Biomass developers fight EPA emissions ruling

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A new report delves into the jobs created and economic activity generated by a tax credit for biomass feedstock.

A recent federal ruling could cripple the region’s fast growing biomass industry.

The U.S. Environmental Protection Agency, in its quest to regulate carbon emissions, last month issued a final rule requiring all large stationary sources of greenhouse gases to obtain emissions permits.

The ruling doesn’t exempt biomass plants, which burn organic materials such as forest waste to generate heat and create electricity.

The EPA largely ignored emissions from biomass plants in the past, theorizing that their carbon output is reabsorbed by forests that generate the feedstock.

But the agency is opening up the issue for discussion, leaving project developers to wonder whether they will be obligated to install costly emissions control equipment.

St. Helens-based Biogreen Sustainable Energy is developing a 25-megawatt biomass plant in LaPine that has already grown to more than $70 million. The plant could eventually power more than 13,000 homes.

Rob Broberg, the company’s president, estimated additional emissions controls could add up to $5 million to the project..

“I would be OK on up to about $80 million (in project costs). Beyond that, it could be a deal killer,” he said. “We’re getting close.”

EPA spokeswoman Catherine Milbourn said the agency previously considered biomass carbon neutral. But now the agency wants to work with stakeholders to consider whether that’s appropriate.

U.S. Rep. Peter DeFazio, a Eugene Democrat, said the ruling puts biomass emissions on equal footing with those from fossil-fuel burning plants. It also brings into question whether biomass is considered a renewable resource and could threaten some developers’ eligibility for federal renewable energy tax incentives.

“It’s like they’re trying to kill the biomass industry in its infancy,” said DeFazio, one of 63 members of Congress who last week signed a letter to the EPA challenging the ruling. “I think you’re seeing some big-time political arm twisting by some big-time misguided environmental groups.”

In particular, DeFazio set his signs on the National Resources Defense Council.

Nathanael Greene, director of renewable energy policy for the New York-based environmental group, said biomass projects can be beneficial to the climate, especially if they use feedstock that would be cleared from the forest anyway.

But it’s a different story if a biomass facility takes its feedstock from land that had been cleared for development.

“If you go out to any landscape and take the standing biomass off it and put in a parking lot, you’re never going to capture that carbon,” Greene said.

Since the EPA can’t regulate land use, it has chosen to account for the carbon output from biomass plants at the smokestack until a better solution can be found, Greene said.

“They clearly said they recognize this is a complicated issue and they will have a stakeholder process and issue guidance, Greene said. Critics have tried “to paint it as if EPA has slammed the door shut and the only solution is to railroad EPA backwards. It’s politics.”

Politics or not, the issue has already made project developers fearful over whether they will be able to finance their plants.

Bill Kravas has plans to build a $60 million, 27-megawatt biomass plant in Amboy, Wash., on the site of a former International Paper mill. It would provide power to some 18,000 homes.

The project is undergoing a feasibility study that will determine its total costs before Kravas seeks potential investors.

“The more costs that go on it will go to consumers until you get to a point where the economics don’t balance out,” Kravas said. “Everybody’s concerned about it because of the unknown.”