Alternative Energy to face fines of $600,000

CHESTER – The Board of Environmental Protection today is expected to fine a Bangor-based energy company $600,000 for air emission violations at three wood-fired power plants.

Chris Hutchins, president and owner of Alternative Energy Inc. of Bangor, has agreed to the fine as recommended by staff at the Maine Department of Environmental Protection for violations of air quality licenses at power plants in Chester, Ashland and Livermore Falls.

The Board of Environmental Protection, which oversees the DEP, is expected to approve or deny three separate consent agreements – one for each plant – during its meeting Thursday.

The agreements call for penalties of $134,000 for violations at the Chester plant, penalties of $276,000 for violations at the Livermore Falls plant, and penalties of $190,000 at the Ashland plant.

Kurt Tidd of the DEP’s Air Bureau said the consent agreements stemmed from violations of conditions of the air quality licenses and for failing to meet certain reporting requirements. He said some of the violations dated back to 1995.

Earlier this month, Alternative Energy sold two of the three wood-fired power plants to a Quebec-based company. Boralex Inc., an independent producer of electricity, purchased the Ashland and Livermore Falls plants from Alternative Energy for $26.5 million.

Boralex owns and operates 16 generating stations, which produce energy from wood-residue, natural gas, co-generation facilities and hydroelectric power stations. The company owns three other generating stations in Maine in Stratton, Athens and Fort Fairfield.

Boralex employs 200 people among all of its plants and has the capacity to produce 300 megawatts of power.

Tim Fitzgerald, Alternative Energy’s general manager, said 75 percent of the fines were caused by lower managers not paying attention.

“What they are is wood stoves so there is nothing nasty coming out,” he said of the three wood-fired plants. “It’s just above what our license was. Our license limits are lower than Wyman Station, an oil-fired facility in southern Maine. We are getting fined for stuff that is way below what Wyman is allowed to do.”

Alternative Energy shut down the Chester plant on April 20 and surrendered its air quality license to the DEP in August.

Fitzgerald said the company was forced to shut down the Chester plant, which employed 17 people, because of a substantial increase in the price of wood fiber. “The price of fuel [wood fiber] between December and January went up 75 percent,” he said. “Fuel prices are 70 percent of our costs. When that goes up 75 percent, that is a big hit.”

Fitzgerald said the plant was closed for several years, but was reopened last June after the company acquired a “good” contract. He said the plant was running at full capacity until fiber prices escalated making it uneconomical to operate.

The Chester plant had the capacity to produce 15 megawatts of electricity, or enough energy to power about 20,000 homes, said Fitzgerald. He said the company plans to dismantle it and sell the parts.

The general manager said the cost per megawatt hour to operate the Chester plant was almost double compared with the Ashland plant, which produces 34 megawatts.