October 2001 - Logging and Sawmilling Journal -

Riverside Forest Products' Armstrong division has just invested a lot of effort and money in completing a new $32-million co-gen plant and is now ready to reap the rewards.

Gary Zecchel, manager of Riverside Forest Products' Armstrong, BC division, explains that the decision to go ahead with a $32-million co-generation power plant at the mill really came down to taking advantage of an internal opportunity at the company. "Basically, it's very simple," he explains. "We were producing 130,000 bone dried tonnes of wood waste here and we were consuming only 80,000 tonnes. We had 50,000 tonnes that we had to deal with in one form or another and there was also the opportunity to de-commission the Lumby division's beehive burner." The Armstrong mill had a very visible problem-a mountain of wood waste. "When a Cat D8 was at the top of our waste pile, you could still see it, but just barely," says Zecchel.

The waste pile, and dealing with waste in general, were constant impediments to the overall operation. The pile was taking up more and more log yard space and the storage, handling and transportation costs were significant. The way the mill chose to deal with wood waste was to build the co-gen plant, but the path they took to get there was not exactly your typical sourcing of equipment. The Riverside facility in Armstrong, just north of Vernon in British Columbia's picturesque Okanagan Valley, consists of a combined sawmill and plywood operation.

Over the years, both sides of the operation have grown in production. Along with that growth, what was a wood waste stream became more of a wood waste river. And in practical terms, there was only so much they could do with the waste. They had been considering a co-gen for some time, but were in part daunted by the numbers. A facility with new equipment would have rung in somewhere around the $70-million-plus mark. However, the project came together for significantly less than that, thanks in part to some investigative sleuthing by a Riverside employee from another operation. Craig Carlyle, of Riverside's Kelowna mill, was in California looking to find a replacement unit for the five megawatt generator at Kelowna. The existing unit needed a major overhaul. "We looked at the costs involved in doing the rebuild and in the end all we would have is a five megawatt unit," says Carlyle.

They were looking at sourcing a larger unit in the US and found a used 10-megawatt unit in northern California. "They wanted to sell the unit, it was 10 megawatts, and it was a Westinghouse, similar to the one we had in Kelowna," he explains. "It had perfect pressure and was a good fit for Kelowna. It looked like a rickety old machine-real bad. But we knew that it would be fine inside with some work."

Assembling co-gen parts a logistical challenge

On a map, British Columbia may look to be just up the coast from California, but that still didn't make the task and the logistics of moving hundreds of tonnes of power generation equipment easy for the group at Riverside Forest Products' Armstrong division. The boiler and associated equipment came from the San Francisco area and filled 56 tractor trailers and 15 rail cars.

The turbine, which also came from California, took 15 tractor trailers to move. The transformer came from Ontario and took up an entire rail car. Once it got to Armstrong, the various components were laid out along the perimeter of the mill, some of which fronts on busy Highway 97. "We were getting phone calls from people wondering what was going on," says project manager Craig Carlyle. "We had pieces of equipment from one end of the yard to the other." Before purchasing the equipment, they had previous informal talks with government officials about a co-gen, but had not started the permit process. "A few months later, here we are with all this equipment," says Carlyle.

The project had the full support of the town of Armstrong, the regional district and the provincial Ministry of the Environment, which all helped to line up the necessary permits quickly. "They've all been very helpful and supportive." While Riverside is certainly a large corporation-sales were over $400 million last year-the company still has a lean operating structure. This helped, says Carlyle. "Other companies might have addressed this in a more bureaucratic way, looked at getting the financing firmly in place, sourcing the equipment and then getting the necessary permits, and it would have taken a lot longer.

In the meantime, the problem is still there. "We actually took the opposite route. We got our equipment, started doing the excavation work after getting the necessary approvals and applied for the operating permits-it was all fast-tracked. We had a problem and we knew we needed to address it." Fast track, indeed. The first piece of structural steel went up on October 1, 2000 and the plant was operational the following August. While the project had a tight time schedule, there was a very strong safety component. "We asked the WCB to come in and talk to the crews every time we entered a different aspect of construction," says chief power engineer Gary Fothergill.

Their due diligence on the equipment included having a turbine specialist do an assessment. While all this was going on, Carlyle took a walk around the California facility. Connected to the building with the 10-megawatt unit was a turbine hall, which he described as "spotless"-it had been shut down for 10 years and had a 20-megawatt GE unit. "We started looking at the turbine, and when we looked at it closely we realized it was designed specifically for a sawmill/plywood plant. I spoke with our senior people and explained that we would never find another machine like this-it was the perfect fit for Armstrong."

Next on the list was a boiler, which they were also fortunate to find in California. It is a 1984 Babcock and Willcox unit rated at 310,000 pounds, but which had been upgraded to almost 400,000 pounds. "It was the perfect pressure and perfect match for the turbine," says Carlyle. That said, they still had several engineering companies check out the boiler so there would be no surprises. They also carried out detailed work on the transportation and installation costs. Once the equipment made it to Armstrong-every single piece labelled-each piece was checked over thoroughly, sandblasted and painted. "It's not your typical employment of used equipment," explains chief power engineer Gary Fothergill. "It basically looks like a new installation," he says, at a fraction of the cost.

This kind of set-up would cost upwards of $70 million or more if it were new, he says. There were some interesting differences to the co-gen plant in Armstrong. It does not have the cooling tower commonly associated with a power facility. While the mill is not far from Okanagan Lake, there is still not an abundance of water in the region. "So we're running air cooled condensers here, which is essentially like a big radiator," says Fothergill. "That's a big difference from other plants."

Zecchel notes that at this point the co-gen is still in the start-up phase. But he is very positive about the doors the new power facility will open for Armstrong. "Not only does it sustain the business that we have now, it gives us stability and will also allow us to grow." They can take a look at taking more wood in because they can now use the bark and waste wood in the co-gen.

Riverside's power goes directly on the grid

The Armstrong sawmill/plywood operation of Riverside Forest Products looked at a number of power generation options before opting to build their own new co-gen plant. In the past, Armstrong purchased its power needs from BC Hydro and will continue to do so. "We are going to put all of the power from the new co-gen, all 20 megs, on the power grid," says division manager Gary Zecchel. A separate subsidiary company of Riverside has been set up for the co-gen operation.

"We could have offset the power we were using from BC Hydro, but once you are on the grid, you can look at a number of opportunities." They could have partnered with a number of power marketing companies. But they opted for an arrangement with BC Hydro subsidiary Powerex, which exports power to the United States. The revenue opportunities could be, in fact, considerable for Riverside. If the power had been sold directly to BC Hydro, it would have gone into their power pool for domestic use and it would have been sold under price regulation. Contrast that with Powerex, who can take it directly to the US market, notably to California.

The record price in that market? A cool $1,600 US per megawatt hour, many times the price in the domestic market. It is important to note that particular price was demanded at the peak of the power crisis in the last year and power prices have drifted down a great deal since then, with more stable markets. Riverside Armstrong had initially been approached by an independent power producer who would have built and operated the plant on a contract basis. It was clear that if this company could run a co-gen profitably, Riverside could, presumably, do the same.

Riverside was also fortunate in having strong capabilities within the company. "We had all the in-house skills we needed to do something like the co-gen project," says Zecchel. A number of contractors carried out construction of the new plant. Focus Industrial Contractors of Edmonton handled the mechanical installation and erection, with support from Sterling Crane. Assisting with engineering services was CWA Engineering of Burnaby, BC. Westwood Company of nearby Vernon was responsible for electrical engineering design and installation. Norpac Controls Ltd of North Vancouver supplied the important control systems and instrumentation.

There is also the option of using the extra steam that will be generated from the plant to run additional veneer kilns. "There's the opportunity to reduce gas and get better heat distribution for our plywood," says Zecchel. "It will also improve our drying efficiencies and our grade outturns." Riverside also has what it calls a "green box" program which sees waste wood brought in from landings in the bush. "We could look at increasing the volume with that program and reducing the amount of wood being burned at our landings."

From a community perspective-and Riverside is a very strong community-based company, being based in nearby Kelowna-the benefits will come in improved air quality. The beehive burner at the company's Lumby mill to the southwest, will be phased out, with wood waste trucked to the Armstrong co-gen plant. And the plant will use wood waste from other non-Riverside operations. "At this point, we are still in that 'how much wood waste can we take, and where are we going to take from' phase, outside of our own operations," notes Zecchel.

And there is still some work to be done. A weigh scale and dumper need to be installed by next March to handle the inflow of material. But Armstrong now has more than enough material on site-it had a pile of wood waste 90 feet high containing 500,000 cubic yards just before start-up-to get the co-gen operating and keep it going for months.

For those companies looking at co-gen as an option-and in reviewing their own experience-there are many things to consider before going ahead, says the Riverside crew. "So many factors come into play," says Zecchel. "We were very fortunate to find equipment that fit our Armstrong operation to a T." Project manager Craig Carlyle and power engineer Fothergill said it is important to have a strong focus on the supporting technology. "In terms of the boilers themselves, the technology has not changed that much over the last 40 or 50 years," Fothergill explained. "Really, boiling water is boiling water. What has changed is how you do it."

It is the control system that has changed more than anything else, Carlyle notes. Thanks to high tech computer control systems and strategies, the boilers will perform better and more efficiently at Armstrong than when they were originally installed in California. The burn itself, the amount of oxygen and a number of other factors are all monitored to make sure they get the optimum burn out of their material.

Suppliers & Contractors that contributed to the Riverside Project
Equipment	Make	Engineer	Supplier	Installer
Boiler	Babcock & Wilcox	CWA Engineers Inc.	Aggressive Tube Bending Johnstone Boiler & Tank Ltd.	Focus Construction Management
Electrostatic Precipitator	PPC Industries	PPC Industries	PPC Industries	PPC Industries
Hog Fuel Handling		CWA Engineers Inc.	Waycon Versatile Fab.	Focus Construction Management
Ash Handling		CWA Engineers Inc.	Waycon Versatile Fab.	Focus Construction Management
Deaerator	Chicago Heater Company Inc.		Johnstone Boiler & Tank Ltd.	Focus Construction Management
Natural Gas Burners		Norpac Controls Ltd.	Norpac Controls Ltd.	Focus Construction Management
Steam Turbine Condensing, Extraction	General Electric	CWA Engineers Inc.	TEAM Machinist & Millwright Services Interpro Technical Services Ltd.	TEAM Machinist & Millwright Services
20 MW Generator	General Electric	Westwood	Beaver	TEAM Machinist & Millwright Services
Buildings		CWA Engineers Inc.	Gisborne Construction Kelowna Steel Fabricators Armstrong Machine	Gisborne Construction
Bridge Crane	Kaverit Steel & Crane Co.		Kelowna Steel Fabricators Ltd.
Water Treatment	MECO Inc.	CWA Engineers Inc. Bacon Donaldson	MECO Inc.
DCS	Delta V	Norpac Controls Ltd.	Norpac Controls Ltd.	Norpac Controls Ltd.
Electrical		Westwood	Westwood	Westwood

Main Page