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Biomass Thermal Incentives in the Northeast

By Anna Simet | April 18, 2014

I didn’t get a chance to blog last Friday, as I was plane hopping all day from Portland, Maine, to Bismarck N.D., after attending the Northeast Heat Biomass Expo.

I spent the first whole day on a bus, which visited six different locations—three schools, a courthouse and a sawmill, all of which utilize biomass boilers, as well as Maine Energy Systems’ headquarters.

Here’s a little more about the tour.

It was a fun trip. Very interesting to see the different set up each location had, and learn why it worked best for them. For example, while the systems are not very different in terms of Btu output, the Oxford County Courthouse stores 15-16 tons of pellets indoors in soft bags, whereas Rowe Elementary school uses an outdoor silo.

The following morning, I was privileged to hear Les Otten, president of Maine Energy Systems and conference master of ceremonies, deliver the opening remarks. That segued into a panel that provided a state-by-state overview of grant and incentive programs encouraging biomass thermal installations, and let me tell you, my head was spinning.

Adam Sherman, executive director of the Biomass Energy Resource Center, which has helped implement a large number of biomass thermal projects in the region from inception to operation commencement, began by discussing policy in Vermont, the leading wood heating state. Wood consists of 15 percent of the state’s heating fuel usage, he said, mostly at schools, and sends about $4.3 million back in the local economy each year.

Sherman went through the many different policy mechanisms that have helped projects in the state succeed, including the School Construction Aid Program, which, prior to a moratorium put into place by state legislature, provided up to 75 percent aid to schools incorporating renewable energy sources, such as wood chips, geothermal, wind, or solar power systems. Sherman said that while the program had a tremendous impact on moving the industry forward, not many schools have installed systems since, even with favorable economics. “It has done a lot of good, but it has led to a lot of support expectation that has frozen the market,” he said.

The July issue of Biomass Magazine is themed Distributed and Onsite Bioenergy Projects, and I’ll be working with Sherman and BERC to put together an article that paints an accurate picture of what Vermont’s biomass thermal industry currently looks like, the impact it has had on the state’s economy and on other states working to achieve similar successes, and the direction it’s headed.

Representatives from Massachusetts, Maine and New Hampshire were also on the panel, and as I was just as floored by past, current and in-the-works incentives/aid programs that they have offered or currently offer. The Northeast seems like a separate country from the rest of the U.S. when it comes to biomass thermal policy/incentives.

A remark that was emphasized during this panel was that there are a couple of tricky aspects when attempting to smartly offer grants or rebates. One is accurately gauging the need for an incentive—i.e., avoiding offering aid to something that was going to happen anyway. Another is determining how much they should be—enough to make the installation worth it, but not overgenerous wherein others in need are deprived—and keeping that number in line with changes in technology costs (changing them, if needed, from year to year). If the number is too high, program money will run out early, leading to program gaps or inconsistencies. If they are constantly available every year, that could lead to consumer procrastination.

So on the exterior, it may seem like most of these programs are a relatively simply exchange of heating fuel change outs for cash, but really, a lot of consideration must go into these programs to make them successful.

It is the season of conferences, and next on Biomass Magazine’s agenda is Heating the Midwest, which is in Green Bay, Wis., end of April. We’ll be sending Staff Writer Chris Hanson, so you can expect some on-the-scene reporting posted on www.biomassmagazine.com.   

 

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