A critical hearing on Senate Bill 129, which supports New Hampshire's six independent biomass energy plants by shoring up the Renewable Portfolio Standard (RPS) law, will be held on Tuesday, April 11, in Concord at the capitol.

The hearing, to be held by the House Science, Technology, and Energy Committee, is part of the committee's deliberations on SB 129 before recommending passage or defeat of the bill.

The New Hampshire Timberland Owners Association (NHTOA) strongly encourages members to attend the hearing, which will be held in Room 304 of the Legislative Office Building (located just behind the gold-domed capitol), beginning at 1:30 p.m. For comprehensive information about testifying, signing in, and sending or phoning in comments to members of the committee, click here.

Posted below is the letter Jasen Stock, NHTOA's executive director, is sending to Rep. Richard Barry, who chairs the Science, Technology and Energy Committee.

 

Dear Chairman Barry and members of the Committee:

 

The New Hampshire Timberland Owners Association (NHTOA) thanks you for the opportunity to speak in support of Senate Bill 129. Founded in 1911, the NHTOA represents forest landowners and the forest products industry in New Hampshire. This sector of New Hampshire’s economy represents the third-largest sector of manufacturing in the state. The total forest products industry in New Hampshire, which includes the biomass power plants we will discuss today, employs more than 7,700 people directly, and contributes nearly $1.4 billion dollars to the state’s economy.

 

The NHTOA supports the biomass provisions in this bill, as they will assist in the continued operations of the state’s six independent biomass power plants. Losing these biomass power plants, and the low-grade timber (trees unsuitable for lumber) markets they provide, will negatively impact hundreds of jobs and disrupt New Hampshire’s entire forest products industry. These power plants are vital to our membership’s ability to practice sustainable forest management and retain land as forests. The relationship of these power plants with the rest of the forest products industry (e.g. sawmills) means their survival is critical to the economic health of the state’s forest products industry. We can see the vital need for SB 129 in last week’s announcement of the temporary closure of one of the six biomass plants, Alexandria, due to very low energy and renewable energy certificate market prices.

 

Forest management

These power plants provide a key market for low-grade timber. According to the U.S. Forest Service’s Forest Inventory Analysis (FIA) data, almost two-thirds of the standing timber in New Hampshire is considered low-grade. Without markets for low-grade timber, landowners and land managers are unable to economically improve forest health and vigor, and in many instances entire woodlots go unmanaged; weeding and thinning of diseased and malformed timber does not occur, weakening these woodlots environmentally and economically. Worse, timber lots are sometimes “high-graded,” where the logger “cuts the best and leaves the rest,” resulting in genetically inferior timber stands with poor growing stock.

 

In addition to standard silvicultural work, biomass markets are also an important tool for watershed management. Several of the state’s largest municipal watersheds use biomass harvesting to manage their timberlands to ensure clean water. Wildlife and recreation managers also regularly use biomass markets for habitat and recreation work. Installing food pots[A1]  for game and non-game species, creating habitat diversity, and installing hiking or motorized vehicle recreational trails are all accomplished through biomass harvesting. Without biomass markets, this work would be much more difficult and costly.

 

Lastly, in addition to healthier and more vigorous woodlots, clean water, improved wildlife habitat, and recreational trails, the forest management work that biomass markets encourage improves the quality and economic value of timberlands. This makes timberland ownership more economically viable, ultimately benefiting the entire timber supply chain (landowners, foresters, loggers, and sawmills) and the communities these individuals and business are located.

  

Economic impact

To help quantify this economic impact, earlier this year the NHTOA retained Plymouth State University’s College of Business Administration (PSU) to conduct a study to estimate the economic contribution the six independent biomass electric power plants make to the New Hampshire economy. Using a customized economic impact model and actual data gathered from the six power plants, PSU calculated their economic contribution for the 2016 calendar year.

 

This study shows:

 

·         The grand total of the direct effect (the six independent biomass electric power plants), indirect effect (supply industries), and induced effect (service sector) economic activities is approximately 932 jobs ($50.9 million in payroll). And the total economic output to the state’s economy is $254.5 million each year.

 

·         The six biomass plants contribute $7.3 million in tax revenues to state and local governments from all sources (direct, indirect and induced effect).

 

Because all facets of the timber industry are connected to low-grade timber markets, these economic figures are not surprising.

 

·         Landowners: With two-thirds of the state’s forests considered “low-grade,” biomass power plants provide landowners a market for those low-grade trees. This adds value to timberland, which translates into higher productivity and ultimately higher property taxes for local communities.

 

·         Loggers: To cash-flow a timber sale, loggers need markets for all the species and grades of timber on the woodlot. Because biomass power plants can accept any species and grade of timber, it is an important market for many timber sales.

 

·         Foresters: To sustainably manage a forest and improve forest health and forest productivity, inferior diseased and malformed trees must be removed. Because these trees rarely produce sawlogs, biomass power plants are the obvious market for them. This market is also important for management work dealing with the increasing prevalence of new invasive tree pests (e.g. Emerald Ash Borer, Hemlock Wooly Adelgid, and Red Pine Scale).

·         Sawmills: Open burning of slabs is not presently permitted by state law. Instead, sawmills chip their slabs and send the chips to a paper mill or biomass power plant. With the contraction of New England’s pulp and paper industry, biomass power plants are becoming increasingly important for managing this material.

 

This economic impact is statewide. According to the New Hampshire Department of Revenue Administration’s (NH DRA) timber tax data, during the 2014/2015 tax year 1,349,018 tons of biomass was harvested in 209 towns in New Hampshire. On a county-by-county basis, the data shows biomass is an important low-grade timber market for several southern counties.

 

Belknap                       148,046 tons

Carroll                         102,415 tons

Cheshire                      78,303 tons

Coos                            151,346 tons

Grafton                       199,985 tons

Hillsborough               163,472 tons

Merrimack                   261,910 tons

Rockingham                96,311 tons

Strafford                     55,646 tons

Sullivan                       91,886 tons

 

 

Although these county biomass harvesting numbers will vary year to year, we believe these data show the broad land management and positive economic impact that biomass markets have on the entire state. Combining the positive economic impact with the forest management benefits means the total benefits New Hampshire gleans from the biomass industry are significant. For these reasons, the NHTOA requests you vote Ought To Pass on Senate Bill 129.

 

Again, thank you for allowing me to testify on this important piece of legislation.

 

 

 

Sincerely,

 

 

Jasen A. Stock

Executive Director

 

 

 

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