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News Release
Commission Clears Way for Newberg Paper Mill Cogeneration Project
April 18, 2003 (2003 - 010)
Contacts:  Roy Hemmingway, Chairman, 503 378-6611; Joan H. Smith, Commissioner, 503 378-6611; Lee Beyer, Commissioner, 503 378-6611; Bob Valdez, Public Information Officer, 503 378-8962
Salem, OR - The Oregon Public Utility Commission has approved a special contract for Northwest Natural to provide transportation services to deliver natural gas for two new cogeneration gas turbines at the SP Newsprint Company’s mill in Newberg.
"This is truly a win for everyone," said Commissioner Lee Beyer. "SP Newsprint gets to lower their energy costs and keep valuable jobs in the community. NW Natural retains a customer and gets to improve pipeline capacity which will benefit all gas users, and an additional 30 megawatts of electricity will be added to the Oregon marketplace without requiring costly new transmission lines to be built."
The cogeneration plants will reduce the company’s energy costs and reduce price volatility. Cogeneration plants use natural gas to create electricity but also capture the steam that is generated for manufacturing processes, thus they are a very cost effective option.
Company officials told the Commission the cogeneration project would allow them to hire more workers and keep their energy costs competitive with other regions of the United States.
Another benefit of the cogeneration is that SP Newsprint will be able to sell up to 30 megawatts of electricity on the open market. Thirty megawatts is enough energy to meet the needs of a city the size of Forest Grove or 22,000 households for one year.
SP Newsprint recently completed an $80 million expansion to optimize recycled material in its newsprint products. Newsprint and recycling operations such as SP Newsprint use a tremendous amount of energy.
Under terms of the contract, Northwest Natural will deliver gas for the next 10 years. SP Newsprint will be responsible for purchasing the gas.
As part of the agreement, Northwest Natural will construct and SP Newsprint will pay for the cost of the six-and-a-half mile pipeline to the mill.