BUCKSPORT, Maine — Federal energy regulators have approved the transfer of power generation assets at Verso’s shuttered Bucksport mill, clearing one hurdle in completing the mill’s sale to a scrap metal dealer.
The Federal Energy Regulatory Commission on Thursday issued its approval of the transaction, allowing AIM Development USA to take over 303 megawatts of power generation capacity.
The approval comes against the wishes of Gov. Paul LePage, who wrote to ask federal regulators not to give the request-expedited review because AIM is not in the business of operating power assets.
If AIM demolishes the mill — which appears likely even though AIM has not explicitly said it will do so — it will have to follow demolition restrictions that were adopted last week as an emergency measure by the Bucksport Town Council.
David Milan, Bucksport’s economic development director, said Friday that town officials decided to amend the town’s building standard and property maintenance ordinance after they consulted with officials in Kimberly, Wisconsin, and Sartell, Minnesota, where AIM has done demolition work at other former paper mills.
Officials in both towns told Milan they wished they had tighter demolition standards in place when the work began. Bucksport officials realized their ordinance did not cover “large-scale” demolition projects, he said, and so used Sartell’s updated demolition ordinance as a template for updating its own. Maine, Milan added, largely lets municipalities decide how to regulate demolition projects.
Milan said the primary goal of putting the tighter restrictions in place is to protect residents from an overabundance of noise, dust or vibration that might emanate from the property while demolition is under way. He said representatives from AIM were aware of the proposed amendment and only suggested minor changes.
“I don’t think they saw any major issues” with it, Milan said.
In its FERC filings about the site’s power generation capacity, AIM stated it would continue to employ several power plant staff and that it has hired Consolidated Asset Management Services LLC to operate the energy facilities. The power plant employed about 70 people at the time Verso announced the mill closure and layoff of about 500 paper mill employees.
The company operates about 9 megawatts of capacity at a hydropower facility connected to the other former Verso mill in Sartell. In 2013, the company had revenue of about $1.45 billion (Canadian).
A lawyer for the machinists union also asked federal regulators not to approve the request. The union separately is trying to block the sale of the mill for scrap, arguing Verso did not consider other bids for the mill from companies interested in continuing papermaking at the site.
In its written determination, FERC found the antitrust complaint raised by the machinists union were outside its jurisdiction and it did not believe any concerns LePage raised should prevent the transaction.
Separately, in the antitrust case, Verso and AIM officials have testified in court and in writing that there were no bidders interested in making coated groundwood paper, which can be used for products such as magazines and catalogs. The machinists union has cited statements from LePage’s office there were other interested buyers but said confidentiality agreements prohibited revealing the names of any potential bidders.
U.S. District Court Judge John Woodcock said during a hearing Tuesday it is difficult to rule Verso violated antitrust laws without evidence there was a competing party interested in continuing to make paper in Bucksport.
LePage separately asked state regulators to question AIM’s ability to abide by an agreement to get state renewable energy credits for production from the biomass generators on site.
The company responded, saying operations largely would remain the same under AIM. The Maine Public Utilities Commission still is considering that matter.
BDN writer Bill Trotter contributed to this report.