When the University of South Carolina opened its Biomass Energy Plant in December 2007, it was supposed to be an environmentally-friendly way for the university to provide up to 85 percent of its electricity needs. Instead, the plant has been shut down after numerous problems, including what USC calls three "potentially lethal accidents" at the plant.
The plant was designed to burn wood chips and bark, which would have gone to landfills otherwise, to produce electricity. But it produced steam to make that electricity on only 98 out of 534 days during one two-year period.
At the time it opened, it was the first facility of its kind in the country. While that got it attention, it was also one of the problems, since Johnson Controls, Inc., which built the plant, had never built one before.
USC Chief Financial Officer Ed Walton says, "It wasn't something that was just fly-by-night. We did lots of diligence about the technical ability to have it done. It worked on paper. It didn't work in practice. But we were backed up with experts saying that it was doable and we were backed up by the financial guarantees of Johnson Controls, so it just seemed like the right thing to do."
USC borrowed the $20 million to build the plant. The plant was supposed to save the university at least $2.1 million a year in energy costs and that money would be used to pay back the debt. Johnson Controls was so confident of the energy savings that it guaranteed that, if those savings didn't happen, the company would pay USC the difference.
Now that the plant has been closed, USC is using those guaranteed payments from Johnson Controls to pay off the plant.
"USC either saves $2.13 million a year in utility costs because of this plant, or, like we saw here just this last spring when we received the first check, Johnson Controls pays us in cash," Walton says. "For USC, it was no-lose."
Since the plant isn't providing the power that it was expected to, USC continues to use its old natural gas-powered boilers to generate electricity.
Walton says USC and Johnson Controls are working now to figure out what the next step is, whether it's refurbishing the plant or changing it so it'll work.
The "potentially lethal accidents" included a June, 2009 explosion inside the plant that blew a sheet of metal toward the plant's control room. No one was hurt. The other two accidents were pipe joints that burst under pressure.
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