From Forest Thinning to Biochar: How West Biofuels Is Scaling Community Energy

00:00:00 - Host:

Hey, welcome to another episode of the North State Rocks podcast. Really excited about today's episode. We're talking about bio energy plants, specifically Hack Creek Bio Energy, which is a 3 megawatt project located here on our our property. We're basically the landlords. The project was built out by West Bofuels. We have a really well-rounded group uh talking about what's so special about having this project here in our local community. Please enjoy. Welcome to the North State Rocks podcast.

00:00:31 - Narrator:

Discover the hidden gems and extraordinary people of California's North State region. Join Perry Thompson, CEO of Hat Creek Construction and Materials as he explores the vibrant communities and interesting neighbors that make our region a great place to live, work, and play. Tune in, be inspired, and rediscover the North State. This is your community. This is your story. Welcome to the North State Rocks podcast. 

00:01:08 - Host:

Excited to have everybody listening today. Really excited about today's episode. We're talking to three heavy hitters in kind of the biomass, bioeny world. Um, and we have two people with West Biofields. We have Matt Summers and McKenzie Castrida. And we also have Matt Hart on who is with Momentum which is a a key grant funding group that was really instrumental in helping kind of in a different role at the time but Matt was super helpful in getting the grant funding to really get this project off the ground. And the project we're talking about today at least we're going to start talking about today is the Hack Creek Bioenergy project which is here at the Hack Creek construction site. So full disclosure, I'm basically just, you know, our our role here is just as landlord for Hat Creek Construction. So I'm excited to talk about plant is actually operational. Really excited about that. That's exciting. I know that's it was a long road to get here. I want to say it's the very first one in the state of California on on 100% forest uh fuel. Is that correct, Mackenzie? Right.

00:02:11 - Mackenzie:

Yeah, that's correct. 

00:02:12 - Host:

And then it's the second one that West Bofuels did. The first one it's kind of in the central valley. Can tell us about that one if you can real quick. 

00:02:21 - Mackenzie:

Yeah, that's that first one in the central valley like you said is is uh agricultural biomass. So they use rice holes and so the second one at Hack Bio Energy is focused on forest fuel.

00:02:31 - Host:

Yeah. Amazing. Amazing. Yeah. I It's funny. Todd Slope uh he's not on the call today, but Todd Slope was kind of the one that got me involved in this project uh from you know kind of day one and the the thing that I first of all I don't know anything about very little about forestry and and certainly bio energy plants don't know anything about that but we're excited to participate from the level of of really kind of local impacts local jobs fire reduction wastewood into energy which are all all things that you know that's things that excite me for our local community and that's certainly why we got involved. So, McKenzie, who is West Biofuels, why are they building plants? Why up here? 

00:02:21 - Mackenzie:

Yeah, absolutely. West Bofuels uh was founded back in 2007. We've been out here in Woodland. It's our main office um I think since 2009. And our main focus is converting what people would consider waste into something of value. So we can convert bi different types of biomass into bofuels, mixed alcohols, sustainable aviation fuel, renewable natural gas. And the one we've been able to commercialize is turning it into power into electricity. And so that's what we've been able to do at Hat Creek Bio Energy. We convert forest biomass into electricity. Um the type of technology we use is pretty unique, mostly seen out in Europe. So we were able to utilize this different technology, put it into work here at Hat Creek and um getting to see a lot of benefits out of it. So one of the main reasons we put plants up in locations like Bernie, these small rural kind of more remote communities are more at risk for wildfire threat. And so the one of the really interesting parts of this the fuel that we use the biomass we use is we partner with RCDs like fall fall river resource conservation district fire safe councils and different organizations that help mitigate wildfire risk through forest thinningings and forest clearings. Um and so we utilize that fuel as our biomass feed stock that feeds the plant. So it's kind of a two-part. We're getting electricity for the community while also using the biomass that's helping mitigate wildfire risk.

00:04:40 - Host:

Yeah. Amazing. Well, I I know quite a bit about the at least the initial stuff on this and I want to say, correct me if I'm wrong, but is it Senate Bill 1122? The kind of the the impetus for, you know, the idea about these small community scale bio energy plants. So I mean I think people need to understand these these plants actually on the site when you look at it's quite large but in as far as power output and what people are kind of used to the older bio energy plants here in town I want to say are like 10 megawatt and then the other one is a 25 megawatt. This is a 3 megawatt. Uh, and then so can you kind of talk about why this one is only three and then kind of what Senate Bill 1122 kind of what it was and how it got this off the ground. 

00:05:29 - Matt Hart:

Absolutely. So yeah, Senate Bill 11220, you got it right. That is the the big driver. I think it was in 2012 uh that California passed the goal to procure 250 megawatts of community scale bio energy. And this was particularly in response to some years that we had backtoback serious fires around the state that were driving a legislature to help address ways to keep the forests more healthy and more resilient. And there are three different categories understanding that forest fuels and a fuels and urban fuels are all sourced differently, priced differently, so they need different solutions. So this program was designed specifically for community scale work. And and Perry, I know you said you're just the landlord now, but I want to I want to take a second just to thank you for your vision in helping drive this forward. I think you're you're a great example of somebody who understands the needs of the community, how this type of an economic driver can support the regional health both from an ecological standpoint and an economic standpoint. These are these are relatively new technologies that were pushed forward with new programs by the state to do this. and you were somebody who was a a big champion in the region to get this moving forward to take the bet on a new technology and figure out how do we support this. So want to give you your call out from those early days wouldn't have happened without you. 

00:06:55 - Mackenzie:

Absolutely. 

00:06:56 - Host:

Yeah. Yeah. Well, for us it's it's it's such a no-brainer, right? I mean, um we we've all we've seen, you know, recent most recently it was a Dixie fire. Million acres. I mean a million acres. uh you know campfire you know the devastating loss of of lives in that fire I just I mean and then to be able to go like my son is in the mastication business right so he's in he's directly involved in forest health does an amazing job with his company but you know the challenge with his is where does the money come from right and yes you can go out and you can mulch and take reduce these ladder fuels these real small diameter brush and small diame 00 trees that are just basically igniters to the big the big fires that really start burning the the big trees in the forest and and become almost uh you know unable to stop. Dixie fire is a good example. They they could not stop that fire basically until it ran out of fuel. Um and so but the cost to that is you go out and you mulch and you masticate and who's coming up with the money? What I love about this program, yes it is subsidized but only a little and because it is making power and that's something that people really need. We're using it to run the computers that we're doing the podcast with today. Everybody needs power and I love that they're figuring out some sort of a solution that is is hand, you know, solving multiple problems, right? So reducing fire risk, I mean I think everybody can get behind that. That's a no-brainer. We've got to spend more time keeping these forest healthy. what we've been doing for the last 20 years is not working and that is you know not just basically letting letting the forest just completely become overgrown and with zero management that that we have learned does not work so some sort of management that so now we need jobs so the part about where we live up here in near Bernie California which is where we're I'm doing the podcast right now it's where the plant is located there's no jobs I mean the jobs are you know you started with the mill in town used to employ you know, a few hundred people of the biggest mill that we have in town. Fortunately, thank God, we still have that mill, but a like all advancing technology, things are automated. So, it is, you know, less jobs there. But I think the biggest factor is, you know,that mill is running off of purely private ground. It's uh virtually no federal lands and state lands that are being actively managed anymore. So SPI owns the land and they're taking care of their land, but it's not taking care of nearly as much. I think they do a small small percentage of their stuff comes from maybe state and federal lands, but the lion share, the mass lion share comes from their own properties. So, you know, we had spotted owl. I'm old enough to know the whole the spotted owl absolutely decimated the logging industry in this area and it just really hasn't recovered. and these rural communities that I love so much and so many great kids and great families still live in this areas, but when the kids graduate from high school, what kind of job opportunities do we have to offer them? And that's that's what gets me most excited about having these these community scale, they don't like, you know, Mackenzie talked about, they're located in these rural communities and they're not massive plants, so you can have multiple, you know, multiple plants in the north state potentially. And so with that segue, I think, you know, we were talking earlier offline, McKenzie, if you could kind of talk a little bit about some of the, you know, first of all, congratulations West Bofuels. I think you guys are the only ones. There were multiple companies that were all trying to take advantage of Senate Bill 11:22, right? But the reality is is yes, the price is pretty decent, but you still have to figure out how to get the private money to go get the thing built. You've got to figure out some grant money to get the thing built because on its own it's not it's not going to probably very difficult to sustain without the grant money. And you know you guys uh got two have two of them and the only company that's gotten two and you have others plans. So I want to say congratulations for being a a California-based company, right? Cuz usually the companies that are succeeding uh it seems like are movin out of California. So it's awesome to see a company based in California winning. So tell us a little bit about kind of that process getting these ones, how big of a deal that is because I I think it's a huge deal. I'm really proud of you guys and then kind of where you see the next five years going for for your company. 

00:11:24 - Mackenzie:

Yeah. Well, thanks Perry. Um yeah, it's a it's a huge win not only for us at West Biouels, but I think just in the bio energy industry just to see that these projects are possible. So yeah, it's it takes a takes a long time. Earlier we were talking about the groundbreaking ceremony happening in April 2023. Um, now it's April 2026 and we're almost at a full year of commissioning. We went into commercial operations officially on June 30th, 2025 and then got to celebrate with a ribbon cutting ceremony back in October 25. So, it's been a whirlwind the last couple years, but like you said, there takes a lot of of efforts and multiple aspects to get the funding off the ground. That's just all the preparation and pre-development before these projects actually even break ground. Um, and like we said earlier, Matt Hart was a big part of that through Momentum. um getting different state and federal funding uh grant opportunities to help support this. We have funding with CalFire with a uh transportation subsidy being able to get the fuel from the forest floor to the current project site and that was for operations. Um but for pre-development and just kind of getting the project started was a grant coming from California Energy Commission through the Fall River RCD. So that helped their kind of project get off the ground. We also have funding from USDA and US Forest Service. So, there's been multiple partners to really support these types of projects. Um, and as we look forward, Matt Summers, our COO, and myself have been working really hard to get um different biomat projects in before the biomat program sunseted in December 2025. And um we have a few few in the pipeline which we're really excited about. We have one down in Mariposa. We've been working with the Mariposa Biomass Project. and they're a nonprofit down there and working with the Mariposa RCD. Um they have an extensive amount of biomass that needs to be utilized. You know, one thing we were just talking about how you can get funding for these, you know, different forest workers or forest industries. A lot of the time they have funding to potentially do the clearing, but they don't have any place to take it. So that second half is, you know, are they taking it down the hill to a um a landfill and having to pay dumping fees? or they going to have to um you know just do small biomass fires as well just to mitigate their cost of taking it somewhere else. So having a location in rural areas really helps benefit those uh fuel workers as well. Um, so that one project in Mariposa, we're also looking at another project out in Grass Valley, working with the city of Grass Valley because they are really concerned with their biomass and fuel surplus. And so they want to partner to make sure that they help protect their constituents in their area. The third is out in Quincy, which we're really excited about. Partnered with Plumis County, Plumis Core. They just have excessive amount of biomass as well. They're actually right next to another SPI mill. But like as you said, the difference is having private lands versus additional public lands. So a lot of these areas are surrounded by extensive public lands that don't have any location to bring that biomass to. So having those um these projects kind of specifically located in those areas really helps benefit that community. And even I know there's some other grants out there that say, you know, if you're looking for biomass utilization or being able to take out that fuel from the forest floor, they need to have a designated location that it's going to to make sure that the funding isn't wasted. So having those um located is really interesting. 

00:14:48 - Host:

Yeah. Yeah. So was there so Mariposa, Grass Valley, Quincy, I think there was Was there another one that you guys were talking about? 

00:14:55 - Mackenzie:

Yeah. Um, we're there's another one up in the northeast area out in Beieber and one more out in Mary'sville actually as well. Those are all going to be forest biomass which are like we said very needed in those areas. But we have one more out in Bigs that we've been looking at too that could potentially be agricultural. So that would be category 2 out of the biomat program would potentially be rice holes in addition to woody biomass from like orchards, wood wastes. 

00:15:20 - Host:

So these let's see one two three four. So these four, so Mariposa, Grass Valley, Quincy, and then the Northeast Bieber area one, would they all be eligible for SB120? 

00:15:34 - Mackenzie:

So we got all of the projects other than Bieber into the biomat program before it ended. And so we were able to get all of those uh contracted or they're in the process of getting contracted, but those were all applied for um uh under SP 112.

00:15:49 - Host:

Amazing. So for for Bieber that uh if if something happens there and I know you guys are kind of in the early stages of that, but um is there do you anticipate legislature extending some sort of something to continue that funding mechanism because uh I mean you the great thing, right? So I I think a lot of people don't realize and I think Matt, I'd love for you to talk about this, but how many projects receive grant funding that go nowhere? Um, and and that not because people are just pissing money away. Really, people don't understand how hard it is and what a massive lift it is to get a 25$26 million project funded, built online, all the bugs out of it, uh, permitted, just permitted. I listened to poor Matt Summers who's kind of off the call here temporarily, but listen to him talk about just pulling his hair out with with Shasta County, which you know, Shasta County has its challenges with permitting, but I will say in the state of California, it's definitely not the worst county uh to have to work with on permitting. So just can you Matt give people kind of an understanding of of the incredible amount of levers that have to be pulled successfully to take a project from from what you know Quincy for example to fruition so they get a little better understanding of that please. 

00:17:16 - Matt Hart:

Absolutely. Um and I'll I'll add to what McKenzie said for for all of our funders out here who help support this one. I think um the state treasur's office as well came through with some tax credits for the program as well. 

00:17:28 - Host:

Yeah. 

00:17:29 - Matt Hart:

Which is one of the programs that has been really consistently around and supporting these types of projects for years and years. But Perry, to your point, um, a lot of agencies across the state do put in money, whether that's tax base money, whether it's greenhouse gas reduction fund money, whether it's rateayer money to support the development of these new projects. When we started the project at Hack Creek, as you mentioned, there there wasn't one of these before, which means there was no permitting agency for Shasta to go call and say, "Hey, you've done this before. Can we talk? can we talk this through? They don't don't have the the foundational understanding of that project. When you look at the private sector and they're thinking, okay, how are we going to put 20 plus million dollars into a project? They want to see where's some operational history, where can I go to see that this has worked out and how how do they think through their risk as investors? Getting getting first projects up is really important to moving uh an industry and a sector forward. So, as you said, there are certainly times where grant funding has gone to support projects that haven't ultimately made it through to commercial success at one point or another. And and that's not a failure of the granting agency. That is not necessarily even a failure of the project development team who are who are going forward with these projects with the best intentions there. But sometimes new technologies for some reason or another just don't work. They don't work out. and and that's a really important part of the way the state considers investing its funds in bio energy and in other technologies to to push things forward knowing that not everything will make it but as they are able to build the coalitions here who do get some of these over the finish line especially as we look forward into what's going to happen after the biomat program and for those listening who haven't spent all their time thinking about this um SP122 is the legislation that then created the bio tile map program which is the program that is um run by the utilities um in co in collaboration with the California public utilities commission um to to actually offer the rates and as McKenzie mentioned that program is is currently um over it ended in December in 2025. I don't think all the 250 megawatts were allocated across the three sectors. So we're we're at a little bit of a crossroads from a state perspective of where do we go next? It's always a challenge. These smaller biomass plants are more expensive from a per kilowatt hour basis than a solar facility or wind. But they're running 24/7, providing base load power, providing greater reliability. They are supporting forest health. Watershed health is becoming increasingly important as part of a driver for making sure that we're conserving our forested lands in California. I know California Northeast has a lot of um hydro assets as well that rely on healthy waterersheds um and forest fires and can can really do some damage to waterheds. So, as a state, we're still looking for different ways to help promote a healthy public private sector partnership to drive this economy forward. I don't think we quite know where it is. I'll give a a plug to the bio energy association of California which is a member organization that I know momentum myself and the West Biouels teams are members of as are many who are thinking about developing these projects. It's a really great resource for anybody who does want to effectively track the legislation, the funding, the direction that the executive director Julia 11 is is really great at bringing that to the members. So for anyone wanting to learn more, it's a great resource.

00:21:18 - Host:

Yeah. Yeah. Yeah. Well, so McKenzie, tell us a little bit about was this project how hard on a scale of 1 to 10 was it to get across the finish line? 

00:21:28 - Mackenzie:

That's a that's a fun question. I God, I wouldn't even know how to answer, but there I think out of multiple aspects financially and then on technology and operations. Our operations team was already kind of commissioning the plant early 2025, but partnering with different utility including PG, but just even other equipment vendors, it was it was tough, but being able to say we are officially in commercial operations and June 30th was a huge feat. So, I'd say it wasn't that hard. It was like a like a nice 

00:21:58 - Host:

You were such a liar. Oh my god, you're such a liar. I was going to say I thought you going to say one out of 10. I thought you going to say 12. It was going to be a 12. 

00:22:05 - Mackenzie:

It was probably I think my operators and our Brandon out there would probably say was up there. And then on and on on a financial aspect and kind of development, you know, it took years to get this project going. And I'd be remiss not to include our private investors, Peter Paul and Yucko Willoughby, they really their belief in the technology and our team, you know, they really got us over the finish line. So we had multiple multiple players. Um, yeah. So, I I think this will be our hardest one, 10, 12, as you said. And I think now that we know what to expect on the permitting side, on the financial side, um, you know, and even on the technology side, I think these next ones will be easier, like 

00:22:46 - Matt Hart:

Yeah. And I want to go in with that that optimism there because as mentioned earlier, we've been through the permitting site. So the next sites, the next folks doing it will have a resource to go to that they can can talk to and see how another agency did permitting. And from a financial standpoint as a in in three months you have a full year of commercial operations to be able to show investors which is just a major milestone in getting over some of the risk challenges that these investors are looking at as they're thinking about how to spend and invest their funds. So from the I think the interconnection side is always going to be challenging. It's just not always that easy to figure out through working with utilities how how to interconnect, how to manage the cost of interconnections. I think that's a that's a really big challenge that a lot of people face. But permitting financing timelines I think are going to be a lot easier moving forward. Can't make any promises about interconnection. 

00:23:43 - Host:

Yeah. Yeah. Yeah. Yeah. Well, you know, as as a business owner that we're always talking about, you know, whether it's a new technology that we're employing, a new estimating system that we're employing. I mean, the one constant in business is change. But one of our things that we talk about all the time is don't reinvent the wheel, right? So, you guys literally invented the wheel on this thing. And so, what you're talking about is what we talk about all the time. Don't be the people that invent the wheel. be the people that get the existing wheel and perfect a few things and make it work. Take a proven system before you integrate it into the business. Take a proven system and tweak it a little is, you know, a million times easier than than start from scratch. So, yeah, I think I think we can't emphasize that enough that that you have proof of concept now, right? And so, and then the other thing I think that McKenzie touched on that I think we need to kind of throw a big shout out to is is Peter Paul risking so much private I mean personal money as he's a wealthy guy but wealthy guys don't stay wealthy guys by risking things thoroughly and he he really I was really impressed with him. I got to meet him, spend a lot of time with him early on in the process. And what I loved is this is a guy that, you know, quote unquote has made it. And um doesn't need to be taking risk. He doesn't I mean uh so what's in it for him? And the answer is um he wants a better California and he wants a better North State without him risking a sizable amount of money to be because again all those things you just talked about Matt, you don't have proof of concept yet. So in institutional investors are like, "Well, show me show me proof that you guys can run for a year without massive breakdowns of this thing, you know, falling apart and P Geny being pissed because now you, you know, you made a commitment that you're going to give them this power or they've committed to pay you for this power." But there's also penalties for not performing that a lot of people don't really understand. There's a lot of risk when you put a power plant online, you sign that contract with P Gen that you're going to provide the power. It's not just, oh, you know, we feel like taking Wednesday off, so we're going to shut the power plant down. It just doesn't work that way. Your your outages have to be your maintenance has to be scheduled way in advance. Has to be coordinated with Pen. There's just so much to it. And so, thank God for for Peter. And, you know, um I'm sure you said another private investor. I'm I'm I'm not familiar with that one, Mackenzie. So, can you touch on that for us? 

00:26:11 - Mackenzie:

Yeah. Yo Willoughby, she actually um is the co-founder and kind of co-owner now West Bofuels. And so she um helped us I think get across the finish line um you know with Peter and their partnership. It it really was um a team effort and we're just really so grateful for both of them. Like you said, extensive amount of risk um but just an extensive amount of belief in our team and um the technology and like you said just the the mindset of this industry and forest health and all that. they they're really have been our biggest supporters. So, we're really grateful for them both.

00:26:44 - Host:

So, talking about this technology, can you argue that it's cleaner? Is it similar? Um, I certainly know that you guys, you know, I have I have some understanding of the ones that are in town, the 10 megawatt that's no longer running and the 25 megawatt is still running. They're using a lot of water and I just kind of want if you could contrast the technology here, what you're using today and why it's better if it's better. 

00:27:09 - Matt Summers:

Particular reason we selected the technology we're using is is because of the low low emissions but also the fact that it doesn't it doesn't use water doesn't produce waste water. It's all a closed loop process. So what we're what we're doing is avoiding things like like ponds or blowdown or these types of things that you would typically have with a steam system. Basically, we're heating thermal oil and then we're using that thermal oil in a closed loop process called a organic ranking cycle. And what that what that does is it just continually runs this organic fluid all closed loop and and runs our generator that way. So, we're not we're not having cooling towers or those types of things which come with some of the older technology. On top of that, we have some, you know, state-of-the-art emission controls. So really good control uh of how the plant processes the wood and converts it into thermal energy and then we have treatment technologies that reduce the the pollutants substantially. So we use a little bit different technology than you than you'd see with the older biomass plants in that respect. Um again another key reason we use the technology we use is is just it's very very automated. So, so the system itself is doing a lot a lot of the controls and so that enables us to build these smaller smaller plants. We don't we don't have to a boiler operator or some of the other positions that you'd have to have with more of the traditional biomass plant. So, for all those reasons, this model, the style of plant has worked really well where it's been imp implemented in um it's been implemented in Europe. Uh there's there's several of these plants up in British Columbia, parts of Canada. There's a a really good, you know, kind of first of its type plant out in in Maine that that was put in a few years ago. But for kind of for 10 megawatts and smaller, this this technology really really really works works well and has a very very small environmental footprint from the respect that you know we don't we don't have to deal with any waist streams. 

00:29:20 - Host:

Yeah, that's incredible. Yeah. Yeah, and I think that's a message that really needs to to be out there is that, you know, it's it's significantly better, especially um emission wise, right? We're we're all worried about that, but especially the water, you know, here here we are so blessed with just some of the most pristine water on the planet. We have it in abundance in the groundwater below us. We have Bernie Falls right next to us. Um there's there's just tremendous incredible incredible water supply here. So, I I love that we're not really having to to mess with that and leverage that and worry about leeching ponds and, you know, all the things that in my mind are are pretty high risk, you know, for environmentally. And so, you know, that's that's incredible. So, I I know when we were talking early on, Matt, a couple years, we're just talking about the groundbreaking was three years three years ago in 12 days, which is amazing. But so I guess it was before that a lot about biochar and then I know the technology was kind of was pivoting potentially. Are you guys creating biochar or are you not creating biochar at the site right now? 

00:30:23 - Matt Summers:

We we we are transitioning into producing uh biochar. We we can set up the plant uh to to basically operate as like a like a carbonizer/gifier. We've run it that way to do test runs. We're right now we're waiting for our certification of the, you know, of the biochar. So, one of its value items is its carbon sequestration capability. So, to do that, we have to sort of demonstrate the the carbon footprint of the biomass of the biochar that we produce at the plant. So, we're going to transition from from ash as being our byproduct to to biochar here in the next months. 

00:31:09 - Host:

Well, that's um exciting 

00:31:11 - Matt Summers:

yeah, and that that'll that'll be great. A lot of that will get used in, you know, farming operations that are also up here in the north state, too. So, so pretty pretty exciting to be able to do that, to be able to demonstrate sequestered carbon and generate some carbon credits also for the u for the plant. So it helps helps us with the it's just another another revenue stream and another way you know another sort of green stamp on the plant that we can also deliver some climate benefits uh to what we're doing too. 

00:31:45 - Host

So Matt explain to me like you know I'm a fifth grader cuz that's not much smarter than that. So explain to me like I'm a fifth grader like I just want to make sure that people understand what I mean I think we're making the assumption that people understand what the plant is taking in but why don't we just really clarify that and really unders so they and then uh quantity so it's we we talked pretty extensively about it being a 3 megawatt plant you know it's part of the cineabil 1122 how that kind of came to fruition but if you could really say for example how many bone dry tons a year the plant is going burn and then what is what does that product look like and then also contrast I think most people understand what ash is as what kind of the existing plants here in town do now but the the special component of biochar and kind of what that is for the layman person that doesn't understand this industry 

00:32:38 - Matt Summers:

yeah 100% yeah so so our our projects we bring in um basically forest thinning so they're they're you know when when our partner timber operators are out doing thinning projects for the Forest Service. They're generating these piles of material that's not it's not timber quality material, you know, it's it's snags, it's you know, brush, it's it's it's all it's all kinds of things. And what they'll what they'll do is instead of just leaving that and leaving the the fire hazard of that, they'll chip it up, put it in, you know, these big big trucks that folks see around on the roads, the big chip vans, bring it into us, and then we put it in our feed stock pile. And that feed stock pile can have anywhere up to like six, you know, seven weeks worth of of material at any given time. So that material sits there, and we kind of go first in first out. So the material that comes in, you know, is going to probably sit there for that four to 6 weeks and then and then get used in the plant. So we kind of cycle it through that way. So material goes up into the into the the plant and then it goes across a thing that's called a reciprocating grate. And when we produce biochar, we operate that with with almost no oxygen or very little oxygen. So basically we have that material heating, drying, and then it gives off this nice combustible GLA gas. The the gas that makes flames in your fireplace comes comes out of the wood and then and then we use that gas which we can clean burn to produce our heat for running our our generator system. What's left on that grate is that material slowly moves, you know, moves its way down the grate. And what's what gets left there is basically like the cellular structure of the wood. If you could look at it with a microscope, that's made of this really nice carbon that it doesn't want to turn into fuel. You know, it wants to stay in that in that little cellular structure. So that falls off the end of our grate and then we collect that which it's going to have a it will have that ash in there that would have been there if we completely burn the biomass but I'll have this this beautiful carbon structure um that's good which is just an excellent soil amendment. So that biochar comes off the end of the grate and what makes it great is it it's got this um these properties where it holds water, it holds nutrients. It it basically is a a great way of building building up soils and that carbon will last in that soil for 100 years or more. So it's it really stays fixed in the soil and it provides basically a lot of service for the soil which is you know it holds on to water. So it kind of acts like an absorbent. it can hold on to, you know, like fertilizer or nutrients like nitrogen type nutrients um and helps the build the kind of the root zone of the of the plant. It's a it's a really nice agricultural horicultural product to build up soil and it delivers that sort of long-term sequestration of the carbon. So the plant absorbed the carbon, the tree did, and then and then we're lengthening the amount of time that carbon stays in the environment by turning it into biochar. So that's that's kind of what we do on the on the feed stock end. And then that biochar comes off the end and we run it up a conveyor and into a you know directly into a a truck. Um and and then and we take it away by a truckload and that can be used directly by by farmers or even like horiculture operations. you know, it could go directly to a Home Depot um to a to a consumer, too. But but at this point, we're looking at using it in the, you know, Fall River Valley agriculture, you know, as as as um as a soil amendment. Now, ash can be used as a soil amendment, too, but biochar is special in the fact that it has all this sort of water and nutrient holding properties. Whereas the ash, you know, also has benefits. It has potassium in it and other things that the soil need. But the biochar also has this active carbon kind of like activated carbon. A lot of people are familiar with that. It's essentially like an activated carbon for the soil and just has a lot of lot of great great benefits. 

00:36:59 - Host

Okay. So that's a great great explanation. I think you went over the top of the fifth grade so I barely hung on to that but but good job. Good job trying to dumb it down for us. That was great. So what do we have going into the plant in in wood chips? Is that 30,000ish bone dry tons roughly? Does that sound about right? About 30,000 tons um on a yearly basis. 

00:37:17 - Matt Summers:

Yeah. On a yearly basis. Yep. So I mean rough numbers about you know 1.2 tons makes a megawatt hour. You so we're running you know probably like three and a half tons dry tons an hour is is what the plant runs at and out of that we might produce you know a 1,000 pounds an hour of biochar. So, so it's substantially reduced in in volume and mass by the time it the time it comes out. 

00:37:52 - Host

Yeah. Excellent. 

00:37:54 - Matt Summers:

Most of it goes into the energy production portion comes out as biochar. 

00:37:57 - Host

Well, I love that it's that the byproduct is such a high high use product. I mean that I'm excited for you guys to kind of again we were talking before you know when you were off there just the challenges with being the first one, right? And you get just incredible that this is the first forestry plant running and now people you guys kind of created the wheel. Now people could kind of copy the wheel including you guys and here's here's what worked proof to inst institutional investors that you know proof of concept and you know yes we are making the power and now the same thing is going to happen with biochar. I mean you guys are kind of basically the lead on hey this is a byproduct. I know biochar's been around, but the the consistent ability to make it on, you know, on demand. I love that you guys can kind of switch back and forth as as need be as you're kind of proven proving out the you know, you need the customers, right? You need you need proof of concept. You need people to try it. You need people to go, "Wow, we're able to hold moisture so much better. we're able to inoculate it with whatever the type of fertilizer that we're trying to really target and it holds it so much better and the crop yields are this much better because that's all the data that you guys are really trying to to produce right now. So, it's it's really really exciting that this hits. And we've talked about the jobs to build it, the jobs here, the guys that are working at the plant, but even more importantly are the guys out in the forest that are, you know, have a place, you know, those jobs are created and have a place to take these ladder fuels, create healthy forests, and now you create power, which is something that we all need, and it's such a great use. And now you're being able to take even the waste product and really add value. So, I just I love how this project is just adding value over and over and over again in so many ways. It's just it's just awesome to see. 

00:39:48 - Matt Summers:

Cool. We're excited. We're excited about it. I think the you know the chance to kind of replicate this in other parts of the north state was a great opportunity. We feed right into I don't know if McKenzie mentioned but we feed right into the distribution circuit. So, you know, our our power really is being used right in right in Bernie. you know, we we are we are helping reduce the amount of transmission that needs to come to that substation because we're always taking a base load 3 megawatts of of load that's that's that comes right from the Bernie community. So, all of that helps with the transmission system and all of that as well. A lot of lot of nice benefits for a for a small community. 

00:40:28 - Matt Hart:

And Perry, just for those who are trying to figure out what does 30,000 tons mean, I think the plant, correct me if I'm wrong here, Mackenzie or Matt, it's it's something on the order of like three to four truckloads of fuels a day is about how much the plant goes through. 

00:40:43 - Matt Summers:

Five, we usually say five or six cuz bone dry tons. Yeah, bone dry tons we get like about 14 or 15 tons a truckload. 

00:40:50 - Matt Hart:

Perfect. that was always the visual useful for me. Clearly, I didn't really

00:40:57 - Host:

Yeah. Yeah. and that that six to seven week supply you're saying that you're always trying trying to have ahead of you. We've had a really mild winter. So, I think if we ever have a real winter, you guys better make sure you have more than six or seven weeks up in the fall cuz we've had some winters where you do not get out in the woods very effectively in the winters.

00:41:16 - Matt Summers:

Yeah, we're you're you're totally right. Yeah. No, we we we can do we can do, you know, like three or four months and and that's probably what we'll do next year. Maybe we got a little lucky in our first year. 

00:41:28 - Host:

Hey, it's better to be lucky than good. I say that all the time. Always take luck. Luck over skill any day. Yeah, that's amazing. Okay, so all right. Yeah, we talked a little bit, Matt, when you were offline, you know, kind of about the Mariposa, Grass Valley, Quincy, and then even that northeastern Bieber area one, which are all exciting because they're all forestry based, you know, which is which is incredible. If you know, I know there was a heavy lift. We talked about really really challenging getting the first one, first forestry run across the across the finish line. You know, how um how far along are you on on these other projects? Is this like just really really early on? We're, you know, 5 years out, are we two years out? What are we kind of thinking and kind of see what is that vision over the next 5 to 10 years that you your company is hoping to accomplish? 

00:42:18 - Matt Summers:

Yeah. So, we've got pretty good news on on that front for five of our next project sites. We've already got draft power purchase agreements for them. Now, that doesn't mean we're going to go build them tomorrow cuz cuz we got to put put together the finance package. There's still some other types of permitting, >> but we focused on getting those utility agreements in place. So, as soon as those project sites finish their interconnection studies, we basically have a three-year build period to build them. And we expect those studies to come back this year. So, we're going to be on a pretty heavy build schedule for these new project sites. We really to make our make our company go, too. I mean, we we I have a staff there in Woodland that goes and helps service all these plants, but we need to have multiple to kind of kind of keep keep that staff going as well. So, so our vision is really to to get probably the next three to five plants online in the next in the next three years, three and a half years. So, um, so we're ready to replicate this model. I think the first one was so hard and, you know, cuz you were there from the beginning with us just because it was new. We had to convince investors. We had to convince, you know, banks. The the project was studied to death. We've had like three or four different independent engineering reports on the project. But now that we have six months of data with more than 90% capacity factors. So, so our uptime is just incredible for a plant that just opened and good revenue stream everything like that. So I think we've now kind of shown the financial entities that we can do it and what we want to do now is get a loan to do three projects at a time instead of one loan to do one project, you know, because it's basically a similar similar effort. So our our concept is to have a kind of a hub and spoke model where where we've got our you know kind of our engineer staff and in Woodland the various plants you know in the Sierras and the Cascades and that were that were keeping going you know and same same with like purchasing fuel you know then you can have one dedicated professional purchasing fuel for all five projects or or what have you right so so um so we really, you know, want to see this model of the smaller plant work. And the way it needs to work is is to have multiple facilities going. So, we're on that slope for those. The good news is that, you know, we do have power purchase agreements coming for those other project sites and then it it'll just be off to the races to get everything built. And we're going to build them very similar to Hat Creek Not a lot of engineering changes, too. So that helps as well cuz that you know that took a lot of time the first time as well. 

00:45:05 - Host:

Yeah. So I imagine you're going to benefit from speed right because you have proof of concept you know it worked. Do you and I know know there was has been incredible inflationary pressures over the last three or four years that I'm sure made things super challenging for meeting budgets and and all of that. Do you do you anticipate that the plants that you're going to be building, you know, these plants can be built less expensively because of what you've learned or is it just a the cost is kind of what the cost is at this point? 

00:45:36 - Matt Summers:

Yeah. No, we've definitely learned how to reduce cost, but as as we do that, inflation is raising the prices goes up. Yeah. So, so I mean there's there's only so much we can do with the amount of copper that goes into the plant, you know, in terms of, you know, both generator and motors and and all the wires and and that type of thing. And, you know, if anybody knows the price of that stuff, you know, it's that's more than more than doubled. So, whatever we do in efficiency kind of is getting it up. So, we're kind of stay staying somewhat stable on the price to build the plant even though we've reduced the inputs to do it. But that's that's you know and we'll we'll continue to do that. We'll continue to learn more about operating the plant efficiently and you know and that type of thing. But you know the fortunate thing is I don't think we've seen our price increase but we haven't seen it go down mostly because every every construction efficiency that we make gets eaten up by the fact that construction materials have gone up by an equivalent amount is kind of what's going on. So So the good thing is we're not we're not going backwards at least. Yeah. We're We're holding We're holding that price, which is what we need to do.

00:46:45 - Host:

Yeah. Awesome. Well, that's great. Okay. Well, I'm trying to think if there is there anything that we haven't covered that you guys want to cover. I'm just kind of looking at my notes here, making sure that I didn't 

00:46:55 - Matt Hart:

Perry, when I think about some of the folks that are thinking about doing this as as the landlord and site host and partner who has has this at your land and you have you run another business out of it. would love to hear what the experience has been like for you having having this site as a neighbor. 

00:47:12 - Host:

Yeah, so it's actually been it's been really really easy to get along with the you know the we're in a business that has tremendous truck traffic, right? So, you know, we're used to a big day of trucks is, you know, 100 loads, um 150 loads, 200 loads. And so, you know, when you're talking about wood chips coming in here, that's probably I would say if you're talking about impacts, that's probably the most noticeable impact would be chip trucks. And again, it's like four or five a day. It's not it's not anything um excessive there. It's nice having another set of eyes here on the property for, you know, just um you know, for for safety and for, you know, we do have a very secure site. Um, we have a night watchman here on site and that kind of stuff. But it's still nice to have 24-hour a day presence um on the site. I think it adds to the safety and um just to have another set of eyes out here. Uh and really it's it's not noisy. It's it's really a quiet plant. That's one of the things that um I was really impressed with. And then as far as visual impacts, you know, in the in the morning, you might see be when it's cold, you see a kind of a steam plume that's that's pretty minor compared to what I'm used to. Even our asphalt plants are significantly more of a plume than this plant. I mean, it's pretty much only on cold cold mornings, you know, when it's you're seeing that steam really. It's not. So, the the impacts have been virtually non-existent. And we're just super excited to have such a positive community impact on our site. I mean that that I'm I'm really proud of the fact that it's here. I love that it's here. I love that there's jobs for this community. I mean, all the things that we we've already talked about, and I kind of hammered those pretty good when when Matt was offline, but it's just it's just awesome to see and I I'm really excited that you guys have these other projects in the pipeline. really excited to kind of keep keep tabs on on moving those along. Yeah. I just Yeah. From my perspective, it's been it's been nothing but a net add to everything that we do here, Matt.

00:49:41 - Matt Summers:

That's great to hear. Yeah. Yeah. I think I think um yeah, being there on your site, you know, has been great. You guys, you guys did a great job supporting us on, you know, on getting the site graded, having a backup system for fire and all of that kind of stuff already on site. So, so that that part's been good and and and the fact that you already had a scale on site. So, so you know, we've we've built a good relationship there with with you guys doing all the scaling in and scaling out of the of the chip vans. So, so it's been it's been um been pretty cool and it's been great to to bring people from Sacramento and Redding and elsewhere to see like like look this really can be done and Right. So, it's a really it's a you got a beautiful location up there to to bring people to and kind of show everything off, Perry. So, that's been awesome. 

00:50:17 - Host:

Yeah. Yeah. Well, I'm really proud of you guys for getting this thing done. And there's been, you know, we talked earlier about, you know, projects like this are hard to get off the ground. They're hard to get going. And I'm just really impressed that you guys got it done and then super excited that you have, you know, four or five more in the pipeline right now. That's to me that's the most exciting thing that the proof of concept is is doing exactly what you know when when people fund grants, this is what they hope for. I hope that you guys will work out the kinks, figure out the the inevitable challenges that are come with being first, right? And so I know I know this is the second plant, but the first forestry related plant. And I think up here in these rural communities, we're a heck of a lot more excited about removing mitigating fire danger is a huge benefit to these plants. the more in my mind that we can be responsibly sourcing and communities that that have the needs and you know we were talking earlier Matt Summers so we were talking earlier about how SPI does amazing amazing things on their private land right they manage their private land the the problem is is nobody's effectively managing the federal and state lands and so when we're talking about being excited about these smaller communitybased plants It's an opportunity for feed stock. I'm a pilot, so I fly over fly over the North State all the time. And you know, talk about the treetops that when the when there is logging, the treetops don't go anywhere. The limbs don't go anywhere. The brush can't go anywhere. You're giving everybody a place to go. But what people aren't talking about is the massive amount of really small diameter wood that you know, say a fire comes through, woof, and I fly over, there are thousands of huge piles of small diameter timber that are are u lost in the fire, but aren't big enough to be utilized for lumber production. And so those are just basically sitting out in the forest rotting is is kind of what's happening right now. And you know, people don't, you know, don't think about it, but you need a place for that really small, if you're even thinning, when you're thinning properly, you need a place to take that really small diameter tree because you're trying to protect the larger, healthier trees, right? And you know, that's what that's what we're all love about the forest in these regions. But in order to manage them properly, you have to have a place to take this stuff. And so, the fact that you guys have five more of these in the pipeline, good for you. God bless you guys. I'm just so so thrilled that we got to be a little part of of number one. I think it's freaking awesome. So So thank you guys.

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