MANISTIQUE - A proposed district heating project in Manistique strives to decrease heating costs for its associated stakeholders and is in the process of seeking funding to see the project completed.
According to Bill Cook, MSU Extension forester and biologist from the Forest Biomass Innovation Center in Hyde, the district heating project would have a number of advantages for the stakeholders involved.
"Lower costs for heat would be one benefit on the top of the list by far, but it also keeps local jobs and dollars local, instead of exporting those jobs and dollars," he said.
Some other advantages listed on a website that highlights the project include: lower energy costs, which can create more cash flow for other stakeholder priorities; sustainability of communities, environments, and finances; an improved carbon footprint, since it would be cleaner than using fossil fuels; and the use of non-commercial woody material, which leads to better forest management.
Eleven potential stakeholders that could benefit from the project were identified, such as Manistique Area Schools, the County Medical Care Facility, the city of Manistique, Hiawatha Behavioral Health, Schoolcraft County, the Schoolcraft Memorial Hospital, County Road Commission, County Public Transit, St. Francis de Sales Church and School, Presbyterian Church of the Redeemer, and the First Baptist
However some of these groups have opted out of the proposal, while others are hoping to move forward.
"At this time the city's opted out, the schools have opted out, the county opted out Tuesday night, the medical care facility is in, the Baptist church is in. I don't know where the others sit," he said.
According to the website, the district heating concept comes from "shared heating" from a central boiler.
"Heat is distributed to member buildings through a hot water piping system. Smaller projects, such as that proposed in the city of Manistique, generate heat only," reads an overview of the project.
The Manistique project would plan to use wood chips to fuel a pair of central boilers. A wood storage building and handling area would be required, and the emplaced piping network would connect 12 to 15 buildings of various sizes. The systems would be largely automated. Approximately 3,900 tons of wood chips would be used each year, translating to approximately one to two truckloads each day during peak heating times.
"In terms of wood consumption, it's a fairly small project," explained Cook. "It's not a huge consumer. The volumes are pretty small."
He said it would typically run three to five truckloads per week, with a maximum of two truckloads per day during cold weather.
Cook said he is not sure where the reluctance from stakeholders comes from, but many have argued the project would cost them more money, which he says is not the case, as it will save them money.
As proposed, the project would cost approximately $9-10 million, depending on the number of stakeholders involved. Construction, operating, and debt payment costs would be paid through energy savings, which is expected to be a significant amount, according to Cook.
"Over the life of the boiler system and the piping network, it would save at least $25 million," he said. "That's a very conservative estimate. It easily could be twice that."
Cook said the most likely source of funding for the project would be from a USDA loan. However, the timeline for this money has been moved up since the current amount of federal funds are only available through September, he said.
"After that, the account that this particular program has at its disposal would probably not be nearly the size that it currently is," he said.
Though there are still many unknowns associated with the project, such as where the location of the heating facility would be and how many stakeholders total will be involved, Cook said engineers have indicated the facility could be up and running in a couple years or less.
"The engineers tell me it would probably be from the time that the loan is secured to the time that the on-switch is thrown, maybe up to two years, possibly less," he said.
Since the project was proposed, a series of studies, energy audits, financial packages, and a funding possibility have been compiled, as well as some legal assistance, according to Cook.
The Manistique district heating concept was first discussed in 2009 through efforts of the Biomass Utilization and Restoration Network for the Upper Peninsula of Michigan program. Former Schoolcraft County MSU Extension Director Dave Andersen, who is now retired, compiled a number of potential stakeholders who might be interested in the project. Since then many studies have been done, including a feasibility study in May 2011 paid for by a grant from the Michigan Department of Labor, Energy, and Economic Growth. An audit by Johnson Controls was completed in November 2011.
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