Placer to cease negotiations with Liberty Utilities for biomass energy facility deal
January 23, 2018
Putting a pause on plans to build the Cabin Creek biomass energy facility in North Lake Tahoe, Placer County’s Board of Supervisors today directed county staff to cease negotiations with Liberty Utilities for a deal needed to build the project.
Biomass facilities create renewable energy by burning wood scraps left over from forestry operations, and help remove a hazardous source of fuel for wildfires. They also generate heat and a byproduct called biochar used as fertilizer and in water filtration processes. A plan for a biomass facility at the county’s Cabin Creek property near Truckee was approved for a conditional use permit in 2012.
Placer and Liberty have been in negotiations for several years on an agreement for Liberty to buy energy from the facility and possibly agree to buy the facility itself after its completion. The timeline to secure a deal became urgent in recent weeks with a deadline looming to build it. To remain eligible for a U.S. Department of Energy grant that has helped fund the project, the facility needs to be complete by May 2019, requiring a deal to be struck by next month.
With staff reporting to the board today that the county and Liberty have yet to come to mutually agreeable terms, the board directed staff to cease negotiations and explore other opportunities.
“I think we’ve given this a valiant effort,” said District 4 Supervisor Kirk Uhler. “But right now, it just doesn’t make sense for us to proceed. We’ve seen enough to know that this track is not going to work, so let’s back off."
District 5 Supervisor Jennifer Montgomery urged county staff to begin looking into other partnership opportunities.
“I think it’s critically important to recognize that we still have an approved project at Cabin Creek and my full intention is to do everything I can to make sure it gets built, just with a different partner,” Montgomery said.
In 2008, the Department of Energy awarded Placer County $492,000 to study the feasibility of building a biomass facility. The Board of Supervisors in 2015 approved a grant agreement with DOE that provided a total of $2,919,250 for the project, which would have also helped fund its construction. The estimated cost to build the facility was $7.2 million, with $1.5 million coming from the DOE grant and the remaining $5.7 million to come from the county and possibly Liberty.
The county has completed the terms of the grant agreement to date and won’t have to reimburse funds that have already been spent. The project’s conditional use permit is still valid, allowing the project to proceed as conditions allow.
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