DR Corn Stoves

Heating the alternative energy debate with wood pellets

By: Rachel Westberg
September 19, 2007
http://www.zwire.com/

If there was as good of a time as any to begin capitalizing on alternative energy, it would be now. Questions surrounding global warming have prompted citizens all around the world to look at how to become more environmentally friendly, including finding ways to lower the nation’s dependence on oil.

Chetek will soon be doing its part in “going green” as it is the new home of Community Energy Corporation, a manufacturing company whose goal is to be a leading provider of renewable energy solutions through the production of wood pellets. During the Chetek City Council meeting on Tuesday, Sept. 11, the council approved the development agreement with Community Energy Corporation, and construction is set to begin on the plant in the next couple of weeks, which will be located in Chetek’s industrial park.

Wood pellets are a type of bio-mass fuel, and one of many agricultural by-products that have the capability of being transitioned into energy. This renewable form of energy turns readily available waste products into clean sources of fuel. Wood pellets are exactly what they sound like-ground-up, dried wood processed into tiny pellets. The pellets are safe, clean burning, and easy to transport. With such an environmentally friendly appeal, James and Mary Bohl, who reside north of Barron, began considering developing a wood pellet plant. It just so happens that they chose Chetek as their location to build.

“I guess we were looking at something different to do as an additional business,” said James Bohl. “The area of alternative energy was something that intrigued us, and there is a lot of interest being generated in this market.”

A couple of years ago, Bohl and his wife Mary, who are also certified public accountants and own Bohl Associates Inc., in Barron. began toying with the idea of going into the business of producing alternative energy. To prepare for the venture, the couple spent time attending a variety of alternative fuel conventions throughout the world and researching their options. In late May 2006, the couple attended the World Bio-Energy and Wood Pellets Conference in Sweden. From that experience, the decision to produce wood pellets was solidified.

“From that conference and from our various field trips, we learned a lot about the industry,” said Bohl. “When we first began looking at alternative energy, we had no idea where we would head.”

One of the first conferences the Bohls attended was in St. Louis, Mo. The event focused on energy from agriculture. It was there that wood pellets piqued their interest. What particularly struck the Bohls’ interest about wood pellets was that with this form of alternative energy, unlike others such as ethanol or bio-diesel, pellets do not require a government subsidy to make them work. Manufacturing pellets, therefore, is more of a stable alternative-fuel industry.

“Economically, pellets stand on their own,” said Bohl. “It makes more sense for me to put in a pellet stove and burn pellets than burning LP or fuel oil. There is a savings there by doing that. We didn’t really want to rely on the government to create that savings. If they pull a plug on a subsidy for your investment, all of a sudden you have nothing.”

Bohl explained that right now, the savings an individual can gain with burning pellets to heat a house versus the other forms of energy can be anywhere from 30-70 percent, depending on what fuel a household is burning. He added that every year in North America, there are 125,000 to 150,000 new pellet/corn stoves sold each year, proving that the demand for such forms of alternative energy is increasing. Ironically, the biggest demand for pellets in North America is actually in the European market. Approximately 25 percent of the pellets produced in North America go to Europe, said Bohl. While this may be true, the Bohls are not currently looking at exporting their products overseas.

The building for the plant will be located directly behind the Parker Hannifin building in Chetek’s industrial park and will be a part of that tax increment financing district. Being located near a number of saw mill operations, Chetek became an ideal location for the venture.

“We also figured with what happened with the bio-diesel plant and that not going in, the city would be enthusiastic about having someone else coming in,” said Bohl. “Granted, we’re not going to be the size that they were, but the city has been very good about helping us get started. We’re very enthusiastic about coming to Chetek.”

The building will be approximately 4,800 square feet, and all machinery and operations will be held inside, with the exception of a rotary driver, which must be located outside. Bohl hopes that the plant will begin by employing 8-10 full-time individuals, but that number could grow depending on how the business progresses and how many shifts they decide on employing. Bohl anticipates selling pellets for $130 per ton, and anticipates selling a 40-lb. bag for $2.60. At a retail store, pellets often go $200 per ton and $4 per 40-lb bag.

According to Bohl, they are looking at getting the building up by the end of fall before the frost sets in, and hope to begin construction by October. By the end of winter or the beginning of spring, the Bohls hope to see the plant up and running.

In a brief description of how the wood pellets are made, Bohl explained that wood chips, saw dust, end pieces from various wood work places, etc., will come into the plant. Items that need to be ground will be ground into small chips. All of the products are then blended and mixed and go through a dryer to bring it to a level of 10 percent moisture. A hammer mill then grinds the pellets up even further. Once finely ground, the products go into a pelleting machine where they are made into pellets. The pellets then go through a sealer and cooler and finally bagged and sold.

“It’s not a complicated process at all,” said Bohl. “There are a couple of tricks, but it’s pretty straightforward.”

Bohl explained that the building will house two pellet mills, allowing the plant to produce similar levels of production as larger, one-mill plants. The hope is to have an output of 12,000 tons a year, depending on the availability of their sources of wood. The capacity, with both mills, will be twice that, however. In addition, the Bohls also hope to experiment with pelleting various other items, such as corn stalks. Along with being a cleaner fuel to burn, wood pellets can also be made by using waste materials, such as old wooden pallets, downed trees, or home-building material.

Over the past couple of years, with the demand for wood pellets rising, many more similar plants have been built. Currently, Bohl feels that there may be only six plants in Wisconsin, with the nearest one being in Marathon. Bohl also noted, however, that with the cost of trucking increasing, he feels that similar regional plants will become increasingly present. Although still a year or two down the line, the Bohls are not opposed to creating more plants in the area.

“We would like to see this as the beginning point of an operation that goes to many locations,” said Bohl. “We’d like to have plants scattered in places where we feel they can economically be feasible. It is really our thought that in the future there will be similar plants throughout the Midwest between 50 and 100 miles apart. This is, hopefully, just a starting point.”

The Bohls are excited about the prospects of their new business, and noted it is easy to be positive when you believe in something.

“The commitment is there, and hopefully, the rewards will follow,” said Mary.

After doing business as accountants for over 20 years, going into business to manufacture alternative energy may seem like quite a jump. For the Bohls, the reward of manufacturing wood pellets is in actually seeing the end product, a welcome change of pace from the intangible rewards of doing someone’s tax returns.

“If the business doesn’t make it manufacturing pellets, we can always go into business making animal feed,” joked James.

Other city news

In other city action, the council approved the airport committee’s request to allow camping on airport property for pilot and passengers camping in grass tie-down areas. This would be an exception to the no-camping regulations.

The curfew ordinance was also under review during the council meeting. After short discussion, per Chetek Police Chief Mark Petersen’s request, the council agreed to take out a section of the ordinance. The section in question dictates that the first time a minor is detained for curfew violation, a parent, guardian shall be advised, personally if known, or by registered mail. The change allows the discretion to issue a warning or citation for the infraction to be up to the police officer on duty without immediately involving parents. The recommendation would be made to the police commission.

“From my own observations, I see a lot of juveniles walking around town well after midnight,” said Alderman Bill Waite. “They’re looking for mischief at that time of night. I think if we tighten up the ordinance, it could possibly curb a lot of these recent break-ins and other crimes.”

In addition, the council also opted to recommend that the police commission require that a police officer log at least 50 miles per shift in the squad car.

“In my opinion, [the police officers] are slacking,” said Waite. “I think the officers need to show what they are doing on their shifts. I see squad cars pull into the police department at night and it is literally hours before they pull out again.”