Vermont utility regulators are temporarily softening environmental rules at Vermont’s two wood-burning power plants to help stabilize the logging industry.
State officials say the $2.3 billion wood products industry is in a perilous situation after one of the region’s largest paper mills announced in July it will no longer purchase local wood scraps to make its paper.
The rule change, announced earlier this month, will allow McNeil Generating Station in Burlington and Ryegate Power Station in the Northeast Kingdom to buy wood that had been destined for that paper mill, even if it comes from timber harvests that have not been inspected by fish and wildlife officials for impacts to wetlands and habitat for endangered species.
The Finch Paper Mill in Glens Falls, New York, used to buy some 2,000 tons of “pulpwood” scraps from Vermont loggers and mills each week before its July announcement.
That’s 2,000 tons of wood from branches and roots and bark left over from the logging and milling process that businesses and local landowners can suddenly no longer earn income on.
“This is an effort to sort of keep loggers in the business,” said Oliver Pierson, who leads the Division of Forests at the Department of Forests, Parks and Recreation. “We want to prevent a situation where there’s just no longer businesses out there who are qualified and skilled and have the right equipment to do low-impact sustainable forest management.”
In documents filed at the Public Utility Commission, Pierson testified that Vermont loggers have reported a 40% reduction in suitable places to sell their wood over the last five years, leading to revenue loss, layoffs, lost clients and fewer harvests.
"This is an effort to sort of keep loggers in the business."Oliver Pierson, Department of Forests, Parks and Recreation
The pulpwood market is especially crucial, Pierson said, for financing restoration projects, like ones that remove and replace diseased trees such as beech and ash to diversify a forest, or to help an old farm field riddled with invasives to grow back as a healthy plot of woods.
“When you lose those markets, then the amount of value you’re getting from a single tree decreases,” he said, adding that lower value per tree adds pressure to cut more of the big, mature trees in a plot of woods.
After Finch stopped accepting pulpwood, the Agency of Natural Resources asked state utility regulators if Vermont’s local wood-burning power plants could be allowed to purchase the scraps for chips instead.
McNeil Generating Station in Burlington and Ryegate Power Station in the Northeast Kingdom purchase some 600,000 tons of wood chips every year to make electricity.
Their operating licenses require they source their wood chips from timber harvests that state wildlife biologists have reviewed in advance, to make sure they don’t hurt wetlands, deer wintering areas or habitat for threatened and endangered species.
Utility regulators are waiving those requirements until the end of the year, only for wood that was already cut before the end of July and intended for Finch. The chips still have to come from projects that follow some guidelines for sustainability.
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Gagnon Lumber in Pittsford sold pulpwood to Finch for 50 years. The mill also makes leftover scrapwood into chips it sells to a local school district in the winter for heat. In the summer, they sell some to local farmers for animal bedding and some to Burlington Electric.
“We’re fortunate here because, you know, it’s not like they were the only girl on the dance floor, so to speak,” said owner Ken Gagnon.
However, Finch was particularly crucial for Vermont’s local hemlock market as the only mill in the region that purchased hemlock chips.
Gagnon said it’s common for about half of a given hemlock tree harvested in Vermont to go to pulpwood — sometimes more.
Gagnon Lumber cuts and sells a lot of locally harvested hemlock for timber framing. In the long term, Gagnon expects that without Finch buying hemlock chips, loggers will just have to harvest fewer hemlocks in Vermont, which would be a big loss for his family’s mill.
Gagnon said the short-term solution will likely help loggers stay afloat, but they’ll still lose money because wood chips for electricity are less valuable than paper pulp.
“It's going to be a little bit of a challenge,” he said. “But we'll be OK.”
Ultimately, he said, Vermont loggers and mills need a new place to sell their hemlock chips.
