From Paper to Power
The closure of the last paper mill in Berlin, N.H., was devastating, but its ongoing transformation into a biomass power plant is revitalizing the region.
By Anna Simet | August 29, 2012
Tucked into northern New Hampshire’s lush forests along the Androscoggin River lies the city of Berlin, a picturesque town that was once thriving as a result of the early twentieth century pulp and paper industry peak. Nestled in a heavily-wooded area near a plentiful water source, the town was an ideal location for mills, and became home to several during the mid- to late 1800s.
COMING SOON: Burgess Biopower has been under construction for over one year, and is due for commissioning during fall of 2013. PHOTOS BY MARK R. DUCHARME.
Though the paper industry boom has long since dwindled, the town of roughly 10,000 still proudly embraces its tagline “the city that trees built.” At times that may have been more true than some residents would prefer, particularly those who became jobless when the last paper mill—the largest source of employment in Berlin— was shut down several years ago.
But things have turned around since then, and a tree-based business will soon serve as an employment and economic boon to the town. Berlin’s paper mill is alive again, undergoing a major transformation into a wood-fired biomass power plant.
Something Old to Something New
Originally part of Berlin Mills Company, the mill was renamed Brown Company during World War II because of anti-German sentiment. It changed ownership multiple times over the years, last operating under ownership of Fraser Paper, according to Alexandra Ritchie of Cate Street Capital. For many years, it was the biggest job and revenue source in the area.
Cate Street Capital, an investment firm focused on financing green projects, acquired the mill in 2008, acting on the opportunity to convert the existing infrastructure into something else—something the city and region could both benefit from. “It [the 2006 mill closure] was a devastating blow to the area, because there were so many people employed there,” explains Ritchie. “During the [early] development process, we were able to see firsthand what happens when a mill closes, as another area mill temporarily closed.”
Fortunately that mill has since reopened, but Ritchie points out the trickle effect these kinds of closures have on the area economy. “In these towns, the restaurants feel it, the grocery stores feel it, everyone is affected.”
Because Cate Street Capital expressed interest in purchasing the property, the existing infrastructure narrowly escaped deconstruction as it was temporarily owned by a dismantling company. What remained at the heart of the facility was particularly appealing to Cate Street: a Babcock & Wilcox black liquor recovery boiler that had strong retrofit potential. “We realized that would improve the economics and timeline associated with the project,” Ritchie says.
Babcock & Wilcox, which was awarded the engineering, procurement and construction contract, installed the boiler in 1993, replacing two black liquor recovery boilers that needed retirement after a few decades of operation. “So it [the boiler] wasn’t that old,” Ritchie says, adding that it is currently being converted into a bubbling fluidized bed boiler. “It is saving us dollars and time, and it’s an added bonus that Babcock was familiar with the existing infrastructure,” she says. Existing boiler conditions will be upgraded to 575,000 pounds of steam per hour, a near 40 percent increase in steam flow when compared to the original boiler capacity, and the superheater will be completely replaced and upgraded from the original 825 degrees Fahrenheit to 925. Boiler outlet steam pressure will increase from 850 pounds per square inch to 900 psig.
Other systems needed to transform Burgess BioPower into a fully functioning biomass power facility included a new turbine/generator, cooling towers, electrical switchgear with associated supporting auxiliaries, state-of-the-art air quality control systems, and a new wood yard.
About 100 truckloads of fuel will be delivered to the wood yard each day as woodchips, dumped into a fuel storage system that sends fuel directly to a boiler via underground reclaimers. “We might explore the option of chipping on site down the road, but the contract we have in place delivers fuel to the site via truck as chips,” Ritchie says.
Aside from attractive existing infrastructure, replacing jobs that were eliminated with the demise of the area’s pulp and paper industry was another appealing aspect of the project.
Jobs And Public Perception
The 75 MW plant will be one of the largest biomass power facilities in the country when complete, and one of the most important components required to stay on time during the construction of a project of that caliber is manpower. “Yesterday [Aug. 10] there were 275 workers on site, many of them local hires,” Ritchie says. “We’re not at peak numbers yet—that’ll be closer to the 400 mark—but we’re inching up there every week. It’s a very active construction site.”
Not only are hundreds of area construction jobs being generated, but the 750,000 tons of biomass fuel that the plant will require annually represents an incredible amount of jobs in the woods for loggers, foresters and truckers who have seen work opportunities dwindle over the years, Ritchie says. Berlin is situated in the middle of a 6 million-acre wood basket within a three-hour radius of the site, she points out, and it has an established, motivated and highly-skilled workforce that has been involved in paper production for years.
A subsidiary of Delta Power Services LLC, a Babcock & Wilcox company, has been awarded a six-year contract worth more than $19 million to provide operations and maintenance services to the plant, and they will take charge of hiring and training required workers. “There will be a lot of synergies with jobs,” Ritchie says, “but Delta will be taking applications in early 2013 to assemble an operating team for when it goes online later in the year.” That team will consist of about 40 full-time, benefitted workers.
Cate Street put forth all efforts to communicate its plans to the public during the development process, an essential, but often tumultuous and time-consuming piece of a successful project. Ritchie says how residents have reacted has been very fortunate. “It’s three-plus years in the works, and we have been really lucky to have a great core support system, people who understood the vision.”
They [area residents] have been dependent on paper production for many years and have seen it start and stop so many times. They could see that this was a new and viable industry that would operate on long-term offtake agreements to provide some stability in terms of employment and revenue generated.”
The education process not only included listening to citizens and understanding their concerns, but getting to know local officials, including the town mayor.
PPA’s, Financing and the Future
Berlin Mayor Paul Grenier, a champion of the project who was recently elected for a second term, has voiced his strong support throughout development of the project, describing the city of Berlin as a regular, blue-collar-folk community that would prosper from the plant’s development. “The fortunes of this property will dictate the strength of the city,” he said during a tour of the plant site. “This property will never be a beautiful housing project; this property will always be a means of putting people back to work, so we can prosper as a blue-collar community again.”
Grenier was a driving force for the project and saw what it meant to the area, according to Ritchie. He played a role in helping Burgess BioPower secure a 20-year power purchase agreement with Public Service New Hampshire, which was a temporary hiccup in development. A handful of independent biomass power producers in the area were afraid the new plant would prevent the PSNH from purchasing their power due to the way the state’s renewable portfolio standard is set up, but the issue was collectively resolved through an agreement between the power producers, PSNH and Cate Street. The facility itself will use about 10 MW for operations; the remainder will be sold to the PSNH.
Further demonstrating the solid economics of the project, Cate Street was able to secure what is known as an investment grade rating (BBB-), which is challenging to obtain in today’s market. “It’s a very complex, $275 million financing package and it incorporates the use of senior debt, New Market Tax Credits and also the Section 1603 [cash grant exchange] program,” Ritchie says. “We capitalized on the different tools available to us to assemble a really unique package that would get us funded and across the finish line.”
While the plant still has roughly one year of construction left before its operating, great progress has been made, and it’s continuing every day. “We’re finishing up foundation work, and steel and boiler work is being done right now,” Ritchie adds. “It’s a busy, bustling site.”
Author: Anna Simet
Contributions Editor, Biomass Magazine
Link to Original Article
Reprinted with permission.
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