Biomass and District Energy April 19, 2011 Private & Confidential Nexterra Overview Company Tolko Industries – Kamloops • • • • • • Global leader in biomass gasification technology and systems Supplies turnkey biomass gasification systems for public institutions and industrial customers Enables customers to generate, clean renewable energy from low cost biomass Ultra low emissions, high efficiency and solution package ideally suited to urban environments World class partners , well capitalized with an experienced team • • • University of South Carolina • • • • • • Channel Partner Channel Partner Combined heat and power (“CHP”) system North American public institution market BC public institutions 7 MMBtu/hr district heating system Heating & Hot Water for residential complex CO2e reduction 3,400 tpy Commissioned May 2009 US DOE Oak Ridge National Labs • Product Partner 72 MMBtu/hr campus heat & power CO2e reduction 20,000 tpy Commissioned 2008 Dockside Green, Victoria • Strategic Relationships 38 MMBtu/hr plywood plant heating system Displaces natural gas CO2e reduction: 12,000 tpy Commissioned 2006 • • • 60 MMBtu/hr steam system JCI/Nexterra selected by DOE CO2e reduction: 23,000 tpy Startup: 2011 Kruger Products (Scott Paper) • • • • 40 MMBtu/hr steam system Gas displacement in a boiler Commissioned: Q4/2009 CO2e Reduction: 22,000 tpy UNBC, Prince George • • • 2 │ Private & Confidential 15 MMBtu/hr campus heat CO2e reduction: 3,500tpy Startup: 2010 Key Business Drivers for Renewable Community Energy • Demonstrate community leadership • Reduce energy costs & reliance on fossils – Economies of scale and scope • Lower greenhouse gas emissions • Minimize carbon taxes/offset costs • Meet state or local government mandates • Create local jobs using local fuels 3 │ Private & Confidential Why Biomass? • • • • • Renewable and carbon neutral Substitution for fossil fuels reduces GHG emissions Locally sourced fuel such as locally produced wood residue, pine beetle kill, municipal tree trimmings, recycled construction and demolition waste etc. Dispatchable (base-load capable) source of energy Lower cost than natural gas or oil 4 │ Private & Confidential Core Gasification Technology Advantages: • Simple, proven, reliable • Low PM, NOx, VOC, CO • Fuel flexibility • Syngas versatility • High system efficiency • User friendly, fully automated • Low lifecycle cost Syngas Biomass 5 │ Private & Confidential System Packages for On-Site Heat and Power Small Scale Turn-key Heat & Power Systems • Steam & hot water systems (20 – 120 MMBtu/hr) • Direct-fired thermal systems to convert boilers from fossil fuel to syngas • Steam power or steam Co-generation (2 –10 MW) • Syngas to internal combustion engine CHP systems (2 – 10 MW) • Fuels – wood (commercial); biosolids (development) 6 │ Private & Confidential A New Approach – Biomass for Community District Energy Traditional Approach Conventional Biomass (Large Combustion) Centralized, rural, industrial, low efficiency, higher emissions, capital intensive Constrained by scale = fuel disruption, fuel risk, financing permitting, community acceptance Disruptive Next Gen Biomass (Small Gasification) 7 │ Private & Confidential Small plants, urban, institutional, high efficiency, ultra low emissions, community friendly Constrained by technology response comparable to other renewables (e.g. solar, wind) Key Project Considerations for a Biomass Project • Air emissions • Dust and odor • • Noise attenuation Fuel truck traffic • Building aesthetics and design • Community acceptance 8 │ Private & Confidential Nexterra Emissions vs. Biomass Combustion 300 250 Tons/year 200 NOx VOC CO PM 150 100 50 0 EPA AP-42 Biomass Average of 17 Nexterra Biomass Combustion Biomass Combustion Gasification*** Facilities** * Data is for 48 MMBtu/hr system, 45% mc fuel ** Data compiled by Levelton Consultants Ltd. *** Third party test results from Nexterra commercial operating facilities 9 │ Private & Confidential EPA AP-42 Natural Nexterra Gasification Gas Combustion With NOx Abatement Dockside Green – Victoria BC • District Heating & Hot Water – 8 MMBtu/hr • Fueled with Urban Wood Waste • LEED platinum development • Recognized by Clinton Climate Initiative • Started up May 2009 / 10 Dockside Green: Requirements • State-of-the-art • Gasification, not combustion • New standard of low emissions • Proven, reliable technology • Community acceptance • Economically viable • Ability to handle variable fuel • Fully automated & operator friendly 11 │ Private & Confidential Requirements for a Successful District Energy System • Existing anchor tenant – significant heat requirement • Located in close proximity to energy users • • Biomass available in the local area (at reasonable cost) Designed to meet public expectations • Open and transparent public consultation process • Strong and consistent political/community leadership • Business model to allow for execution and operation 12 │ Private & Confidential Thank You Private & Confidential