, executive director of the Forest Products Association of Nova Scotia (FPANS), said he did not know whether any of the group's members were pursuing the RFP, but he too senses the response thus far has been less than enthusiastic.
"It is expensive to put together a proposal for consideration by Nova Scotia Power, and there's no guarantee that your proposal will be accepted. There's not a lot of money out there for this kind of thing. Lending institutions are pretty shy on these things right now."
Many people in the industry are skeptical about freestanding biomass-fired power plants, and say the only economically feasible project for an independent producer would be one that generates heat for use at or near the site, in addition to power for the electrical grid. Talbot said FPANS has made an effort to help its members explore this option.
"We put out a tender to develop a template for existing operations, such as sawmills and others, that may be interested in getting into cogeneration ­ that was prompted by the RFP from Nova Scotia Power ­ to see whether it makes sense."
Stantec, an industrial consulting firm with offices in Dartmouth, N.S., won the contract and developed a model based on RETScreen (Renewable-energy and Energy-efficient Technologies) software, which evaluates energy production and savings, costs, and emission reductions.
"It's a little bit more complicated that what we had hoped," Talbot admitted, but the tool is available to members if the level of interest increases.
Stantec representative Bob Chisholm delivered a presentation on the model at the FPANS AGM in January. "It allows an individual sawmill to look at its operation and how much wood waste it has ­ be it be sawdust or shavings or bark ­ and allows it to plug in some numbers like distance or fuel costs, and it factors it all in and tells if it would be feasible to put in a biomass generating facility," he said.
The simplest cogeneration system, best suited to projects in the 2-5 MW range, is the backpressure type, where the process steam is also used to drive the turbine, Chisholm said. The drawback is, "If your kilns aren't drawing any steam, then the amount of power that can be generated is limited."
Slightly more complex, but better for continual operation, is the extraction condensing steam turbine system, with a side stream that draws process steam, independent of the turbine. A cooling tower is required for this type of cogeneration project, but it offers the potential to produce as much as 20 or 25 MW, Chisholm said.
He pointed out that while the model provides important data about the economics of a hypothetical project, "The only thing it doesn't tell you is where to find the capital."
Chisholm also said the RFP process is daunting to prospective independent producers. "What it boils down to is, 'What price can an individual sawmill negotiate for power they're going to produce?' You have to have rate that's guaranteed, and you have to guarantee that you will produce it."