A miscalculation within a critical piece of equipment has already set back the construction of a $9 million Biomass Plant at the University of Minnesota-Morris more than a year, and an upcoming decision by the USDA will determine if $1.89 million in grant money will be lost due to the delay.
Originally expected to be operational in early 2009, the construction of the Biomass Plant was completed in mid-2008. However, during the plant’s first commissioning test in November 2008, plant operators found that a mistake had been made in the design of the gasifier, the $700,000 principal component used in converting corn stover and other biofuels into steam.
Litigation between the project’s general contractor and one of its subcontractors slowed the repair of the gasifier to a halt for several months. If the plant is unable to begin testing fuel stocks before winter ends — which is not expected to happen — the three-year, $1.89 million U.S. Department of Agriculture grant awarded to the plant in 2006 to research corn stover could be in jeopardy.
For this reason, Lowell Rasmussen, vice chancellor of finance and facilities at UM-M, is in Washington, D.C., on behalf of the university to formally request a one-year, no-cost extension to the grant. Rasmussen will meet with a grant officer Thursday and expects to be notified within three to four weeks whether the grant will be extended.
It is estimated that the plant would funnel $500,000 annually into the local economy around UM-M because the plant utilizes a variety of fuel stock, including corn stover, wood waste, distiller’s grain, wheat straw and native grasses, all from land within 30 miles of the UM-M campus.
The plant would cover up to 80 percent of heating needs for the campus, and even the ash byproduct of the conversion would be used as fertilizer in local fields. Corn stover is made up of the stalks, husks and cobs of field corn. In midwinter, the university will also use its natural gas and fuel oil burners as a supplemental heating source for the 1 million square feet of space on campus, previous estimates have suggested.
Typically, Rasmussen said, research grants are extended to a maximum of five years, and if research is not being produced by then, the money will “essentially be pulled back.”
“We’re about 18 months behind on running our production tests and our research,” Rasmussen said.
Another reason to get the project running is a USDA biofuels incentive program that provides a 50 percent subsidy for all corn stover purchased in the next two years. If utilized, it could reduce fuel costs for Morris by as much as $400,000 a year for two years, according to a report presented by Rasmussen to the Board of Regents on Sept. 10.
The Minnesota Legislature appropriated $4 million to the Biomass Plant project in its 2005 bonding bill. Morris is picking up $600,000 of the cost and $1 million is tacked on to university debt. The rest is covered by grants, private organizations and other institutional resources.
Rasmussen said the calculated fuel density of the corn stock was too high for the gasifier to function. This was due to a lapse in communication between UM-M, the general contractor and the subcontractor, due in-part to the use of corn stover, a fuel new to the industry, he said.
“There was certainly a misunderstanding in the density that we needed in relation to successfully operating this system, and it’s a learning curve on all sides,” Rasmussen said.
Rasmussen’s September report stated that the calculated fuel density varied between contract documents held by the general contractor, Knutson Construction Services (KCS), and its two subcontractors, English Boiler and KMW.
“Corn stover is untested and never before used in a gasification platform,” Rasmussen said. “Part of it is we underestimated how variable the fuel stock was going to be in terms of its moisture and thermal properties. I think the gasification industry probably overestimated how easily they could make a transition from the fuel that they’re very familiar with, which is wood, to [agriculture-based] fuel stock.”
After negotiations throughout November and December, KCS and English Boiler have agreed, under the terms of their original contract, to repair the gasifier based on recalculated fuel density and complete the project, Rasmussen said.
“They’re actually on campus now and are putting together the work schedule,” he said. “I would hope by the end of the week we have some idea of some of the work schedule that they intend to adhere to.”
KMW has not signed on to finish the project, and Rasmussen said the university does not know why, because it is not privy to the terms of the contract between Knudson and KMW.
“I wish I knew the answer to that question, and that gets back to, ‘We don’t know what the terms and conditions were between those companies.’ I’m pretty sure there’s litigation going on there right now.”
Rasmussen repeatedly stressed that fault cannot be specifically placed on any of the parties involved.
“It’s not a real cut and dried, ‘Gee, we know exactly who’s wrong here.’ It’s hard to hold someone responsible for something there are no previous data sets on,” Rasmussen said.
—Raghav Mehta contributed to this report.