First Round of Grants Drive $1.7-Million Investment in Developing New Wood Markets

In its first round of funding, the Future Forest Economy Initiative awarded three grants that will drive a $1.7-million investment in the region’s forest economy, seeking to diversify markets for wood and wood products from the Northern Forest region.

“We’re investing in these three projects because they each are significant opportunities to maintain and grow markets for wood, which in turn support forest stewardship and forest-based jobs that are an essential part of the region’s economy,” said Joe Short, vice president of the Northern Forest Center. “The Ashland project is aiming to generate $1-2 million in sales; the Burlington project could mean $500,000 more in wood purchases each year once it’s online; and increased use of modern wood heat can help replace lost markets for low-grade wood that are key to forest landowners and loggers.”

The $847,840 in grant funds will go to the Town of Ashland Maine to expand markets for structural round timber, a mass-timber building product; to a wood heat marketing consortium aiming to increase demand for wood heating fuels by 50 percent in the region; and to the Burlington (VT) Electric Department for design and pre-engineering to advance a wood-fired district heating system to serve the University of Vermont Medical Center.

Grant recipients and other sources are matching the grant funds with $852,053, bringing the total investment in new wood uses and marketing to $1,699,893.

Creating Demand for Structural Round Timber — Ashland, Maine

The Town of Ashland, Maine, will receive $450,000 for an initiative to position Ashland and the Maine Woods to take advantage of an estimated $130 million market for structural round timber products in the northeastern United States. Structural Round Timber is a low carbon mass-timber building product that can be used as an alternative to steel. It requires no adhesives, minimal processing, and can be fabricated using existing facility infrastructure and local timber supplies.

“Ashland has been looking at multiple market opportunities to restore more wood products manufacturing to our local business mix,” says Cyr Martin, town manager for Ashland. “We’re strategically located at the gateway to the Northern Maine forest resource and have proximity and transportation access to significant markets. The Town has a 100-acre industrial park and numerous un- or under-utilized manufacturing sites that could support such businesses. What is missing is market demand to justify business investment in those sites, and this project will help us grow one of those markets,” he said.

Increasing Demand for Wood Heat — Regional

The wood heat marketing consortium, a regional initiative, will invest $300,000 in a 3-year marketing campaign to build public support for a broad range of wood heating options and increase use of Northern Forest wood pellets and chips in lieu of imported fossil fuels. It aims for a 50% increase in low-grade wood used for heat, a gain of 900,000 tons over 2018 levels. Funds allocated to this project will invest in a multi-media advertising and public relations campaign that underscores the environmental and community benefits of heating with wood in this region. The Northern Forest Center manages the collaborative project.

“Northern New England imports all of its fossil heating fuels from other regions and other countries, exporting billions each year from our economy,” said Charlie Niebling, a consultant to Lignetics, Inc., one of 25 participants in the marketing consortium. “We have the technology to use wood to heat homes and buildings efficiently and cleanly – and keep those fuel dollars here at home where they support local jobs.  Wood fuels like pellets and chips provide markets for low-grade wood that have been lost in recent years, which supports good forestry and our forest industry. Wood is a renewable, low carbon fuel that delivers many benefits as a heating fuel,” he said.

Adavancing Wood-Fired District Heat Project

The Burlington Electric Department in Burlington, Vermont, will receive $97,840 for design and pre-engineering to advance a wood-fired district heating system to serve the University of Vermont Medical Center. The work is a precursor to retrofitting the existing 50-megawatt McNeil biomass-powered electricity generator and to recovering some of the plant’s waste heat. If completed, the project would stabilize a significant market for low-grade wood — the plant currently uses 400,000 tons a year — and would grow that market by 15,000 tons a year.

“For decades, Burlington has been working to enhance Burlington Electric Department’s McNeil Generating Station to include a district energy system that would provide renewable thermal energy to large customers in Burlington,” said Darren Springer, general manager of Burlington Electric Department. “With McNeil being such an important supporter of forest economy jobs in Vermont and the region, we were fortunate to receive such generous support from the Future Forest Economy Initiative that, with other funds, gets us the engineering analysis and refined economic feasibility modeling necessary to take us to a decision point on district energy in Burlington,” he said.

About the Future Forest Economy Initiative & Funding

The initiative — a cooperative effort of the U.S. Economic Development Administration (EDA), U.S. Endowment for Forestry & Communities, and the Northern Forest Center — grew out of a congressional mandate to support the development of markets for wood products. The grant awards are the first in a three-year program that will invest $2.6 million to expand innovation, create market demand and create conditions that will allow businesses and communities to benefit from these innovations.
“We’re making these grants at a time when the region needs to find new markets for its existing wood supply,” said Alicia Cramer, vice president of the U.S. Endowment for Forestry and Communities. “Market changes due to the coronavirus pandemic and the recent loss of a pulp-making facility in Jay, Maine, have left landowners, loggers and wood product manufacturers in northern New England seeking new markets for harvested wood.”

Funds for the program come from the U.S. Economic Development Administration and a congressional appropriation of $3 million secured by the region’s congressional delegation in federal fiscal year 2018 that directed the agency to support the development of markets for wood products in northern regions of Maine, New Hampshire, Vermont and New York. The federal funds are matched by $300,000 from the U.S. Endowment for Forestry and Communities to help cover project development and administrative costs.

 

“We’re making these grants at a time when the region needs to find new markets for its existing wood supply,” said Alicia Cramer, vice president of the U.S. Endowment for Forestry and Communities. “Market changes due to the coronavirus pandemic and the recent loss of a pulp-making facility in Jay, Maine, have left landowners, loggers and wood product manufacturers in northern New England seeking new markets for harvested wood.”

Link to Recreation Development Grant Announcement

If you are looking for news about 10 grants awarded in June 2020 to improve recreational opportunities in Maine, New Hampshire and Vermont, please click here. The recreation development grants are funded by a separate program.

Future Grant Funding

A Cooperative Initiative between the U.S. Economic Development Administration (EDA), U.S. Endowment for Forestry & Communities, and the Northern Forest Center.

The Future Forest Economy Initiative responds to a congressional mandate to support the development of markets for wood products. Over the next three years, the Initiative cooperators will provide $2.6 million in sub-grants to projects that deliver regional approaches to:

  • Innovate new forest products and the business infrastructure to commercialize them;
  • Create market demand for wood and wood products across the Northeast and New York; and
  • Enable the conditions that allow businesses and communities to benefit from these innovations.

Economic Background

For over a century the Northern Forest region of Maine, New Hampshire, Vermont and New York provided lumber and fiber to feed economic growth along the eastern seaboard. In those communities that produced and added value to the forest resource, residents benefited from some of the highest per capita incomes in their states. Over time, however, consumer tastes, world trade, multinational corporate ownership and regulations eroded the economic vibrancy – and ultimately the socio-demographics – of this region. Despite the more than 70 million people that live within a day’s drive, the region is struggling to adapt and has limited investment dollars for developing new markets for forest products and services that deliver economic value back to the region's businesses, landowners, and communities.

In recognition of this challenge, a Congress appropriated $3 million in FY18 "for EDA to collaborate with the Northern Border Regional Commission to support the development of markets for wood products. The Committee encourages EDA to work with communities researching and developing new construction technologies, such as engineered wood products."

Investment Objectives & Download for Call for Concepts

The EDA, Center and the US Endowment worked together to develop the Future Forest Economy Initiative. The Center is now accepting project concepts for funding consideration. Please read the Investment Objectives below and the full criteria in the PDF linked below.

In support of the broad goals above, the Initiative is focused on 4 interrelated investment objectives informed by 1:1 conversations with public and private-sector leaders, a survey of wood products businesses in the region, and assessment of relevant state and federal strategies.

1.    Support the development of new products and services from the region’s forests, particularly those that create or expand uses for low grade wood, mill residuals, and/or underutilized species. Priority project activities include:

  • Research, Development and Commercialization of new products from wood.
  • Testing and real-world demonstration of new wood-based product applications.
  • Design and pre-engineering for innovative use of wood for construction and energy applications.

2.    Conduct strategic marketing campaigns to expand wood industry interest in the region as a place to do business and increase consumer demand for wood products. Priority project activities include:

  • Business Attraction. Coupled with necessary market research, market the region to locate and grow wood products businesses.
  • Consumer Awareness and Marketing. Conduct strategic marketing campaigns to increase consumer awareness of Northern Forest wood products and services.

3.    Improve the efficiency of wood products supply chains to reduce transportation and production costs and increase access to markets for the region’s manufacturers. Priority project activities include:

  • Regional site assessment(s). Identify suitable locations for new wood utilizing facilities (e.g. site characteristics, proximity to raw material, workforce, transportation, and available financing options).
  • Transportation solutions. Develop innovative solutions to optimize supply chains, particularly for low-value wood.
  • Co-location. Advance initiatives that lead to co-location of multiple wood-utilizing facilities in close proximity to one another.

4.    Strengthen the ability of the region’s wood manufacturers to capitalize on new market opportunities. Priority project activities include:

  • Workforce development and retention. Develop innovative and replicable models for attraction, retraining and retention of workers in the wood products sector, with an emphasis on post-secondary education strategies.
  • Innovation technical assistance. Deliver non-exclusive programs of business technical assistance to assist the sector in implementing business and manufacturing innovations that enable access to new markets.

The Center is now accepting project concepts for funding consideration. Download the Call for Project Concepts.