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Timing called excellent to move forward on heating district plan for Colebrook

Union Leader Correspondent

May 27. 2014 8:19PM

COLEBROOK — Motivated by the prospect of lower energy costs for customers, job creation, and the opportunity to keep money that would be spent on other fuels within the community — the town is enthusiastically exploring the potential of biomass district heating.

During a recent interview, Kevin McKinnon, Colebrook’s public works director, said the timing is good to consider district heating because Colebrook needs to rip up a significant chunk of its downtown in order to replace a more than century-old water main.

Replacing the water main, he pointed out, would also be the logical time to install some 10,000 feet of piping to carry hot water to customers of the heating district and cooler water from them back to the heating plant.

During an interview last Thursday, McKinnon said the idea of a heating district in Colebrook actually originated in the town of Northumberland about six years ago. Although Northumberland eventually had to step away from plans to build a heating district in Groveton Village, the idea caught fire with McKinnon and the Colebrook Board of Selectmen who advised him to explore the matter further.

At present, the town, working with the Northern Forest Center, is doing a survey of potential customers within the proposed heating district to determine what their actual savings would be if they joined the heating district rather than using oil, propane or other fossil fuel to heat their facilities.

Phase I of the project, which would cost $10 million to bring online, calls for building a biomass plant on a parcel west of the downtown and running the piping the length of Bridge Street, into the Main Street core and up to Village Way, an area that includes nearly a hundred potential customers, private dwellings as well as the town’s largest institutional users, among them two schools, a hospital, a senior-citizen housing complex and the Colebrook Industrial Park.

McKinnon stressed that while the U.S. has been a pioneer in using steam for heating, Colebrook is actually looking to Europe, and the Scandinavian countries in particular, for its model, adding that unlike the Concord Steam Corp., the heating medium would be hot water, not steam.

That distinction, he said, sets the Colebrook heating district apart from the CSC, although he noted that a hot water district heating system is currently utilized in New Hampshire to a more limited extent by several hospitals and universities. McKinnon noted that Denmark heats 70 percent of all its buildings with a hot-water heating district and while the technology has been successfully used there for more than 20 years, it is still rare in the U.S., although the city of Claremont and the town of Randolph, Vt. are both considering implementation.

The Colebrook heating district would be operated by a nonprofit entity, not by the town, and it would make a lot of sense for the town, said McKinnon.

He said district heating in Colebrook would provide safe, reliable heat, a 10-15 percent savings over fossil-fuels with few of the price spikes, that it could create 14 jobs in logging, chipping and transportation, and would keep money in the local economy, rather than sending it to out-of-state gas, oil or coal companies.Also, he said, by eliminating carbon-based fuels, the heating district would also reduce the amount of “greenhouse” gases produced annually in the district by almost 6,000 tons, while reducing the emission of sulfur oxides by 39 tons and of nitrous oxides by 14 tons.Funding for Phase I has yet to be secured, but it will likely include private funding and public grants. Regardless of whether Phase I is enacted, Colebrook will replace the water main and toward that end the town has applied for a federal Transportation Investment Generating Economic Recovery (TIGER) grant, recipients of which are expected to be announced sometime in September.A member of the town’s public works department for 29 years and its head for the last 18, McKinnon hoped that heating district becomes a reality in Colebrook.McKinnon said that two feasibility studies have shown than the heating district is a viable project which over the 20 years of Phase 1 would see a modest, but continual, incremental increase in revenues for the facility’s operators, adding that right from the first year, income would exceed projected expenses.

Ideally, if all the pieces fall into place, McKinnon said Colebrook would like to begin work on replacing the water main and installing the piping for Phase I in 2016.

Attorney Rick Brock of FD Brock, PLLC, is the coordinator of the Project Management Team at the Colebrook Development Corp. Currently, the project management team is working to review the energy survey data collected this past heating season and then, sometime in late June, will decide whether to hire an engineering firm and develop the business plan and model for the heating district.

On Tuesday, Brock echoed many of McKinnon’s points and said a preliminary review showed that if Phase 1 of the heating district were built, it would displace the need for 250,000 gallons of heating oil per year, adding that “those are dollars that stay in the community.”

Over 30 years, he said the heating district would have a net, positive economic impact of about $39 million, which is calculated as the savings achieved by using wood pellets instead of fossil fuels and also by keeping the money spent on heat in Colebrook.

“Seventy-four cents of each dollar that is spent on oil actually goes outside the community and that money would now end up staying here” and go to landowners, loggers and truck drivers, said Brock, rather than to oil companies, none of which are headquartered locally.

Another benefit of the heating district, he continued, is that it would make the Colebrook Industrial Park that much more attractive to new tenants, which, hopefully, would also bring jobs with them.

As a standalone enterprise, “the financials don’t indicate that it (the heating district ) would make sense as a private project,” said Brock, “but it does support itself as a nonprofit project which raises the question of why do it if it only marginally supports itself financially and the reason is that it could create these tremendous benefits in the community.”

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