Apr 10 - McClatchy-Tribune Regional News - Kevin Miller Bangor Daily News, Maine

Baldacci administration officials said Wednesday that Maine's vast commercial forests contain enough "waste wood" to heat 150,000 homes and small businesses without reducing fiber supplies to existing mills.

As oil prices continue to rise, state officials are exploring ways to expand Maine's wood-to-energy market as a way to promote economic development in the forestry sector while reducing dependence on foreign oil.

On Wednesday, Gov. John Baldacci and the state conservation commissioner, Patrick McGowan, discussed the state's wood-to-energy goals as well as the various challenges facing Maine's timber and paper industries. The pair spoke to members of the Maine Pulp and Paper Association during the annual "Paper Days" event at the University of Maine.

Baldacci said the combination of unusually deep snow, skyrocketing diesel prices and other transportation issues are putting a pinch on the pulp and timber industries. Expanding the wood-to-energy market could help, not hurt, those industries while replacing heating oil with a homegrown commodity, he said.

"We have to be able to branch out and diversify to make them stronger for the future," Baldacci told representatives of the state's major pulp and paper companies.

The wood pellet market is still relatively young in Maine, despite the state's ample wood resources. And while wood pellet stoves are growing in popularity, they still account for a tiny share of heat sources in Maine homes and businesses.

To change that, Maine needs a fuel distribution system to make wood pellets more convenient for consumers, as well as more technicians trained to install pellet stoves, McGowan said.

There are currently two pellet manufacturers in the state -- Corinth Wood Pellets and Northeast Wood Pellets in Ashland -- and several more in the planning stages. The two existing plants produce a combined 95,000 tons of pellets from sawdust and other waste materials from mills.

McGowan said an estimated 4 million tons of branches, tree tops, cull trees and other wood fiber is left in the woods after harvests in Maine annually. About 1.8 million tons of that waste wood is good enough to use in the production of quality wood pellets, McGowan said.

Using that waste wood from Maine forests would allow future wood pellet manufacturers to produce about 900,000 dry tons of pellets, which is enough to heat 150,000 homes or small businesses, McGowan said.

"We want you to understand that we are not trying to take one stick of wood out of your wood yards," McGowan told the group.

The prospect of mills losing fiber to wood pellet or other wood-to-energy facilities is a real concern, said John Williams, president of the Maine Pulp and Paper Association. Fiber supplies are already extremely tight, which is driving up costs.

The organization's members support exploration of expanding the wood-to-energy market in Maine. In fact, the MPPA's leadership voted Wednesday morning to apply to the Maine Technology Institute for a grant to help fund that exploration.

But the pulp and paper mills want to make sure their concerns about fiber supplies are heard, Williams said.

"We want to make sure we have a seat at the table," he said.

In related news, Baldacci said his administration is leading an inventory of energy uses at public buildings throughout the state, including state and local government offices, schools and even hospitals. The purpose of the inventory is to identify buildings where it makes economic sense to convert to wood pellet heat.

McGowan said the state will eventually seek bonds to pay for the upgrades.

Baldacci said he is also considering proposing an expedited regulatory review process for waste-to-energy facilities. The process would be modeled after an expedited permitting proposal for wind farms recently put forward by the administration.

"It's my role and my responsibility as governor to say, 'Look, this is the bigger picture,'" Baldacci said.