The Daily Star, Oneonta, NY - otsego county news, delaware county news, oneonta news, oneonta sports

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August 21, 2008

Plans for Wells Bridge plant making progress

Two industrial development agencies have approved loans totaling $175,000 to a family business that plans to open a plant for making grass and wood pellets to burn for heat.

Robert and May Miller, their son, Michael, and their daughter-in-law, MaryLou Miller, will open the Enviro Energy plant on state Route 7 in Wells Bridge, said Carolyn Lewis, Otsego County economic developer.

The Millers didn't immediately return messages left Wednesday night at their telephone numbers.

Enviro Energy initially will make wood pellets, manufacturing grass pellets as demand develops, according to the business plan submitted to the Otsego County Industrial Development Agency. Demand for wood pellets outstrips supply, the plan said, and demand for grass pellets will increase as fuel costs rise.

The Otsego IDA has approved a $100,000 loan for a term of 15 years at a 4 percent interest rate, Lewis said recently, and the project will create five jobs within five years. The loan was the first time the Otsego IDA has funded a project also supported by the Delaware County IDA, she said.

The Millers, who live in Delaware County, received a loan of $75,000 from the Delaware County IDA for a term of 10 years at 5 percent interest, said Bill Willis, county economic development specialist, last week. Willis, who worked with the Millers on the plan, said the market for fuel pellets is ``very strong.''

``With the price of oil, we feel it's only going to get better,'' Willis said, and the Millers' project will benefit Delaware County residents, farmers, loggers and the local economy.

``It's good all the way around,'' Willis said.

The building on Route 7 is up, officials said, and both loans are for equipment and machinery. The $450,000 project also is supported with $70,000 in equity from the owners, plus bank financing, the plan said.

Canada is the major exporter of wood and grass pellets, the Millers' plan said. More than 1,200 stoves are in use in Oneonta and a survey of wood-pellet fuel retailers in Oneonta found that at least 3,400 tons were sold in 2007. A stove typically will use about three tons of pellets a year for residential use, the Millers' plan said; stove sales are increasing as the price of oil increases, and a stove that burns corn or soybeans can burn grass pellets.

At Enviro Energy, pelleting creates a market for weather-damaged hay crops, wasted hay or overgrown acres, according to www.enviroenergyny.com. The Millers expect to be selling pellets this autumn, the site said.

Pellet stoves burning grass produce 90 percent less greenhouse gas than fossil fuels, the Millers said, and use of locally produced pellets will conserve oil used for heating.

A crop of grass takes 70 days to grow, the plan said. Comparing pellets with oil, it said, 90 cents worth of pellets at $224 per ton equals about 1 gallon of fuel oil.

Robert and May Miller, each born on a farm in Delaware County, owned and operated a dairy farm in Franklin from 1961 to 1985. After farming, Robert operated an excavating business, and May owned a quilting business.

Michael Miller owned a home construction business and has experience in the forest and lumber industries. Mary Lou has retail management and banking experience.

Lewis said the Millers were innovative in developing a manufacturing operation that adds value to a low-grade product.

``They have a business plan that was well-thought out,'' Lewis said.

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