Renewable Energy Generation

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Renewable Energy Generation
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About Telogia Power, LLC

• Designed and constructed by the General Electric
  Company at a cost of 12,000,000 the 14 megawatt
  Timber Energy Resources, Inc. renewable energy
  plant was the first Qualifying Facility of its
  type operated in Florida.
• Supply all of the training (off-line and
  on-line)
• Over its operating life the Telogia asset has
  changed hands seven (7) times and is now owned
  and operated by CQ Inc. of Blairsville,
  Pennsylvania.
• Single boiler / Single Turbine Generator
  alignment with Best Available Air Control
  Technology comprising a Cyclone Separator in
  combination with an Electrostatic Precipitator.
  The plant is in substantial compliance and on the
  emissions side of the equation operates at
  between 33 and 50 of the regulatory threshold.

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About Telogia Power, LLC (contd.)

• Base biomass fuels include bark, green chips,
  sander dust, sawdust, hogged fuel from land
  clearing acitivities, yard waste and peanut
  hulls. Alternate fuels comprise mixed
  non-recyclable fibers, suitable manufacutring
  residues, confidential documents and
  off-specification commodity wastes. Alternate
  fuels are shredded and then densified into a cube
  at a dedicated Paper Processing Facility
  preparatory to combustion with the biomass fuels.
• Telogia Power, LLC purchases all of its biomass
  fuels (for between 3.00 and 12.00 per ton
  depending on quality) and is paid to destroy
  alternate fuels at tipping fees ranging from
  5.00 to 15.00 per ton. Overall fuel
  consumption averages approximately 200,000 tons
  annually.
• The current mix of materials combusted for
  renewable energy generation at Telogia comprises
  90 biomass fuel and 10 alternate materials

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What it takes to make power

• CASE 1 With the present mix of fuels comprising
  bark, green chips, hogged fuel, yard wastes,
  sander dust, sawdust and non-recyclable fibers it
  takes 2.2 tons of fuel to produce One (1)
  megawatt hour of electrical energy.
• CASE 2 By eliminating the use of lower-end
  fuels such as yard wastes and hogged fuels (from
  land clearing activities etc.) fuels consumption
  drops from 2.2 tons per megawatt to 1.75 tons per
  megawatt hour produced.
• Average fuel costs in CASE 1 are approximately
  8.50 per ton meaning that fuel costs per
  megawatt hour produced are 18.70.
• Average fuel cost in CASE 2 are approximately
  12.00 per ton meaning that fuel costs per
  megawatt hour produced are 21.00.

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What it takes to make power (contd.)

• On the average, annual fuel costs, labor,
  salaries, along with fixed and variable expenses
  for the Telogia plant totals approximately
  3,860,000 which equates to a production cost of
  41.06 per megawatt hour.
• Absent any Federal Production Credits, Telogia
  Power, LLC sells its net electrical generation
  for an all-in price of 43.00 per megawatt hour
  for total annual revenues of approximately
  4,000,000 meaning that the only way to increase
  profit is to reduce fuel costs via tipping fees /
  avoided costs from accepting alternate fuels at
  Telogia.
• Managing the Business of the Operation in the
  current market environment has become of equal
  importance to administrating the Operation of
  the Business.

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What are the Pros and Cons

• There has been no meaningful development of
  biomass-to-energy facilities in Florida over the
  last decade due largely to the absence of Federal
  and State incentives and enabling legislation
  that would serve to sponsor what presently
  amounts to the tight spark gap business
  opportunity. In short, some pioneers left but
  very few new settlers.
• Most recent tax and production credit legislation
  is seen as an incentive for developing new
  biomass-to-energy capacity and not necessarily to
  sustain existing generation facilities.
• Combusting a carbon neutral fuel in preference
  over conventional fossil fuels absolutely reduces
  greenhouse emissions.

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What are the Pros and Cons (contd.)

• Biomass fuel utilization makes good sense,
  whereas landfilling a fuel source does not.
  Estimates are that as much as 75 of the
  available renewable fuel sources in Florida are
  actually never used in renewable energy
  applications.
• Monitor and control new development. Too great a
  concentration of new facilities could serve to
  outpace the fuel shed availability ina given
  region, thus driving production prices up as the
  fuel harvesting radius increases.

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What needs to be done for the common good

• Approve bankable Power Purchase Agreements.
  Green Energy can cost more to produce therefore
  Utilities should receive regulatory compensation
  that enables them to pay more to acquire it if
  necessary. Can the Florida Public Service
  Commission be the facilitator that levels the
  playing field as it applies to environmental
  benefit versus public benefit?
• Encourage greater flexibility and cooperation at
  the regulatory level to stimulate industry
  growth. Most permits and/or petitions still take
  years to acquire in Florida. The aim is not to
  circumvent the issues, more to view the
  biomass-to-energy industry as part of the
  solution, not part of the problem.

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What needs to be done for the cmmon good(contd.)

• Legislate the controlled supplemental combustion
  of select Florida-generated treated wood wastes
  at Florida biomass-to-energy facilities rather
  than sending to Alabama and the Carolinas for
  disposal. Available tipping fees would
  significantly reduce overall fuel costs at
  participating facilities, while in parallel
  handling a Florida waste management problem in
  Florida.
• Sponsor legislation to place meaningful subsidies
  behind the United States Forestry Services Clean
  Forests Program. Apalachicola, Ocala and Osceola
  National Forests are named in the program but due
  to the expense involved do not participate in
  generating any renewable fuels for use at this
  juncture.

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What needs to be done for the common
good(contd.)

• Sponsor real time research and development and
  subsidize energy crop farming to stabilize
  biomass fuel availability. Most renewable energy
  facilities are at the mercy of the economy. Slow
  production or demand at the Pulp and Paper Mill
  is often the precursor to limited fuel
  availability at the power plant as Chip Mills and
  Sawmills likewise slow or halt production. Lets
  up the ante now!

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Contact Information

• David E. (Ted) Hill
• President
• CQ Specialty Materials Group
• 12063 Cranefoot Court
• Jacksonville, Florida 32223
• Tel [phone]
• Cell [phone]
• E Mail david.hill13_at_comcast.net

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