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New $135M S.C. biomass plant will sell power to Progress Energy

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Raleigh-based Progress Energy (NYSE: PGN) will buy 50 megawatts of electricity from a $135 million power plant to be built in Hartsville. The facility will use biomass from wood and other products as the source for the power.

Peregrine Energy and Progress announced their agreement on Wednesday.

The deal provides Progress with power for 14,000 homes. The biomass-generated electricity is another source for alternative and renewable energy as required by N.C. state legislation that passed in 2007.

The plant will be built at a manufacturing complex operated by Sonoco, which manufactures recycled paperboard and other materials. The generator will replace a coal-fired boiler facility at the Darlington County complex. The company will sell electricity to Progress and steam power to Sonoco.

Peregrine plans to seek permits for the plant in May.

Once complete, the plant will provide some 30 jobs plus another 100 jobs in the area.

"This is a great environmental success story, and Sonoco's considerable experience in forestry operations will help keep the cost of fuel low, which is important in ensuring this is a cost-effective renewable energy resource for our customers,” said Progress Energy Carolinas Chief Executive Officer Lloyd Yates.