Grants Aim to Develop New Markets for Northern Forest Wood

Recipients seek to increase use of structural round timber, wood heat and wood-fired district heating

The Future Forest Economy Initiative awarded three grants that will drive a $1.7-million investment in the region’s forest economy, seeking to diversify markets for wood and wood products from the Northern Forest region. 

“We’re making these grants at a time when the region needs to find new markets for its existing wood supply,” said Alicia Cramer, vice president of the U.S. Endowment for Forestry and Communities. “Market changes due to the coronavirus pandemic and the recent loss of a pulp-making facility in Jay, Maine, have left landowners, loggers and wood product manufacturers in northern New England seeking new markets for harvested wood.”

The $847,840 in grant funds will go to the Town of Ashland Maine to expand markets for structural round timber, a mass-timber building product; to a wood heat marketing consortium aiming to increase demand for wood heating fuels by 50 percent in the region; and to the Burlington (VT) Electric Department for design and pre-engineering to advance a wood-fired district heating system to serve the University of Vermont Medical Center.

Grant recipients and other sources are matching the grant funds with $852,053, bringing the total investment in new wood uses and marketing to $1,699,893.

The initiative — a cooperative effort of the U.S. Economic Development Administration (EDA), U.S. Endowment for Forestry & Communities, and the Northern Forest Center — grew out of a congressional mandate to support the development of markets for wood products. The grant awards are the first in a three-year program that will invest $2.6 million to expand innovation, create market demand and create conditions that will allow businesses and communities to benefit from these innovations.

“We’re investing in these three projects because they each are significant opportunities to maintain and grow markets for wood, which in turn support forest stewardship and forest-based jobs that are an essential part of the region’s economy,” said Joe Short, vice president of the Northern Forest Center. “The Ashland project is aiming to generate $1-2 million in sales; the Burlington project could mean $500,000 more in wood purchases each year once it’s online; and increased use of modern wood heat can help replace lost markets for low-grade wood that are key to forest landowners and loggers.”

The Town of Ashland, Maine, will receive $450,000 for an initiative to position Ashland and the Maine Woods to take advantage of an estimated $130 million market for structural round timber products in the northeastern United States. Structural Round Timber is a low carbon mass-timber building product that can be used as an alternative to steel. It requires no adhesives, minimal processing, and can be fabricated using existing facility infrastructure and local timber supplies.

“Ashland has been looking at multiple market opportunities to restore more wood products manufacturing to our local business mix,” says Cyr Martin, town manager for Ashland. “We’re strategically located at the gateway to the Northern Maine forest resource and have proximity and transportation access to significant markets. The Town has a 100-acre industrial park and numerous un- or under-utilized manufacturing sites that could support such businesses. What is missing is market demand to justify business investment in those sites, and this project will help us grow one of those markets,” he said.

The wood heat marketing consortium, a regional initiative, will invest $300,000 in a 3-year marketing campaign to build public support for a broad range of wood heating options and increase use of Northern Forest wood pellets and chips in lieu of imported fossil fuels. It aims for a 50% increase in low-grade wood used for heat, a gain of 900,000 tons over 2018 levels. Funds allocated to this project will invest in a multi-media advertising and public relations campaign that underscores the environmental and community benefits of heating with wood in this region. The Northern Forest Center manages the collaborative project.

“Northern New England imports all of its fossil heating fuels from other regions and other countries, exporting billions each year from our economy,” said Charlie Niebling, a consultant to Lignetics, Inc., one of 25 participants in the marketing consortium. “We have the technology to use wood to heat homes and buildings efficiently and cleanly – and keep those fuel dollars here at home where they support local jobs.  Wood fuels like pellets and chips provide markets for low-grade wood that have been lost in recent years, which supports good forestry and our forest industry. Wood is a renewable, low carbon fuel that delivers many benefits as a heating fuel,” he said. 

The Burlington Electric Department in Burlington, Vermont, will receive $97,840 for design and pre-engineering to advance a wood-fired district heating system to serve the University of Vermont Medical Center. The work is a precursor to retrofitting the existing 50-megawatt McNeil biomass-powered electricity generator and to recovering some of the plant’s waste heat. If completed, the project would stabilize a significant market for low-grade wood — the plant currently uses 400,000 tons a year — and would grow that market by 15,000 tons a year.

“For decades, Burlington has been working to enhance Burlington Electric Department’s McNeil Generating Station to include a district energy system that would provide renewable thermal energy to large customers in Burlington,” said Darren Springer, general manager of Burlington Electric Department. “We were proud to announce earlier this year with our partners VGS and University of Vermont Medical Center that we were launching Phase 2 of an updated district energy project. With McNeil being such an important supporter of forest economy jobs in Vermont and the region, we were fortunate to receive such generous support from the Future Forest Economy Initiative that, with other funds, gets us the engineering analysis and refined economic feasibility modeling necessary to take us to a decision point on district energy in Burlington,” he said.

The US Endowment’s Cramer added, “The Northern Forest region is among the continent’s most heavily forested areas, with a long history of economic activity rooted in forests. We are working with the Center and the EDA to help the forest economy overcome losses due to mill closures and ensure that the sector can continue to benefit the region.”

Funds for the program come from the U.S. Economic Development Administration and a congressional appropriation of $3 million secured by the region’s congressional delegation in federal fiscal year 2018 that directed the agency to support the development of markets for wood products in northern regions of Maine, New Hampshire, Vermont and New York. The federal funds are matched by $300,000 from the U.S. Endowment for Forestry and Communities to help cover project development and administrative costs.