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Published: Wednesday, May 16, 2012, 12:01 a.m.

Biofuels company to repay county

The company has agreed to compensate the county for $143,000 in goods and services it didn't deliver for a canola project.

  • A canola plant grown on a Monroe farm in 2007.

    Dan Bates / Herald file

    A canola plant grown on a Monroe farm in 2007.

CLEARVIEW -- Snohomish County's experiment helping farmers turn crops into biodiesel hasn't been a failure, but it's hardly a success either, according to an entrepreneur involved in the project.
Whole Energy Fuels of Bellingham entered a settlement agreement last month to compensate the county for $143,000 in goods and services it failed to deliver in developing the county's canola-crushing system. The original $465,000 contract, signed in 2008, was to design, build and install the system.
Whole Energy CEO Atul Deshmane said technical difficulties hampered his company's ability to finish the work. So did turmoil in the biofuels market, which he said has since improved.
"This is the only project of its kind in the country, so I'd like to see it succeed," Deshmane said. "I wouldn't call it a failure, but it's not a success."
County leaders have said that the equipment, shop drawings, manuals and training they expect to get from Whole Energy under the settlement will more than offset the county's loss. County spokesman Christopher Schwarzen said that Whole Energy has begun purchasing those items, and that "we are pleased to see this moving forward."
What's not so clear is how well the long-term effort to grow and process local biofuel crops will fare.
The canola crusher was the most visible project to grow out of a biodiesel initiative that County Executive Aaron Reardon announced in 2005.
"Biodiesel fuel offers the potential to open up new opportunities for local farmers and businesses," Reardon said at the time.
By 2008 the county had lined up about $1.2 million in federal, state and county money. That paid for a 15-ton-per-hour grain dryer that runs off methane from the old landfill and the Whole Energy contract for a 24-ton-per-day canola seed crusher.
Reardon has made supporting local agriculture a cornerstone of his administration. Upon taking office in 2004, one of his first acts was to appoint an agriculture coordinator. For eight years, the county has hosted the Focus on Farming conference, and a ninth is scheduled for November.
But tangible, government-driven progress toward remaking the county's agricultural landscape has been harder to achieve. The canola crusher may be a case in point.
The original plan was to have private companies run the operation. But the county has received little interest. For the past two years, county employees have been running the crusher and dryer.
Reardon spent much of 2011 focusing on winning re-election to a third term. In recent months, he's laid low as the Washington State Patrol investigates allegations that he's engaged in official misconduct using public money.
The last time Reardon was talking about energy projects was to claim that was the reason he'd talked so often during the work day with the campaign finance consultant who helped him raise $400,000 for the campaign. Reardon claimed he and the man were exploring a project to turn landfill gas into energy. The executive produced no documents outlining the proposal, however.
Meanwhile, farmers' interest in the crusher has fallen short of expectations.
In 2010, for example, local farmers were only growing about a tenth of the oilseed crop originally envisioned. Some farmers have complained that agricultural land here in Snohomish County is too pricey for such low-value crops.
Despite the setbacks, County Councilman Dave Somers still sees potential in the project. While Whole Energy may have "gotten in over their heads," Somers believes the original idea is sound.
"It's much smaller scale than we had hoped -- that could change with the energy situation," Somers said.
Washington State University and other institutions might be interested in the project for alternative fuels research, Somers said.
The biodiesel initiative is on a list of county projects the County Council expects to be updated about soon, to see whether programs are meeting their original goals. Other items on the list are the county's agricultural and housing plans.
"We have come up with a list of things we've done over the years, comparing what we wanted to do when we started and where we are now," Councilman Dave Gossett said. "It's not like this was singled out, but yes there is interest in it."
Noah Haglund: 425-339-3465, nhaglund@heraldnet.com.

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