NH's Berlin Station biomass power project gets new life

By Lisa Gibson | August 24, 2011

After reports that Cate Street Capital’s proposed wood-fueled Berlin Station in Berlin, N.H., was dead in the water, a new agreement established this week could bring the plans back to life.

With expired or near-expired power purchase agreements (PPAs) with Public Service New Hampshire, six small independent biomass power plants wanted renewed agreements, arguing that PSNH was entering into an agreement with the 75-megawatt Berlin Station. Negotiations ensued, but were difficult because most of the older plants produce Class III Renewable Energy Credits, which utilities in the state are not required to buy under the state’s renewable portfolio standard of 23.8 percent by 2025. The new Berlin Station, however, will produce Class I RECs, which utilities are mandated to increasingly purchase over the next few years.

Scott Tranchemontagne, spokesperson for Cate Street Capital, declined to release details about the breakthrough agreement, but a letter from New Hampshire Gov. John Lynch’s office urges the Public Utilities Commission to accept the PPAs agreed upon by PSNH and five of the six independent biomass power plants. Without the PUC’s support, the PPAs are not valid and the agreements are negated. “Given the state of the energy market today, it has become difficult for small wood-fired plants to continue to operate without the stability of contracts to sell their power to a utility company,” Gov. Lynch said in a statement. “The power purchase agreements address a short-term problem in a measured and responsible way. The petition and settlement agreement will also allow the Berlin BioPower project to go forward, which is an important step forward for economic development in Coos County.”

"We are pleased that all parties were able to resolve outstanding issues so that the Berlin Biomass renewable energy project can now move forward to the economic benefit of the North Country region and the state, while also providing a basis for the existing biomass plants to continue operations during these difficult economic times,” said Gary Long, PSNH president and chief operating officer. “We thank the governor, legislative members and other state officials for leading this effort and helping to implement this solution."

The $275 million Berlin Station is proposed on a former Fraser Pulp Mill site. The project has encountered a number of barriers, including local opposition and petitions for intervention in its PPA process. Earlier this year, a reorganization of the years-long project prompted a change of the name from Laidlaw Berlin BioPower LLC to Berlin Station, as well as a switch in the primary developer from Laidlaw Energy Group Inc. to Cate Street Capital.