It should have been a good year for turning wood and waste into electrons.
A record-setting drought forced growers to bulldoze thousands of acres of trees, and hardly anyone in the Central Valley has permission to light bonfires anymore.
But more than trees have withered in California's sun. The state's biomass energy plants are folding in rapid succession, unable to compete with heavily subsidized solar farms, many of which have sprouted up amid the fields and orchards of the San Joaquin Valley.
Paul Parreira is painfully aware of the irony. The third-generation grower and almond processor is running out of dirt roads where he can spread ground-up almond shells, even as he expands a one-megawatt solar array on six acres of his family's property in Los Banos.
The waste-to-energy facilities where Parreira used to send about 50,000 tons of shells per year are vanishing. Six have closed in just two years, the latest in Delano, which shut down Thursday, after San Diego Gas & Electric ended its power purchase agreement. Twenty-five people were laid off, and 19 will remain to complete closure of the plant, said Dennis Serpa, fuels manager of the 50-megawatt plant, owned and operated by Covanta.
The Rio Bravo biomass facility south of Fresno is taking some of the fuel that would have gone to Delano. But short of a miracle, the 25-megawatt plant run by IHI Power Services Corp. will burn its last wood chips in July, when its power purchase agreement with Pacific Gas & Electric Co. expires.
The Sacramento Municipal Utility District, meanwhile, is locked in a dispute with the 18-megawatt Buena Vista biomass facility in Ione, and has threatened to terminate its contract, according to district spokesman Christopher Capra.
The closures have forced the San Joaquin Valley Air Pollution Control District to consider allowing more agricultural waste to be burned in open piles, which produces particulate matter and ozone-forming compounds associated with cardiovascular illnesses.
"Do not underestimate the fact that state law requires that if farmers do not have an economically feasible alternative, the district is prohibited from banning the open burning of those materials," Executive Director Seyed Sadredin cautioned the district's governing board at its November monthly meeting. "We have 11 farmers right now that are risking the loss of hundreds of thousands of dollars if they do not find a way to dispose of that material."
No one expects a wholesale return to bonfires wafting smoke across the Central Valley. But without the revenue from selling farm waste to the biomass plants, the costs of clearing agricultural debris are expected to skyrocket.
"It's going to triple the cost to farmers," said Frank Sanchez, who owns a tree-grinding service that is one of the top customers at Rio Bravo. "They're going to be paying about $1,000 to $1,200 an acre just to do the same work that you were doing before for about $300 an acre."
Biomass-to-electricity plants — essentially hyper-efficient wood furnaces linked to steam turbines — owe their existence to federal alternative-energy mandates enacted on the heels of the 1970s energy crisis. In the 1980s, more than 60 biomass plants in California turned 10 million tons of woody waste into about 2% of the state's electricity, according to the National Renewable Energy Laboratory. By the turn of the century, the industry already had contracted by more than a third, amid deregulation of California's grid, according to the lab.
By 2011, California's biomass industry faced a cliff. Its long-term contracts and a key subsidy paid by ratepayers were about to expire. New purchase agreements would be tied more closely to the cost of natural gas, and those prices were plummeting.
Pacific Gas & Electric Co. renegotiated purchase agreements with Rio Bravo and another facility in Mendota, along with three others in Northern California. The utility agreed to pay a higher rate in exchange for an earlier exit from contracts. San Diego Gas & Electric got the same deal from Delano.
Now down to 25 plants with a capacity of 611 megawatts, the biomass industry is taking its case to Sacramento, bolstered by Gov. Jerry Brown's latest drought-related emergency proclamation. It touts biomass energy generation as a solution to culling dead trees that pose a wildfire threat in the Sierra Nevada. The San Joaquin Valley facilities are a short distance from the most browned swaths, advocates note. They are hoping for some direct funding or a way to pass costs to utilities, and ultimately to consumers.
Advocates for biomass say utilities and their regulators should factor other benefits of biomass into the rates — the plants prevent pollution from open burning and help municipalities comply with state rules to reduce landfilling.
"With wind and solar, you just get electrons," said Julee Malinowski-Ball, executive director of the California Biomass Energy Alliance, an industry advocacy group. "With biomass you get all this added benefit."
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