Firm files suit over Bethlehem landfill gas

The company that wants to burn the Bethlehem landfill’s methane to generate electricity alleges that the landfill’s owner has reneged on a deal to give it control of the gas by refusing to allow construction of the plant, according to a complaint filed Wednesday in U.S. District Court in Concord.

Commonwealth Bethlehem Energy — a subsidiary of Boston-based Commonwealth Resource Management Corp. — says that it paid $230,000 to North Country Environmental Services, a subsidiary of Rutland, Vt.-based Casella Management, which runs the landfill, for the exclusive rights to the methane gas.

Commonwealth has been burning off the gas for more than a decade. But by denying it the right to use it to generate power on the property, Casella is effectively denying what it bought and paid for, according to the suit.

“It’s beyond me,” said Tom Yeransian, a principal of Commonwealth. “They are stopping a renewable energy project that could benefit the environment and benefit them as well. We are burning it anyway, and it’s just a waste of such a useful resource.”

“We certainly do not agree with the underlying basis in the suit,” said Casella Vice President Joe Fusco.

Commonwealth originally bought the gas rights in 1999 with the idea of building a small power plant, but rejected it as not economically feasible. Instead, Commonwealth torched the gas to evaporate the leachate, the liquid waste that seeps out of the trash dumped in the landfill.

Landfills have to burn off the methane gas in the first place to minimize odors from trash. Secondly, evaporating the water turns the leachate into solid waste, easier to truck and dispose of. In addition to whatever remuneration Commonwealth received from Casella, the company also was able to sell carbon offsets, since methane is a greater contributor to global warming than carbon monoxide, and because of the fuel saved by deliquifying the leachate.

But Casella decided to end the leachate project in April 2007. The decision was made after the New Hampshire Department of Environmental Services required testing of the air emissions. Opponents of the plant contended that both Commonwealth and Casella were afraid of what the tests reveal. At the time, Fusco said that the landfill was just not producing as much leachate and the company decided to burn methane to produce electricity.

Indeed, Commonwealth had already decided that generating power was more economically feasible – especially given various incentives toward renewable energy – and in September 2008, purchased a 1.4 megawatt generation facility, according to the suit.

Commonwealth also reached an agreement to sell the power to Public Service of New Hampshire, said Yeransian. And since the project is relatively small – it would power about 2,000 homes – it could serve people locally – it would not need major upgrades in the power grid in the North Country that larger renewable projects require, Yeransian said.

The only major barrier, Yeransian said, is where to put the facility.

In its suit, Commonwealth says that it was working with Casella to site the plant where the evaporator once stood, but after some back and forth agreed to another location nearby.

Both locations would be outside the landfill “footprint” where the trash is disposed, but on the Casella property.

Casella apparently changed its tuned after the Supreme Court decision denied Casella the right to expand the landfill beyond the 51 acres for which it was already permitted. (The Supreme Court remanded the decision back to Coos County Superior Court, so that battle still continues.)

In its suit, Commonwealth says that it discovered during this process that Casella had no plans for a generating plant on the property, which – it claimed – meant it was reneging on its deal.

Commonwealth then decided that Casella “had no intention of approving any proposal by [Commonwealth] for the project on the landfill property, and made a deal for an adjacent parcel not owned by Casella.

However, the suit says, there are problems with that. Commonwealth had to agree to make “certain payments” to the owners of the site. It would cost more to build a pipeline to the new site. And, most importantly, it might involve permitting issues on the state and local level.

Indeed, Commonwealth is already beginning to run into such problems, according to George Manupelli, president of AWARE, a group opposed to expansion of the landfill. AWARE doesn’t have any position on a power plant, Manupelli said, but it does object to putting it outside the landfill property.

“If they are piping methane from the landfill to generate off-site, they can say they already have expanded the landfill more than 51 acres, and we don’t want that to happen,” he said.

Manupelli said that might be one reason Casella won’t let the plant on the property, but it also might be that, since the company might be restricted to only 51 acres, it did not want to make room for a power plant.

In any case, Manupelli said, the Bethlehem Board of Selectman turned down a request to build the plant on the adjacent Tucker property.

The suit filed on Wednesday asks for the court to affirm that Commonwealth has exclusive rights to the gas, as well as unspecified amount of damages, including triple damages under the Consumer Protection Act. – BOB SANDERS/NEW HAMPSHIRE BUSINESS REVIEW

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