Request for proposal issued for co-gen project

NEWS RELEASE

DAVID ORAZIETTI, MPP

************************* Orazietti announces provincial request for proposals to construct new co-generation facilities

McGuinty government’s renewable energy program could benefit St. Mary’s Paper

SAULT STE. MARIE, ON - (January 19) - The McGuinty government, through the Ontario Power Authority (OPA), posted a request for proposals (RFP) today to enter into contracts with large industrial companies such as St. Mary’s Paper capable of generating both electricity and heat for industrial processes from renewable fuels David Orazietti, MPP announced today.

“Today’s announcement has the potential to be great news for St. Mary’s Paper and Sault Ste. Marie and is part of our government’s continuing commitment to renewable energy and local industry,” said Orazietti. “The construction of a new co-generation project would help to strengthen the position of St. Mary’s Paper in the market place, while increasing job security for paper workers and their families.”

The process initiated today by the province is officially termed combined heat and power III (CHP III): industrial energy from renewable biomass.

The CHP III procurement is designed to increase industrial efficiency, expand the role of renewables in Ontario's energy mix and increase the flexibility and reliability of the entire electricity grid.

The RFP for co-generation projects, posted on the OPA's website today, responds to a directive from George Smitherman, minister of energy and infrastructure, to secure approximately 100 megawatts (MW) of high-efficiency renewable-fuelled combined heat and power projects.

CHP III encourages large industrial businesses such as St. Mary’s Paper to generate both electricity and process-heat for their own manufacturing processes and to enter into a power purchase agreement with the McGuinty government to sell excess power back to the provincial grid.

The procurement is expected to attract companies that create potential bio-fuels as part of routine industrial process, such as wood waste.

The new CHP III process follows a successful CHP I procurement completed in 2006 - which awarded seven contracts, including the $135 million co-generation facility at Essar Steel, with a total capacity of 414 MW - and CHP II, an RFP for large gas-fired CHP projects which closes on January 29, 2009.

Deadline for the CHP III submissions is April 30, 2009.

Other projects in Sault Ste. Marie facilitated by the McGuinty government’s innovative renewable energy strategy:

- Provincial power purchase agreement to support $400 million Brookfield Power wind farm.

- Provincial power purchase agreement to support $360 million POD solar farm.

- Provincial power purchase agreement to support $135 million co-generation plant at Essar Steel.

- Certificate of approval issued for EnQuest’s innovative waste-to-energy project.

For further information on CHP III and other OPA procurements, please click here.

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