Bio oil to power up the Sault.

Sault Ste. Marie could be the site of one of the world's first commercial uses of a cogeneration plant powered by bio oil.

A consortium of leading private energy players and the Sault's Public Utilities Commission announced plans in late March to install a 2.5-megawatt cogeneration plant to power and heat the city's two government forest laboratories.

DynaMotive, a Vancouver-based energy company, has developed a patented 'fast pyrolysis' process that converts wood waste into an environmentally-friendly fuel known as bio oil, used to generate green power.

They have teamed up with Magellan Aerospace of Mississauga, a leader in advanced turbine technology, who have adapted a natural gas and diesel-fired turbine that runs on bio oil.

The participants, including the City of Sault Ste. Marie, have entered into a Memorandum of Understanding to conduct a feasibility study to develop the power project. The cogeneration plant would contain a turbine and heat recovery equipment located on a site between the Great Lakes Forestry Centre and the Ontario Forest Research Institute.

"We thought the fit was really good in terms of the type of thermal and electrical load for the two forestry research facilities," says Brian Curran, president and CEO of the Sault Ste. Marie Public Utilities Commission.

If the feasibility study, expected to be complete by August, presents a good business case, a plant could be operating on the research campus sometime in 2005, subject to successful negotiation of commercial agreements.

No project price tag is yet available.

Curran expresses confidence in DynaMotive's 10-year-old technology and believes they will successfully demonstrate bio oil to be a cheaper, renewable, environmentally-friendly alternative to conventional heating oil and natural gas.

DynaMotive and Magellan are building a 2.5-megawatt demonstration plant in West Lorne, Ont. using wood waste and the pyrolysis process, which produces bio oil that goes into a Magellan turbine.

The project received federal funding from the Sustainable Technology Development Fund.

"The technology we believe is proven and that will be confirmed with the (West) Lorne project that will be running in June," says Curran.

A bio oil refinery supplying the Sault project would be located elsewhere, likely closer to the source of feedstock. DynaMotive is talking with forest product companies to supply the biomass waste material.

Curran says the PUC began showing interest last year in installing a cogeneration plant for the city's proposed new hospital. Rather than fire it by natural gas, they realized there were significant wood waste resources from numerous nearby pulp and paper operations.

"Why wouldn't we be looking at something that could use the indigenous resources, rather than import natural gas from the West?" says Curran, who adds countries such as Sweden and Finland already make "tremendous use" of biomass and are considered world leaders in this type of plant equipment.

The PUC became aware of how Magellan adapted a turbine to operate on bio oil and how DynaMotive was aggressively marketing their technology and were quite active in Northern Ontario.

From the start, Curran says feedstock would include lumber and wood waste, but if the technology becomes a viable economic alternative to oil and natural gas, the area's supply could run out. There is the possibility down the road of also using municipal sludge in the process.

"We are working with DynaMotive to see if we can do something in Sault Ste. Marie. That's another project, but it certainly has potential."

If this made-in-Canada technology is commercially adopted, Curran says it could spawn new employment opportunities with dedicated tree farms using rapid growth and unused tree species that could be harvested quickly and could make use of lands not in production in Northern Ontario.

www.dynamotive.com

By IAN ROSS

Northern Ontario Business