Lawsuits challenge ‘abandoned’ biomass project permitting
PORT ST. JOE — for a project that appears all but dead, the Northwest Florida Renewable Energy Center continues to garner plenty of attention.
The final few weeks of 2011 offered a flurry of activity as the developer of the proposed woody biomass energy plant in Port St. Joe issued its first public comments on the project it abandoned during the fourth quarter and several lawsuits were filed challenging the state and local permitting of the project.
During a meeting on Nov. 29, a consultant for Rentech, inc., the West Coast-based renewable energy company developing the NWFREC notified Port St. Joe city officials that the company was pulling out of the project due to the inability to secure financing for the $200 million construction phase.
A press release announcing Rentech’s intentions was to be released the following day, city officials were told, but for several weeks no official word came from Rentech, leaving opponents and proponents of the project guessing.
However, a press release issued just prior to Christmas, detailing Rentech’s activities for the fourth quarter of 2011, spells out the thinking behind the company’s decision to pull stakes from Port St. Joe.
“the company’s energy strategy includes reduced spending on project development and (research and development) …,” the release stated in part. “Rentech does not intend on its own to fund development activities … but may co-invest alongside partners. for example, Rentech may seek to invest in projects that would combine Rentech’s biomass gasification technologies with third-party technology for the production of renewable fuels or power …”
The Rentech investment in such an instance would be to fund the commercial deployment of a gasifier – the Port St. Joe project was set to be Rentech’s first commercial application of its biomass gasification process – which would require $30-$40 million in investment by the company contingent on a complete financing package for such a project, the release stated.
Rentech project development should not exceed a few million dollars per year and the number of projects will be limited, the release stated.
The company would also no longer be involved with projects that relied on U.S. Department of Energy funding.
When it acquired the Port St. Joe project in April 2011, Rentech announced it was in discussions on a term sheet for a federal loan guarantee.
Later in the year, it was announced that the loan guarantee was on hold due to a lack of government funding.
“the company stopped development of large scale projects that required larger development spending by Rentech in order to meet deadlines for government funding,” last month’s release stated. “for example, in the fourth quarter of fiscal year 2011, Rentech abandoned its large-scale projects that relied on DOE funding and took losses of more than $58 million based on prior investment in those projects.”
Among the three projects abandoned was the NWFREC, the release detailed.
While the company may no longer rely on DOE financing for commercial projects, the release stated that the company would pursue other grants and forms of support as well as partnerships.
As Rentech was sounding retreat on its Port St. Joe project, a series of lawsuits were filed challenging the permitting of the NWFREC.
On Dec. 19, six Port St. Joe residents filed a pair of lawsuits in Circuit Court seeking to rescind the city of Port St. Joe’s development order for the project.
The development order was issued Nov. 17 and the suits challenge the local permitting of the plant on the grounds that officials claimed the biomass plant “quiet” and “clean” based on erroneous information provided by a contingent of local elected officials and business leaders regarding a visit to a much smaller plant at the University of South Carolina.
While local officials claimed the plant was not noisy, smelly nor an eyesore on the USC campus, the State newspaper published a series of articles in 2009 concerning chronic problems at the plant.
“Although there have been some reports that Rentech is cancelling the project for lack of funding, the city’s development order and the state’s air and water permits remain in effect. Rentech is still searching for funding, and it can transfer the development approval to another company,” said Landy Luther, one of the plaintiffs in the development order appeal.
The city development order is in effect for 18 months; state water management and air emissions permits are good for five years.
In its final meeting of 2011, Port St. Joe city commissioners took no action on the lawsuits as the city had yet to be served with any paperwork.
Further, three other Port St. Joe residents filed a complaint with the U.S. Environmental Protection Agency under Title VI of the Civil Rights Act of 1964, asserting that the state committed a civil rights violation by issuing an air emissions permit for the biomass plant in close proximity to a predominantly African-American neighborhood.
The plant, if built, would have been within 1-2 miles of the area of North Port St. Joe.
A letter to the Florida Department of Environmental Protection during the permitting process last year threatened just such a lawsuit.
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