Firms back Millinocket biomass plan

MILLINOCKET – Two “green energy” companies are tentatively proceeding with plans to build a 17-megawatt biomass cogeneration facility worth $50 million that will employ about 45 workers and produce electricity for the New England power grid, investors said Monday.

KMW Systems Inc. of London, Ontario, and First National Power Corp. of Fox Island, Wash., have agreed to assemble legal, environmental and engineering teams to begin the permitting, plant and finance design processes for the Millinocket-area facility, said Jerry Tudan, owner of Peregrine Technologies, which first proposed the facility.

Monday’s announcement might be cause for celebration in the Katahdin region, which has half its population at or below the poverty line and unemployment at double the state average, but Tudan and town officials were deliberately low-key.

“I don’t want to get people’s hopes up until the formal [permitting] review process is complete,” Tudan said Monday.

The companies’ endorsement of Tudan’s proposal – itself culminating about 41/2 years of research for the investors, Tudan, the Millinocket Area Growth & Investment Council and Millinocket Town Manager Eugene Conlogue – doesn’t guarantee the project’s completion.

Many factors could shelve it, including unanticipated permitting issues or costs, changes in the volatile energy market, or simple reconsideration by the two companies, who can pull out of the deal whenever they like, Tudan said.

“We have a green light to go to the first hurdle. They will very cautiously move forward, and if something comes up that presents a stoppage, they will stop,” Tudan said.

“I am very pleased and very encouraged, but this is still just a first step,” Tudan said. “When you’re dealing with financial markets, this is as final as you are going to get until [investors] get the assurances they seek as far as permitting goes.

“After this first stage, we will be jubilant.”

If all goes well with permitting, plant operations should begin 15 or 16 months after permits are issued. As planned, the cogeneration facility would burn about 250,000 tons of tree fiber – mostly wastes – annually in a 24-hour, seven-day-a-week cogeneration facility located at Huber Industrial Park or other locations in and near Millinocket.

The facility could draw partners who could double or triple the number of workers employed with the project by using electricity, steam or heated wastewater to run such operations as a large greenhouse, fishery or wood mill.

The electricity generated by the plant also could power local municipal schools and build-ings, and the plant’s presence could be a draw for other indus-tries that could use what it pro-vides.

Just the two companies’ endorsement, which Tudan said he received Friday, is a significant step forward, Conlogue said.

KMW, which has built about 3,500 biomass systems around the world, including about 120 in North America since 1987, would construct the Millinocket facility. Formerly known as Capstone International Corp., First National focuses on the acquisition and deployment of green energy generation solutions, including propless wind power, water purification and biomass waste energy.

Representatives from the two companies visited Millinocket and Augusta in May as part of their research into the project’s feasibility and reported a warm and encouraging reception.

Monday’s announcement is “most welcome,” Conlogue said.

“It shows the seriousness of their intent and also indicates that the project is financially feasible at this point, and that is also very encouraging news,” he added.

As someone who has occasionally ventured onto local Web forums to tongue-lash residents for what he felt was their erroneous and premature criticism of other fledgling projects, Conlogue counseled patience.

“It is exciting news for us here to know that they have taken that next step, but it takes time to complete the process that they are in, and people don’t want to jump to any conclusions,” he said. “They need to exhibit patience while the company goes through the process.”

If all goes well, the permitting application process should begin in several weeks, Tudan said.