The Gainesville City Commission has approved a 30-year energy contract between Gainesville Regional Utilities (GRU) and Gainesville Renewable Energy Center, LLC (GREC), an American renewables project company. Under the terms of the deal, GREC will build, own and operate a 100-MW biomass power plant in Gainesville. GRU will purchase and own 100% of the energy produced. The renewable-energy plant will begin operating in 2013.
The plant will be fueled by forestry-waste material generated by north central Florida’s principal agriculture industry – forestry for paper pulp, chip and saw timber – as well as urban wood waste. GRU general manager Bob Hunzinger said the project is a good deal for customers because it will meet the community’s future energy needs in a cost-effective and environmentally responsible manner.
GRU is excited to partner with American Renewables to bring biomass energy to our community, Hunzinger said. By using biomass materials, a local renewable resource, this facility will promote our energy independence, add diversity to our fuel supply and shield customers from anticipated increasing fossil-fuel prices. This plant also will allow Gainesville to achieve its carbon-reduction goals, which are based on the Kyoto Protocol.
Since GREC will build and own the plant, Hunzinger said there will be no impact on customer bills until it comes online in 2013. Then customers will see a small increase in the fuel adjustment, but early on in the contract the cost of producing the biomass energy is expected to become less expensive than fossil-fuel alternatives.
GREC’s biomass power plant will be located on GRU’s Deerhaven Generating Station property. To ensure that the facility is environmentally friendly, GRU and GREC have created strict sustainability standards for forest-produced biomass materials and developed a forest-stewardship incentive program to encourage suppliers to perform better than the minimum standards.
With the signing of this contract, American Renewables has achieved a major milestone toward our goal of building a state-of-the-art biomass project that will deliver significant energy, environmental and sustainable economic development benefits to Gainesville, said Jim Gordon, president of American Renewables. We are thrilled to be working with GRU which has demonstrated itself to be a leader in encouraging the development of renewable energy.
The project will create up to 350 construction jobs, 45 new jobs at the GREC facility and will support nearly 500 permanent, forestry-industry jobs. It also will add more than $5.5 million per year to Gainesville’s property-tax base.
In addition to this power-purchase contract, GRU and GREC will enter into a long-term lease for the parcel of land on the Deerhaven site. GREC is beginning the process of obtaining the necessary environmental and operational permits necessary for construction and operation of the facility. GREC anticipates breaking ground for construction of the biomass power plant in late 2010.