Louisiana sugar mill turns power company into customer

Lafourche Sugar President Greg Nolan stands next to the nearly 500 megawatt generator the mill recently installed
Lafourche Sugar President Greg Nolan stands next to the nearly 500 megawatt generator the mill recently installed

Thibodaux, La. -- Along Louisiana Highway 1, a business that dominates the landscape makes its own fog.

In a cooling pond, and in the giant mill itself, Lafourche Sugar lets off a little steam.  Actually, it's quite a bit of steam and in this place, steam is money.

"We produce all of our steam-generated power," said Greg Nolan, Lafourche Sugar's president.

In the fall, often until a few days after Christmas, the mill grinds sugar, squeezing the sweetness out of the cane stalk and feeding giant boilers. Steam rushing into a turbine produces electrical energy used in the sugar mill.

In fact, only a tiny fraction of the massive amount of power needed to produce sugar comes from the utility, Entergy.  The mill generates power on its own, a huge cost savings.

"It's what keeps us in business," Nolan said.  "If we had to use natural gas or coal, we would be out of the business."

The secret is bagasse, a fibrous bi-product of sugar left over when the sweet part is gone.

The problem for many sugar mills, including Lafourche Sugar, is too much bagasse.  In fact, it has a virtual mountain of bagasse, rising 60 feet high and stretching over a footprint of roughly 10 football fields.

Prior to Hurricane Katrina, the mill sold much of its excess bagasse to a wood products company on the west bank.  That facility is no longer in business, resulting in eight years of excess piled up outside the mill.

"We have some people who think they use a lot of bagasse until they come see the pile," Nolan said. "A truck load a week is not a lot of bagasse."

A couple years ago, Nolan read about a pilot project for renewable energy and saw an opportunity in that big bagasse pile.

The Louisiana Public Service Commission ordered utilities to effectively buy back power from some of those able to generate it.

Nolan figured bagasse was a renewable energy from 2,000 years ago: "Sugar cane dates back to 8 BC."

Lafourche Sugar found a used generator, invested over $3.5 million, and just in time for this grinding season, set up its own power operation.

It now produces just under five megawatts of electricity, or enough to power roughly 500 homes.

"We want to be a good neighbor to Lafourche Sugars," said Harry Shields, an Entergy customer service manager. "They're a good corporate neighbor to Entergy. We live here, they live here."

In recent decades, dozens of Louisiana sugar mills struggling against stagnant prices and rising costs have closed.  Finding a little cost savings can mean the difference between surviving and not.

"Financially, it's really not that important to Entergy," Shields said. "But we're helping Lafourche Sugars to stay in business."

While in the grinding season, the mill -- hungry for power -- is selling only a trickle of electricity back to Entergy.

"To get our feet off the ground, we wanted to do it just for the grinding season to start with," Nolan said.

Once the season ends, Nolan said the mill may feed some of that big bagasse mound into the boilers and sell more electricity back to Entergy.

While cautioning the renewable energy program is only part of the solution, Nolan also hopes to attract a customer to help eat into the leftovers piling up outside the mill.

"We're in it for the long term," Nolan said.