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GRAND RAPIDS, MN-Minnesota Power and Blandin Paper Co. are proposing to build a $200-million energy facility next to Blandin’s paper mill here. The combined heat and power plant will be able to use wood waste for fuel and will meet all steam requirements of the UPM-Kymmene-owned Blandin Paper Co.

In addition, the facility will provide about 225 megawatts of electric generation capacity to help meet the region’s growing power needs.

The combined heat and power (CHP) plant will use new technologies in efficiency and environmental controls. It will be capable of utilizing up to 40% renewable bio-fuel composed mostly of wood waste, and Rapids Power LLC will partner with local producers and government agencies to maximize their use.

Low-sulfur, Powder River Basin coal and natural gas will also be used to fuel the plant.

CHP plants are very efficient and this project design replicates a project under construction in Pietarsaari, Finland, that is the world’slargest bio-fuel circulating fluidized bed boiler.

The plant will fully replace existing energy production facilities at theBlandin Paper mill.

A new company, Rapids Power LLC, will be created to own the facility. Minnesota Power subsidiary Rainy River Energy Corp. will own 71.5% of Rapids Power LLC and Blandin Paper Co. will own 28.5%.

Minnesota Power is a business unit of ALLETE Inc. and Blandin Paper is a subsidiary of UPM-Kymmene of Helsinki, Finland. Raimo Malkki, senior vice president and general manager of Blandin Paper, says the “the new facility will not only modernize our steam supply, but also help sustain our long-term viability and success.”

Rapids Power LLC will likely soon file a Certificate of Need with theMinnesota Public Utilities Commission early next month. The project is contingent on getting Federal and state approvals and permits. Construction would begin in the fall of 2002 and is slated for completion in mid-2005.

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