But what is this hub? Who, exactly, is receiving the money? And why is Emera investing so heavily?
The provincial funding partners, which are the Department of Natural Resources and Innovacorp, declined to answer specific questions about the ownership model for this hub. So did Emera, the principal investor.
A principal consultant to the project, Rod Badcock, said the government partners and Emera had formed a governance committee to guide the work, which was being done by an informal partnership, in which he plays a principal role.
Badcock described the hub model as “flexible” and in a telephone interview he agreed it was not “straight-forward.”
He said the two partners providing key services to the project were Bioapplied Innovation Pathways, which is itself a private partnership, and FPInnovations, a not-for-profit research institute serving the forestry industry in Canada.
Bioapplied is a partnership between Badcock and Gregory Maloney and their respective companies: Fusion Intel Inc., registered in Nova Scotia, and Enoptec Inc., registered in Quebec.
The hub project is just one of Bioapplied’s clients. Another client is CelluForce Inc., whose shareholders are the pulp and paper company, Domtar Corp.; Schlumberger Limited, a global technology company serving the oil and gas sector; and FPInnovations. CelluForce supplies wood-based cellulose nanocrystals, or nanocrystalline cellulose, for industrial products.
One the objectives of the hub partners is to find domestic markets for new industrial products, such as biofuel, which may be processed from wood fibre.
Emera, which indirectly owns the province’s two major biomass plants, seems attracted to the commercial prospects for diverting low grade wood to higher value products at a time when there is less demand for burning biomass to produce electricity.
The biomass plant in Point Tupper, Richmond County, is owned by Nova Scotia Power, which is owned by Emera. This year the plant was downgraded from a must-run, round-the-clock enterprise to a plant that is only fired up as demand peaks.
Since it began producing electricity at the plant in 2013, the provincial utility has built up a significant forest supply chain. It likely has excess stockpiles of waste wood and may have contracts for more forest biomass than it can use.
The power plant in Brooklyn, Queens County, is owned by another Emera subsidiary. That plant is also operating well below capacity when it is not idle.
In its 2016 fuel plan, Nova Scotia Power indicated it planned to use less electricity than previously from the Brooklyn plant, due to the high cost of generating fuel from this source. In fact, Nova Scotia Power often pays the plant owner a special fee to not to generate power, because producing electricity from biomass is so expensive.
Both plants — in Point Tupper and Brooklyn — have been propping up the forestry supply chain.
Now that they are producing less power from woody biomass, government is obviously keen to generate new markets for low grade wood.
It is not clear if or how Emera stands to gain commercially from its major investment in the hub project. And the company declined to answer a specific question about its role in the project.
But Emera president and CEO Chris Huskilson was reported as saying this week that private investors would likely own any intellectual property created through this R&D enterprise.
The interesting question is how Emera will position itself in relation to wood-based renewable products in the years to come. And whether the industrial-scale benefits will trickle down to the contractors and woodlots owners on the forest floor.