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Home My WebLink AboutWood-Peat Municipal Solid Waste Agricultural Byproducts Alaska Bioenergy Program Quarterly Report Oct-Dec 1993mw wood - peat municipal solid waste agricultural byproducts Alaska Bioenergy Program Quarterly Report October - December 1993 State of Alaska Department of Community and Regional Affairs Division of Energy wood - peat municipal solid waste agricultural byproducts Alaska Bioenergy Program Quarterly Report October - December 1993 State of Alaska Department of Community and Regional Affairs Division of Energy TABLE OF CONTENTS I. TASK FORCE ACTIVITIES 0.00.00... cece cececee eee cneeneeneeeeeeeenetaeeeeeeeneene el 2 ll. INFORMATION AND TECHNICAL ASSISTANCE ............0... eee 2 lil INTERAGENCY AND INDUSTRY CONTACTS & PROJECT DEVELOPMENT 000... cece cece ceeceeeceeeeeeeeaeeeeceseeseeseeesesseesseseeseeeeae es 3 IV. INDUSTRY ACTIVITIES IN ALASKA |... ccc eee cece ee eeeeeeeeteeeeeees 12 A. Southeast Alaska... cccccccccccsccescesseeseeeesseeeseeesseeesseeeseeeteenseens B. Southcentral and Interior Alaska ... APPENDICES Appendix A Quarterly Project Status Reports State of Alaska Bioenergy Technical Assistance Program Small Commercial Wood-Fired Boiler Demonstration Seward Spring Creek Prefeasibility Analysis Juneau Lemon Creek Prefeasibility Analysis Fairbanks Waste-to-Energy Sitka Co-Generation South Tongass Wood-Waste Appendix B Task Force Correspondence e Letter to Christine Ervine, U.S. DoE « Comments on draft Process Evaluation of Regional Biomass Energy Program Appendix C Current Industry-Related News Articles TASK FORCE ACTIVITIES The Division of Energy participated in the November 4 to 5, 1993 Biomass Utilization Advisory Group Meeting in Boise, Idaho. In addition to updating regional and state bioenergy projects the conference addressed issues relating to the transfer of the regional program from Bonneville Power Administration to the U.S. DoE Seattle Support Office and the regional project solicitation/funding process. The Division of Energy reviewed and submitted comments to Mike Vorhies on the draft Process Evaluation of the Regional Biomass Energy Program in November. Additionally, we reviewed and submitted comments to Craig Chase on the FY 92-93 PNAB Program Yearbook (Appendix B). In December, Department of Community and Regional Affairs Commissioner Edgar Blatchford wrote a letter of support for the regional biomass programs to DoE Assistant Secretary Christine Ervine (Appendix B). INFORMATION AND TECHNICAL ASSISTANCE The Division received and responded to requests for information on availability and potential markets for biomass fuels, current regional and state projects, Alaskan communities’ power demand and capacity, timber development and inventory, and existing state biomass facilities. A list of contacts is given below. The Division of Energy and Morgantown Energy Technology Center continued to cooperate on organizing a workshop which will expose Alaskans to small-scale biomass, other renewable, and fossil fuel energy technologies. Slated for May 17 and 18 in Anchorage, the workshop emphasizes technologies that are appropriate to the Alaska bush with power loads less than 1 megawatt. Due to time constraints relating to reorganization and an office move, the Division did not publish the Alaska Bioenergy News this quarter. The next issue will be published in April. Page 2 ~~ i, INTERAGENCY AND INDUSTRY CONTACTS & PROJECT DEVELOPMENT Since Alaska Bioenergy Program efforts remain focused on project development, most of the contacts with the private and public sectors during this quarter are related to current or planned projects. See Appendix A for a detailed description of the status of projects referenced. Channel Corporation and Tlingit-Haida Regional Electrical Authority (THREA) requested that funding for the full feasibility analysis for the Juneau Heat Recovery and Distribution project be delayed until March, 1994, when Channel would have completed a financial audit and have a good handle on their capability of incurring additional debt for heat recovery/distribution and air emission control equipment. Before THREA is certain that it can issue tax-exempt debt for the improvements, it will have to obtain a determination from IRS to that effect. Despite these uncertainties, the Division of Energy designed and funded an initial financial analysis by an accounting firm experienced with energy projects aimed at comparing how various project operation/ownership roles for Channel and THREA affect yearly costs (Appendix D). The Division staff's assistance to the Seward sawmill in analyzing wood waste to energy alternatives culminated in a report to be published in early January. As part of the prefeasibility assessment, the Division contracted with mechanical engineer Roger Kolb to prepare preliminary heat balance calculations for the various conversion alternatives. The Alaska Program worked the Alaska Department of Environmental Conservation to assess expected levels of criteria air pollutants and to get an early reading on their effect on permitting. The Alaska Program also worked with the departments of Corrections and Economic Development, the mill, and the City of Seward to coordinate support for the project. In December. America North/EMCON of Anchorage prepared a final South Tongass Wood Waste resource assessment Two rounds of review by the Division of Energy followed by modifications of the draft were necessary. Approximately 32,000 bone dry tons (BDT) are available from seven sources; however delivered cost ranges as high as $100/BDT depending on source and destination. The two sites which the study identifies as possible energy project locations are Metlakatla and Thorne Bay, and we have been working with local entities to further assess their development potential. In December we were contacted by the locally-owned Metlakatla Power and Light (MPL), which is negotiating with Annette Hemlock Mill owner Louisiana Pacific (LP) on how much the utility will pay for excess Page 3 power that LP will produce from their planned 650 kW wood waste- fired boiler. Currently MPL must spin their diesel generator to provide for peak load at LP's mill, since their hydro plant's capacity is inadequate. The Division of Energy worked with MPL, LP, and another Metlakatla sawmill to assess bioenergy opportunities which will result in a net decrease in the use of oil, such as heating the community's swimming pool, which is currently closed because of energy costs The Alaska Program continued to collaborate with U.S. DoE's Sandia Labs and Solar, Thermal and Biomass Power Division on establishing a feasibility study for wood-fired power in the middle Yukon funded by DoE Office of Minority Economic Development. We provided data on energy demand, cost and generating capacity for the villages included in the study area and other background information for project planning. Public involvement and education dominated the Fairbanks North Star Borough's solid waste pianning process this quarter. Paper pelletization and cofiring in coal units continued as the favored option, and the Borough and the Division of Energy were contacted by a number of companies interested in production of RDF in Fairbanks or nearby Eijelson Air Force Base. As in past quarters, we had frequent industry contact (see below) regarding other current projects. The Alaska Program received and provided information to companies interested in marketing products or services in the areas of gasification, waste disposal, densified biofuels, feasibility analysis, power project development In November, the Division submitted comments to the Department of Environmental Conservation on its draft solid waste management regulations. The comments were aimed at ensuring that waste to energy options were included in the list of alternatives that the state specifies be analyzed during the solid waste planning which the regulations require. We were in frequent contact with Department and Public Utilities Commission staff to gain understanding of the issues which would affect success of our Juneau, Sitka, and South Tongass projects. Page 4 Alaska Bioenergy Program DATE October October 1 October 4 October 5 October 7 October 8 Partial List of Contacts September to December 1993 CONTACT Eric Wohlforth Wohlforth, Argetsinger, ... Attys., Anchorage Ted Pauling SWIS Corporation Eden Prairie, MN Richard Bonwell Fairbanks North Star Borough Dick Smith City and Borough of Sitka Ed Enswiler Alaska Dept. Environmental Conservation Jim Harris Seward Forest Products Seward Bob Martin THREA, Juneau Ed Clinton Eureka Pacific Pellets Arlington, WA Jim Toland Consulting Forester Concord, CA llen Stoll NCAT Washington, DC Marvin Yoder City of Klawock Page 5 DESCRIPTION Authority of THREA to own district heat system, AEA remaining authorities Paper pellets and RDF as option for Fairbanks Status of Fairbanks WTE project Sitka WTE status, procurement rules Solid waste management in Southeast, Juneau Heat Recovery project Seward wood waste project Authority of THREA to own district heat system Interest in Tok pellet plant Request for information Request for information Klawock mill and interest in MSW and wood waste to energy October 11 October 13 October 19 October 20 October 21 Robert McCarroll PGI Power Systems Fort Worth, TX Dan Garner Alaska Dept. Environmentai Conservation, Juneau Bruce Wood Morbark Winn, MI Bob Martin, Bill Brock Tlingit-Haida REA Auke Bay Dan Logan Seward Forest Products Seward Don Mahon Alaska Power and Telephone, Tok Les Fortune Alaska Div. Forestry Fairbanks Craig Chase Chase and Assoc. Bellevue Jim Lexo ICRC Alexandria, VA Jack Coutts Alaska Dept. Env. Cons. Fairbanks Poonsin Sreesangkom Biomass Users Network Bangkok, Thailand Craig Chase Chase and Assoc. Bellevue, WA Bill Brock Tlingit-Haida REA Auke Bay Cal Kerr EMCON Corp. Anchorage Page 6 Applicability of PG! projects in Alaska Possibility of funding waste management projects Info on shredders and grinders Juneau HRD project status Seward Wood waste project status AP&T stance on wood-fired power in Tok Timber supply in Tanana Valley Project updates Interest in Seward Wood Waste project Status of demonstration coal/biomass combustor in McGrath Info on ASH VI conference Request for information Juneau HRD legal issues South Tongass Wood Waste deliverable October 22 October 26 October 27 October 28 October 29 November November 1 Mike Tavella Alaska Public Utilities Comm. Anchorage Don Grimes J.C. Bradford Co. Nashville, TN Louis Bencardino Seward City Council Eric Johnson Four Nines Philadelphia, PA Mason, Bruce & Girard Redding, CA Don Bonk, Randy Dellefield, Morgantown Energy Tech. Ctr., Morgantown, VA Howard Garner Alaska Power and Telephone, Seattle, WA Paula Cullenberg Alaska Fisheries Devel. Foundation, Anchorage Jerry Wilkerson Channel Corporation Juneau Oscar Bailey Seward Bob Cruise SW Integrated Systems Minneapolis, MN Roger Kolb Energy Pacific Corp. Anchorage Ernie Polley Channel Corporation Juneau Page 7 Juneau HRD solid waste management issues Juneau HRD financial issues Seward project financing Interest in Juneau HRD work information request Planning for May, 1994 CRADA workshop Tok wood-fired power feasibility Fish oil generation in Alaska Juneau HRD financial feasibility assessment Seward Wood Waste interest Cubing paper and cardboard in Fairbanks Seward Wood Waste O&M costs Juneau solid waste management November 2 November 3-5 November 12 November 16 November 9, 17 November 17 November 18 November 19 November 22 November 23 Chris Gates Alaska Div. Econ Devel. Juneau Richard Bonwell Fairbanks North Star Borough Steve Phillips Alaska Div. Forestry Anchorage Craig Chase Chase and Assoc. Bellevue, WA Don Bonk, Randy Dellefield, Morgantown Energy Tech. Ctr., Morgantown, VA Mike Pope Entech Corp. Anchorage Pat Woodell Pleasant Valley, NY Roger Kolb Energy Pacific Corp. Anchorage Bill McClarence Alaska Dept. of Env Conservation, Anchorage Ed Enswiler, Glenn Miller, David Wigglesworth Alaska Dept. of Env Conservation, Juneau George Kipper Kipper and Sons Seattle, WA Dave Wallingford Alaska Div. Forestry Anchorage Dick Smith Sitka Public Works Dept. Page 8 Seward Wood Waste project development Crimp in Boise for Bioenergy Task Force Meeting Fairbanks WTE project update Timber inventory in Tanana Valley RBEP evaluation and Fairbanks WTE project Planning for May, 1994 CRADA workshop Status of Entech MSW incinerator, possibilities for heat recovery NY bioenergy contacts Seward Wood Waste capital costs and air emissions Seward Wood Waste air emissions Div. Energy comments on draft solid waste regulations Seward Wood Waste air emissions Industry perspective on solid waste regs SW management in Southeast Alaska, project updates November 29 November 23- 30 December December 2 December 3 December 7 Gerald Fleischman Idaho DWR Energy Bur. Boise, ID Paul Klimas Sandia National Lab Albuquerque, NM Glenn Miller Alaska Dept. Environmental Conservation, Juneau Troy Rinehart Alaska Forest Assoc. Ketchikan Dana Andrews Boeing Corp. Seattle, WA Neil Johnson SFT, Inc. Toledo, OH Jeff James U.S. DoE Seattle, WA Starky Wilson KFX, Inc. Dallas, TX Jim Vanderpoole McGrath Chris Hladick Galena City Utility Robert Young & Assoc. Portland, OR Mary Adams US Gen. Services Admin. Anchorage Page 9 Request for information Middle Yukon Wood Power assessment Comments on draft solid waste regs industry perspective on solid waste regs Request for power statistics information Seward Wood Waste and South Tongass Wood Waste projects Interest in Seward Wood Waste project Role of Seattle Support Office, Anchorage visit schedule. Fuel densifier applicability in Alaska Interest in pelletizing peat Status of Air Force power purchase contract with Galena Request for information on bioenergy facilities Follow up on info request December 9 December 10 December 13 December 14 December 15 December 16 Jim Harris Seward Forest Products Seward John Booth Metlakatla Power and Light Metlakatla Jeff James US DoE Seattle Paul Klimas Sandia National Labs Albuquerque, NM Lynn Fitch Anchorage Recycling Anchorage Ernie Polley Channel Corp. Juneau Don Grimes JC Bradford Nashville, TN Kathlyn Connor US DoE Washington DC Ed Clinton Eureka Pacific Pellets Arlington Cathy Mayer Kenai Peninsula Borough Solid Waste Management Knut Rasmussen Doug Scott Humphries Technology Monmouth, ME Cal Kerr EMCON, Inc. Anchorage Jim Lexo ICRC Alexandria, VA Page 10 Seward Wood Waste project Use of sawmill residue for district heat system to community swimming pool Visit to Alaska Yukon bioenergy assessment update Earth Day activities including bioenergy Juneau HRD solid waste management issues Assumptions for Juneau HRD financial analysis Information request Logging in Tetlin area MSW transportation costs Seward to Soldotna Danish swine project in Alaska. Possible large manure digestion project. Downdraft gasifier suitable for use at Seward sawmill South Tongass Wood Waste report Seward Wood Waste interest Jack Wood Grass Valley, CA DJ Whitman Seward Ship Chandlery Seward December 17 Jim Philps Alaska Dept. Corrections Seward December 20 Jack Wood Anchorage Christine Ervine U.S. DoE Washington, D.C. December 1,10, and 21 Don Bonk, Randy Dellefield, Morgantown Energy Tech. Ctr., Morgantown, VA December 30 Tex Gazzaway Annette Hemlock Mill Metlakatla Frank D'Elia Alaska Housing Finance Corporation, Anchorage Geothermal in Unalaska Use of district heat system from Seward sawmill. Use of district heat system from Seward sawmill. Request for information on Morgantown Energy Technology Center CRADA workshop Letter from Community and Regional Affairs Commissioner Blatchford supporting bioenergy program Planning for May, 1994 CRADA workshop Status of planned package boiler and 650 kW T-G for sawmill DoE's Institutional Conservation Program, possibility for district heating system development INDUSTRY ACTIVITIES IN ALASKA A. Southeast Alaska Following the shutdown of the Alaska Pulp Company (APC) mill in Sitka last summer, mill owners and the Forest Service are assessing the promise of medium density fiberboard as a substitute product of lower grade logs previously used for pulp. APC's long-term timber sale with the Forest Service requires utilization of such lower value material in order for more valuable sawlogs to be milled at the company's Wrangell sawmill. If the Forest Service determines that the fiberboard option is not consistent with the current agreement, which does not expire until 2014, then they will declare breach of contract and curtail timber supply. APC has brought suit against the Forest Service, claiming that the agency has decreased the availability and increased cost of the low grade utility logs. Page 11 Meanwhile, Ketchikan Pulp Company (KPC) filed an administrative claim with the Forest Service of $280 to 300 million for damages because of unilateral long-term contract changes’ effect on timber supply between 1989 and 1994. Similar to APC, KPC claims that sufficient accessible timber was not made available according to the terms of the contract, because of 1989 Tongass Timber Reform Act requirements for separate environmental impact statements for individual timber sale, stream buffers, and removal of an annual $40 million subsidy for timber access. The subsidy was a compromise agreed upon in the Alaska National Interest Lands Conservation Act in 1980 to compensate for removal of land from the timber base. Other environmental issues remain the forefront, given federal seizure of KPC documents in December to support the government's allegations of unlawful pollution levels in wastewater, actions against KPC from former workers who claimed they were fired for blowing the whistle for water pollution violations, and a continuing 1992 civil suit by the federal government against the company for violations of the Clean Water Act. KPC brushed off warnings by a Seattle business newsletter that the company might shut down their pulp mill, citing continued plant improvements, but offered to halt operations temporarily until federal pollution enforcement actions are settled. The Justice Department said this was not necessary. Alaska Senator Ted Stevens, bucking national environmental groups and the Clinton Administration, convinced a House/Senate committee to block implementation of the Forest Service's "PACFISH" plan in Alaska. The plan, would temporarily prohibit timber harvest in 100 to 300-foot buffers around wetland, streams and lakes while the Forest Service studied the effects of logging on habitat values. The state government had projected dire economic consequences if the measures had been implemented. B. Southcentral and Interior Alaska State and private timber continues to move because of continued high demand for sawtimber and fuelwood. Winter harvest began or was planned by the Division of Forestry and Native corporations in the vicinities of Nenana, Fairbanks, Tok, Glenallen, Seward, and Homer. The increased use of higher efficiency and more expensive equipment such as feller bunchers and shovels in interior operations indicates continued high demand for logs. Stumpage paid for state and Native timber sales in the Fairbanks area averaged as high as $160 per MBF. Page 12 APPENDIX A Quarterly Project Summary Reports State of Alaska Bioenergy Technicai Assistance Program Smail Commercial Wood-Fired Boiler Demonstration Seward Spring Creek Prefeasibility Analysis Juneau Lemon Creek Prefeasibility Analysis Fairbanks Waste-to-Energy Sitka Co-Generation South Tongass Wood-Waste Page 13 Project Summary Report Title: State of Alaska Bioenergy Technical Assistance Program Brief Description These are the "core" activities of the Alaska Bioenergy Program, which promote the development of biomass resources for energy production through information transfer and technical assistance, facilitate project development and comment on state policies related to the use of biomass for energy.. Identification Number DE-FG79-84-BP14984, A014 Grantee Alaska DCRA Division of Energy PO Box 190869 Anchorage, AK 99519-0869 Project Manager Peter Crimp, 907/561-7877 Division of Energy Regional Bioenergy Program Funds Current year: $50,000 plus $126,359 carryover for special projects described separately below Cumulative through federal FY 93 : $811,297 Cost Sharing Division of Energy: Cumulative through Federal FY 93, $195,837 Expanded Description See project objectives and approach for expanded project description. Need Addressed One of Alaska's largest energy challenges is the high cost of fuel oil, particularly in rural areas. Biomass has the potential to provide alternatives to this conventional fuel. Alaska's location often makes it difficult to receive information on product development, new trends in industry and items that are pertinent to its economy and infrastructure. The Bioenergy Technical Assistance Program provides an in-state biomass center for receiving and distributing this information. Awareness of biomass opportunities improves the economics of use in related industries. This program supports State policies which influence the use of biomass as an energy resource. Page 14 Project Objectives The Alaska State Program objectives include the following: 1) to promote the efficient ana environmentally sound use of biomass tor energy ana other applications in Alaska: 2) to assist in resolving institutional barriers to biomass production and use. This includes education ana information to policy makers who can influence resolutions to institutional problems; 3) to direct program activities and information towards self-sustaining biomass production and consumption activities. This includes an emphasis on economics, environmental and technical feasibility for industry and municipal projects; 4) to clarify major, environmental resource recovery and use issues and to seek solutions to environmental problems; 5) to continue technology transfer to target users. Economic. environmental and technnicai feasibility for industry and municipal projects are emphasized in these objectives, and 6) to continue deveiopment and operation of a state-wide institutional framework to promote biomass development issues. Approach Activities under the State Technical Assistance Program are divided into the following work areas: Fi Task Force and Policy Group Participation - Attend regional meetings, participate in regional planning activities, and support the regional program through effective communication of in-state bioenergy activities, goals and policies. Development and evaluation activities for the regional program are also included in this section. i Information and Technology Transfer - Emphasis is to increase public awareness of opportunities to use biomass as an energy resource. The goal here is to maintain an effective network of information on technologies, resource management techniques and other topics applicable to the private and public sectors. ii Technical Assistance - Identification of biomass use barners and assistance to industry and public agencies in developing biomass use opportunities are the major goals in this area. i Interagency Coordination - Determining common interests in the development of biomass use opportunities is emphasized. Coordination also helps define common problems among agencies in project implementation. Successful interagency planning improves likelihood of project success. Tasks in this area have included working with the Alaska Department of Environmental Conservation in two separate processes for the development of solid waste and air quality management regulations. Status: Solid waste regulations draft comments have been submitted and are being considered. Initial air draft of quality regulations out for review; working group meetings are being held. i" Institutional Barriers - This area focuses on identifying state regulatory requirements and procedures that affect the development and use of forest and mill residues, non-commercial stands of timber, and municipal solid waste as energy options. This area also includes identification of environmental impacts and tradeoffs associated with using biomass energy fuels, and recommending solutions consistent with state environmental policies and laws. Page 15 Major Milestones Field Projects - As part of this year's project activities, the Alaska program will complete a final report for the wood waste fired boiler at the Alaska Correctional Industries greennouse complex in Sutton. Additionally the Alaska program is conducting prefeasibility analyses for a wood-waste-fired boiler in Seward and a district system for MSW- generated heat in Juneau. Other projects include a wood-waste fired power plant in the South Tongass Area. assistance to the Fairbanks North Star Borough in WTE planning and the City-Borough of Sitka in system upgrades to their incineration facility, including extraction of 100 kW of power from steam. Status: See project reports. All work is on-going with accomplishments reported in quarterly reports. Results A full reporting of the status and results of this program are detailed in the text of the quarterly report. Prepared: Peter Crimp, Development Specialist Amended: December 7, 1993 Page 16 Project Summary Report Title | Small Commercial Wood-Fired Boiler Demonstration Brief description This is a demonstration of a wood-fired boiler system for institutional heating. The project includes the design, installation, performance monitoring and reporting for a small commercial wood-fired boiler project. The project is located at the Alaska Correctionai Industry's agricultural complex, within the Alaska Department of Correction's minimum security facility, Palmer Correctional Facility, Sutton, Alaska. Identification Number DE-FG79-84-BP14984, A011 Grantee Alaska Department of Community and Regional Affairs, Division of Energy PO Box 190869 Anchorage, AK 99519-0869 Project Manager Peter Crimp, 907/561-7877 Alaska Dept. Community and Regional Affairs, Division of Energy, Anchorage, AK 99519-0869 Regional Bioenergy Program Funds $25,000 Cost Sharing Match AEA cash (boilers and equipment) $20,000.00 Alaska Correctional Industries cash (parts and $17,339.89 materials) Alaska Correctional Industries (inmate labor) $4,457.84 Alaska Correctional Industries (in kind, staff labor) $44,543.54 Total Match $86,341.27 Expanded Description The project was established to demonstrate the effective use of wood as an institutional heating fuel. In summer and fall of 1990, AEA contacted numerous local governments, school districts and public facilities managers to locate a site for the project. Based on the availability of wood fuels, willingness to participate and provide matching support and overall project economics, the Alaska Correctional Industries agricultural complex in Sutton, Alaska, was chosen for the project. AEA and Alaska Correctional Industries have jointly managed this project, using contractual expertise for boiler sizing and mechanical room layout. Two 350 mBtu cordwood fired boilers and a 3,000 gallon accumulator tank were installed in a newly constructed boiler Page 17 house in spring and summer of 1991. Annual fuel oil offsets from 8,000 to 10.000 gailons per year are anticipated. § The project will include monitoring of fuel consumption and boiler performance over a twelve month period and reporting on findings. The project wiil also include a pro-active effort to publicize the project in the media and provide tours of the facility to parties interested in establishing similar systems in other facilities. Need Addressed In many areas of Alaska, markets for lower quality timber are nonexistent. Timber harvesting and land clearing residues have become an environmental liability, contributing to burgeoning landfills or air quality problems through open burning. Fuel oil is shipped to rural Alaska at great expense, exporting cash that might otherwise stay in the local economy. The use of locally based woody fuels for energy projects can contribute to the environmental and economic well being of rural Alaska. The wood-boiler demonstration !s intended to promote the use of locally harvested wood fuels as a replacement for fossil fuels from outside the local economy. Project Objectives Specific objectives are as follows: 1) to reduce the volume of wood harvesting residue left on federai/state lands 2) to identify institutional or commercial users interested in alternatives to using fuel oil for space heating 3) to develop a transportation plan for moving fuel wood to end-user markets 4) to purchase and install wood boilers at one or more project sites f Approach This project will began with an investigation of wood residue availability, characterization of fuel quality, and an examination of transportation, environmental and economic issues that would affect the outcome of the project. This part of the project included contacts with regulatory agencies to get input on permit requirements, performance criteria of wood-fired boilers and other information that would influence equipment selection decisions. The next phase of the project resulted in the identification of specific sites for small- commercial wood-fired boiler applications, followed by a survey of potential sites, presentation of project plans to potential users; gathering cost, weather and heat load data, evaluating equipment, and doing project cost estimates. Data was submitted to the Regional Task Force for approval and recommendation. Upon approval, actual design work and equipment selection was initiated and bids for materials and installation will be solicited. Installation was followed by assistance with start up, assistance in developing an operation and maintenance plan, and a 12 month performance monitoring period. Results Project construction is complete and the wood-fired boilers are operating as the primary heat 4 source for the facility. Facility management and operating personnel are extremely satisfied Page 18 with the system. A monitoring system nas been developed and AEA purchased a surplus 2,000 pound floor scale, a moisture meter and 3 hour-meters. With these tools, operation and fuel consumption was recorded to obtain information useful for other potential project developers. The monitoring period extended for one year into November of 1992. In the fall of 1992, the Energy Authority prepared Autocad drawings and text describing the project to be included in the agency's 1992 annuai report. In January, 1992 AEA prepared media materials to publicize the project. A press release was sent to Alaska news outlets, and the Governor's media office used a state satellite system and a recording phone line to transmit video pictures and audio interviews provided by the Energy Authority to interested broadcast stations. The Associated Press sent out a short story on its wire. Stories were run in at least the two major Anchorage newspapers, and video aired on the Rural Alaska Television Network reaching viewers in approximately 200 small communities. Staff also heard reports that stories had aired on some radio stations. The project was also highlighted in the Energy Authority's Annual Report. The project has generated increased interest in institutional wood heating throughout the state. It is displacing over 8,000 gallons of fuel oil annually at the correctional facility. Since the wood system was put into operation in November 1991, the facility has performed without any major problems and has burned virtually no oil. The Division of Energy is working with the Department of Corrections to compiie current and past operation and maintenance costs, fuel usage, and other data on the existing wood fired and the old oil-fired system. Because of workload, the final report scheduled for December 1993 will not be completed until June 1994. Major Milestones Milestone Status Investigation of resource availability and delivery infrastructure Complete Site identification Complete Heat load analysis and system design Complete Materials list, bids and orders Complete Shipment Complete Boiler house plan preparation and submittal to fire Marshall Complete Earthwork and foundation Complete Boiler house construction Complete Plumbing, heat distribution and electrical Complete Boiler installation Complete Monitoring Complete Final report June 1994 Prepared: Peter Crimp, Development Specialist Amended: December 7, 1993 Page 19 Project Summary Report Title | Seward Wood Waste Brief description This project is an initial assessment of the feasibility of various ootions for using wood waste from the newly-reopened Seward mill to produce heat or neat and electricity for the mill, the nearby Spring Creek Correctional Center, and other buiicings in the vicinity. \dentification Number Not applicable. Grantee Not applicable. Project Manager Peter Crimp, 907/561-7877 Alaska Dept. Community and Regional Affairs, Division of Energy, Anchorage, AK 99519-0869 Regional Bioenergy Program Funds Unspecified. Research costs for this project are paid for as part of technical assistance core program costs. Cost Sharing Not applicable. Expanded Description The Seward Forest Products sawmill in Seward reopened in Marcn after having closed in Fall, 1991 when its owner Chugach Alaska Corporation filed for Chapter 11 bankruptcy. The mill produces dimension lumber from timber from Native corporation land in Prince William Sound and, to a lesser extent, mixed ownerships on the Kenai Peninsula. Slabs and edgings are chipped and exported, while the 150 tons of bark, sawdust, and shavings produced each day are being stockpiled in the mill yard. At the same time, the Seward landfill has been closed by the Department of Environmental Conservation because of possible leaching into a high water table, so the Kenai Borough has been trucking MSW 100 miles to Soldotna, the nearest landfill. Around 105 tons of waste paper is separated out the 5,500 ton yearly MSW stream in Seward. The sawmill is located in an industrial park near the Spring Creek Correctional Center and Seward Ship Chandlery across the bay from downtown Seward. The mill supplements the electrical service provided by the local utility with diesel generators to run their saws and chipper; however current air quality permits for the generators jimit their use to the extent that the mill is limited to one shift. Moreover, due to energy costs, kiln drying costs are about twice the cost that the local mill manager feels are reasonable. At the same time, the local prison is using around 250,000 gallons of fuel each year for space and water heating, while the chandlery is planning an expansion which may require 300,000 gallons per year to heat it. Page 20 This project is an initial assessment of the feasibility of various options for using wood waste from the newly-reopened Seward mill to produce heat or heat and electricity for the mill, the nearby Spring Creek Correctional Center, and other buiidings in the vicinity. Need Addressed Currently the facilities in the Seward industriai park are using diesel oil as their primary energy source, despite the availability of a potentially inexpensive source of biomass fuel. The local landfill is closed, so the mill must determine a cost-effective way to dispose of the considerable amount of residue that is accumulating. The project addresses the needs for environmentally sound and efficient energy sources by evaluating the potential for producing energy from material that might otherwise require disposal. Project Objectives The objective of this project is to assess the key technical factors influencing the success of a wood waste-fired plant and distribution system and make recommendations on if and how the project should proceed. The scope of the project is intentionally limited so that prospects for success might be determined before a substantial investment of time and money is made. Approach The approach of the prefeasibility analysis is to estimate current heating and electrical requirements and costs for the mill, prison, and chandlery; assess quantities and costs of available mill residue, waste paper and waste wood produced locally, coal, and other potential fuels; estimate capital costs that would be associated with various options for energy conversion and distribution; and perform a simple economic analysis of the costs and benefits of various alternatives, including the status quo. In addition; potential political and legislative obstacles to the project will be assessed. Results and recommendations will be presented in a report. If results of initial work are favorable, the Division of Energy will assist Seward Forest Products and other project participants in conducting a full feasibility study, siting analysis, and conceptuai design. Results Work is in progress. A spreadsheet economic model has been prepared and a consultant has prepared heat balance calculations for project alternatives. The Energy Authority is assisting the mill in installing a data logger for power usage. Work results have been delayed partly because of the difficulty in obtaining information on wood residue fuel production and prison energy demands. Additionally we underestimated the detail in which energy conversion alternatives would be need to be addressed in order to make meaningful recommendations. Major Milestones Milestone Status Report and Recommendations December Prepared: Peter Crimp, Development Specialist Amended: December 7, 1993 Page 21 Project Summary Report 2 Title | Juneau Heat Recovery and Distribution Brief description This project is an assessment of the feasibility of recovering heat from the MSW incinerators at Channel Corporation's Juneau landfill and constructing a district heat system to distribute the heat to the nearby Lemon Creek Correctional Center and other facilities in the vicinity. If the assessment shows that a facility would be feasible, then the Division of Energy will provide the project owner(s) with assistance in financing and further development activities. Identification Number Not applicable. Grantee Not applicable. Project Manager Peter Crimp, 907/561-7877 Alaska Dept. Community and Regional Affairs, Division of Energy, Anchorage, AK 99519-0869 Regional Bioenergy Program Funds Unspecified. Research costs for this project are paid for as part of technical assistance core program costs. Cost Sharing Not applicable. Expanded Description Currently the Channel Corporation is incinerating around 20,000 tons and landfilling 2,400 tons of MSW per year at their facility, located between downtown Juneau and the airport. Although the two Consummat CS1600 incinerators are set up for heat recovery, Channel A Corporation has not attempted to recover heat in the past. The Lemon Creek Correctional Facility is located around 4,000 feet from the incinerators and uses around 110,000 gallons of oil per year for space heating and hot water. Costco has purchased land between the incinerators and the prison, and is planning to build an 80,000 square foot store on the site. In addition, there are numerous other existing or planned facilities in the area (not necessarily near the prison or incinerators) including a proposed KMart, the Juneau Pioneers Home, and a public school under construction. This project assesses the feasibility of recovering heat from the MSW incinerators at Channel Corporation's Juneau landfill and constructing a district heat system to distribute the heat to the nearby Lemon Creek Correctional Center and other facilities in the vicinity. Need Addressed Currently the Channel Corporation operation is not recovering heat from the incineration of the local MSW stream. Meanwhile the Lemon Creek Correctional Facility and other facilities Page 22 in the area are using oii as an energy source. This project addresses the need for a potentially inexpensive, efficient, and environmentally sound source of energy for locai industry and government by recovering heat energy that wouid otherwise be lost. Project Objectives The objective of this project is to develop a heat recovery and distribution system in Juneau. The project is designed in phases of increasing scope, so that prospects for success might be determined before a substantial investment of time and money is made. Approach The approach is phased as follows: 1. A prefeasibility analysis estimates available energy from the Channel Corporation incinerators; estimate current heating requirements and costs for the prison and other facilities in the area; estimate capital costs that would be associated with heat recovery and distribution; and perform a simple financiai analysis of the costs and benefits of various alternatives, including the status quo. 2. Assuming a finding of technical and economic feasibility, the Division of Energy will assist Channel Corporation in conducting a full feasibility study, siting analysis, and conceptual design. 3. Assuming the study indicates feasibility, the Division of Energy will work with other project participants to secure project financing and address barriers to project development. Results A draft prefeasibility assessment was released for review by the Channel Corporation, Tlingit-Haida Regional Electrical Authority (THREA), the City and Borough of Juneau, and the Alaska Department of Corrections. Currentiy operation and ownership options for Channel and THREA and their effect on possible tax-exempt financing are being assessed. THREA, Channel, and Division of Energy have identified funds for the full feasibility assessment/conceptuai design. Major Milestones Milestone Status Work plan Completed February 1993 Prefeasibility Report and Recommendations (draft) Completed June 8 Initial Financial Analysis December Work Scope for Feasibility Analysis January 1994 Prepared: Peter Crimp, Development Specialist Amended: December 7, 1993 Page 23 Project Summary Report Title | Fairbanks Waste-to-Energy Brief description This project is to prepare a comprehensive solid waste management plan for the Fairbanks North Star Borough, including a thorough evaluation of waste-to-energy as a solid waste disposal option. Identification Number AEA contract 2800559 Grantee Division of Energy Funds passed through to: Fairbanks North-Star Borough PO Box 190869 410 Cushman Street Anchorage, AK 99519- Fairbanks, AK 99701 0869 Project Manager Peter Crimp, 907/561-7877 Alaska Dept. Community and Regional Affairs, Division of Energy, Anchorage, AK 99519-0869 Regional Bioenergy Program Funds $25,000 Cost Sharing Match Fairbanks North-Star Borough, Minimum per AEA $150,000 contract Total Match $150,000 Note: Total match likely to be higher. This is the minimum required in agreement between AEA and FNSB. Expanded Description The Fairbanks North Star Borough (FNSB), with solid waste management responsibilities for Fairbanks and outlying areas, has been struggling to find a solution to a very difficult solid waste management problem. The Borough currently operates a bale and landfill facility that will be completely full in four to five years. While efforts have been made to select a site for a new landfill, wetlands regulations, shallow water tables, discontinuous permafrost and other siting difficulties have delayed any final determination of a suitable site. Page 24 The Borough assembly has been approached by several experienced, private firms interested in developing a waste-to-energy facility in Fairbanks. Proposals have varied from modular mass burn units, to retrofits of coal spreader stokers for dedicated dRDF combustion and fluidized bed combustion with a front end material recycling facility. Power production estimates for the waste-burning facilities have ranged as high as 7.5 mW. Conceptual siting indicates a location adjacent to the city's waste water treatment plant may be logical, as siudge solids could be processed and this facility's 1 mW load could be directly served. Ballpark figures for tipping fees of around $70/ton have been aired by potentiai developers. Landfilling in compliance with new federal regulations is likely to be costly, and a WTE facility may have favorable economics. Fairbanks is certainly the most promising prospect for the development of a sizable WTE facility in Alaska. The Alaska Bioenergy program's support of the Borough's efforts to evaluate WTE on equal footing with land filling is in keeping with current DoE emphasis on development and commercialization of biomass energy facilities. While it is uncertain whether WTE will be the preferred alternative, support for the study will ensure this option is given a fair consideration and could lead to the development of a multi-million dollar WTE facility with up to 7.5 mW of capacity. Need Addressed Where appropriate from an economic and environmental perspective, waste-to-energy is an attractive solid waste disposal alternative which recovers useful energy from an otherwise wasted resource. Because land filling has been the solid waste disposal alternative of choice in Alaska, WTE often is overlooked as a serious alternative. For example, the FNSB has initiated landfill siting without concluding that land filling is the most cost effective alternative. Providing support to evaluate WTE along with other solid waste disposal options, promotes the development of this resource where appropriate. Project Objectives Specific objectives are as follows: 1) to ensure WTE is evaiuated as a solid waste disposal option for the FNSB 2) to promote the recovery of energy from MSW in those instances where it is environmentally and economically beneficial to do so 3) to promote least cost planning of solid waste disposal alternatives that considers the environmental and economic benefits of recovering energy from waste 4) to encourage other communities in the Pacific Northwest and Alaska to evaluate WTE as a solid waste disposal alternative Approach AEA will grant funds to FNSB in support of the comprehensive solid waste plan. FNSB will be required to include an in depth evaluation of WTE as a solid waste disposal alternative. The analysis will include : e An evaluation of the Borough's current and projected waste stream quantities and heat content e A thorough evaluation of mass burn, RDF with dedicated combustor and RDF for co- firing in existing power boilers as solid waste to energy alternatives Page 25 ¢ A description of the public invoivement in the planning and evaluation process from early stages on e An evaluation of the markets for power and steam sales (and fuel sales in the case of RDF production for use at existing facilities), and an estimation of sales and revenue streams from these sources *® Recommended environmental mitigation strategies including front end material separation and processing, hazardous and problem waste removal, combustion optimization, flue gas control technoiogies and asn disposal * A discussion of environmental constraints, permitting requirements and public acceptance issues ¢ A description of how Borough recycling programs would affect waste-to-energy economics and availability of fuel supply * An economic analysis of waste-to-energy options including tipping fees required and anticipated power and/or steam sales * Acost and benefit comparison with other solid waste disposal alternatives such as land filling Resuits Rick Rogers met with the FNSB RFP evaluation team in Fairbanks, May 21, 1992, to educate team members of waste-to-energy technologies and issues, and to outline what AEA expected as a condition of awarding a grant to assist with the solid waste plan. 4 AEA entered into a grant agreement with the FNSB on August 10, 1992. FNSB has selected a consulting contractor in response to an RFP issues early summer. Dames and Moore was initially selected to complete the study. A procurement appeal has resulted in cancellation of the Dames and Moore award and the award of the project to CH2M. Since the last quarterly report, the procurement appeal has been concluded and the Borough has executed a contract with Dames and Moore. A Notice To Proceed was issued on November 23, 1992, and the Borough has obtained a detailed schedule for the project. To date, Dames and Moore has prepared eight technical memos for the FNSB SW plan. AEA submitted written comments on TM 7 and 8, the delineation of alternatives for MSW management, on May 5 stating concerns that grant requirements were not being met in the evaluation of markets for power, steam, and RDF; the discussion of environmental constraints; recycling effects on WTE; and the structuring of alternatives. At the same time, the FNSB notified Dames and Moore that TM 7 and 8 were not adequate for their needs. Because of this, Dames and Moore restaffed the project and will rewrite TM 7 and 8. After meeting with FNSB staff in early June, AEA is satisfied with the work progress, and extended the grant until October 31. In August FNSB delivered TM 7, revised alternatives for MSW management. Division of Energy has submitted comments on the alternatives. Three of the five alternatives presented included waste-to-energy in some form. Public comment to date has been strongly against landfilling. In November, the Solid Waste Management committee for the Borough unanimously recommended that the Borough pursue the least expensive alternative of the five, a WTE alternative. This option is to continue landfilling at the current facility but recover mixed waste paper through source separation, shred and pelletize it, and burn it in the University of Alaska power plant. Burning the pellets at UAF will require modifications in the fuel feed and storage systems, as well as changes in the current air quality permit. Page 26 Major Milestones Milestone AEA and FNSB enter into grant agreement Professional Services Contract signed Solid waste plan under preparation Public meetings on MSW management options Mid project formal consultant review Draft report submitted AEA and peer review of draft Final report submitted Final report Plan adoption Prepared: Peter Crimp, Development Specialist Amended: December 7, 1993 Page 27 Status Compieted 8/10/92 Completed November 1992 January 1993 -August 1993 Completed February 1993 date to be selected approx. August 1993 December 1993 December 1993 January 1994 February 1994 Project Summary Report Title Sitka Co-Generation Brief description This is a demonstration of a small back-pressure steam-turbine installation at the waste-to- energy facility in Sitka, Alaska. Identification Number AEA contract 2800559 Grantee Division of Energy Funds passed through to: City-Borough of Sitka PO Box 190869 304 Lake Street Anchorage, AK 99519- Sitka, AK 99835 0869 Project Managers Peter Crimp, 907/561-7877 Dick Smith, 907/747-3294 Department of Community and Regional City-Borough of Sitka Affairs, Division of Energy, Anchorage, AK 99519-0869 Regional Bioenergy Program Funds $25,000 Cost Sharing Match City-Borough of Sitka $580,000 Total Match $580,000 Note: Total match includes improvements to the facility in addition to the steam turbine- generator including emissions controls and design improvements. Expanded Description This project is aimed at promoting the environmentally sound and efficient use of MSW for energy through increased energy recovery efficiency and cost effective operation of an existing waste-to-energy facility. The project will also serve to demonstrate the use of a small-scale back pressure turbine, that has direct application at facilities generating steam from other biomass fuels such as wood waste and hospital waste. The City-Borough of Sitka owns a mass burn municipal soiid waste incinerator which disposes of 25 tons of MSW and sewage sludge per day. The facility is operated by Sheldon Jackson Community College and recovers steam for heating campus facilities via a district heating system. Boilers are currently rated to 150 psig and are operating at 30 psig, Page 28 producing an average of 4,000 pounds of saturated steam per hour. The incinerator produces steam for 166 hours per week. Preliminary estimates indicate a 100 kW in-house demand for power. Increasing steam pressures to 150 psig and installing a back pressure turbine would resuit in power savings of about $23,160 annually, reducing power purchases and demand charges for 289,500 kWh annually. 30 psig exhaust steam wouid be available to meet the existing campus heating requirements. The City-Borough has identified several other capital improvements for the facility, including adding a larger capacity electrostatic precipitator to provide redundancy in the flue gas handling system, and other state-of-the-art pollution control systems. In addition to the energy production benefits, the turbine-generator project will reduce the costs of operating the facility, improving the ability of the City-Borough to finance the implementation of these other air quality related improvements. The turbine-generator that will be installed is a Dresser-Rand model 351W or 501W. Specific recommendations for facility improvements are contained in the draft report entitled Incinerator Operating Measures Study, prepared for the City-Borough by R. W. Beck and Associates. Page 18 of the draft summarizes cost payback estimates for the turbine- generator portion of the project proposed for regional funding. Needs Addressed Where appropriate from an economic and environmental perspective, waste-to-energy is an attractive solid waste disposal alternative which recovers useful energy from an otherwise wasted resource. To remain competitive with other solid waste disposal alternatives, and to provide the level of environmental controls demanded by regulatory agencies and the public, waste-to-energy facilities must operate efficiently and use state-of-the-art emissions control technologies. Older plants require capital upgrades to remain competitive. This project addresses both the need for upgraded environmental controls and improved operating efficiency through better energy recovery. Recovery of electrical energy from low pressure steam using a back pressure turbine- generator is an energy production strategy with potential applications throughout the Pacific Northwest and Alaska. Small sawmills, waste-to-energy facilities, hospitals and industrial facilities that require low pressure steam, are all potential sites for this energy recovery technology. This project meets the need of demonstrating this small scale technology in a region of the country in which steam turbines have typically been on a much larger scale. As power rates in the Pacific Northwest and Alaska escalate, the number of cost effective applications for these small scale systems is likely to increase. Project Objectives Specific objectives are as follows: 1) to promote the upgrade of existing waste-to-energy facilities to improve energy efficiency and reduce environmental impacts 2) to promote the recovery of energy from MSW in those instances where it is environmentally and economicaily beneficial to do so 3) to promote the recovery of electrical energy from low pressure steam by using small scale back-pressure steam turbines at other facilities throughout the Pacific Northwest and Alaska Approach Page 29 AEA will grant funds to the City-Borough of Sitka in support of capital improvements to tne community's existing waste-to-energy facility. These capital improvements will include the installation of a back pressure turbine to recover electrical energy from steam currently produced for district heating. The City-Borough will also allow access to parties interested in touring the facility, and facilitate technology transfer by documenting the seiection, installation, start-up and performance of the steam turbine-generator system. Results AEA entered into a grant agreement with the City-Borough of Sitka on August 10, 1992. The City-Borough remains in the planning phase of the project; Dick Smith, Director of the City's Public Works Department and project manager for this project, reported that plans are temporarily on hold due to City funding problems. Problems started earlier this year when $175,000 in planned state funds for the City of Sitka was cut from the Governor's FY93 budget. Because of this budget problem, the generator will not come on line until early 1994. Major Milestones Milestone Status AEA and City-Borough of Sitka enter into Completed 8/10/92 grant agreement Project Plan Developed by Sitka October 31, 1992 Procurement and turn key contract Equipment procurement and shipping Installation Startup and shakedown December 31, 1993 Final inspection by AEA Begin performance monitoring End performance monitoring 12 months from date of monitoring start Final report open Prepared: Peter Crimp, Development Specialist Amended: December 7, 1993 Page 30 Project Summary Report Title | South Tongass Wood-Waste Brief description This is a feasibility study to evaluate the potential for developing a power plant fired with surplus wood residues from several industrial sources in Southeast Alaska. Identification Number DE-FG79-84-BP14984, A014 Grantee Alaska Dept. Community and Regional Affairs, Division of Energy PO Box 190869 Anchorage, AK 99519-0869 Project Manager Peter Crimp, 907/561-7877 Alaska Dept. Community and Regional Affairs, Division of Energy, Anchorage, AK 99519-0869 Regional Bioenergy Program Funds $40,000 Cost Sharing Match AEA cash, contractual services $33,839 AEA personal services, electrical and mechanical $2,370 engineers AEA overhead $3,791 Total Match $40,000 Expanded Description Several sawmills and log sorting facilities in Southern Southeast Alaska are producing wood residues in excess of their ability to properly dispose of this material. The practices of open burning, land filling and the use of silo burners without adequate emissions control devices are all being discouraged by regulatory agencies. Preliminary estimates indicate that mills in Ketchikan, Metlakatla, Annette, and Kasaan are collectively producing sufficient residue to provide fuel for about 3 mW of baseload power. Electrical power for the communities of Thorne Bay, Craig and Klawock is produced by diesel fired generators. The community of Ketchikan uses primarily hydroelectric power, although load projections indicate that additional diesel-fueled capacity will be needed to meet demand within the next few years. Metlakatia uses a mix of hydroelectric and diesel power. Page 31 This project will evaluate the prospects for developing a power plant that uses these surplus wood residues to produce power for local utility use. A detailed description of the evaluation is described under the heading ot approach below. Need Addressed The project addresses the need for power production alternatives to costly diesel fuel in Southeast Alaska communities, the need for improved wood waste disposal practices, and the need to use local fuel resources for local needs as an economic development strategy. Project Objectives Specific objectives are as follows: 1) to encourage the development of a facility to fully utilize wood waste being produced by wood processors in Southern Southeast Alaska at a regional generation facility. 2) to provide adequate information concerning project development to encourage independent power producers, local ,electric utilities, wood processors and public agencies to participate in developing a wood-waste fired generation facility. 3) to reduce dependency on non-renewable fuel resources imported into the Southern Southeast Region of Alaska. 4) to determine the long term wood residue supply anticipated for the Southern Southeast Alaska Region that could be available for energy production. 5) To encourage local economic development through the use of “import substitution” of fuels for power production. Approach The scope of work proposed for this project is to complete a feasibility study for a wood- waste-fired electrical generation facility located in a South Tongass community. The study will take place in two parts: (1) A wood resource and transportation cost assessment that will examine the quality and quantity of mill, sort yard and landing residue available for fuel and (2) a design concept and cost estimate for a wood-fired power plant at a location identified by the first phase of the feasibility study. The study will be tailored to seek alternate energy markets for the wood-waste on a regional basis, providing a regional wood- waste disposal facility and utility power in the location offering the highest feasibility and public benefit. The second phase of this project will be initiated only if the results of the first phase demonstrate that it is economically viable. 1. Analysis of Fuel Supply The fuel supply analysis will investigate both short and long term (20 year) wood fuel availability to the project from a multitude of sources including sort yard waste, landing slash, and off-island residue deliverable by barge. Estimates of the quantity, characteristics, and cost of prepared fuels from all sources will be included. The long term fuel supply analysis will include factors such as the level of harvest activity on the Tongass National Forest, potential for future competitive markets for wood waste and possible changes in the flow and production of logs and wood waste over the next 20 years. 2. Siting Page 32 The study will recommend a proposed site tor the facility with considerations for: fuel delivery cost and storage; site development costs; make up water; cost to access power grid; power sales and proximity to market for steam and transmission line; environmental impacts including air quality, water quality and noise; proximity to fuel supply from uplands and tidewater; land ownership and land use designations; utility participation and cooperation; and public acceptance. 3. Concept Design Electrical A concept design that maximizes power sales from the facility, while recognizing the superiority of diesel generators in load following will be prepared. Remote diesels with automated dispatch may be necessary to serve peak loads. Plant design, cost estimates and performance criteria, suitable for use in preparing of an RFP for independent power producers will be prepared. Mechanical A mechanical concept design including fuel handling, preparation and storage, boiler feed water system, boiler design, flue gas controi and ash handling will be prepared. The concept design will also consider the viability of co-firing portions of the municipal waste stream. The concept design will include cost estimates and performance criteria suitable for use in preparing an RFP for independent power producers. 4. Environmental Analysis This portion of the project will address environmental issues including: stack emissions and Clean Air Act compliance; ash-fill siting and design criteria (or alternative means of ash disposal); air emissions from fuel dryer, if applicable; and water quality impacts. The study will also discuss the avoided impacts of reduced land filling, open burning, fuel oil transport and storage, and generation of power via diesel internal combustion units. If determined to be necessary for permitting and if adequate funds are available, the study will include the collection of baseline air quality data. 5. Economic and Financial Analysis The study wiil include an economic and financial analysis of the project which includes estimates of capital cost, operations and maintenance costs, and fuel costs for the life of the project. This analysis will address the level of State and Federal funding needed to arrive at a target kWh power rate. The target power rate will be a rate determined to be competitive with alternative costs of wholesale power. The economic analysis can be used for comparative studies with hydro and diesel power generation, as well as serve as a decision document for obtaining public and private project financing. Resuits Phase 1 contractor America North has submitted a draft final report which was reviewed by the Division of Energy, the US Forest Service, and the Alaska Department of Environmental Conservation. Division staff submitted written comments on two report drafts. A finalization of the report was expected in late December. Since the project began the Alaska Pulp Corporation pulp mill in Sitka has shut down, citing insufficient and expensive utility logs from the Forest Service. Louisiana-Pacific's hemlock mill in Annette has announced plans to install 650 kW of generating capacity fuel by their residues. The final report recommends Annette Island as the most feasible site for a wood-fired power plant from a standpoint of fuel cost and availability. The Thorne Bay sortyard may also accomodate a facility given current trends in waste disposal requirements and costs. Phase 2 activities Page 33 will concentrate in these areas. This quarter contacts were made with the hemiock mill, other Ketchikan Pulp Company officials, and Metlakatla Indian Community electrical utility and sawmill staff to assess potential for an energy project in Metlakatla. Major Milestones Milestone Status Secure matching funding Completed Draft RFP and review, Phase | Completed December, 1992 Wood/Transportation Assessment Advertise for Professionai Services Completed January 1993 Proposal deadline Completed February 1993 Select Consultant, Finalize Agreement Compieted April 7,1993 First interim report Compieted June 21 Second interim report Completed June 21 Third interim report Compieted June 21 Draft final report Compieted September 13 Final report December Prepared: Peter Crimp, Development Specialist Amended: December 7, 1993 Page 34 APPENDIX B Task Force Correspondence Page 35 WALTER J. HICKEL, GOVERNOR DEPT. OF COMMUNITY & REGIONAL AFFAIRS DIVISION OF ENERGY November 29, 1993 Mike Vorhies U.S. Department of Energy 1000 Independence Ave. SW Washington, D.C. 20585 Dear Mike, Thanks for the opportunity to comment on the Draft Process Evaluation of the Regional Biomass Energy Program. We are pleased that the report recognizes the important role of the states in identifying potentially successful bioenergy projects and bringing state and local resources to bear in making them happen (section 3.1, last paragraph). This, in combination with the broader perspectives gained by regional and national collaboration, is a unique strength of the regional programs. We agree that program objectives should be measurable (section 6.1.1, last paragraph). Total energy recovered for heat and power would seem to be the logical measure. Although the report plays down the reliability of the leveraging ratio as a single measure of program effectiveness, we are concerned that the numbers may later be used out of context. The eye-catching bar graph in figure 6.2 suggests that the PNAB program is relatively poorly matched. Table F.1 tells a more complete story, since it shows the state project matches, the disproportionate effect of individual project categories, and the extent of the data. Adding the state project match to that of the PNAB region boosts the leveraging ratio to 2.4. Perhaps figure 5.1 should show the region totals in hatched lines when they are known. Similarly, the executive summary should present the impressive nationwide state program leveraging ratio using available data (page xv, paragraph 3). The report recommends that program focus should be on near-term markets (section 6.2, paragraph 2). We agree. It doesn't make sense to use the scarce funds on projects which will not bear fruit soon. That is not our niche. We do not agree that coordination of the northwest program would necessarily benefit from less use of a support services contractor (section 6.2, paragraph 6). Coordination of the program has been very good, and we are not sure of the basis for this recommendation. The report recommends that industry participants should receive more of the overall funding. We agree in general, but wish to make the point that pass-through grants to local government often lead to substantial industry involvement. In the Alaska program a good example of this is the $25,000 regional funds that were passed through to Fairbanks for WTE planning. Partly because of this funding, Fairbanks will be likely hiring a firm to design and construct a paper pelletizing and co-firing operation. As part of the PNAB program, Alaska has published and disseminated the Alaska Bioenergy News quarterly since 1986. This should be noted on page E.7 under the heading of "Northwest", The following are a number of typos and unclear sentences that we came across: p xiv, line 8: project or projects’, not project's Pp 10, line 8: Add region after Alaska. p 14, line 10-11: Fix names of regions. p 57, line 23: Substitute "an analysis of the feasibility for a regional wood-fired power plant in the South Tongass area of Alaska" for "the South Tongass Wood- fired Power Plan". p 80, line 31-33: Fix sentence; there is no subject. Thanks again for the chance to comment. Sincerely, Peter Crimp Development Specialist o1-PILH WALTER J. HICKEL, GOVERNOR 1 P.O. BOx 112100 JUNEAU, ALASKA 99811-2100 PHONE: (907) 465-4700 FAX: (907) 465-2948 DEPARTMENT OF COMMUNITY AND REGION AL AFFAIRS 1 333 W. 4TH AVENUE, SUITE 220 ANCHORAGE, ALASKA 99501-2341 PHONE: (907) 269-4500 OFFICE OF THE COMMISSIONER FAX: (907) 269-4520 QO Division of Energy P.O. Box 190869 Anchorage, Alaska 99519-0869 Phone: (907) 561-7877 Fax: (907) 561-8584 December 20, 1993 Ms. Christine A. Ervine Office of Energy Efficiency and Renewable Energy U.S. Department of Energy 1000 Independence Avenue, S.W. Washington, D.C. 20585 Subject: Department of Energy's Regional Biomass Energy Program Dear Ms. Ervine: I am writing to express the State of Alaska's support for the Department of Energy's Regional Biomass Energy Program. The regional program aims to promote biomass (in our case, chiefly sawmill waste and garbage) as cost-effective sources of energy in the region and, in so doing, contribute to the area's economic and environmental well-being. In Alaska, the biomass program is administered by the Division of Energy within the Department of Community and Regional Affairs (DCRA). During the last ten years we have found that implementing efficient energy alternatives requires much work at the local level dealing with unique economic and environmental issues. We work closely with industry and local governments to develop alternatives to costly power generation, heating fuels, and current waste disposal methods. Consistent with the other regional programs, the Alaska program emphasizes using of commercially available technology and leveraging of federal and state funds by matches from industry and local government. Current activities include: . Assisting the city of Fairbanks in considering waste-to-energy options in its solid waste planning process. Partly because of the bioenergy program's help, the city will likely be using the most cost- effective waste management alternative -- co-firing pelletized paper with coal for power production. Ms. Christine A. Ervine December 16, 1993 Page 2 . Analyzing the feasibility of a power plant in southeast Alaska fueled by waste wood from saw mill, pulp mill, and logging operations. . Assisting the City of Sitka to upgrade its garbage incinerator so that it generates electricity and improves air quality. Pay-back on the steam turbine is around three years. . Assessing the potential for heating correctional facilities using residues from the new sawmill in Seward and waste heat from Channel Corporation's modular garbage incinerators in Juneau. I am encouraged to see that the U.S. Department of Energy included the Regional Biomass Energy Program in its proposed budget for Fiscal Year 1994. Given the practical, results-oriented nature of this program, I hope that you will consider even higher levels of funding in future years. Please contact my Division of Energy staff at (907) 561-7877 if we can provide you with additional information about the state and regional bioenergy programs. Sincerely, Edgar Blatchford Commissioner cc: Peter Crimp, Division of Energy APPENDIX C Current Industry-Related News Articles Page 36 Alaska salmon lose logging By DAVID WHITNEY Daily News reporter WASHINGTON — Alaska fish- ermen were against it. National fishermen were against it. Envi- ronmentalists opposed it and the Clinton administration also thought it was a bad idea. But Sen. Ted Stevens, R-Alas- ka, Wednesday surmounted those seemingly overwhelming odds and won a congressional panel’s agreement to block a Forest Ser- vice plan to protect salmon in southeast Alaska’s Tongass Na- tional Forest next year. The plan, called PACFISH, hasn't been completed. If applied in its draft form to the Tongass, however, it would triple the size of existing no-tree-cutting buffers AON around salmon streams and set up new buffers around lakes and wetlands. Those measures would have been temporary while the Forest Service studied the effect of log- ging on the health of fish streams. The studies are not pro- hibited by the Stevens’ provision but the new and expanded buff- ers are. The state claimed the buffers envisioned by the Forest Service would have cut the annual timber harvest from the Tongass in half, costing as many as 1,700 jobs and damaging the economies of log- ging-dependent communities in Southeast. Stevens’ provision was tenta- tively accepted Wednesday by a lof /a $ House-Senate conference commit- tee working on a compromise 1994 spending bill for the Forest Service. How much timber will be cut from the forest in 1994 is still an issue. The House has supported funding for no more than 280 million board-feet, while the Sen- ate, urged on by Stevens, has backed enough money to build roads, draw up maps and other- wise prepare 420 million board- feet of timber for sale. That issue will be resolved today by the conference committee. While there is still some chance that Stevens’ provision will be challenged today, the prospects Please see Page C-8, PACFISH buffer zone BILL ROTH | Daily News file photo Sen. Ted Stevens ar seemed remote after Stevens told the panel he has no desire to harm salmon stocks “These people know I am an ardent salmon fisher- man,’’ Stevens said. el wouldn't do anything to hurt salmon.’ Attempts to reach others on the conference panel were not successful late Wednes- day. But among interest groups, not everyone agreed with Stevens. Tom Cassidy of the envi- ronmental group American Rivers accused Stevens of advocating an “unsustaina- ble logging industry at the expense of salmon habitat.” “His use of the Senate appropriations process is masterful,’ Cassidy said. “But Alaska’s fish just got mugged behind closed doors and without debate.” Numerous Alaska and na- tional fishing organizations and environmental organiza- tions had lobbied against the Stevens’ provision. They in- clude the American Fisher- ies Society, the Izaak Walton League, the Natural Re- sources Defense Council, the Southeast Alaska Conserva- tion Council and the Alaska Center for the Environment. They argued that, while Alaska salmon stocks ap- pear to be healthy, the PAC- FISH initiative is aimed at H: ensuring that remains true along fish streams in the Tongass while the detrimen- tal effects of clear-cut log ging are analyzed They noted that logging has contributed to the de- struction of salmon stocks in the Pacific Northwest “The results of past forest and land management prac- tices in the Pacific North- west should serve as a warn- ing for Alaska while the opportunity still exists to prevent decimation of sal- monid_ stocks,”’ the Ameri- can Fisheries Society's Alas- ka chapter told Forest Service administrators in a Sept. 25 letter opposing Ste- vens’ provision The Clinton administra- tion notified lawmakers that it, too, opposed Stevens’ ex- emption for the Tongass. While the Forest) Service said it was willing to consid: er modifications of the plan for the Tongass, it felt that the plan's broad provisions should be applied to the forest Because of Stevens’ provi sion, the Tongass could be the only forest on the West Coast with a congressionally mandated exemption from the plan By federal law, 100 foot nu-cut buffers are required on each side of salmon-pro- ducing streams. Those buff ers would have tripled to 300 feet under the PACFISH Plan blocked plan while smaller buffers would have been established along all other streams, lakes and wetlands Gov. Wally Hickel’s ad ministration mounted a cam- paign in support of Stevens’ provision. Among its argu ments was that PACFISH would do more harm to Alaskans than the 1989 Exxon Valdez oil spill The state said the livell hoods of more Alaskans would be jeopardized by the PACFISH plan than the oil spill That argument drew ridicule “To liken the spill’s ef fects to those that would result from a sound, sc ientif- ically based strategy de signed to ensure the long-term viability of Alas- ka’s salmon runs 1S absurd,” said Rick Steiner, a biologist and commercial fishermen from Cordova The essence of the Forest Service’s argument was that some salmon. stocks in Southeast appear to be de clining and that rivers should have enhanced pro tection while the effects of logging are studied The state said most of the salmon stocks the Forest Service cited were from ar- eas of the Tongass off limits to logying or were in areas lopged years ago under less stringent environmental pro tection. Forest Service weighs prospects for mill ~ ne Associatea Press SITKA — The Forest Ser- vice has begun a review of the Alaska Pulp Corp. mill -o see if it may be converted :o produce fiberboard. The mill, Sitka’s key em- ployer, closed Sept. 30 and displaced more than 400 workers. It produced pulp ‘hat went into a range of linished products including rayon. A Forest Service laborato- ry in Wisconsin has begun reviewing manufacturing re- quirements if the mill was converted, and agency econo- mists in Juneau also are studying alternatives. Randy Coleman, a Forest Service group leader in Ju- neau, said market studies were among concerns if me- dium-density fiberboard was produced at Sitka. Key ques- tions also include how a Sitka plant could compete and the cost of retooling the plant. Under consideration is a very thin board, about one-eighth of an inch thick. Coleman says one market is Japan, where the board could be used as substitute plywood. Medium-density board made from timber industry byproducts already is com- mercially available. Propo- nents say the Sitka mill could make a higher prod- uct, perhaps using logs cut for the purpose. Rollo Pool, Alaska Pulp spokesman, said medium- density board was ‘the most promising prospect.” “There are some bigger questions looming out there that have to be answered before we can say yes or no about the fiberboard,’’ Pool said. Among concerns is an assured wood supply con- tract. Alaska Pulp has sued the Forest Service, claiming changes to the company’s 50-year contract reduced the quality and accessibility of timber. s2/ widy \2/| HO The Anchorage Times Publisher: BILL J. ALLEN "Believing in Alaskans, putting Alaska first" Editors: DENNIS FRADLEY. PAUL JENKINS. WILLIAM I. TOBIN The Anchorage Times Commentary in this segment of the Anchorage Dailv News does not represent the views ot the Daiv News. it is wntten ana published under an agreement with former owners ot The Times. un the interests of preserving a diversity of viewpoints in the communutv. Down, not out HEIR PULP MILL closed in September laying off 400 work- ers. They see a frenzied school of environmental piranhas clos- ing.in to kill their timber harvest contract with the U.S. Forest Ser- vice. Yet the community of Sitka and the Alaska Pulp Corporation are not throwing in the towel. They are looking instead to the challenge of converting the for- mer pulp mill to another use — one which could provide many of the jobs lost when the pulp miil closed. and one which could grow to be- come the mainstay of the Sitka economy. The proposal, still in its evaluation stage, is to produce medium- density fiberboard — a plywood-like substance that uses basically the same quality of wood chips and other forest materials that went into the pulp operation. Unlike pulp manufacturing, however, fiberboard does not gener- ate vast amounts of wastewater. The quality of water discharged in- to Silver Bay was the principal issue that caused the most grief for the pulp operation. Fiberboard is made of ground up pieces of wood material and fibers bonded together with adhesives. The medium-density board is used in furniture and for construction trim. Company officials say there is a good market for it in the United States and overseas. First, though, they must fend off an attack by fellow Alaskans in the environmental community who are trying to kill Alaska Pulp’s federai contract to harvest timber from the Tongass National Forest. The Southeast Alaska Conservation Council has challenged the Forest Service to terminate the 50-year contract. which still has 17 years remaining, and not allow any more timber harvest, including that necessary for APC’s Wrangell sawmill to continue operation. Anyone who has watched the Tongass debate in Congress over the past decade or so will see the irony and cruelty of the organiza- tion’s effort. In testimony after testimony, the environmentalists have said their intention was never to cause job loss. They just wanted cleaner, more efficient operations. Sure they do. The fiberboard manufacturing plant would provide the kind of en- vironmentally clean and efficient operation the environmentalists claim they want. So what do they do? They try to kill the contract before the operation can get off the ground. And they seem to delight in the agonies they are causing for the displaced workers. Rollo Pool, spokesperson for the Sitka mill, said he received a McDonald’s job application from one Southeast envi- ronmentalist with a brief note: “Ha, ha,” it said. The challenge of getting the fiberboard operation off the ground may be formidable — but it would be worth it ail to stick the “ha, ha” in the critic’s ear. ! i Newsletter says Ketchikan mill at risk of closing The Associated Press KETCHIKAN — A Seattle-based business publication has listed the Ketchikan Pulp Co. as one of the region’s mills most likely to close, but company officials say they wouldn’t be sinking big money into the operation if they intended to shut it down. Marple’s Business Newsletter, which fo- cuses on the Pacific Northwest, placed the Ketchikan mill among seven regional pulp a as the greatest risk of beinc mothbal- ed. The Nov. 24 article said the listing weighed availability of resources at reason- able prices, mill age and size, and cost of complying with new environmental regula- tions. Reporter Kevin Gudridge said he inter- )wy2\ 10¥ ts viewed about 10 knowledgeable sources for the story. “What the folks were saying is that not necessarily all seven will go down, but three of these mills in three years will close unless something dramatic changes,” he said. Ketchikan, Pulp manager Steve Hagan said he didn’t know where the news'stter got its list, but said the 39-year-old mil] is not in danger of closing. “We're putting a lot of money into the mill,’”’ Hagan said. ‘‘We’re not planning on being a short-term mill. We're in for the long run.” Hagan pointed to a $6.5 million barge the mill just launched as proof. The company, however, is facing heavy costs to update the mill to meet new environmental standards. And the operation was shut down for about 3% aonths this year because it couldn’t secure enough tim- ber to keep running. Feds again search pulp BN ~ | Ketchikan official says agents look for 7 as pollution violation By BRIAN S. AKRE The Associated Press JUNEAU — Federal agents searched the offices of Ketchikan Pulp Co. in Ketchikan on Thursday, apparently as part of the continuing criminal investigation into al- leged pollution violations at its mill there. ‘The search was the second ina little more than a year. Company President Martin Pihl said the agents arrived with a search war- rant about 8 a.m. and searched the offices throughout the day. i) He said the search appeared to be con- *hected’ with the same investigation that ‘“Sbécame' public after a Nov. 18,' 1992, search. “As you know, we’ve heard nothing from that,” Pihl said. ‘The only thing appropri- ate for me to say is to confirm we have had another visit.” Spokesman Bob Jacobson of the Environ- mental Protection Agency in Seattle and Assistant U.S. Attorney Tim Burgess in Anchorage would neither confirm nor deny that a search was being conducted. They also declined to discuss the investigation. Jeff Feldman, an Anchorage attorney for Ketchikan Pulp, said EPA and FBI agents were conducting the search, apparently for documents they felt they had missed. “It doesn’t appear that this changes the scope of the existing investigation,” Feld- man said. “It appears to be for more of the documents of the same nature. “It doesn’t surprise me that with an investigation as complicated as this that they might determine they need to go back and get some more.” The Justice Department said in a court affidavit last year that the investigation of the mill’s waste-water treatment began in October 1991. A grand jury has heard evi- dence in the case in Anchorage, but no indictments have been issued. “My impression is there have been two or three days of testimony,” Feldman said The attorney said the company is cooper- ating, but that Justice officials have provid- ed little additional information. Justice also filed a civil lawsuit against Ketchikan Pulp in September 1992 for al- leged violations of federal pollution laws The lawsuit cited numerous instances where the mill allegedly violated the Clean Water Act by discharging waste water that ex- ceeded pollution limits. In September, three former workers testi- fied at a Labor Department hearing that they were fired for reporting the violations to federal officials. They said the company had repeatedly falsified its pollution re- cords. The company denied the allegations. It is illegal under federal law for an employer to retaliate against a worker for reporting an environmental-law violation The three are seeking reinstatement of their jobs and back pay. Wolves in Tongass s The Associated Press JUNEAU — An environ- mental group and an Alaska biologist petitioned the fed- eral government Monday to list a subspecies of the gray wolf in the Tongass National Forest as a threatened spe- cies. The move is unusual be- cause there is no evidence the Alexander Archipelago wolf population is declining. The petition alleges oniy that the wolf is vuinerable to continued large-scale log- ging, road-building, hunting and trapping in the south- east Alaska forest. Its filing comes as envi- ronmentalists are asking the new chief of the U.S. Forest Service, Jack Ward Thomas, to overturn the agency’s re- gional approval of a large timber sale on Prince of Wales Island in the Tongass. The 267-million-board-foot sale and the petition are being cited as tests of the Clinton administration’s dedication to protect the en- vironment in its manage- ment of federai lands. The Biodiversity Legal Foundation, based in Boul- der, Colo., and independent biologist Eric Holle of Haines are seeking the woif designation under the En- dangered Species Act. “This is probably one of the first times in the history of the Endangered Species Act where a major petition has come forward before major declines have been documented,”’ foundation di- rector Jasper Cariton said in a telephone interview from Boulder. ‘‘Congress did not say that we had to wait until a species was near ex- tinction.” The designation, if grant- ed, would require steps to protect the animal’s popula- tion. Those could include re- strictions on logging, road- aid at risk APN m2 building and other develop- ment in the 16.8 million-acre rain forest. But a ‘“‘threat- ened’”’ designation is less re- strictive than an endangered species classification. The petition, filed with the U.S. Fish and Wildlife Service in Washington, is the first in a series of actions the group plans to protect wildlife in the Tongass, the nation’s largest national for- est. Other possible species that may be targeted include the Queen Chariotte gos- hawk, Franklin spruce grouse, spotted frog, river otter and brown bear. “This will oniy be the opening shot,’’ Carlton said. The petition asks the agencies to work jogether on a plan that would set aside additional large tracts of old-growth forest as special habitat areas for specific species. Ketchikan Puip files claims, $300 million sought from U The Associated Press KETCHIKAN — The Ketchikan Pulp Co. has filed claims with the U.S. Forest Service for up to $300 million in damages it says it has or will sustain because of supposed breaches in its contract with the federal agency. According to a Monday news re- lease, the company filed the admin- istrative claims with the Forest Ser- vice contracting officer in Juneau “to both recover damages and pro- tect and defend KPC’s timber con- tract which is the foundation of its a Continued from Page C-1 A cciohiterbn hd ee ernment agency made unilat- eral revisions in its original. bilateral contract with the company without the firm’s agreement. Ketchikan Pulp claims those changes will have a damaging effect on the company through June 30, 2004. Company officials said they are willing to forgo monetary damages if the Forest Service will ‘‘stop the unreasonable disregard of KPC’s contract rights in the future.” The company did not state how much money it claimed as compensation for future damages but Forest Service Contracting Officer Gene Chelstad said the total amount of the claim, deliv- ered to Regional Forester Mike Barton, was for ap- proximately $280 to $300 million. The company said it has performed its part of the contract signed in 1951. “The original intent of the federal government to devel- op a forest products manu- facturing industry providing stability and year-round S. for timber deal breaches operations in Southeast Alaska.” Among the company's grievances are what it considers a failure by the Forest Service to provide the agreed-upon amount of timber be- tween 1989 and 1994 and the failure of the agency to provide what tim- ber it did supply in a timely man- ner. Ketchikan Pulp also claims the Forest Service failed to establish proper stumpage rates for timber between 1989-1994 and that the gov- . Please see Page C-2, PULP jobs in Southeast Alaska has been met. The timber indus- try which has deveioped un- der KPC’s contract is an important leg of the econo- my of Southeast Alaska,” the release said. But the Forest Service's failure to supply timber and terms of the Tongass Timber Reform Act of 1991 led to Monday's filing, said compa- ny controller Ralph Lewis. Previously, the Forest Service received $40 million in annual operating ‘unds through provisions of the Alaska Nationai Interest Lands Conservation Act. That’s no longer so, For- est Service planner Dave Ar- rasmith said Monday. The act also removed legislated harvest leveis and mandated minimum 100-foot buffer zones around salmon spawn- ing streams and around streams that run into salmon streams. The act made the long-term timber sales more like short-term programs in the Tongass National Forest, said Arrasmith. That meant separate environmental im- pact statements must be written for each timber sale. a rr Anchorage Daily News ESS Friday, December 31, 1993 D5 Inquiry won’t halt mill work Justice Department acts to ease minds at Ketchikan Pulp By HAL BERNTON Daily News business reporter The federal Justice De- partment has no intention of closing down the Ketchi- kan Pulp Co. mill during a pending criminal investiga- tion of water-pollution vio- lations, U.S. Attorney Joe Bottini said Thursday. Bottini’s statement was part of an unusual public announcement confirming the year-old criminal inves- tigation of the Louisiana Pacific Co.’s Ketchikan Pulp mill. It came in re- sponse to a Dec. 16 letter from Louisiana Pacific President Harry Merlo, of- fering’ to shut down the mill ‘‘for whatever time necessary to facilitate fur- ther testing and resolution of your concerns.” Tim Burgess, an assis- tant U.S. attorney, said the statement Thursday was an effort to reassure Ketchi- kan residents about the government’s intent. The Ketchikan mill tums federal timber from the Tongass National For- est into pulp used for rayon and other products. It em- ploys about 500 people and is a mainstay of the south- east Alaska timber indus- try. Alaska’s pulp industry was set up in the 1950s to diversify the economy, but the industry has been un- der seige in recent years for the pollutants the mills emit and for the logging that supplies the mills. The state’s only other pulp mill, in Sitka, shut down last fall amid a battle with the U.S. Forest Service over terms of its logging contract. FBI agents searched the Ketchikan mill last year as the government began in- vestigating alleged viola- tions of the federal Clean Water Act, according to an affidavit by Justice Depart ment attorney Rick Filk- ins. The investigation has targeted water-pollution control systems, according to court documents recently unsealed in U.S. District Court. Jeff Feldman, an attor ney for the mill, confirmed in December 1992 that a grand jury was looking in- to the alleged violations. FBI agents again searched the mill Dec. 8, resulting in the seizure of “approximately five bank- er boxes of business re- cords,” according to court documents. The documents indicate that FBI agents searched for operating logs and records that involve wastewater operations dat- ing back to 1989. The search also sought to in- spect and trace manholes Please see Page D-7, KETCHIKAN British §) Columbia ‘Peel ; LB Ketchikan # Pulp Mill rear es. rea tek ccem RON ENGSTAOM /Anchorage Daily News KETCHIKAN: Mill stays open during investigation | Continued from Page D-5 | and piping that leads from the plant to Ward Cove, the water body that treated mil] wastes flow into. Prior to the search, the govern- ment also obtained court permission to use ground- penetrating radar to trace the piping. In justifying the search warrant, government offi- cials said the plant con- tains ev-dence of ‘‘specified however, are alleged in a confidential affidavit that remains under seal. Ketchikan Pulp attor- neys have been trying to persuade the court to un- seal the affidavit. In a brief filed Dec. 17, Feldman ar- gued that the mill ‘wishes to act quickly to discover and correct any environ- mental violations’’ that may be occurring. Without access to the search watr- rant affidavit, KPC’s abili- ty to do so is severely Burgess, the assistant U.S. attorney, said his of- fice would oppose unseal- ing the affidavit. While the criminal case is pending, the federal gov- ernment and the mill have been negotiating a settle- ment to a separate civil case accusing the mill of failing to monitor pollutant flows on at least 170 differ- ent occasions, and_ failing to report violations of pol- lution standards. It also al- leges the illegal dumping of pulping compound known as red liquor, as well as other violations of the fed- eral Clean Water and Clean Air laws. According to a Nov. 1 status report filed with in U.S. District Court, the government and Ketchikan Pulp are trying to settle the civil case. 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