Kingdom Pellets continues to secure financing for proposed plant

By Katie Fletcher | August 24, 2016

The proposed Kingdom Pellets wood pellet plant in northern Vermont is moving forward on track to produce pellets late next year as it continues to secure financing. Mid-summer, Vermont Gov. Peter Shumlin announced that $550,000 had been awarded to the town of Lunenburg, Vermont, in community development funds. The town will loan the grant funds to Kingdom Pellets.

According to Tabitha Bowling, partner of Kingdom Pellets, the town of Lunenburg applied for a community development block grant and, upon receiving the grant, they’ll, in turn, be loaned these funds to support the build cost of the mill. “That was very exciting,” she said.

Bowling’s company Root 8 Ventures partnered with Vermont Wood Pellet Co. to develop the $5 million Kingdom Pellets plant. Bowling said VWP owner Chris Brooks and two others in his operation formed an LLC to be a partner in Kingdom Pellets. “He’s the majority owner of that LLC and, all told, their part of the ownership is 50 percent, and my company Root 8 Ventures owns the other 50 percent,” she said.

In concert with the 50/50 ownership structure, Kingdom Pellets is relying on the operational expertise Brooks' acquired while operating the 16,000-ton-per-year plant in North Clarendon, as well as the proven VWP product and brand. “We’re trying to leverage that and his model, which has been working so successfully in North Clarendon, here in the Northeast Kingdom, and bring more Vermont-made pellets into the market,” Bowling said.

Once operational, the mill will produce 30,000 tons of super-premium softwood pellets, and, to do so, source around 80,000 tons of green wood, primarily pine, within a 30-mile radius, according to Bowling.

In addition to the loan from the town of Lunenburg, the project has received other financial help from the state, including funding from the state’s Clean Energy Development Fund in April. These funds are made available to increase the demand and supply for local wood heat. Kingdom Pellets received a $250,000 bulk pellet infrastructure grant amongst four others in that category.

This year, Kingdom Pellets was also approved for tax incentives through the Vermont Employment Growth Incentive program, a job stimulus program run by the Vermont Economic Progress Council. “We were approved for VEGI incentives, which are downstream funds that we can count on after we have gone through our hiring process,” Bowling explained. “It’s all calculated based on the number of full-time employees that we hire as well as the W-9 wages that are paid out to the logging community that’s going to be bringing green logs to this facility. That’s something we can’t anticipate until the actual mill is up and running.”

Altogether, the plant is expected to create 21 full-time jobs and, for now, Bowling said the company is on track to become operational by Oct. 1, 2017.  “At this stage, we are looking at our financing picture coming together nicely,” she said. “We’re waiting to clear some problematic hurdles with the big grant we were just awarded, but as soon as all of that takes place, we are right on track of where we wanted to be. We’re excited and remain cautiously optimistic that we’ll continue to be able to move forward.”

Bowling said they’ve not set a date for groundbreaking, but they may initiate some preliminary foundation work this fall, and then, following the winter thaw, around April, Kingdom Pellets has the intent to commence construction of the plant.