PRINCE ALBERT, Sask. – The company operating a wood-burning energy plant in Prince Albert, Sask. says it’s been forced to temporarily shut down due to economic and industry forces beyond its control.
The move by Prince Albert Pulp Inc. (PAPI) for its green energy project is effective immediately, and 42 employees will be laid off Aug. 29.
PAPI has been operating the project since 2012, designed to use wood waste from the pulp mill beside the plant which company officials say is vital to the economics of the energy plant.
With the pulp mill idle, PAPI has been using alternative sources of wood fibre to create energy for the provincial power grid.
In a release, the company said that’s no longer viable.
“These alternative sources of fuel are more expensive than on-site internally generated wood waste,” states the release signed by David Kerr, vice-president of operations for B.C. based Paper Excellence Canada, the parent company of PAPI.
“Since the inception of this project, diesel prices have risen significantly. This translates directly into much higher biomass fuel transportation costs for wood waste purchased from market sources.”
The company also said acceptable wood waste from Domtar’s operations at the idle pulp mill have been exhausted and reclaimable wood waste has deteriorated to the point where it is no longer usable.
Paper Excellence signed a non-competition agreement when it purchased the mill from Domtar in 2011, and has been trying to negotiate a deal with the big forest products company that would allow it to resume production.
Paper Excellence is currently recommissioning and upgrading the mill and is anticipating a start-up for late 2015 depending on those negotiations with Domtar.
With files from The Canadian Press