BRISTOL — Statewide renewable energy mandates that kicked in this year are helping an important local industry — production milling of trees — upgrade its energy infrastructure so that it can modernize equipment and increase capacity.
“Technology is playing a more and more important part in our industry,” said A. Johnson Lumber Co. General Manager Ken Johnson. “If you’re  going to be competing in the production (milling) industry it’s kind of a technological arms race.”
State-of-the-art machinery now computerizes where and how to make the most effective cuts to turn logs into lumber. Part of this technology “arms race” includes machines like an “optimizing edger,” which cuts the edges off boards by first scanning them with lasers to analyze their geometric profile.
A recent report from the North East State Foresters Association estimates that Vermont’s forest products industry “employs 10,555 people and has $1.4 billion in economic output” annually. A. Johnson Lumber Co. has 45 employees, making it among Bristol’s largest businesses. It’s also among the state’s largest sawmills, though it is midsize compared to other production sawmills in New York and New England.
Vermont Forests, Parks and Recreation Wood Utilization Leader Paul Frederick maintains that the Vermont forest products industry has a key role in keeping Vermont green.
“Eighty percent of forestland in Vermont is privately owned, and local markets for forest products help make ownership of that land by individuals affordable,” Frederick said. “Harvesting and selling trees helps us keep forests as forests.”
TIME TO UPGRADE
A year ago, Johnson and other owner/managers at A. Johnson Lumber were touring sawmills in Vermont, New York and New Hampshire, looking to see how their mill measured up and what could be done to make it more competitive in an increasingly global marketplace.
“We hadn’t done as much as we should have in the past 10 years,” said Johnson.
One key problem? Energy.
Johnson and others knew what they needed to do, but the mill lacked sufficient energy to power those upgrades.
“Last year we started talking about upgrading the mill because we hadn’t been doing much investing in machinery in a while,” he said. “From visiting other mills, we’d begun to see that we were falling behind the curve, that we were not as competitive as we wanted to be. So in order to basically survive and compete in a global marketplace we realized we needed to spend money on mill upgrades. And to do that we needed to increase the electrical capacity.”
They also knew they needed to trim energy costs to stay competitive.
Among A. Johnson’s first steps was to purchase a reconditioned, used transformer from a company in the Midwest, using typical commercial channels. They then started to think about what to do about their main generator.
FEELING STUCK
For the past 15 years, the company had been using a diesel-powered generator to run its green and dry lumber sorters, planers, ring debarker and sawdust handling blowers, said Johnson. Other parts of the mill were already powered by electricity from the commercial power grid. Still other energy demands are supplied by a boiler that uses bark removed from the logs at the sawmill as well as scrap lumber, processed into smaller chips. Smaller generators are on hand as backup for the large generator and for emergency power for the boiler at the drying kilns.
The main diesel generator itself used around 31,000 gallons of diesel a year. The generator had been purchased when burning diesel was a more cost-effective option. It was also getting old and was in need of an estimated $60,000 in repairs.
“We were feeling a little trapped, really,” Johnson said. “We were trying to figure out: Do we rebuild the generator and stick with diesel, or do we spend $60,000 to $80,000 and put in a transformer? We were unsure how to resolve the problem.”
ACT 56 AND ‘ENERGY TRANSFORMATION’
What opened up the company’s option, said Johnson, was when he and the other owners realized that Green Mountain Power has a program for helping to move larger users off fossil fuel, and A. Johnson qualified for that.
GMP’s program is part of its response to Vermont’s Act 56, signed into law in June 2015. The law creates renewable energy standards that raise the bar over the next 15 years for how much renewable energy Vermont’s utility must purchase. Among the various aspects of Act 56 is a separate “energy transformation” category that utilities can meet by purchasing additional distributed-generation renewables or by undertaking “energy transformation projects.” The mandate for the energy transformation category kicked in in 2017.
For Green Mount Power, A. Johnson’s situation with its aging diesel generator provided a perfect opportunity for one such Act 56-mandated energy transformation project. For A. Johnson, partnering with GMP and with Efficiency Vermont meant that costs for installing a new, energy-efficient transformer and connecting to GMP high-voltage lines already running through the mill’s property were largely covered. That’s right, covered.
The switch from diesel to electricity will reduce A. Johnson’s carbon dioxide output by close to 6,176 metric tons over 20 years, according to Green Mountain Power. GMP’s Jeff Monder, who worked closely with A. Johnson on the project, said that well over 80 percent of the electricity GMP purchases is from renewable sources (which he listed as hydropower, biomass, nuclear, wind and solar). Monder said the amount of renewables in GMP’s energy mix varies year to year, depending on where the company purchases energy on the open market.
   
A. Johnson also lowered its electricity rates by joining GMP’s curtailment program.
“As part of helping GMP manage their electrical purchasing in the marketplace, we get a day’s warning by email and we shut down to reduce the overall demand on the grid,” said Johnson.
During those hours it’s off the grid, the company returns to running its main diesel generator.
Monder explained that curtailment has larger eco-benefits. Reducing peak load reduces the need to build larger energy infrastructure and helps GMP make cleaner energy choices. He said buying additional energy to meet peak demand is often when utilities turn to the dirtier sources like natural gas, gas turbines, or, in some parts of the country, coal.
SURVIVE AND GROW
Johnson said that A. Johnson estimates that the two measures — getting a better electrical rate by joining the curtailment program and switching from the main diesel generator to electricity from the grid via the transformer — will reduce the company’s energy costs by 30 percent.
And with the new transformer, the company has access to the energy it will need to run new equipment. 
“In 2018, we’re going to be installing an optimizing edger … And over the next five years we hope to upgrade the material handling system around the resaw, do some work with the trimmer, replace the controls on our sorters. The dry kilns need work, the planers, the sorters. There’s a never-ending stream of things that can be improved.”
Johnson is optimistic when he looks to the future.
“If we’re going to survive as a sawmill we need to grow,” he said.
Reporter Gaen Murphree is at [email protected].