Wood chips from low-value trees eligible for RECs in NC

By Lisa Gibson | August 16, 2011

The Appeal Court of North Carolina has unanimously turned down an appeal against a decision by the North Carolina Utilities Commission to allow the inclusion of wood chips derived from low-value whole trees in the state’s renewable energy definition.

In late 2010, power utility Duke Energy requested that cofiring wood chips derived from lower-value whole trees be eligible for renewable energy credits (REC) under the state’s renewable energy standard. The Environmental Defense Fund, Southern Environmental Law Center, and North Carolina Sustainable Energy Association then filed an appeal, claiming the decision allowed natural old-growth forests to be cut down, and that state renewable energy credits should be restricted to using waste wood as fuel.

Because of the appeal court’s unanimous denial of that appeal, the process is likely over, according to Megan Butler, Duke Energy’s manager of renewable strategy and compliance. “If there were any hold outs, I could see them filing another [appeal], but I would be surprised if they did,” she said.

The deadline for an appeal on the appeal court’s decision is Sept. 6 and if none are filed, the North Carolina Utilities Commission’s decision goes into effect, Butler said.

The decision has ruffled feathers in part because wood chips derived from low-value wood are often confused with whole tree wood chips. But forest management and thinning operations often leave unmerchantable whole trees and the promise of RECs for chipping and using those trees can create a market, and therefore an incentive for landowners to improve forest management.