Legislature(2011 - 2012)BARNES 124
03/06/2012 03:00 PM House ENERGY
| Audio | Topic |
|---|---|
| Start | |
| Presentation: Tok Biomass Project | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| * | HB 323 | ||
| * | HB 336 | ||
| * | HB 357 | ||
ALASKA STATE LEGISLATURE
HOUSE SPECIAL COMMITTEE ON ENERGY
March 6, 2012
3:05 p.m.
MEMBERS PRESENT
Representative Neal Foster, Co-Chair
Representative Dan Saddler
Representative Pete Petersen
Representative Chris Tuck
MEMBERS ABSENT
Representative Lance Pruitt, Co-Chair
Representative Bob Lynn
Representative Kurt Olson
OTHER LEGISLATORS PRESENT
Representative Tammie Wilson
COMMITTEE CALENDAR
PRESENTATION: TOK BIOMASS PROJECT
- HEARD
HOUSE BILL NO. 323
"An Act relating to the Alaska energy efficient home grant fund;
and creating a grant program for converting homes in regions
designated as particulate matter nonattainment areas to
efficient home heating systems."
- BILL HEARING POSTPONED TO 3/13/12
HOUSE BILL NO. 336
"An Act establishing an energy assistance program in the
Department of Revenue to issue an energy voucher to Alaska
permanent fund dividend recipients; and relating to the analysis
and recommendation of an energy assistance program by the
governor."
- BILL HEARING POSTPONED TO 3/13/12
HOUSE BILL NO. 357
"An Act establishing the sustainable energy transmission and
supply development program in the Alaska Industrial Development
and Export Authority."
- BILL HEARING POSTPONED TO 3/13/12
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
DAVE STANCLIFF
Stancliff Consulting
Tok, Alaska
POSITION STATEMENT: Speaking as a consultant for the Alaska
Gateway School District and Alaska Power & Telephone (AP&T),
presented information on Tok and Tok School, and answered
questions.
JOHN "CHRIS" MAISCH, State Forester; Director
Division of Forestry
Department of Natural Resources (DNR)
Fairbanks, Alaska
POSITION STATEMENT: Gave a PowerPoint presentation entitled,
"Woody Biomass Update" dated 3/6/12, and answered questions.
THOMAS DEERFIELD
Dalson Energy, Inc.
Anchorage, Alaska
POSITION STATEMENT: Speaking as consultant to Alaska Power &
Telephone (AP&T), described his task and answered questions.
TODD POAGE, Superintendent
Alaska Gateway School District
Tok, Alaska
POSITION STATEMENT: Presented a short film that depicted a fire
in Tok and the history of the biomass project at Tok School.
ACTION NARRATIVE
3:05:53 PM
CO-CHAIR NEAL FOSTER called the House Special Committee on
Energy meeting to order at 3:05 p.m. Representatives Foster,
Tuck, Petersen, and Saddler were present at the call to order.
Representatives Pruitt, Lynn, and Olson were excused.
Representative T. Wilson was also present.
^PRESENTATION: TOK BIOMASS PROJECT
PRESENTATION: TOK BIOMASS PROJECT
3:06:47 PM
CO-CHAIR FOSTER announced the only order of business would be a
presentation on the Tok Biomass Project.
3:07:07 PM
DAVE STANCLIFF, Stancliff Consulting, said he was a consultant
for the Alaska Gateway School District and Alaska Power &
Telephone (AP&T), and also the vice-president of the Tok Chamber
of Commerce. He informed the committee that Tok is in the
unique position of having a tremendous amount of resource that
threatens its safety; however, the community has found a way to
harness that resource for the benefit of its school. Biomass is
now heating Tok School and providing its electricity, whereas
the school district used to spend more money on heating and
lighting than on classroom instruction. Mr. Stancliff said Tok
is not connected to other electrical grids in the state, and was
forced to find solutions to the high cost of energy. He said
the first part of his presentation would be through a DVD video
entitled, "Alaska's Green Gold," produced by the Division of
Forestry, Department of Natural Resources (DNR), followed by
updates on projects, and the measurable results from funding
previously provided by the legislature. Mr. Stancliff concluded
that these results are not only related to power, but to the
wellbeing of the Tok community and to the education of its
children, because Tok School now has a music teacher and a
counselor paid by the money saved using renewable energy.
3:10:56 PM
There followed a video presentation from 3:10 p.m. to 3:28 p.m.
3:28:49 PM
CO-CHAIR FOSTER commended the video.
3:29:18 PM
JOHN "CHRIS" MAISCH, State Forester; Director, Division of
Forestry, DNR, began a PowerPoint presentation entitled, "Woody
Biomass Update," dated 3/6/12. Mr. Maisch said his presentation
would provide a perspective on biomass projects that are in
other areas of the state. Slide 1 was a map that depicted woody
biomass projects currently operational, under construction,
under design phase, and under feasibility study throughout the
state. He pointed out that the first larger scale chip project
that came online was at the Craig School on Prince of Wales
Island, followed by Tok School, and Delta High School in Delta
Junction. At this time, Tok School is the only combined heat
and power operation. Also, there are many GARN boiler projects
- using solid wood that is hand fed twice per day - in Tanana,
Gulkana, Coffman Cove, and Thorne Bay. Mr. Maisch stressed that
there are many types of systems and their scale should be sized
for the resource, the community, and the heat load. Slide 2 was
a picture of the Delta High School Wood Chip Boiler Space
Heating Project which was completed for $200,500,000 with an
appropriation of $200,000,000 from the Alaska Energy Authority
(AEA) and a capital appropriation from the legislature for
$800,000. The boiler is fueled by white spruce wood chips from
Logging and Milling Associates' slab wood waste material
delivered at a cost of $64.20 per ton.
3:32:34 PM
MR. MAISCH explained that biomass is measured as a green ton or
a bone dry unit. Because the slab wood is already processed in
a kiln, the wood chips are 18 percent moisture content (MC),
which is drier than normal. Slide 3 was a picture of the Hurst
Boiler installed at the Delta School. The school's 2011 heating
oil consumption was 24,000 gallons, and on a British thermal
unit (Btu) basis, one ton of chips at an 18 percent MC equals
106 gallons of fuel oil, thus the cost savings is about 85
percent. Slide 4 was a picture of the Sealaska Corporation
wood pellet boiler that heats the Sealaska Plaza building, and of
wood pellets being delivered to the storage bin, which auger
feeds the pellets by an automated system. Turning to the role
of the Division of Forestry in woody biomass development, he
stressed that the forestry division must ensure current forest
inventories in the state forest and other lands that are managed
by the division. For AEA, the division must calculate the wood
supply for proposed projects to ensure the supply is sustainable
and economic over time, and write a report. The division also
helps communities with jobs, reduces wildland fire risks,
improves habitat, and offers local energy solutions. Finally,
regarding the Alaska Power & Telephone (AP&T) project, the
division is developing a 25-year, long-term contract for woody
biomass to supply the proposed two megawatt (MW) power facility
in Tok, including the best interest finding and a timber sale
that would commit a resource for that facility.
3:36:10 PM
THOMAS DEERFIELD, Dalson Energy, Inc., said he is representing
Alaska Power & Telephone (AP&T). His company is part of a team
contracted by AP&T to conduct a full scale, investment-grade
feasibility study of a two MW combined heat and power (CHP)
facility in Tok. Alaska Power & Telephone is a leader in
utility conversion to renewable energy, converting from almost
100 percent fossil fuel generation in 1999, to over 70 percent
renewable energy power in 2012, mostly generated by small
hydropower. Several years ago the utility began to study
biomass CHP operations around the world and in the Lower 48.
Currently, the upper Tanana area is an isolated power grid, with
a two MW generation station in Tok that pays the highest fuel
cost for power generation in the state at over $4 per gallon,
yielding power at over $.50 per kilowatt (kW) hour. The utility
has researched alternatives such as small hydro, hydrokinetic,
wind turbine, and solar, all of which have limitations. A
prefeasibility study of biomass CHP "looked positive," so the
utility and AEA are funding further study. Some of the benefits
of biomass are that it is on-demand power - not dependent upon
wind or sun - that is fueled by local fuel and local labor,
keeping approximately $1,000,000 per year in the community to
pay for local feedstock supplied by local harvesters. Also, the
cost of power will be stable and significantly lower; perhaps 30
to 40 percent lower than fossil fuel. There is state support
for the project through AEA, and federal support is possible -
with quick action - through Rural Development, the Farm Service
Agency, and the Forest Service, U.S. Department of Agriculture,
and the National Renewable Energy Laboratory (NREL), U.S.
Department of Energy.
3:41:40 PM
MR. DEERFIELD cautioned against comparing the project to
conventional energy because renewable fuels cannot compete with
the Btu density of fossil fuels, but fossil fuels are no longer
cheap. The cost of operation and maintenance (O&M) is higher
with all forms of biomass; however, O&M also creates local jobs.
He advised that the feasibility study is dependent upon the
long-term biomass harvest contract from the Division of Forestry
mentioned by the previous speaker; the need is for 25,000 green
tons harvested per year for 25 years to secure the financing for
the project. In addition, his company is working on site review
and technology review, which looks at all of the commercially
available and reliable forms of small-scale CHP technology
appropriate to Tok's climate. Permitting, environmental, and
financial analyses will follow, and the report is expected by
the end of June.
3:43:30 PM
TODD POAGE, Superintendent, Alaska Gateway School District, said
he has been the superintendent for five years.
There followed a video presentation from 3:44 p.m. to 3:54 p.m.
3:55:09 PM
MR. POAGE said the low-speed electrical turbine is now
operational and is generating 20 kW of electricity. Through
further testing and development, it is hoped one-half of the
school's electricity will be generated by the turbine, in
addition to the by-product of heat used for space heating.
3:56:13 PM
CO-CHAIR FOSTER observed the school does not benefit from power
cost equalization (PCE).
MR. POAGE said correct.
REPRESENTATIVE TUCK asked how many schools are served by the
Alaska Gateway School District.
MR. POAGE answered there are seven schools and a correspondence
program that serve approximately 400 students in the district.
In further response to Representative Tuck, he explained the
turbine and boiler described are a source of power for Tok
School. However, the district has applied for a grant from AEA
in the amount of $750,000 to run a heat loop to the multi-
purpose building in Tok.
REPRESENTATIVE TUCK asked how the electrical wattage was
increased from 20 kW to 40 kW.
MR. POAGE explained bigger air fans were added to keep the
combustion cooler, so that all of the wood is burned and there
is no smoke. In further response to Representative Tuck, he
said the boilers will last for 25 years to 35 years, and they
can be reconditioned.
3:58:09 PM
REPRESENTATIVE SADDLER asked for the source - and the timeline -
to obtain federal funds.
MR. DEERFIELD advised 2012 requests for proposal (RFP) from
federal agencies are open. Historically, communities look to
NREL and USDA agencies such as the Farm Services Agency, the
Forest Service, and Rural Development.
REPRESENTATIVE SADDLER asked whether harvesting this amount of
spruce would lead to any environmental or forest health
detriments.
MR. MAISCH assured the committee this is a sustainable activity,
with an allowable cut to ensure the fuel supply is available in
perpetuity. There may be opposition from a minority viewpoint.
In further response to Representative Saddler, he confirmed this
harvest is black spruce; however, in Southeast, the fuel may
come from harvested old growth timber, which leads to
opposition. Furthermore, in the Interior, fire danger is a
factor; in fact, spruce is known to firefighters as "gasoline on
a stick."
REPRESENTATIVE SADDLER asked for per unit costs of the chippers
and boilers.
4:01:58 PM
MR. STANCLIFF said the chipper was $375,000, plus the log
loader. The chipper can be shared with other communities and
schools. He pointed out all of the schools that are adding
biomass equipment are trying to make the equipment and training
compatible to save money. In further response to Representative
Saddler, he said in order to prevent air pollution, pellets,
briquettes, and dry cured wood all are about 12 to 14 percent
MC, ideally. However, in a biomass boiler, it is desirable to
have chips with a 20 percent to 50 percent MC.
4:04:17 PM
REPRESENTATIVE T. WILSON asked whether the university project to
measure trees growing in Tok is still underway.
MR. MAISCH said the University of Alaska (UA) has an active
Growth and Yield program. The Tok experimental forest is a unit
within the State Forest and there is an ongoing agroforestry
species trial comparing the growth of lodgepole pine with that
of spruce during drier climate conditions. He noted financial
support has been requested for this type of research in biomass.
In further response to Representative T. Wilson, Mr. Maisch
explained that the 25-year contract the division is working on
now uses its authority to sell timber for a period of up to 25
years. The division must write a forest land-use plan for the
area, a best interest finding, and a draft contract for the
purpose of negotiation. He expected this work to be completed
in draft form for public comment in June.
4:07:00 PM
REPRESENTATIVE T. WILSON asked whether this process is required
for each project. For example, how does the division work with
AEA and advise different communities on which fuel and equipment
is best for them.
MR. MAISCH answered that the division practices due diligence.
The role of the division is on the supply side: to supply the
raw materials for these types of projects. The division also
has expertise on the types of fuels and harvesting systems,
which is the forest management aspect of a project. At the
beginning of the project under discussion, the division
recommended AP&T engage a forestry consultant so that there was
a common language between the parties. The division is also
capable of data analysis and can provide technical assistance to
AEA to ensure that the fuel supply is sustainable, available,
and economic for a specific project.
4:11:09 PM
MR. POAGE, in response to Representative T. Wilson, said the
district's electrostatic precipitator came from Germany, but was
purchased through another company. Every two weeks the ash is
easily dumped from barrels underneath.
MR. MAISCH suggested that Representative T. Wilson could tour
Sealaska's electrostatic precipitator.
REPRESENTATIVE T. WILSON has heard that installation was
difficult.
Due to technical difficulties, the committee took a brief at-
ease.
REPRESENTATIVE T. WILSON understood the installation of
electrostatic precipitators in chimneys would help the air
quality in Fairbanks.
MR. POAGE restated his earlier response for the record.
4:12:13 PM
REPRESENTATIVE PETERSEN expressed his belief that to apply for
an AEA grant, one needs to have a financial feasibility study.
He then asked whether the trees left standing grow faster after
the undergrowth is cleared.
MR. MAISCH said yes; reducing competition for water, sunlight,
and nutrients in a stand of trees encourages growth in height
and diameter. However, clearing underbrush is mainly done to
create a defensible space around a home, and make a safe place
for firefighters to work. In further response to Representative
Petersen, he added that the trees left are more esthetic, or can
be harvested by the homeowner for firewood.
4:14:43 PM
REPRESENTATIVE PETERSEN asked for confirmation that biomass
boilers can use a mix of wood chips and solid waste.
MR. STANCLIFF said yes. He added that wood chips can also be
mixed with coal, and this process is called co-firing.
Locally, there is concern among harvesters of firewood, house
logs, and saw logs, about the loss of wood supply; however,
working roads to the biomass supply will increase access to
other commercial trees. The typical biomass fuel is four-inch
to eight-inch diameter trees, and "is not going to eliminate
these other multiple-uses of our wood resources."
REPRESENTATIVE PETERSEN observed Eielson Air Force Base uses a
mix of coal and garbage in its boiler.
MR. MAISCH, in response to Representative Petersen, said in
hazardous fuel mitigation areas there is a 25-year to 30-year
short rotation in spruce, but normally the cycle in the Tanana
Valley State Forest for spruce is 100 years, and 80 years for
birch and aspen. For areas where the division has taken black
spruce out of a fuel break, aspen sprouts first, and spruce
takes over at age 60 years, thus the intent is to mow down the
hardwoods on a 20-year to 30-year cycle, and also create good
browse for moose.
MR. STANCLIFF added that the nutrient layer down to 18 inches
can be sterilized by a very hot fire, causing regrowth and
regeneration to be slower than if man cuts down the trees.
Worldwide, biomass research has found that planting trees -
which accelerates regeneration - is carbon positive, even though
biomass is considered as carbon negative. He reminded the
committee that in Tok, the trees will burn in wildfires if they
are not cut.
4:20:05 PM
REPRESENTATIVE SADDLER asked whether the Department of Natural
Resources (DNR) area plans for the best use of land encourage or
inhibit this action.
MR. MAISCH said no. The division works with the area plans as
they are updated; for example, the Tanana Basin Area Plan has
been divided into the Yukon Tanana Area Plan and the Eastern
Tanana Area Plan. The Tanana Valley State Forest is not
affected by an area plan, and there is pending legislation to
designate more land to the State Forest. The division seeks to
aggressively participate in updating the area plans to ensure
that forestry is discussed.
4:21:46 PM
REPRESENTATIVE SADDLER asked for the best classification for
land in order to facilitate woody biomass power generation for
heat.
MR. MAISCH responded that land in a State Forest is the
strongest way, or land classified for forestry use in area
plans, although classifications are subject to change over time.
In further response to Representative Saddler, he said there is
no prohibition, but there are co-classifications, such as
"allowed use." In Tok, the lands are classified as settlement
lands and concurrence must be obtained from the Division of
Mining, Land & Water, DNR, for access.
4:23:45 PM
CO-CHAIR FOSTER asked whether there are obstacles to using
driftwood.
MR. DEERFIELD explained there was a pilot project in Stebbins to
test both the long-term sustainability of volumes of driftwood,
and the ability of boilers to safely and cleanly combust wood
that has been embedded with salt. The questions have not yet
been resolved.
REPRESENTATIVE PETERSEN asked whether underbrush could be
cleared on designated parkland to protect it from fire.
MR. MAISCH recalled the division has done hazard fuel mitigation
on some parkland, in concurrence with the Division of Parks and
Outdoor Recreation, DNR; however, these projects have not been a
large commercial harvest.
4:26:36 PM
REPRESENTATIVE SADDLER asked what is required from the
legislature for continued success.
MR. STANCLIFF listed many projects in Vermont and opined they
are successful because the [Vermont] Division of Forestry had
the resources available to stay ahead of the demand. He opined
in Alaska the economic and social benefits of biomass will cause
demand for these systems to grow quickly. He also cautioned
that funding must be limited to sound projects without failures.
In addition, his experience is that the DNR office in Tok is not
fully staffed.
4:29:25 PM
REPRESENTATIVE PETERSEN suggested adding garbage to lengthen the
sustainability of the biomass material available.
MR. STANCLIFF advised that everything burns at some temperature;
in fact, in Sweden, utilities collect the refuse, process it,
and generate power at minimum expense to the utility. This is
not an opportunity for Tok, but is for Anchorage.
MR. MAISCH informed the committee the division has submitted a
capital budget request in the amount of $200,000 for the Tok
Long-Term Timber Sale for Biomass Energy.
MR. DEERFIELD opined that the state will be heating all of its
rural schools - and the majority of its community buildings -
with biomass, as fossil fuels escalate in cost. Although the
infrastructure is not in place in Alaska, the technology is
widely established in the Lower 48, Canada, and Europe. He
compared the time needed to reforest with the time needed to
produce oil or gas.
4:34:16 PM
REPRESENTATIVE TUCK referred to slide 1 of Mr. Maisch's
presentation and asked whether the eight operational facilities
in Alaska have to import wood pellets or are self-sustaining
with local wood.
MR. MAISCH said they are all self-sustaining operations, using
waste wood from sawmills or local wood from vendors.
REPRESENTATIVE TUCK asked where Tok School gets its power now.
4:35:20 PM
MR. STANCLIFF stated that prior to the biomass conversion, and
to a degree now, Tok School and the 1,200 residents of Tok got
power from the AP&T main grid located about 20 miles from the
center of town. This power supply is approximately 1.5
megawatts (MW), and when there is a fire, power goes out and
there is no communication possible from the communication tower
to the Public Department of Public Safety, the Department of
Transportation & Public Facilities, and other emergency
services. Now, however, the independent power system from the
school can back up the communications system. The power from
the school will have to be balanced with AP&T on the grid to
ensure that the cycles are the same.
4:37:10 PM
REPRESENTATIVE TUCK asked whether there will be an opportunity
for the school to sell power on the grid during the summer.
MR. POAGE advised the peak demand of the school is 150 kilowatts
(kW), and the system seeks to produce between 50 kW and 65 kW
which is one-third of the peak demand rate. He said there is no
agreement with AP&T, but AP&T allows the school to run the
electricity it produces through its line into the school, thus
it is not a closed circuit. The ultimate goal is to "have some
type of net metering in place." In further response to
Representative Tuck, he said peak demand in the summer is about
80 kW, and "at this time, none of what we've been creating has
gotten past Tok School."
4:39:04 PM
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on Energy meeting was adjourned at 4:39 p.m.
| Document Name | Date/Time | Subjects |
|---|