The collapse of the second phase of the Four Forests Restoration Initiative (4-FRI) has sent everyone scrambling for a way to protect watersheds and reduce the chance of catastrophic fires across millions of acres of Northern Arizona forests.
That includes the effort to thin 64,000 acres on the C.C. Cragin watershed – which remains critical to Rim Country’s future water supply in an era of deepening drought and megafires.
“We are very disappointed about the U.S. Forest Service’s RFP decision,” said Elvy Barton, SRP forest health management principal. “Unfortunately, the Forest Service’s decision does not move us any closer to reducing the risk of catastrophic wildfires that impact water supplies and cause dangerous post-wildfire flooding.”
Representatives of the timber industry met this week in the wake of the Forest Service cancellation of negotiations to thin nearly a million acres. Some 18 months of negotiations with two potential bidders on a 20-year contract collapsed recently.
Two issues proved critical. First, the Forest Service offered no money to guarantee the contractors against massive financial losses. Moreover, the contractors feared they would have no reliable market for the biomass the thinning projects would produce.
For the past decade, 4FRI has represented the best chance to prevent megafires from consuming forested communities like Show Low and Pinetop by reducing tree densities on millions of acres from about 1,000 per acre to more like 100 per acre.
Advocates for thinning project to reduce catastrophic damage and long-term damage to watersheds and reservoirs focused immediately on the plight of NovoPower, which runs the only biomass burning power plant in Arizona.
The Snowflake power plant burns enough wood scraps, saplings and waste from sawmills to sustain the thinning of about 15,000 acres of forest annually. The two 4FRI bidders had proposed building either a small-wood sawmill or a plant to produce high-tech composite wood products. Either of those operations would have used more biomass – increasing the acres NovoPower could support to perhaps 30,000.
Now, the survival of the NovoPower plant has been cast into doubt. The plant’s long-term contracts with Arizona Public Service (APS) and Salt River Project (SRP) are coming to an end in 2023. The two power companies entered into those contracts when the Arizona Corporation Commission required them to generate a tiny share of their power from renewable resources. However, solar and wind power are now cheaper than burning biomass and the Corporation Commission has refused to issue a separate mandate to burn biomass. That decision ruined APS plans to convert a coal-burning plant into a biomass plant. It also threatened the shutdown of NovoPower.
Fortunately, APS has signaled a willingness to extend its contract – regardless of progress on 4FRI.
Salt River Project has been more reserved, insisting it wanted to wait until the Forest Service made a decision on the contracts for the second phase of 4FRI before making a decision.
The Forest Service cancellation of the contract negotiations dealt a blow to those plans – but SRP insisted this week it will continue to support forest thinning efforts. This could keep NovoPower open and the struggling timber industry in the White Mountains alive long enough for the Forest Service to restart its 4FRI bidding process.
Barton said the Forest Service action leaves untouched the thorny question of how to handle the biomass, which constitutes half of the material removed in any thinning project. The biomass problem has dogged 4FRI for nearly a decade. A succession of contractors for the first phase of the 4FRI project were supposed to thin 50,000 acres annually. Those contractors promised to use the biomass for everything from making jet fuel to producing plywood. But in the end, the only way to cope with the 20 or 30 tons of debris generated from each thinned acre has been to haul it to Snowflake and burn it in the NovoPower power plant. So the contractors have burned only a fraction of the 50,000 acres annually called for in the contract.
“It was our belief that the 4FRI Phase 2 RFP would address how much biomass would be a part of the overall solution,” said Barton. “Unfortunately, the Forest Service’s decision does not provide us with any additional insight on this topic. We are meeting internally to discuss Novo Power’s power purchase agreement. We currently have a contract with Novo Power until June 2023.”
Brad Worsley, the head of NovoPower, said an extension of the SRP contract remains essential to keeping the plant running beyond 2023. The plant could shut down even sooner, since without a long-term contract he can’t justify investing in improvements and repairs. Losing NovoPower could shut down much of the remaining mills and forest thinning operations in the region, crippling even the limited thinning efforts underway.
Barton held out hope that SRP will extend that contract, now that the 4FRI alternative has collapsed into a pile of wood scraps.
“SRP is committed to moving forward to address forest health and the impending threat of catastrophic wildfires on the Salt, Verde and East Clear Creek watersheds,” she said. “For example, SRP is partnering on four thinning projects that are expected to thin up to 3,300 acres over the next year.”
Worsley said his discussions with SRP about a contract extension have revolved around whether the power plant could buy biomass from thinning projects on key watersheds. Normally, it’s not economical to haul such low-value biomass more than about 100 miles. However, a network of chipping operations to break up and compress the debris could extend the range of the plant.
That’s crucial now since the collapse of the 4FRI talks leaves burning biomass and the lack of a Forest Service subsidy for thinning projects leaves the burning of the biomass the only game in town.