Montpelier, Vermont Community Energy System: First Step Project Development
"Community energy" is a system that distributes energy from one or more central plants to various users in a community. Generally this approach uses district heating, in which heat is carried from a central plant through underground pipes to users in neighboring buildings.
A large community-energy plant can also generate electricity and cooling. District Energy St. Paul, the largest U.S. system, uses a variety of low-grade wood wastes to both heat and cool all the city's downtown buildings, and some residential neighborhoods.
In Montpelier, Vermont's small capital city, there has been discussion since the early 1990s of expanding an existing woodchip-fired district energy system, which now serves state buildings in the capital, to heat private and city buildings downtown as well.
A first feasibility study was completed for the city in 2001 by the CANMET Energy Technology Centre of Natural Resources Canada, a Canadian federal agency. BERC facilitated an effort, funded by the U.S. Forest Service, to take this project to the next stage.
Project Outline
BERC worked with a steering committee of local stakeholders - including representatives of the city, state, Vermont Legislature, and Montpelier's largest business - to shape first-step design concepts. RDA Engineering, a consulting firm specializing in community district energy, then developed a design concept and cost estimates for Phase I.
Key features of the design concept:
- The existing woodchip plant, which creates steam heat for state buildings, would be retrofitted to also provide hot water to new city users of the system. Heat exchangers and hot water pumps would create the new capacity without changing the current boilers.
- New pipe mains would be routed for easy connection to future spur lines.
- The project team was offered a choice between an $850,000 Phase I that would only meet the needs of city buildings and a few others on the main pipe route, and a $1.4 million Phase I with the capacity to be the "backbone" for a full system build-out over time. The team chose the $1.4 million option.
Project Advantages
- Modest reduction in heating bills for system users, who would no longer have to own and maintain their own building-based heating plants.
- Relatively low heating costs would remain stable, avoiding the ups and downs of oil heat, Montpelier's current primary heating fuel.
- Dramatic reduction in energy dollars exported outside the local and regional economy.
- An enhanced local business climate, and a more vibrant downtown.
- Environmental benefits of replacing fossil fuel with wood.
- Creation of jobs in the forest industry, and improved health of the forest resource.
Financial Commitments
- In March 2003, city voters approved a $250,000 bond issue, its amount equal to the 20-year net present value of the heating cost savings for three city-owned buildings.
- In 2003, the Vermont Legislature allotted $60,000 to study the state's long-term needs and capacity for heating in Capital Complex buildings. That report was completed in early 2004.
- National Life of Vermont, Montpelier's largest business, contributed $5,000 toward project development.
- BERC leveraged Forest Service funds by allocating funding from the U.S. Department of Energy to support the Montpelier Community Energy System project development from late 2003 through 2004.
- The Legislature is currently studying the need to expand and modernize the Capital Complex's woodchip heating plant to meet state needs in the city, and possibly to build in added plant capacity to serve downtown Montpelier.
Project Lessons
- Community district energy systems are complex, difficult to organize, and take much time to bring to fruition.
- Direct economic benefits to potential users are modest. Most project advantages are long-term benefits to the community (see "Project Advantages" above).
- USDA Forest Service funding has raised the Montpelier Community Energy System project to a new, more serious level of visibility and positive development. While the system may still be years from implementation, the project lessons are already valuable - and can inform the thinking and actions of communities in the Northeast, and in other regions with major forest resources.