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We Energies, Domtar biomass plant decision to come soon

By Anna Austin | June 16, 2011

The verdict on whether a 50-megawatt, woody biomass-fired cogeneration plant in Rothschild, Wis., will move forward is still out, but a decision will be made soon.

Despite several reports that power utility We Energies and paper manufacturer Domtar Corp. had already begun construction of the plant, spokesman Barry McNulty said that was not the case, as Domtar is still mulling over the project’s revised financial plan.

Early in May, the Public Service Commission of Wisconsin approved plans for the $255 million plant, but ordered the companies to come up with $10 million in additional concessions to lower the cost to We Energies’ ratepayers. A revised plan still under review by Domtar modifies the arrangement between the companies, and requires the company to increase its capital cost allocation of $22 million to $47 million, upping the steam payment to We Energies by 20 percent. That would save ratepayers about $2 million in annual capital recovery costs.

“We received approval and have indicated we’ll move forward with what’s necessary on our end, but we’re waiting for our partner (Domtar) to give its approval on moving forward,” McNulty said.

Domtar has taken the revised plan to its board of directors, which is expected to make a decision sometime in mid-June.