Photo Credit: Shutterstock.com/Edijs K
At one point in the 1990s, California had 66 power plants that produced electricity by burning biomass. Today, that’s down to 30, including six that primarily burn wood. These six embattled plants collectively generate just 0.2% of the state’s electricity, and many Californians see them as polluting and costly boondoggles. Yet, for the [rural and indigenous] communities that house and supply these plants, biomass power generation offers the only significant end market for their wood products. These facilities have not only provided economic opportunity for the state’s forested regions, but also a critical demand-driver for investments in wildfire fuel reduction. These six power plants alone consume waste from 100,000 acres of forest health treatments—treatments that also reduce the risk (and cost to ratepayers) of fires caused by downed utility lines.
Given the complex economic, climate, and energy linkages at play in the state’s shrinking biomass power plant fleet, the Governor’s office has created a specific work group focused on increasing wood product utilization within its Wildfire and Forest Resilience Task Force. For several years, the Task Force has coordinated efforts across state government to pilot innovative wood products and harvesting techniques—but, as it acknowledged in its 2021 action plan, much more is needed.
A recent bill focused on this issue passed the California Assembly, though was tabled in the Senate. Assembly Bill 706 would provide funding for increased forest fuel reduction by prioritizing the use of wood waste in these existing bioenergy facilities, essentially extending a procurement program called BioMAT that expires at the end of this year. This would offer a temporary financial lifeline to the six aforementioned power plants, and buy California time to pursue new wood utilization markets.
While the BioMAT program is an essential end-market for many of these wood products, over its decade of existence it has failed to demonstrate long-term economic viability for these facilities. The program is still far short of its original 250 MW procurement target and is buying power at well above-market prices: Close to $200/MWh, several times the average wholesale price on the California grid. There are many good reasons for government subsidies to support regions and communities facing economic headwinds, but when there are structural competitiveness concerns around current solutions, these near-term subsidies must go hand-in-hand with proactive investment in a long-term transition strategy. We need only look across the U.S. at coal-dependent communities that are grappling with the consequences of decades of underinvestment in new economic opportunities.
At CA FWD, we support a regions-up, economic development-oriented approach to energy transition. As such, we believe there is a strong case to support our forest communities in a shift towards the array of growing wood utilization opportunities in the burgeoning bioeconomy and, ultimately, away from our reliance on the shrinking bioenergy fleet. And, in general, we love any approach that uses existing industrial infrastructure, rather than expanding into undeveloped areas of the state.
Bills like AB 706 can be an important part of the puzzle, so long as they are pursued in concert with this overarching strategy for a managed transition. We urge lawmakers to articulate a clear transition plan, including a strategy for investment into re-engineering these plants toward more financially and environmentally sustainable models by 2030. A proactive, comprehensive, and fair strategy for transitioning these facilities will incorporate clear phaseout timelines for bioenergy facilities, explicit funding to support forest communities in finding new markets, and plans for repurposing aging infrastructure. AB 706 could also require any facility utilizing BioMAT procurement to develop a five-year transition strategy to convert the facility to other beneficial, non-combustion uses. Otherwise, we may be merely creating a “bridge” to nowhere for our forested regions.
Woody biomass power plants will not be a part of California’s energy mix forever. But, if we play our cards right, our state can leverage our rich forest resources to build a bioeconomy that accelerates the clean energy transition, makes us more resilient to wildfires and other climate risks, and support California’s diverse regional economies.
In the coming months, CA FWD will expand our efforts to grow the bioeconomy and facilitate a fair energy transition for California workers and communities, including through plenary discussions and breakout sessions at our California Economic Summit in Stockton this October.
