GREC Making Progress
Since construction started in March, the Gainesville Renewable Energy Center, a 100-megawatt biomass power plant in Gainesville, Fla., is on track to being operational by the third quarter of 2013. “The project has enjoyed favorable summer weather for construction and is making great progress,” says Josh Levine, vice president, project development for American Renewables, the GREC development company.
Minnesota-based Fagen Inc. is constructing the plant with engineering being performed by Zachry Engineering Corp. About 65,000 man hours of construction and 30,000 for engineering have been performed on the site as of the end of August, Levine says.
“The project will use advanced combustion technology and the latest boiler and emissions control technology to achieve best available emissions,” according to American Renewables.
The GREC’s wood-handling system is being provided by Wolf Material Handling Systems of Elk River, Minn., Metso Power is supplying a bubbling fluidized bed boiler, and a steam turbine generator system is being installed by Siemens Energy.
Project planning began in 2006 and, after a one-year negotiation period with Gainesville Regional Utilities, the local utility provider, a 30-year power purchase agreement was signed in 2009. The plant will provide enough electricity to power 70,000 homes, according to American Renewables.
The permitting process was quite extensive, and local development site plans were required in addition to a state site certificate for facilities over 75 megawatts. Final state permits were obtained in 2010.
Cost projections provide a capital total of hard and soft costs at just under $500 million, according to Levine. Close to its financial goal, the developers have successfully raised nearly $500 million in construction financing to date. The ongoing involvement of capital partners and financiers has allowed the project to remain on schedule.
“Completion of construction financing allows GREC to move forward without delay, ensuring that the Gainesville community will receive the many environmental and economic benefits of this renewable energy facility,” says Jim Gordon, president of GREC.
“The success of this transaction, completed on a tight timeline with the participation of eight sophisticated, renewable-project finance lenders, demonstrates that a well-structured biomass transaction is understood by the project finance market and results in a marketable asset class,” says Chris Smith, GREC project financial advisor. The combination of the power purchase agreement for 100 percent of output with an established utility, proven technology, and firm-price construction contract gives the GREC project strong credit fundamentals, he adds.
Nearly 1 million tons of green woody biomass, or 600 million dry tons, will be needed to fuel the plant annually, which will be obtained within a 75-mile radius of Gainesville.
Gainesville-based BioResource Management Inc. will manage feedstock procurement for the facility. Wood Resources Recovery, also in Gainesville, will provide a large portion of the biomass to fuel the facility.
The GREC is co-located with GRU’s 235-megawatt, coal-powered facility on 1,046 acres near Gainesville, 131 acres of which are leased by GREC. With the local utility largely dependent on coal imports from outside the region, significant money and resources will be kept local as a result of the GREC’s efforts, according to Levine.
Economic development projections show that the GREC will generate more than 1,100 direct and indirect jobs in the region, including 400 construction jobs during peak construction. Once operational, the facility will include 40 full-time positions on site, and provide approximately 700 indirect jobs throughout the region in the areas of forestry, supply, transportation and other secondary industries.
“In a county with high unemployment rates, this project is creating jobs where they are needed the most,” Levine says.