Plant construction proceeds despite mill closure: Atikokan facility will produce green electricity.

• Author: Ulrichsen, Heidi
• Position: SPECIAL REPORT: ENERGY & ENVIRONMENT - Delta Energy Co. Ltd

The ground has been broken on Atikokan's 10 megawatt clean electricity cogeneration plant despite the fact that its main source of fuel is in receivership.

The $50 million plant, which will create 40 well-paying jobs once it's in operation, is being financed and built by Delta Energy Co. Ltd. of Thunder Bay.

Site preparation work began in the last week of April, and construction will be completed in eight to 12 months. The plant will be up and running shortly after construction is completed.

Electricity will be generated by gasifying waste wood such as sawdust or bark, or alternatively, trees that have been destroyed by forest fires or insect infestations, said Larry Hebert, Delta's chief administrative officer.

Delta was originally planning to purchase waste wood from Fibratech Manufacturing Inc. in Atikokan in exchange for giving the company a break on their power bills, but the fibreboard plant went into receivership late last year, said Hebert.

In fact, Delta had wanted to build an additional five megawatt energy plant in Atikokan based on a relationship with Fibratech, but that won't happen unless the sawmill is able to pull itself out of debt, he said.

Even though it is not currently in operation, Fibratech still has enough waste wood sitting on its property to feed the electricity plant for three years, Hebert said. Delta is still looking into purchasing the waste wood from Fibratech's creditors, he said.

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If that isn't possible, waste wood will be purchased from other sawmills. Because very few sawmills are operating in the region, it may be necessary to hire private contractors to go into the bush and haul trees destroyed by forest fires and insect infestations, said Hebert.

"We take a solid wood chip and expose it to very high temperatures--2,400 degrees Fahrenheit--and it turns into synthetic natural gas," he said.

"The synthetic natural gas can be taken and turned into several different kinds of energy. We can leave it as synthetic natural gas, which is a replacement natural gas. We can turn it into electricity. We can turn it into high, medium and low pressure steam. We can turn it into air pressure."

Atikokan is already home to a coal-powered electricity generation plant run by Ontario Power Generation. About 90 people work there.

The new plant is being supported by the Ontario Power Authority's Renewable Energy Standard Offer Program, which provides a market for small-scale plants producing energy...