By PATTY RAMUS
News Staff Writer
The Lincoln Downtown Development Authority is trying to obtain federal funding to conduct an energy and engineering study, which will help determine the scope of a proposed biodiesel plant project.
For the past year, village officials have been discussing a proposed facility with representatives from Northern Oil & Mill of Fife Lake. The company expressed interest in Lincoln after Bob Jones, Lincoln Downtown Development Authority consultant, made the suggestion to company partners to consider the village as a location.
The DDA has submitted a grant application to U.S. Department of Agriculture Rural Development to help pay for a study which is estimated to cost $65,000. The purpose of the study is to analyze the amount of thermal energy being produced at Viking Energy in Lincoln, said Bruce Soloway, a partner for Northern Oil.
"Right now they don't have any users for the thermal energy and that's what we intend, to try and harness that as part of our biodiesel and we also have an algae production facility that we would like to do there," he said. "Part of this study that we're doing is to do a complete analysis of how much thermal energy is available."
In September 2008 the village council voted to formally support a plant coming to the village and authorized that a letter of support be drafted. Council members visited different biodiesel and crushing facilities earlier in the year to assist them in making a decision.
Soloway along with Holly Hawkins and Lewis Rasho, other partners for Northern Oil, met with village officials on Jan. 15 to answer their questions about the company's initial plans. Northern Oil's preliminary idea is to focus on a crushing facility with a biodiesel plant being a secondary part of the project. The plant would be built in phases over a five year period. The first phase could cost between $2 million and $3 million.
Viking Energy has preliminary interest in the project because it could provide a business venture to sell steam energy to another company. The company burns wood products and shredded tires to produce steam, which turns turbines to produce electricity. If the plant sells steam to another business, it would have less steam to produce electricity, said Plant Manager Neil Taratuta.
"If we get a reasonable rate that's comparable to what we're doing for electricity - we're all for it," he said of selling steam.
Jones said the DDA is asking the USDA to provide $40,000 towards the study with the DDA contributing $20,000 and Northern Oil providing a $5,000 in-kind match as the project manager. He is confident the project could receive federal dollars because it seems to match federal stimulus funding descriptions for energy, he added.
"We should know about this grant in the next two weeks," he said.
According to Soloway the study would likely be completed within three months. Once the study is finished, Northern Oil can begin to determine the scope of the project.
"Once we've determined what available energy is available, then we can design our system around what we've discovered and we should be able to determine what the cost of the new facility will be and start raising the funds to build it. We're thinking it will be a 5 million gallon plant at this point but we're not sure," he said.
A firm hasn't yet been hired to conduct the study because the DDA doesn't know what the rules will be regarding the USDA funding and how firms are to be selected, Jones said.
Patty Ramus can be reached via e-mail at pramus@thealpenanews.com or by phone at 358-5687.