City Council moves 2 ways on downtown energy; it readies to hand out money to convert from downtown steam system as it spends half-a-millon on new downtown energy study

City Hall seems to be moving in two directions at the same time on downtown energy.

On the one hand, city officials are helping oversee a program to help businesses convert from the downtown steam system. And on the other hand, the City Council has agreed to spend $487,113 to conduct a study called the “Downtown District Energy Feasibility Study.”

At its meeting Wednesday evening, the City Council is expected to hire Transitions Made Better Inc. of Cedar Rapids to administer the city’s financial-assistance program for those who had used the downtown steam system. The system had depended on Alliant Energy’s Sixth Street Generating Station, which was damaged by the June 2008 flood and won’t be rebuilt.

The city program will divvy up $21 million, $16 million from the Iowa Department of Economic Development and $5 million from the state’s I-JOBS economic stimulus program.

In late May, the City Council voted to use $8 million to help five large users of the steam system – including the Quaker Co. and Cargill plants near downtown – convert to another system; $8 million for a group of some 200 smaller users to help them convert; and $5 million to help offset higher steam costs for all the users.

Two other of the system’s large users, Coe College and St. Luke’s Hospital, have obtained a $6.5 million grant from the U.S. Department of Commerce to help them convert to their own steam system, and another large user, Mercy Medical Center, also has applied for such a grant.

Transitions Made Better Inc. has told the city it will begin to process steam claims on Thursday if the firm wins the city contract on Wednesday evening.

According to a City Hall memo to the City Council, Transitions Made Better Inc. was the only firm to bid on the city’s contract to administer the steam claims. Transitions Made Better Inc. also is administering a city contract to dispense state funds for flooded landlords.

A week ago, the council awarded a contract to Sebesta Blomberg & Associates Inc., Roseville, Minn., for a downtown energy feasibility study.

The study will look at creating a “new downtown district energy system” that may use renewable fuels or fossil fuels.

The council has talked about the prospects of burning sewage sludge and municipal garbage to produce energy.

Funding for the study is coming from the state of Iowa, according to city documents.

A view from U of I power plant: a new biomass power plant in downtown Cedar Rapids would be ‘claim to fame’ for the city

The University of Iowa’s power plant has been burning oat hulls, a byproduct of cereal-making at the Quaker plant in Cedar Rapids, since 2002.

In a discussion on Wednesday with Ferman Milster, the university’s associate director of utilities and energy management, Milster was asked about burning biomass materials like oat hulls for power and what the future might hold for such examples of renewable energy.

He was informed, too, that some community leaders in Cedar Rapids have pitched a proposal to Iowa’s congressional delegation for a huge federal grant that would pay to build a new biomass energy plant in downtown Cedar Rapids. City Hall, Alliant Energy, the downtown and nearby industries have been trying to figure out how to replace Alliant Energy’s flood-damaged Sixth Street power plant, which had provided low-cost steam.

In his comments, Milster couldn’t have been more excited about the future of burning biomass materials or more thrilled about the pursuit of a new biomass plant in downtown Cedar Rapids.

He said the current state of climate awareness and the current federal administration’s awareness of the issue will mean an increased emphasis on all kinds of renewable energy.

“You’re going to see a biomass fuel market develop,” Milster said. “And oat hulls will be a piece of that, an important piece.

“But there are numerous other sources that are byproducts of industrial production of some form. … And we (at the university) have been very, very active in identifying other sources of biomass. We have a laundry list of those.”

He said his power plant at the University of Iowa is readying to experiment burning corn cobs.

“Biomass fuel combustion is going to gain popularity,” he said. “The economics are going to start to favor it as we start to regulate carbon emissions. If the federal government regulates carbon emissions, that radically increases the value of biomass fuel.”

As for the idea of a biomass power plant in downtown Cedar Rapids, Milster suggested that the city may have a “perfect storm” in place to make such an idea work.

He noted that Cedar Rapids has an existing steam distribution system that serves the downtown and nearby industries. There’s a year-round need for power that a plant would produce. And the city, an agriculture-processing center, has multiple sources of renewable energy.

“A new district energy plant – a combined heat and power plant – is the ideal thing,” Milster said. “It just makes perfect sense. And you could make all renewable energy.

“Wow. What a claim to fame for Cedar Rapids to come out of the flood with a renewable energy plant and a district energy system. That’s super.”