Strategic Industry Effort Proves Successful

By Bill Bell | April 02, 2013

The proof will be in the pudding, but up here in the heavily forested northeast corner of the country, we may have hit upon an approach to breaking the Congressional logjam blocking biomass thermal incentives.

First, here’s a bit of background. When U.S. Sen. Olympia Snowe, R-Maine, surprised everyone last year by announcing she would not seek re-election, the partisan sharks and hyenas suddenly saw a chance for Democrats to pick up a Republican seat. At the time, control of the Senate appeared to hang in the balance. Democratic optimism quickly disappeared, however, when popular former Gov. Angus King announced his candidacy. King, an independent, handily won the three-way election with 53 percent of the total vote; the Republican and Democratic candidates received only 30 percent and 13 percent, respectively.

Part of King’s success came from his cordial relationships with Maine business leaders; a portion came from his thorough command of energy issues, in part from his investments and management experience in low-head hydro—prior to his election as governor—and wind power, after his two gubernatorial terms. At a debate hosted by Maine’s Environmental and Technology Council, the first such confrontation between the top three candidates, King clearly emerged by far as the best-informed in a state where energy is a major issue.

Fast forward to February, when Maine entrepreneur Les Otten, founder of both Maine Energy Systems and the Maine Pellet Fuels Association, invites King for a tour of his OkeFEN boiler assembly plant in Bethel, Maine. It’s also the home of the Sunday River ski resort, which Otten developed. King accepts, and Otten cuts short the plant tour to provide King with PowerPoint presentations crafted by a carefully assembled group of economic and forestry specialists, each of whom spoke to the logical concerns of an elected official seeking to make broad-based decisions.

A constant problem confronting Maine’s pellet industry, with four pellet manufacturing plants plus Otten’s boiler assembly operation, has been objections of the state’s long-dominant pulp and paper firms to perceived competition for fiber. These concerns have led King’s successor as Maine governor to constantly hedge the bets that he wanted to make on behalf of wood pellets replacing some of Maine’s over-dependence on heating oil. Anticipating King’s similar concerns, the group meeting with him over the Congressional recess included a top executive with one of Maine’s leading forest product firms, who spoke on “how traditional and new wood-based industries can complement, rather than compete.”

Additionally, King was provided with a summary by Maine Forest Service’s director of forest policy and management, which set forth the growing surplus of wood in Maine’s sustainably managed forests. The group also assured King that any Maine pellets produced for export would have to meet European sustainable forestry management standards.

A former Maine Forest Service employee was on hand to provide Sen. King with a detailed report on how federal stimulus funds entrusted to the forest service for fuel-switching in public buildings are now saving local taxpayers millions of dollars in fuel costs. In the instance of such fuel-switching in a municipality that is home to a large pellet manufacturing plant, such savings result in a substantial reduction in property taxes for the pellet mill, enabling the mill to purchase a pellet delivery truck to better serve the school and other customers.

Key to the overall impression made upon the newly elected senator was a presentation by the Northern Forest center, a nonprofit “committed to thriving communities and healthy forests.” The group spoke to the economic and community benefits of developing the pellet heating industry in northern tier states, and specific benefits accruing to homeowners in Berlin, N.H., where the Center is funding a demonstration project converting a neighborhood to pellet heat.

The bottom line in this story is the phone call from Sen. King to Otten, upon the former’s return to Washington, stating that he plans to play a lead role in advancing the ongoing quest by the Biomass Thermal Energy Council to obtain the same federal tax incentives that for years have been extended to residential and industrial users of virtually all other forms of renewable energy. In this quest, he will no doubt be joined by Maine’s senior Sen. Susan Collins, a long-time supporter of pellet heating, who, a day later, received the same presentation from Maine’s group of advocates. 

Author: Bill Bell
Executive Director, Maine Pellet Fuels Association