District Energy System: On-line And In Budget
Prince George, BC – With the City’s new district energy system up and running in the downtown core, city councillors deliberated on its inaugural budget fund earlier this week.
Since September, six civic facilities – City Hall, the Four Seasons pool, the Civic Centre, the library, Two Rivers Art Gallery, and the new RCMP building – have been connected to, and running on, the new centralized heating system which provides hot water heating from wood waste.
The operational costs of the system this past fall (unaudited) were 39-thousand dollars. On Wednesday, councillors passed a provisional budget for the coming year that will see costs of $241-thousand dollars offset by anticipated revenue of $201-thousand dollars and a $40-thousand dollar transfer from city funds. Eventually, the system will be funded by user fees.
In answer to Councillor Garth Frizzell’s question, the City’s Superintendent of Operations, Bill Gaal, says he expects it will be 10-years before the energy system starts generating a profit.
The following chart shows the proposed operating fund budget for the next five years:
"By mid-2013, we will have (a) marketing package prepared (to entice the private sector to hook into the energy system)," Gaal told councillors. "We are looking at also, though, what’s happening in our community with our supply, heat supply." Specifically, he said, with what’s going to happen to Lakeland Mills, which is supplying heat for the system.
When asked by Councillor Cameron Stolz if the City has the ability to increase capacity on its own, should Lakeland choose not to re-build, Gaal said, "Yes, we do." The Superintendent said there’s a secure supply of wood waste for the next one to two years. He says, at this point, the City has not entered into discussions with any other wood waste providers.
Councillor Garth Frizzell said a recent tour of the City’s new administrative building at the 18th Avenue works yard highlighted an ‘unintended benefit’ of the district energy system. "(It) was one that really pleased me to see – that we were re-using old boilers that were taken out of the Civic Centre and getting some more life out of them."
The budget for the new District Energy Fund passed unanimously.
Comments
And the wood waste is getting trucked in from where?
Hardly a banner project when the 15 million dollars in capital cost are not considered in a payback. 10 years before the payback begins. Not a project the private sector would entertain.
As usual the city glosses over the facts to portray things in a positive light.
“The operational costs of the system this past fall (unaudited) were 39-thousand dollars.” That has got to be a misprint.
There’s only a payback because the City is paying themselves elevated rates for the heat.
When the left hand pays the right hand, it’s not a profit.
When you consider what the City would have been paying for heat had this project not been done, there is no payback. The City is now paying more for each GJ of heat than they would had they stayed on natural gas.
The red flag here is that the private sector has not signed up. If there were any savings, surely the City would be able to convince the private sector to sign up?
Totally agreed with the above comments. The city is trying to spin this tremendous waste of taxpayer dollars into something it will never be.
Are routine maintenance and unforeseen breakdowns calculated in anywhere?
Those hog trucks are beating up our roads and polluting the air. Why was this project done again?
Now is a good time to look into installing a wind turbine on Cranbrook Hill too. The equivilent of taking 208 cars off the road. What could be wrong with that?
Part of the rationale for building this system was that it would eliminate 300 truckloads of woodwaste (hogfuel) from Lakeland Mills to the pulpmills.
This would reduce approx. 70 Tonnes of contamination into the air. They are now trucking in the hog fuel from Isle Pierre, so you can kiss that idea goodbye.
In addition there has been a huge increase in the availability of natural gas, so one would assume that the Citys original numbers for savings by going to hot water, and now skewed.
Furthermore we now have a huge operation that was to burn all the surplus hog fuel at Lakeland mills and produce steam, hot water, etc; just producing enough hot water for the Citys system. This was a joint venture between Lakeland and the City.
The question is; Because the Lakeland operation is now a stand alone operation for supplying the City with hot water, is it still viable??? Seems to me it would be like using a hammer to kill a flea.
So what happens if Lakeland doesn’t rebuild. Does the City buy the system, and property, if so, where will they get the hog fuel, and what will be the overall reduction in fine particulates, etc; etc;.
So many questions, so few answers.
The White Elephant graveyard of Prince George gets bigger and bigger.
What we now have is a City **Stand alone** system at Lakeland Mills being supplied by Hog Fuel that has to be trucked in.
Sooooo. It would now appear that the City is a net producer of pollution into the air shed.
Ie; Trucking into Lakeland, and emissions from the Energy Plant. This pollution from the City has to be compared to the pollution that was being caused by those facilities using natural gas, to see if in fact there is any reduction.
The cost of this system should be compared to the cost of natural gas, and then we would have the complete story.
I told them so–
I also asked “what if Lakeland shuts down”?
“Now is a good time to look into installing a wind turbine on Cranbrook Hill too. The equivilent of taking 208 cars off the road. What could be wrong with that?” Sarc right?
The plant can burn gas, may be cheaper than hog fuel and no trucks. Be interesting to see what happens.
The City, as well as other governments, have trouble operating in the real economic world.
If they could, as a for instance, look at the amount of money they receive in grants from senior governments as a finite source which has an annual limit of âgenerosityâ to this region as to other regions, they would have to look at âlost opportunityâ costs due to not being able to spend it on other projects which should take priority.
So, which is the better investment if one has limited funds â improving infrastructure which already exists but is falling apart more and more every year that proper maintenance is not done (roads, bridges, water and sewage systems, etc.) or putting it into pet projects such as switching from natural gas to wood as well as individual systems to community systems.
We are caught in the arms of the feds and province that look on us as their children and cause us to spend our allowance as they see fit, not as we sit fit.
One of these days we need to be weaned off the teats of our mommies in Victoria and Ottawa and learn to serve ourselves by meeting the requirement we set out for ourselves.
Time for the rise of city states and statelettes. Provide protection for us if you can. Let us take care of the rest.
Then again, they might take one look at our Councils over time and say to themselves “that can never happen”. LOL
Comments for this article are closed.