Out of the ashes an opportunity

Here are some of the realities/facts as it pertains to the Laidlaw/Berlin Station project. Although many thought that Jon Edwards was barking up the wrong tree or just out of his mind, the points he made about the negative impact to the existing small biomass operators turned out not only to be true, but may be the deal killer for the Berlin project. If forced out of business the combined value of the small plants (IPP’s) and their tax payments to their individual towns plus the number of jobs lost at these plants exceeds what would be created by Laidlaw/Berlin Station. The paradox is that, PSNH is as much to blame for killing the Berlin project as it was its promoter. Had PSNH been ready to negotiate in good faith reasonable contracts with the small operators, the issue of putting the IPP’s out of business would have gone away. As one small plant operator told me, “Just give me the same deal that they’re offering Laidlaw and I’ll be happy”. But no, PSNH the arrogant 1,000 pound political gorilla in New Hampshire, overplayed its hand and their obsession to put the small operators out of business and monopolize the generation of electricity in the State has come back to bite them on the backside. I have every reason in the world to believe that PSNH has been in bed with Mr. Bartoszek/LLEG and Charlie Bass from the time the recovery boiler was made available by American Dismantling. The availability of that boiler was the opportunity PSNH had been waiting for; they just had to find a way around New Hampshire law. Enter Laidlaw and promoter Bartoszek, the Trojan Horse was born. If you doubt my word, just ask yourself why PSNH wrote themselves in the deal (PPA) with the right of first refusal on the Berlin Station biomass plant. It was all part of the strategy developed behind closed doors at PSNH. Now, there’s no question that this is an economic loss for Berlin, but it may also be an opportunity to have our cake and eating it too. I hope that Clean Power/Gestamp hasn’t given up on Berlin and thrown their plans out the window. With the mill at Cascade under new ownership, co-locating Clean Power with the Cascade Mill becomes a once in a lifetime opportunity to do this “biomass thing” right. (Can you imagine, an efficient biomass plant, what a concept!) City Hall needs to come to its senses and clean-up the mill site and support the concept that Clean Power and Cascade Mill is a once in a lifetime economic development project that’s right for Berlin/Gorham!

Comments

[jon]

Clean Power/ Gestamp sold their interest to Cate St. That is not necessarily a bad thing if Cate St. could be convinced the proposed Clean Power project is viable especially with steam synergy to Cascade. What can be powerful at this stage is the synergy of teamwork between Cate St., Gestamp, and Clean Power. But don't count on it. PSNH wants legislative change and is willing to ruin the economy to get their way.

[wood burner]

WOW strong talk!! There is NO more clean power last I knew.I think the Berlin station will happen,Just my feeling on it.And the small power plants are just comminting suicide.(like its a surprise)GREED gets them Nowhere.

[Rocky]

Jon, I knew that CPD sold their interest to Cate Street, but isn't this a new ball game? If Cate Street has really walked away and Berlin Station is dead, why wouldn't CPD get back in the game?

[wood burner]

Ya Jon tell e'm LOL

[Chet]

Tell me this doesn't make sense - just popped up on IHUB

CTTC Share Monday, July 04, 2011 9:06:59 PM
Re: None Post # of 98219

Here's where PSNH comes in to save the day. Watch PSNH tell the state that "we can finance and build the plant for Berlin - just change the rules as to what we can and can't own." Bingo - Now PSNH shows up as the White Knight to save the day. I wouldn't be a bit surprised if they didn't plan this all along.

[warren,]

PSNH offered the IPPs a 20 month deal and it wasnt good enough for them! They wanted more...gimme, gimme, gimme! And CPD is History in Berlin/ Gorham, Didn't Cate St. buy their Sewer Front Plot? This is Aweful news for ISSI, as the Northern Pass is a couple years away at least...IF it "Passes"!!! BTW, nice Rework on Rano's Editorial Cartoon! Did You get Permission for that?

[egrohs]

You are more naive than I though Rockster if you think Cate St is going to turn around and now work with Gestamp/CP......LOL

This is a lose, lose for everyone. PSNH gave them what they wanted. Short-term contracts. They turned around and asked for cash on top of that?!!! LOL. Those smaller IPP's deserve what they get at this point. If no Berlin, PSNH will withdraw their offer. The majority of those IPP's will eventually go under anyway. Not economically sustainable, according to their own testimony.

Not really surprised since PSEG of New Jersey owns the Bridgewater Plant. Talk about greed, high rates, and the worst customer service you can ever think of. PSEG would most definitely give PSNH a run for their money in being corrupt.

We'll see what transpires here in the next few weeks. Seems like there are still powerful people up in NH that want to see this happen in the 11th hour.

Good luck to all of you

[jon]

Stranger things certainly have happened along the way on this journey, Rocky. ;)

Egrohs has it pegged; "We'll see what transpires here in the next few weeks. Seems like there are still powerful people up in NH that want to see this happen in the 11th hour."

[jon]

Chet, PSNH crafted the PPA with one significant word; unappealable. Now...how can a PPA not be appealable? I think you're on the right track as to what PSNH ultimately would like to have, but wouldn't a legislative change to allow PSNH to start owning the mill that presumably puts the smaller IPPS into closure, be a move towards the monopolization the laws are currently trying to protect?

[Rocky]

I think that PSNH behavior is one good reason to start investing in solar panels and ween ourselves off the grid one panel at a time.

[warren,]

And I Have to hand it to jon on the Propane Idea, Having Options come wintah is not a Bad Thing. We need to ween ourselves off of Oil Heat faster than Electricity as Oil is FAR more Expensive. Drill Here, Drill Now? Not in Our Lifetimes apparently.

[warren,]

Hey Dennis, That Laidlaw Pig Toon is now so beyond moot, its fossilized! Looking forward to a PSNH Pig? Berlin does not own the property, Cate St. does, correct? Do Pigs Abhor a Vacuum?

[jon]

Change in legislation would only further monopolize PSNH's position. It has become apparent that there is enough political pull within the impact of the IPPS survival that such a PSNH monopoly could further jeapardize their survival. If PSNH gets a change in legislation if will come with significant protective clauses to allow for these IPPS to enjoy long term PPAs or it will never happen in my opinion.

[warren,]

Could Gov. Lynch exert some Serious Pressure on the IPPs in the next week to accept PSNH's more than Generous Offer of 20 month PPA's? At least 4 of the 5 IPP's appear to be commiting "suicide" in this Pyrrhic Victory of sorts. Then there are some mad as hell Unions out there. Not only could PSNH step in to save the Day, but the State of NH might do so as well. With ISAACSON in Chapter 11 Banckruptcy, this is Bigger than what it was a few years back. Then there is the Failure of CLUB FED up the road, not to open anytimesoon because of a U.S. Govt. DeFault on its Debt looming by August 2nd....Too much to lose all around.

By Coös County Democrat on Saturday, July 2, 2011 at 8:11pm

Halle says Berlin Station deadlines are real

By Edith Tucker

etucker@salmonpress.com

BERLIN — John Halle, president of Cate Street Capital of Portsmouth, said in a Friday afternoon telephone call that he is close to placing the 75-megwatt Berlin Station biomass project on hold.

In order to put the project back on track, the state’s independent power producers (IPPs) must collectively agree to stand down and withdraw their case in front of the state Supreme Court challenging the Purchase Power Agreement (PPA) that Berlin Station and Public Service of New Hampshire have signed. Although progress was made at a stakeholders’ meeting convened at the State House at 2 p.m. on Wednesday, June 29, by Gov. John Lynch that did not end until 10:30, the one company that has no urgent need for resolutions remained — and still remains — a holdout.

June 30 was the hard deadline by which Cate Capital said the IPP stalemate had to be resolved.

This is because July 15 is the latest date that construction can begin this summer that would allow enough progress to be made to continue work through the winter. The total construction project will take 27 months before electricity can be generated. If construction cannot start by mid-July then nearly a year must pass before the project could be re-started, Halle said. “Meanwhile the price of copper, the price of steel, and the price of labor will going up, and there’ll be inflation; that is, the financials will change,” he explained, adding that he cannot know if a year from now the project would still be viable.

“I don’t want to walk away,” Halle said. “This project could be profitable for investors, and it would do Berlin a lot of good and the forest products industry a lot of good. The $2.5 million in New Market Tax Credits would also do a world of good in Berlin.”

[egrohs]

"In order to put the project back on track, the state’s independent power producers (IPPs) must collectively agree to stand down and withdraw their case in front of the state Supreme Court challenging the Purchase Power Agreement (PPA) that Berlin Station and Public Service of New Hampshire have signed. Although progress was made at a stakeholders’ meeting convened at the State House at 2 p.m. on Wednesday, June 29, by Gov. John Lynch that did not end until 10:30, the one company that has no urgent need for resolutions remained — and still remains — a holdout."

Jon or anyone else, do you know which IPP is the holdout? Is it Bridgewater?

[Rocky]

I've been told by a very reliable source that emperor Grenier has circulated a scathing email/letter to various State Agencies and urging anybody and everybody to pressure the Governor and the PUC to remove the obstacles in the way of granting the PPA. If you want to know who is a whore to PSNH just watch this drama unfold over the next couple of weeks. We already know the names of a few by the statements they've made to the press.

[Chet]

egrohs - Its Whitefield

[John Lambert]

Rocky:

If you get a copy of the letter / email can you post it?

[Rocky]

I'll try to get a copy today John.

[jon]

Whitefield, I believe, has a few years remaining on their PPA. Bridgewater, from what I've been told, have done significant upgrades to their facility. Those facts alone may cause either company to ask for more than the others.

If the letter from Grenier is indeed "scathing" it should become public (perhaps printed in the local paper) for those within Berlin to see that do not appreciate Grenier coming across as though Berlin is a united front in bypassing due process, company rights, and in general coming across as though the city and its residents practice the bullying tactics our schools are trying to abolish. It's no wonder why the perception of the area is what it is at times, and that's really too bad, as it doesn't have to be that way.

[Antonio Andolini]

Like any good mouth-piece, the Mayor's statement will have the proper buzz words, such as GREED, out of state owners, foreign owners, GREED, bad IPPs ...

[Antonio Andolini]

Because, remember, PSNH is only doing what's best for us; they know these things, you know.
Just think of them as your little local power company fighting all those greedy out-of-state-owned other power companies.

[warren,]

Yeah Right... A Text Book Case of C.Y.A. So if some IPP's go ( quite deservedely ) down the bowl in the next few months, will this strenghten PSNH's case for the Northern Pass?

Biomass plants say they are not the villain

By Barbara Tetreault

Jul 06, 2011 12:00 am

BERLIN -- The wood-fired independent biomass plants charge Cate Street Capital walked away from negotiations just when it looked like the parties were close to an agreement.
“The fact they withdrew from the deal so abruptly came as a shock to everyone,” said Mike O’Leary, plant manager for Bridgewater Power Company. “We were very very close to a deal.”
Cate Street Capital declared its efforts to construct a 75-megawatt biomass plant on the former pulp mill site are dead after the parties failed to reach an agreement by the Portsmouth company’s deadline of June 30.
Six smaller biomass plants are appealing the Public Utilities Commission’s approval of a power purchase agreement between the Berlin Station and Public Service of N.H. to the state Supreme Court. For several months, Cate Street, PSNH, the PUC, the Independent Power Producers, and state officials including Gov. Lynch have been attempting to negotiate an agreement that would see the IPPs withdraw the appeal.
Cate Street Capital spokesman Scott Tranchemontagne said the company needed an agreement by June 30 to allow it to get its financing in place and meet its winter construction schedule.
O’Leary said the June 30 deadline was not part of the discussion when the negotiations first got underway. He said Cate Street Capital inserted the deadline part way into negotiations. O’Leary said all the IPPs have done is exercise their business rights by filing as intervenors in the PUC docket on the power purchase agreement between Berlin Station and PSNH. He said appealing the PUC’s order to the Supreme Court is part of the process.
Tranchemontagne said the negotiations settled on short term power purchase agreements for the four plants currently without such contracts. He said the IPPS wanted other concessions including a cash payment.
“The IPPS got greedy and started asking for more,” he said Saturday.
O’Leary said Cate Street Capital is trying to make the IPPs the villain when all they are trying to do is protect their jobs, infrastructure, and businesses. He noted that the IPPs have all been in business for a long time. His plant opened in 1984. In contrast, he said Cate Street has never built, owned, or operated a biomass plant.
O’Leary said his company has been operating without a power purchase agreement since August 2010, selling its power on the spot market. He said his company is just hanging on and has been seeking a short term agreement from PSNH since before the Berlin Station was on the PUC docket.
He said the short term contracts are needed to allow the IPPs to keep operating while the legislature considers changes in the Renewable Energy Portfolio that would make the plants more economically viable.
State Senator John Gallus, (R-Berlin), said Cate Street Capital’s decision to stick to its June 30 deadline and walk away from the Berlin Station project is bad news for everybody. He said there will be no short term power purchase agreements for the IPPs which he said means their future is in doubt. Between Berlin Station and the IPPs, Gallus estimated 1,200 direct and indirect jobs are at stake. Plus, he said, the Berlin Station would employ over 300 people in the construction phase - he said many local construction workers had turned down other jobs with the expectation they would work at the biomass site. The plant would also be the city’s largest tax payer and would revive the forest industry.
“We want to see this work out for everybody,” said Gallus.
As part of the negotiations, Gallus said legislators agreed to work to make changes in the Renewable Energy Portfolio that would benefit the IPPs. Now that is unlikely to happen as well.
He said Whitefield Power and Light was the main hold out at last week’s negotiations. He said the company has a power agreement and was seeking additional incentives.
“It seems everyone was dealing at the end except Whitefield,” he said.
O’Leary said the IPPs are still open to further negotiations.
“We want to be at the table. We were so close we were shocked at how abruptly the thing blew up,” he said.

[Wing Nut]

Good one Antonio. I'm sure you know that our "local" power company (PSNH) is actually owned by a CT company called Northeast Utilities. Just wanted to set the record straight. I suspect your post was meant to be sarcastic anyhow and to point out the irony of any statements made by our trusted public officials regarding out of state ownership by greedy power companies.

By the way, I won't believe that this project is dead until the boiler and stack no longer exist. And, for the record, I'm not rooting for that to occur. I find it very hard to believe that Cate Street Capital would give up on this project with the goal line right in front of them (they are definitely sitting on the 1 yard line and it is first and goal). Something doesn't make sense and I’m baffled. Something tells me that we have not heard the end of this story and that this biomass project will be revived at some point in the very near future.

Take care,
WN.

[warren,]

Of Interest....

http://www.cbc.ca/news/canada/british-columbia/story/2011/07/05/bc-hydro-tower-collapse.html