MIRAMICHI – New Brunswick must get its energy costs under control if its battered economy is going to re-establish itself, an industry magnate told the province’s energy commission Tuesday.
Jim Irving, president of J.D. Irving Ltd., said the cost of electricity can be the difference between success and failure in the energy-intensive pulp and paper industry.
“Every other forestry jurisdiction in North America has dealt with energy. They’ve decided that forestry provides a key economic engine for a lot of communities,” he said.
“We can’t wait too long. We need to get a firm plan in place, but we need great co-operation between the industrial players of the province, the government and the utility.”
Jeannot Volpe and Bill Thompson, the commission’s co-chairmen, are in the midst of a series of information- and opinion-gathering meetings as they formulate the province’s long-term energy plan. That road map is set to be released in May and will seek to find a balance between environmental sustainability, low costs for ratepayers and fostering economic growth.
Speaking at a consultation session overlooking the banks of the Miramichi River that was once home to a thriving forestry industry, Irving said high energy prices won’t only prevent companies from moving to the province, but also put pressure on those already doing business here.
“Electricity is a huge part of our costs,” he said.
The Irving Paper mill in Saint John uses about $75 million worth of power every year.
“It’s about equivalent to the amount of electricity used in the province of Prince Edward Island. It represents about 30 per cent of our costs of manufacturing.”
In the past 10 years, industrial energy costs have risen more than 50 per cent, Irving said.
He said products sold in New Brunswick are only a fraction of the company’s business. Most are exported to the United States and around the world, he said, and higher energy costs make it harder to be competitive in the global market.
“We’ll saw enough lumber in about 10 days to build all the houses in New Brunswick for a year. We’ll make enough toilet paper to supply New Brunswick for the year in about 25 or 30 days,” he said.
“We’re in a very competitive global marketplace out there.”
With the number of jobs that depend on forestry and manufacturing in New Brunswick, Irving said costs need to be reined in to encourage investment and help the economy get back on its feet.
He also said the distribution cost of natural gas needs to be addressed quickly, especially with New Brunswick becoming an increasingly popular site for exploration.
“Never mind bringing anybody else to New Brunswick. This is a tragedy what’s going on here. We won’t have a plant in Saint John,” he said.
Volpe and Thompson have heard several calls for investment in wind and solar technology during the initial stops of their tour, but Irving said investment in other areas could provide indirect benefits.
“I have no problem with wind at all, except it’s expensive and that’s a fact,” Irving said, suggesting other alternative energy sources could be encouraged, citing an Irving mill in St. George that both sells power onto the provincial grid and provides local employment.
“Are we going to support local jobs and a local mill and local loggers, or are we going put up a wind tower?”
Irving said biofuel and biomass energy could be a part of the solution, but a healthy forestry industry would be needed to go hand-in-hand with the development of such technology.
“We should burn biomass and make electricity, make steam, make a more competitive paper mill, a more competitive pulp mill, a more competitive saw mill, a more competitive french fry plant or brewery,” he said, recommending the government holds industry to account for creating related jobs in the process.
Kevin Gallant from Southside Air Inc., a Miramichi-based renewable technology company, told the commission that wood products and other sources could be used to produce methanol, which can then be used to power large steam turbines for widespread consumption.
“It’s out there, it’s right around us,” he said of the potential energy alternative .
“You can create biomass from wood, but even better you can create it from wind and solar. It’s a really easy combination.”
One of the products the company manufactures is a mobile energy station that uses wind and solar technology to power construction, disaster relief and other activities in remote locations, rather than using diesel.
Thompson, a former deputy minister of Energy, said reducing the reliance on petroleum products was an important goal.
“One of the challenges we have is petroleum. Believe it or not, it is the largest source of energy we use in New Brunswick and the second-largest contributor to emissions,” he said.
On the broader scale, Gallant said large-scale methanol production from biomass products could help dilute fossil fuel usage.
“We think that’s a solution for our kids,” he said, adding that although it isn’t clean burning, its production is more energy-efficient than that of fossil fuels.
“What you’re doing is a diesel replacement for transport fuel, for steam turbines. That’s a big market potential and they’re already doing it in Europe now.”
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