Unexpected problems with the current Tom Forsyth Arena pellet heating system and high expansion costs have led Village of Burns Lake council to shelve plans to extend the heating system to include the upcoming multi-use facility expansion.
In a report to council, Jeff Ragsdale, Development Services Coordinator, recommend that council not expand the pellet heating system.
Ragsdale obtained an estimate from Fireside Mechanical for expansion costs. They recommended allowing at least $400,000 to expand the heating system to include the new multi-use facility.
According to Ragsdale’s report, the investment would never show a return.
“The net present value calculations to offset the natural gas consumption, indicate it would take 24 years to pay for the system,” he said in his report. “But the expected lifespan of the system is only 20 years.”
This means that the pellet heating system expansion would never pay for itself.
Added to the negative return on investment are the difficulties that the village has been having with the current system.
It is unable to use pellets produced locally due to a higher than optimal moisture content, and the village has struggled to find a consistent supply.
This situation has been solved for 2013 through an arrangement with Starland Timbermart to provide fuel from Pinnacle Pellet Quesnel at $198 per metric tonne delivered.