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Active Energy’s wood pellet operation in Maine has failed; no word on fate of Lumberton plant

CoalSwitch pellets (Photo: Allenby Capital)

“An irreparable mechanical issue” has apparently doomed Active Energy Renewable Power’s “CoalSwitch” wood pellet operation in Maine, casting doubt on the company’s original plans to launch a similar plant in Lumberton, in Robeson County.

Asked about the ramifications for the company’s North Carolina plans, Brad Crone, spokesman for Active Energy, told Policy Watch that it has “no plans to respond or to make any comments to your questions.”

Six months ago, Active Energy moved its wood pellet operation to Maine for a trial operation, in hopes of collecting air and water quality data to satisfy changes it had requested for its air permit in North Carolina. The NC Department of Environmental Quality had issued a Notice of Violation to the company for constructing new equipment and changing the process design without state approval. The process change would have significantly increased toxic air emissions, DEQ said at the time. Active Energy denied that emissions would increase, but the documents submitted to the department contradict the company’s stance.

Although unable to get its air permit in North Carolina, Active Energy still had to meet a contractual deadline to deliver 900 to 1,000 tons of pellets to PacifiCorp, which plans to burn them at its Hunter Power Plant in Utah, according to company correspondence with investors. Active Energy piggybacked on an existing permit holder in Maine, Player Holdings, which makes fireplace logs, to produce the wood pellets. Player is also Active Energy’s engineering consultant in North Carolina.

Maine environmental officials issued a temporary authorization to Player Holdings to produce wood pellets. That authorization initially expired July 31 but was extended until Sept. 29. It “has not been extended,” according to emails from Eric Kennedy, director of licensing and compliance for the Maine Bureau of Air Quality.

Kennedy said in the email that Player Holdings told the bureau in August that the trial operation had stopped. It has not been restarted, Kennedy said, because of “an irreparable mechanical issue that stopped production associated with the trial operations.”

The operations shut down before Maine environmental officials conducted any of the required air emissions studies or tested water discharges associated with the wood pellet process, Kennedy said.

The data was key to Active Energy obtaining its revised air quality permit in North Carolina. Here, the Division of Air Quality had planned to use information from Maine to estimate emissions at the Lumberton facility.

The division has not received any more information from Active Energy since May 21, Sharon Martin, NCDEQ spokeswoman told Policy Watch via email. The company’s request to modify its air permit “remains on hold until the requested additional information is provided,” Martin said.

Active Energy has touted its CoalSwitch wood pellets as a replacement or companion fuel for coal that could be burned in traditional power plants with no loss of heat. Utilities that chose to use CoalSwitch pellets wouldn’t have to spend millions of dollars to retrofit their facilities. And because the patented technology uses steam to explode the pellets, which resemble black kibble, to remove some contaminants, they burn cleaner than coal.

However, the wood pellet industry relies on cutting vast tracts of forest, particularly in North Carolina. Under the guise of renewable energy, the pellets are then are shipped across the ocean to Europe, Great Britain and even Asia. There, utilities burn the pellets in lieu of coal to generate electricity, further releasing greenhouse gases into the air.

Another concern was that the company did not test the stack emissions from a wood pellet plant itself. Active Energy acknowledged to NC DEQ that the proposed process had no precedent “to calculate air emissions from the proposed sources.” Nonetheless, even absent any test data, Active Energy boldly proposed that its emissions would be so insignificant that the state should exempt it from an air permit altogether. The Division of Air Quality disagreed, writing in a series of internal emails, “they have provided no empirical test data to substantiate this assertion.”

Even before the company began unlawfully altering the process design, estimated facility-wide emissions were significant: Carbon monoxide was estimated at 7.9 tons per year. Under the amended application request, that amount increased to just over 16 tons.

Particulate matter — essentially fine dust — would increase dramatically from 0.1 tons per year to 26.7 tons, according to the permit applications.

Hazardous air pollutants, classified by the EPA as those that can cause cancer and other serious health problems, also increased to 6,263 pounds a year, up from 4,963 pounds.

Active Energy has a troubled financial and legal history. The company was sued earlier this year for allegedly failing to pay two top employees during a financial rough stretch. The company’s chief operating officer in Lumberton, Antonio Esposito, has left the company. 

The company was awarded a $500,000 building reuse grant from the NC Department of Commerce in 2019; however, none of that money has been disbursed, according to a department spokesman.

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