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Iberdrola Renewables halts operation at Oregon plant

Bioenergy company Iberdrola Renewables has ceased operations at its biomass power plant at Collins Pine Fremont sawmill in Lakeview, Oregon because it could not find a company to buy the power generated on the site.

The 26.8MW facility was previously owned by two other companies and has been under development for the past few years.

When Bioenergy Insight contacted Iberdrola for comment, communications manager Paul Copleman said the market for power purchase agreements around the US had become 'unattainable due to the economy and lower energy prices'.

He says: 'In this current economic climate, Iberdrola Renewables has decided not to build more projects without a long-term agreement to sell the output. We have decided to cease construction efforts until we are able to obtain a long-term power agreement sufficient to support the restart of construction at the Lakeview biomass site.'

The company previously did not have a long-term agreement in place to sell its energy and Copleman says the changing regulatory environment in California has hindered biomass business.

'The 33% California Renewables Portfolio Standard (RPS) bill may provide future market opportunities but it only became law earlier this year. Customers subject to the law and regulators are just now developing  the rules for the new RPS. Until there is clarity around those rules, customers have told us that out-of-state generation is not something they can count on using for RPS compliance,' he explains.

Without a power purchase agreement (PPA) agreement, continuing operations at the plant is not viable. However, the company says that it has not abandoned the project altogether and resuming operations in the future is a possibility.