Morice Land and Resource Management Plan

Opportunity Analysis

In the Northwest Region, the rationale behind the cogen concept has as much to do with environmental benefits as pure economics. The Skeena Region Beehive Burner Phase-Out clearly documents the implications of not dealing with the wood waste issue in a proactive manner.⁴ Several times over the last nine years, the BC Government asked Tier 1 burner operators to phase out their use and find alternative methods of disposal or use. On the surface, continued operation of the burners would appear to have drawn a source of supply to a cogen facility, but underneath it is really a low-cost solution that keeps the feasibility of alternative uses alive. This is because forest companies would have had to invest significant capital into new burner technology, thereby foreclosing on future options for more productive use of wood waste. The benefits to cogeneration include:

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  Conversion of wood waste (otherwise burned at present) to electricity;
  
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  Radical reduction in environmental problems from wood waste through improved air quality and reduced greenhouse gas emissions;
  
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  Net new jobs in trucking wood wastes and plant operation; and,
  
• 
  Returns to government through PST, fuel taxes, income taxes, capital tax and property taxes
  

There have been two previous wood-fired electricity generation projects proposed for Houston in the early-1990s. NW Energy Corporation, a joint venture involving Pacific Energy (a subsidiary of Tersan), proposed a 60 MW generating station at Houston. At the time, the project was to be supplied with residues from Houston Forest Products, Northwood Pulp & Timber, Decker Lake Sawmills, Babine Forest Products, Pacific Inland Resource and Repap Smithers. Another proposal was driven by a joint venture between PowerGen and Destec. Both of these proposals failed to move forward.

In recent years the number of new facilities coming on-line has increased as BC Hydro and provincial energy plans developed targets for “green” generation projects in their respective planning processes. A list of BC Hydro’s approved customer-based generation projects is shown in Table 6.

Table 6. BC Hydro’s Customer-Based Generation Projects

Table 7 shows an estimate of the variety of gas turbine and reciprocating engine CHP facilities completed or being planned across Canada. In addition, there are several straight combined-cycles and utility re-powering projects being proposed, which could potentially involve heat recovery.

Table 7. Summary of Canadian Cogeneration Projects by Sector, 2001

Sector	Completed/ In construction No. of plants	Planned Mwe	Number of plants	MWe
Chemicals	7	1070	3	560
Oil industry	8	1340	2	530
Pulp and paper	12	750	6	720
Gas processing	3	190	2	200
Food processing	7	300	-	-
Steel, metals	2	115	2	400
Manufacturing	8	190	6	50
Hospitals	6	95	2	10
Universities	8	28	3	15
Municipal service	12	55	5	40
Utility re-powering	1	200	5	1800
Total	75	4333	36	4325