Middlebury strikes deal with energy company

MIDDLEBURY — The Massachusetts firm that is proposing to build a plant off Exchange Street to convert organic wastewater into electric power has reached an agreement with the Middlebury selectboard that will lower its fees to connect to the town’s wastewater system.

PurposeEnergy Inc. of Woburn, Mass., plans to use an anaerobic digester to extract energy from organic wastewater. Green Mountain Power would then distribute the electricity through the power grid. The technology is similar to GMP’s Cow Power program, but the PurposeEnergy plant would process waste byproducts from beverage and dairy companies, not manure.

The Middlebury selectboard made the deal official by signing a memorandum of understanding at its Oct. 8 meeting. Negotiations had been ongoing since the summer. The company hopes to start building the plant in the spring at 183 Industrial Avenue, just off Exchange Street on land owned by local businessman Tony Neri.

PurposeEnergy successfully argued that it would be diverting wastewater that other Exchange Street-area companies would otherwise send to the town sewage-treatment plant, so it should pay less for its connection fee.

The town has a Connection Fee Policy that established a levy for industrial users of $400 for each 210 gallons a day that is discharged into the system, an assessment called the Equivalent Residential User fee.

According to town officials, the list price for PurposeEnergy’s connection fee would have been $285,000 for its goal of handling 150,000 gallons of wastewater, a fee that Town Manager Kathleen Ramsay said per the policy also could be paid in phases.

Because Otter Creek Brewing has already pledged to send 20,000 gallons of waste to PurposeEnergy’s proposed plant, the selectboard agreed to reduce the connection fee by a corresponding per-gallon amount.

That translated to an ultimate connection charge of $171,000, according to Ramsay, with the first payment due “when that waste is discharged, when they have that plant up and running.”

The deal signed last week will also allow PurposeEnergy to lower its connection fee further if it brings aboard other users who divert wastewater rather than discharge it into the town system. Town officials said PurposeEnergy has already reached out to other companies.

“There probably will be other users. If there is an existing business, say Aqua ViTea or Vermont Hard Cider, they would get credit for that flow into the facility,” Ramsay said. “Other new waste that isn’t discharged into our facility, there is no credit, it’s full charge.”

PurposeEnergy also has an agreement with the Cabot-Agrimark cheese and whey plant to transform 40,000 gallons of waste per day into energy that will go into the GMP power grid. But Ramsay said that waste is now being spread on farm fields and thus will not be credited toward the company’s connection fee.

The agreement carries a five-year term. PurposeEnergy may renew the agreement for another five years, according to the terms of the deal, “as long as PurposeEnergy is in compliance with this Memorandum of Agreement” that the selectboard signed last week. The company will be required to provide signed agreements with other firms that it is receiving their waste and diverting from Middlebury’s wastewater treatment plant.

PurposeEnergy is still working through the permitting process. Its most significant hurdle will be obtaining a Certificate of Public Good from the Public Utilities Commission. PurposeEnergy CEO Eric Fitch said during late-August talks with the selectboard that a connection fee agreement would be an important component of the company’s application for that certificate.

Ramsay said the Middlebury Planning Commission has a concern about the proposed siting of the plant, specifically that it is set closer to Industrial Avenue than permitted in zoning for the area. Ramsay told the selectboard that issue will be addressed in hearings before the Public Utilities Commission.

The PurposeEnergy plant will also be able to provide on a local basis hot-water heat to other facilities. Fitch told the Independent in August he has had discussions with Vermont Gas Systems about providing that thermal energy to Exchange Street customers, including Agrimark-Cabot.

Andy Kirkaldy may be reached at andyk@addisonindependent.com.

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