United States Department of Agriculture

Forest 

Service

Pacific Northwest 

Research Station

General Technical Report

PNW-GTR-922

February

2016

Case Study Comparison of 

Two Pellet Heating Facilities 

in Southeastern Alaska

David Nicholls, Allen Brackley, Robert Deering, Daniel Parrent, 

Brian Kleinhenz, and Craig Moore
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Authors

David Nicholls is a forest products technologist and Allen Brackley is a research 

forester, U.S. Department of Agriculture, Forest Service, Pacific Northwest 

Research Station, Forestry Sciences Laboratory, 204 Siginaka Way, Sitka, Alaska 

99835; Robert Deering was a transition framework biomass specialist, Alaska 

Region, Tongass National Forest, Juneau, Alaska 99901 (currently with the 

U.S. Coast Guard); Daniel Parrent is a program manager, U.S. Department of 

Agriculture, Forest Service, biomass utilization and forest stewardship, Alaska 

Region, State and Private Forestry, 161 East 1st Avenue, Door 8, Anchorage, 

Alaska 99501; Brian Kleinhenz, is a natural resources manager, Sealaska Corporation, 4340 North Douglas Highway, Juneau, Alaska 99801; Craig Moore is 

vice president, Tlingit-Haida Regional Housing Authority, 5446 Jenkins Drive, 

Juneau, Alaska 99801.

This publication is the result of a joint venture agreement (2014-JV-11261935-061) 

between the USDA Forest Service Pacific Northwest Research Station and the 

University of Oregon.

Cover: David Nicholls
Abstract

Nicholls, David; Brackley, Allen; Deering, Robert; Parrent, Daniel; 

Kleinhenz, Brian; Moore, Craig. 2015. Case study comparison of two pellet 

heating facilities in southeastern Alaska. Gen. Tech. Rep. PNW-GTR-922. 

Portland, OR: U.S. Department of Agriculture, Forest Service, Pacific 

Northwest Research Station. 23 p.

Over the past decade, wood-energy use in Alaska has grown dramatically. 

Since 2000, several dozen new wood-energy installations have been established, 

with numerous others in the design or construction phase. This case study report 

compares two wood-pellet heating systems in Juneau, Alaska. The Tlingit-Haida 

Regional Housing Authority, a native housing authority that serves more than 

27,000 tribal residents in 11 communities in the southeast, recently established 

a wood-pellet boiler to provide heating to their 10,000-square-foot warehouse. 

The Sealaska Corporation is an Alaska Native Corporation that recently 

installed a wood-pellet system to heat its 58,000-square-foot office building in 

downtown Juneau. In this case study, we consider the ongoing efforts of both 

organizations to advance wood energy in southeast Alaska. We review the wood 

energy conversion process—including the motivation for change, feasibility 

work, construction, system operation, and lessons learned.

Keywords: Wood energy, pellets, Alaska, rural, community, Tlingit-Haida 

Regional Housing Authority, Sealaska Corporation, Alaska Native Corporations.
Contents

1 Introduction 

3 Case Study 1: 

Tlingit-Haida Regional Housing Authority Warehouse (Juneau, Alaska)

3 Background

3 Motivation for Wood Energy

5 System Implementation

6 Operation

8 Fuel Calculator Results

10 Future Operation and Prospects

12 Conclusions

13 Case Study 2: 

Sealaska Corporation (Juneau, Alaska)

13 Conversion Process

13 Motivation for Change and System Implementation 

14 System Operation

18 Future Operations and Prospects

19 Conclusions

21 Discussion 

22 Metric Equivalents

22 References
1

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

Introduction 

Over the past decade, wood-energy use in Alaska has grown dramatically. Confronted 

by high fuel costs, many communities in rural Alaska have committed to renewable 

energy. Since 2000, several dozen new commercial-scale wood-energy systems have 

been installed in schools, government buildings, and other facilities (table 1) in various locations throughout Alaska ranging from Craig in the southeast to areas north 

of Fairbanks in the interior. This growth has been facilitated in part by numerous 

feasibility studies that outlined the economic, environmental, and social importance 

of community-scale wood energy. Several other important drivers have helped spur 

this growth, serving as catalysts for wood-energy development in Alaska. Among 

these are financial support from the Alaska Energy Authority, professional support 

from numerous partners and government agencies, and prefeasibility study reviews 

Table 1—Wood energy systems in Alaska, both operating and under construction, as of July 2014

Location Host site

Number of 

systems Wood-fuel type System selected

Coffman Cove School 1 Cordwood GARN system

Craig School and swimming pool 1 Sawmill residues Chiptec chip system

Delta Junction School 1 Sawmill residues Messersmith chip system

Elim Water plant 1 Cordwood GARN PAK model 2200 system

Fort Yukon University of Alaska at 

Fairbanks

1 Cordwood Tarm system

Galena Senior center 3 Cordwood Tarm Innova Solo 50 system

Gulkana Village council 2 Cordwood and 

pellets

GARN cordwood and Tarm 

pellet systems

Haines Chilkoot Indian Association 2 Pellets Pellergy system

Haines Senior center 1 Pellets Okafen boiler

Ionia Ionia, Inc. 1 Cordwood GARN system

Juneau Tlingit-Haida Regional Housing 

Authority

1 Pellets Maine Energy Systems

Juneau Sealaska Plaza 1 Pellets KÖB pellet boiler

Ketchikan U.S. Forest Service discovery 

center

1 Pellets and chips Hurst boiler

Kasaan School 1 Cordwood GARN system

Ketchikan Federal building 1 Pellets ACT Bioenergy system

Ketchikan Public library 1 Pellets ACT Bioenergy system

Kokhanok Lake and Pen Borough 1 Cordwood GARN system 

Tanana Washeteria 3 Cordwood GARN/Econoburn systems

Tetlin School 3 Cordwood Tarm Innova Solo system 

Yakutat Tlingit-Haida Regional Housing 

Authority

1 Cordwood WoodMaster/Woodgun
2

GENERAL TECHNICAL REPORT PNW-GTR-922

by the Alaska Wood Energy Development Task Group during the initial phases of 

wood-energy planning.

Most of the systems have been thermal, providing heat to schools, woodproducts facilities, federal buildings, libraries, senior centers, and other community 

buildings. However, at least one facility (the school district in Tok) has installed a 

cogeneration system that supplies both heat and electricity. 

The employment benefits of wood energy in Alaska, although modest statewide, can be significant at local levels. For example, several communities require 

part- or full-time labor to monitor and perform routine maintenance, and in some 

instances, “stoke” their systems. Other communities experience increased employment in logging, transportation, and manual splitting of cordwood. Concurrent 

with the trend of community-scale wood energy has been an increased use of wood 

for heating residential units. An estimated 6 percent of households are heated with 

wood (U.S. Census Bureau 2013)—historically, more often cordwood than pellets 

(Nicholls et al. 2010)—with usage likely highest in the southeast. 

Across Alaska, wood-energy use is increasing for both residential heating 

and small industrial-scale operations, and pellet systems have recently begun to 

contribute to that growth. Much of this motivation has stemmed from very high 

energy prices for heating homes and other community buildings—and this is 

particularly apparent in rural Alaska. After more than a decade of growth and 

learning, wood-energy use in Alaska is now entering a “second generation,” and 

with it comes a strong need to summarize the success stories and lessons learned 

from the early adopters. 

Growth in wood-energy use has been aided by funding from the state of 

Alaska’s renewable energy fund, which has provided millions of dollars to develop 

an array of renewable-energy projects. However, state funding is currently (2015) 

uncertain on many fronts. Ultimately, the hope is that wood-energy projects that 

once required subsidies will become economically attractive on their own financial 

merits without the need for subsidies. The experiences, trials, and successes of 

Alaska’s current wood-energy systems will help this development path.

Both of the wood-pellet systems reviewed in this case study could be considered 

as early adopters; however they differ widely in their system designs and heating 

needs. This case study considers both systems—evaluating motivations for wood 

energy, project development, and system operation—with the goal of benefiting future 

communities who are adopting similar installations. Thus, a primary objective of this 

paper is to provide valuable information as part of the “learning curve,” and to help 

inform future wood-energy adopters. We do this by evaluating operational data for 

each system, as well as conducting an economic analysis of the potential cost savings.
3

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

Case Study 1: Tlingit-Haida Regional Housing Authority 

Warehouse (Juneau, Alaska)

Background

The Tlingit-Haida Regional Housing Authority, headquartered in Juneau, was 

established by the Central Council of the Tlingit-Haida Indian Tribes of Alaska in 

1973 to serve nearly 29,000 members in southeastern Alaska (CCTHITA 2014). Its 

programs include funding for home ownership, rental-unit leasing, house repairs, 

weatherization services, assistance for elders, and youth programs (THRHA 2014). 

Pursuing renewable-energy projects is consistent with its mission of helping members become self-sufficient and empowering the communities it serves to manage 

local resources sustainably and create new jobs.

Motivation for Wood Energy

Several factors have stimulated efforts by the Tlingit-Haida Regional Housing 

Authority to increase use of wood energy. One of the primary motivations has been 

the high cost of fuel (primarily heating oil) in the villages it serves. Many of these 

communities experience heating-oil prices that are often high or widely variable (or 

both). Use of wood energy would not only help lower fuel prices through use of 

biomass in place of more expensive fossil fuels, but would also boost employment 

in underserved communities and retain money in those local economies. The 

Housing Authority was able to benefit from synergies created with Sealaska CorpoFigure 1—At the Tlingit-Haida Regional Housing Authority, a primary motivation for using wood 

energy has been the high cost of fuel (primarily heating oil) in the rental units it manages and the 

villages it serves. Many of these communities experience heating-oil prices that are often high or 

widely variable (or both). 

Tlingit-Haida Regional Housing Authority
4

GENERAL TECHNICAL REPORT PNW-GTR-922

ration, which was already using wood pellets to heat its corporate offices in downtown Juneau. The existence of the Sealaska system reduced the need to find a 

separate fuel supplier and delivery system, as both systems could be serviced 

together. Integral to the decision-making process were the efforts of the management team and local partners. Project champions included Craig Moore, vice 

president of planning and development, and Ricardo Worl, president and chief 

executive officer, Tlingit-Haida Regional Housing Authority; Nathan Soboleff, 

former renewable energy program manager, Ha-Ani LLC (a subsidiary of Sealaska 

Corporation); and Bob Deering, environmental and engineering manager, U.S. 

Coast Guard.

Figure 2—The wood-pellet burner installed by the Tlingit-Haida Regional Housing Authority at its 

warehouse in Juneau, Alaska.

David Nicholls
5

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

Table 2—Timeline for the wood-pellet heating system installed by the 

Tlingit-Haida Regional Housing Authority at its warehouse in Juneau, Alaska

Month and year Milestone

June to December 2011 Initial planning 

January 2012 Decision on type of wood feedstock

January to June 2012 Detailed feasibility and design

June to July 2012 Equipment selection

September 2012 Construction underway/system in place

April 2013 Construction completion

May 2013 System startup

May 2014 Completion of first heating season 

December 2014 Completion of first full calendar year of operation 

1 The use of trade or firm names in this publication is for reader information and does not 

imply endorsement by the U.S. Department of Agriculture of any product or service.

System Implementation

The wood-energy conversion process consisted of several steps, including a preliminary feasibility assessment, a detailed feasibility study, project financing, a fuel 

supply assessment, equipment selection, permitting, and construction. During the 

preliminary feasibility assessment, Housing Authority managers evaluated several 

potential wood-fuel sources and system types and determined that wood pellets 

would be the most appropriate fuel for their installation despite cheaper purchase 

costs for other wood-fuel types. Factors in favor of pellets included higher transportation efficiency, higher combustion value, and less system maintenance. 

The wood-pellet system was installed as part of a new warehouse construction 

completed in 2013 (table 2). The system uses a hydronic heating system coupled 

with a heat exchanger. Housing Authority managers researched vendors of pellet 

combustion systems, selecting Maine Energy Systems,1 a company with a wellestablished reputation in Europe for proven reliability, durability, low maintenance, 

and high efficiency. An additional benefit of purchasing a high-quality boiler was 

the opportunity to showcase the system to other communities, thereby serving a 

valuable demonstration function. Maine Energy Systems is licensed to distribute 

the Okofen wood-pellet systems, which was established in Europe almost 20 years 

ago, and has more than 45,000 customers worldwide (Okofen 2014).
6

GENERAL TECHNICAL REPORT PNW-GTR-922

The cost of the combustion system was almost $65,000 (table 3). However, 

when the control system, distribution system, and other accessories were taken 

into consideration, the total cost approached $215,000. Financing was negotiated 

through the American Recovery and Reinvestment Act (ARRA 2009). 

With this new system, Juneau doubled the number of commercial facilities 

heated by wood pellets, including the system at Sealaska Plaza. A third facility, 

Sealaska Heritage Institute in Juneau, came online in May 2015. These systems 

are helping generate a small economy of scale for use of wood pellets, creating a 

synergy for future systems while potentially lowering costs by increasing overall 

pellet consumption. This is already evidenced by the shared use of delivery trucks 

and of common pellet unloading and storage methods at the port of Juneau.

Operation

Pellet transport—

Most of the pellets are transported from a manufacturing facility in Tacoma, 

Washington, with the remainder coming from a pellet mill in Ketchikan (about 

300 miles to the south). Fuel handling and transport continues to be an important 

consideration, especially with an anticipated increase in pellet volume in the Juneau 

area. The pellets are carried by a delivery truck owned by Sealaska Corporation. 

Alaska Marine Lines, which has become a key partner in this effort, designed a 

special container to facilitate bulk transfer of pellets and agreed to allow pellets to 

be stored for up to 30 days without charging demurrage (Soboleff 2011). 

Table 3—Specifications of the wood-pellet boiler 

installed by the Tlingit-Haida Regional Housing 

Authority at its warehouse in Juneau, Alaska

Specification Description

Year established 2013

System size 191,000 BTUs per hour

Installed costa $65,000 

Wood pellet consumption 22 tons per year

Fuel storage capacity 10 tons

Fuel type Pellets

Primary fuel source Tacoma, Washington

Equipment vendor Maine Energy Systems

Area heated (warehouse) 10,000 square feet

Wood pellet cost $300 per ton

a

 Cost of wood-pellet system only; including the costs of the control 

system, distribution system, and other accessories would bring the total to 

nearly $215,000.

BTUs = British thermal units.
7

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

Fuel storage and handling—

A 10-ton outdoor silo was built for onsite pellet storage. Fuel is loaded into the silo 

by auger delivery using the truck owned by Sealaska Corporation. Because the 

delivery truck can carry more than 10 tons of pellets, the silo can be filled to 

capacity for each delivery. The pellets are transferred by pneumatic conveyor to a 

day hopper located inside the warehouse next to the pellet system. The day hopper 

is an integral part of the boiler system because it serves as a small buffer immediately before the pellet combustion chamber. Using a vacuum system rather than an 

auger reduces the number of mechanical parts for easier maintenance. Wood pellets 

are transported by auger the short distance from the day hopper to the combustor.

Figure 3—Exterior shot of the 10-ton wood-pellet silo installed by the Tlingit-Haida Regional 

Housing Authority at its warehouse in Juneau, Alaska.

David Nicholls
8

GENERAL TECHNICAL REPORT PNW-GTR-922

Pellet combustion—

Pellets are burned in an underfeed combustion chamber. A precise amount of 

wood is metered onto the combustion plate, which is initially ignited electronically. Once combustion is established, hot combustion gases are fed to a heat 

exchanger that is coupled to a hydronic heating system and then out through the 

powered exhaust vent on the side of the building. The heat exchanger tubes are 

automatically scoured by an integrated turbulator cleaning device, which periodically removes ash from the heat transfer tubes. Another function of the turbulator 

is to increase turbulence in the flue gas flow within the heat exchanger, thus 

increasing the efficiency of the heat transfer process. A variable-speed induced 

draft fan, which provides airflow through the system, required some adjustments 

early on to correct a clogged auger at the bottom of the storage silo (most likely 

a weather-related moisture problem). This problem was easily remedied and has 

not resurfaced.

Emissions control—

No emissions control devises were needed because the design and high efficiency 

of the pellet system ensures clean burning. Small amounts of smoke are sometimes present on system startup. One modification that is planned for the system 

is to replace the powered exhaust system with a more traditional flue pipe system 

extending past the roof line. The powered exhaust, which blows flue gases out of the 

wall of the building approximately 10 feet above the ground surface, was deployed 

as an attempt to reduce capital costs and avoid penetrating the roof membrane, but 

smoke during system startup has been leaking into the building.

Ash management and disposal—

An ash auger automatically transfers any ash that is formed in the burn chamber 

into the adjacent ash bin. Ash management requires very little work, with removals 

of about a gallon equivalent every two weeks during the intensive heating season 

(typically December through February). The system came with an ash compression device in the ash box, which reduces the frequency of ash disposal. The small 

amounts of ash generated are discarded as normal waste.

Fuel Calculator Results

Numerous factors will influence the performance of the pellet system, chief among 

them being total fuel costs. The fuel calculator developed by the vendor (Maine 

Energy Systems 2015) was used to evaluate these factors at five levels of pellet use. 

A 2 percent inflation rate was assumed, as was a $65,000 system cost. The pellet 

price range for the evaluation was $220 to $380 per ton. At a usage of 25 tons per 

year, annual savings (versus heating oil costing $4.50 per gallon) ranged from 
9

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

$5,090 to $9,105 and total energy savings over a 25-year planning horizon ranged 

from $166,297 to $297,461 (table 4). The range for evaluating annual pellet consumption was 20 to 50 tons per year, which reflects the higher end of annual pellet 

usage and allows for additional pellet use to heat other buildings on an expanded 

heating loop. At that usage, annual savings ranged from $5,873 to $14,267 and total 

energy savings over a 25-year planning horizon ranged from $191,887 to $466,114 

(table 5). Heating oil was not evaluated directly, but any future increases in oil 

prices will undoubtedly make pellets more economically attractive, assuming that 

pellet prices remain stable (as was the situation in 2007 when oil prices spiked). 

Both tables reflect the impact of wood-pellet cost and of wood-pellet consumption 

on project economics. The Maine Energy Systems fuel calculator, although developed by the equipment manufacturer, is expected to provide meaningful results for 

the purposes of this case study.

Table 4—Projected savings with variable pellet costs 

for the wood-pellet system installed by the TlingitHaida Regional Housing Authority at its warehouse in 

Juneau, Alaskaa

Pellet cost per ton Annual savings 

Total savings 

over 25 years 

U.S. dollars

220 9,105 297,461

260 8,101 264,670

300 7,097 231,879

340 6,094 199,088

380 5,090 166,297

Source: Maine Energy Systems 2014.

a

Assumptions: the inflation rate is 2 percent, 25 tons of pellets are consumed 

per year, the equivalent oil use is 3,250 gallons per year, heating oil cost is 

$4.50 per gallon, and the installed cost of wood-pellet system is $65,000.

Table 5—Projected cost savings over 25 years for the wood-pellet 

system installed by the Tlingit-Haida Regional Housing Authority at its 

warehouse in Juneau, Alaskaa

Annual pellet 

consumption Equivalent oil use Annual savings 

Total savings 

over 25 years 

Tons Gallons - - - - - - - U.S. dollars - - - - - - -

20 2,680 5,873 191,887

30 3,870 8,481 277,091

40 5,160 11,308 369,455

50 6,510 14,267 466,114

a

Assumptions: the inflation rate is 2 percent, the cost of pellets is $300 per ton, the cost of oil is 

$4.50 per gallon, and the installed cost of wood-pellet system is $65,000. 
10

GENERAL TECHNICAL REPORT PNW-GTR-922

Future Operation and Prospects

The Tlingit-Haida Regional Housing Authority manages residential housing programs in 12 communities across southeastern Alaska. Forests owned by Alaska 

Native corporations are often close to communities, where the need for rural 

employment is substantial. These factors are increasing interest in expanding the 

wood-energy model to communities beyond Juneau. Below is the status of expansion effort as of December 2014.

Lemon Creek (Juneau)—

With the warehouse wood-pellet system having completed its initial heating 

season—nearly 8 tons burned from May 2013 to December 2013 followed by 

about 22 tons in 2014—the Housing Authority is contemplating an expansion of 

the system to include a heating loop to a second building across the street from 

the warehouse. If new buildings were to be constructed on several vacant lots 

adjacent to the warehouse, they also could be heated with wood, either through a 

district heating loop or with additional stand-alone systems. Additional buildings 

would have the potential to greatly increase the heating demand and the tons of 

pellets burned.

Yakutat—

A cordwood system is installed and has been in use at the Yakutat senior center 

since 2013. This system is heated with a Wood Gun E-180 cordwood boiler (Alternate Heating Systems), which includes underground piping to the mechanical 

room. A flat plate heat exchanger is used, with two Tarm 400-gallon buffer tanks 

housed in the mechanical room. An oil boiler serves as the backup system. The 

system requires properly sized fuel dried to an optimal moisture-content level for 

best operation. During the initial heating season (2013 to 2014), some sizing and 

moisture-content problems were encountered, but these will be resolved before the 

second heating season.

Kake—

Another proposed expansion is in Kake, a community that experiences heating-oil 

prices that are often high or widely variable (or both). Efforts are now underway to 

replace oil boilers with wood systems in 17 housing units, expected to reduce 

heating costs by 38 percent (THRHA 2012). Work is underway to install several 

residential units in Kake as well as a district heating loop for a senior center with 

the option to include a school complex later. Mayor Henrich KaDake has been a 

project champion for the system. 
11

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

Angoon—

A feasibility study is nearing completion for a wood-energy installation in the community of Angoon. The proposed system would include a district heating loop and 

would provide residential heating for nearly 80 residents. Importing pellets is the most 

likely option because the community is surrounded by Admiralty National Monument 

where harvesting wood is not permitted. The feasibility study will evaluate the 

technical and economic options for their 

wood-energy system. A subdivision 

with 22 housing units could become 

part of a single district heating loop—

single family units, an elders housing 

unit, and a senior center. This means 

that a broad cross section of the Angoon 

community would be served with one 

heating system. The Angoon system is 

unique in that it would become the first 

residential heating loop of this scale in 

southeastern Alaska. 

Craig and Klawock senior centers—

Klawock and Craig are communities on Prince of Wales Island in southeastern 

Alaska that are separated by fewer than 10 miles. The Municipal Housing Authority 

is considering wood energy to heat the senior centers in both locations, replacing 

Figure 4—Cannery at Kake. 

Library of Congress

Figure 5—Energy Cents movie day at Angoon, where residents pledged to keep 

thermostats below 68 °F and water heaters below 120 °F. 

Tlingit-Haida Regional Housing Authority
12

GENERAL TECHNICAL REPORT PNW-GTR-922

fuel-oil systems. Because local wood residues are abundant, viable options include 

pellet, chip, or cordwood systems. A final decision on fuel type and other operating 

parameters is imminent, after the two feasibility studies now underway are completed. Other operating wood-energy systems on Prince of Wales Island (including 

a chip-fired school heating system in Craig) could create fuel-supply opportunities 

and synergies for the senior centers.

Conclusions

The Tlingit-Haida Regional Housing Authority is providing significant economic 

and social benefits to its members in southeastern Alaska. It has already installed 

two successful wood-energy systems (in Juneau and Yakutat) and has plans to 

expand to Kake, Craig, and Klawock. This effort is promoting more self-sufficiency, 

sustainable use of local resources, and job creation in underserved communities. 

Converting their building inventory to wood energy could provide the “critical 

mass” within communities to allow other facility owners to make a similar switch. 

Bringing in new fuel supplies and system-support networks can have a powerful 

catalyzing effect for these communities. 

The flagship wood-energy system at the construction warehouse in Juneau is 

already providing tangible benefits and demonstrating effective use of wood energy. 

Using wood-pellet fuel is providing a synergy with Sealaska Corporation, which 

recently installed a pellet boiler at its downtown Juneau location. 

The future of wood energy for the Tlingit-Haida Indian Tribes is bright. They 

have several wood-energy projects underway and are already realizing cost 

savings and employment benefits. They are integrated 

into a strong network of agency and partner support in 

Alaska. They are pursuing flexible fuel types (pellets, 

chips, and cordwood) tailored to locations and available resources. They are also exploring different 

wood-energy configurations depending on specific 

needs (including residential stand-alone systems, small 

industrial-scale stand-alone systems, and district 

heating loops). As with all startup ventures, the effort 

faces many challenges, for example developing the 

critical mass for efficient and cost-effective biomass 

supply and distribution chains.

Figure 6—A demonstration for the U.S. Forest Service staff by 

Craig Moore at the Tlingit-Haida Regional Housing Authority. 

Tlingit-Haida Regional Housing Authority
13

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

Case Study 2: Sealaska Corporation (Juneau, Alaska)

Established in 2010, the Sealaska system is the oldest small industrial pellet system in southeastern Alaska, having accumulated four heating seasons 

worth of operating data. Its 220-kilowatt (750,000 British thermal units [BTUs] 

per hour) wood-pellet boiler provides heat to the 58,000-square-foot Sealaska 

Plaza, annually replacing roughly 35,000 gallons of oil with 280 tons of pellets. 

Already, this wood-energy system is guiding the establishment of new facilities 

in Juneau and Ketchikan. 

Conversion Process

The Sealaska project was the first pellet installation of its kind in Alaska. Sealaska 

began the conversion process by evaluating the demand for pellets in Alaska. 

Market research showed that 39 percent of the 82 retailers in Alaska sell pellets in 

40-pound bags; that most of the demand for pellets is in areas outside southeastern 

Alaska; that pellet manufacturers are largely from Oregon, Idaho, Washington, 

Missouri, and Canada; and that a pellet mill near Fairbanks started production in 

2010 (but has not supplied pellets to Sealaska). Sealaska also did extensive research 

on pellet boiler manufacturers, and decided on a “top-of-the-line model,” partly 

because of limited space in the Sealaska boiler room and partly because a reliable 

system was a top priority. A significant part of the total project cost was incurred 

for infrastructure improvements and site work. 

Nathan Soboleff, former renewable energy program manager, Haa Aaní, LLC 

(a subsidiary of Sealaska Corporation) and Rick Harris, executive vice president, 

Sealaska Corporation, championed the conversion process and worked steadily over 

several years to spearhead efforts for the new system.

Motivation for Change and System Implementation 

Several factors led Sealaska Corporation executives to consider installing the woodpellet system to replace their aging fuel-oil system. First, the corporation had long 

been in the timber business and was anticipating the benefits of its second-growth 

forestry and timber operations, with large volumes of harvesting residues and other 

wood wastes expected in the coming decades. These wastes could be used to help 

stimulate a biofuels industry in southeastern Alaska and could be manufactured 

into wood pellets, chips, or other densified products such as “biobricks.” Although 

the potential has always existed for pellet production in the southeast, the initial 

supply has been shipped from Washington. Following the Sealaska model, several 

other wood-pellet energy systems have since been installed and are operating in 

Ketchikan, creating additional regional demand for wood pellets. 
14

GENERAL TECHNICAL REPORT PNW-GTR-922

Sealaska Plaza is a 58,000-square-foot facility located in downtown Juneau, and 

is home to the Sealaska Corporation, an Alaska Native corporation. Before 2010, it 

was heated with a fuel-oil system built in 1976. Situated near the high-tide mark for 

the Juneau waterfront, this outdated system could have posed environmental risks in 

the event of a leak. Another factor that Sealaska executives considered was the rapid 

escalation in heating-oil prices in 2006 and 2007. Given these conditions, the decision 

was to “lead by example” and install a new wood-energy system. Sealaska executives considered a variety of wood feedstocks—including chips, densified “pucks,” 

and “biobricks”—before settling on wood pellets. Factors in favor of pellets included 

better control over moisture content and more efficient transportation. Together, these 

more than compensated for the higher delivery cost of wood pellets. Given the small 

area available for a wood-energy system and the need for reliable operation, Sealaska 

invested the extra amount needed for a high-quality pellet system.

The new system became operational in November 2010—the first small 

industrial-scale wood-pellet boiler in the southeast and a demonstration model for 

other organizations. The following timeline describes major events in the startup of 

the Sealaska system (Soboleff 2011):

• Autumn 2009 Emerging Energy Technology Grant awarded to Sealaska

• December 2009 Official news release announcing wood-pellet system

• May 2010 Bulk delivery truck in place

• October 2010 Boiler in place

• November 2010 Boiler startup

System Operation

The Sealaska system burns nearly 280 tons of premium grade wood pellets per year, 

eliminating the need for 35,000 gallons of heating oil (Grass 2010). Its Viessmann 

(2012) Pyrot boiler—rated as 750,000 BTUs per hour (the equivalent of 220 kilowatts)—operates at 85 percent overall efficiency (ACEP 2013). The pellet system 

provides energy for both heating and hot water to Sealaska Plaza (tables 6 and 7).

Routine maintenance includes manual removal of clinkers from the firebox and 

periodic cleaning of the firetubes with a pneumatic cleaner. Ash is automatically 

conveyed into a small storage bin and is periodically given to local gardeners and 

other organizations (Soboleff 2011). Once a year, the flue gas filters are removed and 

steam cleaned. 

During the first year of operation, an electrical backup system was 

installed, eliminating any need for the old oil system. Relatively few startup 

operational problems occurred, although some issues have been encountered 

since (noted below).
15

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

Fines management and fuel quality—

On rare occasions fines that accumulate in the silo result in clogging, which can 

lead to a boiler shutdown. This is a problem that can be easily fixed by manually 

removing the fines (Soboleff 2011) or mitigated by purchasing wood pellets with 

low levels of fines and a high durability index. Pellets must be kept dry during storage to prevent problems with the pellet feeding system.

System outages—

Sealaska reports that on several occasions during the first heating season, high 

winds extinguished the wood pellets in the combustion chamber. This was remedied by simple modifications to the flue, and has not been a problem since.

Table 6—System cost for the wood-pellet boiler 

installed by the Sealaska Corporation in Juneau, Alaska

Component Cost 

U.S. dollars

Wood pellet boiler 524,400

Electric heating system 119,000

Site work and boiler room renovationa 164,750

Contingency and overhead 484,000

Concrete silo 56,500

Total 1,348,650

a

 Includes substructure, exterior closure, interior construction, and mechanical 

and electrical work.

Source: Alaska Energy Engineering LLC.

Table 7—Operational overview of wood-pellet boiler installed by the 

Sealaska Corporation in Juneau, Alaska

Specification Description

Year established 2010

System size 220 kW (750,000 BTU per hour)

Installed cost $1.35 million

Wood-pellet consumption 250 metric tons per year

Fuel storage capacity 19 tons (900 cubic feet)

Fuel type Premium wood pellets

Fuel source Primary: Tacoma, Washington

Secondary: Ketchikan, Alaska

Amount of heating oil not burned 30,000 to 35,000 gallons per year

Auxiliary energy type Electric

BTU = British thermal unit.
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GENERAL TECHNICAL REPORT PNW-GTR-922

Emissions control—

Given the downtown location of Sealaska Plaza, emissions control is an important 

concern from an aesthetic and human health perspective. No visible emissions have 

been reported, likely because keeping pellets dry during transport and storage has 

been an integral part of operations. 

Pellet transport—

Most pellets are transported from a manufacturing facility in Tacoma, Washington, 

with the remainder coming from a pellet mill in Ketchikan (about 300 miles to the 

south). During the first year of operation, Sealaska began using “supersaks” for 

delivery. Fuel handling and transport continues to be an important issue, especially 

Figure 7—The wood-pellet boiler system installed by the Sealaska Corporation in Juneau, Alaska.

David Nicholls
17

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

with an anticipated increase in pellet volume in the Juneau area. Sealaska owns the 

pellet delivery truck and is working to maximize this resource by developing more 

efficient pellet unloading and transportation processes. 

Alaska Marine Lines, which has become a key partner in this effort, has 

designed a special container to facilitate bulk transfer of pellets and has agreed to 

a 5-year contract that allows Sealaska to store pellets at their facility in Juneau for 

up to 30 days without being charged a daily use rate (Soboleff 2011). Local delivery 

by someone with a commercial driver’s license costs at least $100 per truckload and 

requires not only a time-consuming auger delivery but also a climb onto the storage 

silo. Therefore, continued efforts to streamline the pellet transport and delivery 

process will help reduce costs. 

Figure 8—Outdoor wood-pellet storage silo at Sealaska Plaza in downtown Juneau, Alaska.

David Nicholls
18

GENERAL TECHNICAL REPORT PNW-GTR-922

Pellet storage—

Sealaska is exploring options for bulk storage, including a small silo farm. Having 

pellet silos would reduce costs by eliminating the need for shipping in super sacks 

and would permit transloading from barge to delivery truck. It would also allow 

delivery truck drivers more flexibility in scheduling pickups (Soboleff 2011). Currently, a 19-ton pellet silo stores fuel adjacent to Sealaska Plaza. The silo is located 

less than 20 feet from the boiler room and the pellet burner. All fuel conveyance from 

the delivery truck to pellet silo and then to the boiler room is done by auger transport.

Future Operations and Prospects

Expansion—

Sealaska Heritage Institute Center (The Walter Soboleff Center) is a 29,500-squarefoot, three-story building located adjacent to Sealaska Plaza. It has a new woodenergy thermal system that is independent of the Sealaska Plaza system. The new 

system has benefited from the learning experiences of the Sealaska system. Several 

new features have been incorporated, including below-grade pellet storage in fabric 

“bunkers,” external delivery by means of a chute system, a thermal storage buffer 

tank, two pellet boilers that operate in a coordinated tandem lead-lag fashion, and 

an electric boiler backup. The initial heating season for the Soboleff Center woodpellet system is expected to be the autumn of 2015. 

Cost-saving measures—

Sealaska is exploring the possibility of training custodian staff to perform routine 

boiler firetube cleanings (less than $20 per hour) rather than using the current 

method, which involves a trained plumber (nearly $100 per hour). Most of the other 

periodic maintenance is performed as prescribed, through outside sources and 

contractors, with little opportunity for further cost reductions. 

With the growing inventory of Maine Energy System boilers being installed 

in Alaska, the company has offered to provide regional training classes for facility 

operators interested in performing their own boiler maintenance. This training 

typically takes about 5 hours to complete. 

Wood fuel handling—

Sealaska is interested in streamlining fuel handling (and therefore reducing costs) 

at several points in the delivery process. At the barge terminal in Juneau, pellets 

are unloaded into specially built fuel containers to facilitate transfer into delivery 

trucks. Sealaska is able to wait up to 30 days after arrival to take delivery of the 

pellets, which helps manage inventories in the onsite storage silo. Pellets are transferred in supersaks to delivery trucks, and then unloaded street-side into the pellet 

silo at Sealaska Plaza. One potential area for improvement is in the weighing of 

pellets. Presently, the delivery truck must be weighed before and after deliveries to 
19

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

determine the actual weight transferred—a metering device that could determine 

the actual weight unloaded would make this step more efficient (ACEP 2013).

A future step for Sealaska could be to establish a wood-pellet “silo tank farm.” 

Advantages of a tank farm are that at least one handling step would be eliminated 

and truck drivers would have more flexibility in setting delivery schedules. Additional pellet storage space would also be advantageous if Sealaska becomes a 

regional supplier of wood pellets.

Conclusions

The Sealaska facility was the first small commercial-scale pellet-boiler system in 

southeastern Alaska. Operational in 2010, it has served as a regional wood-energy 

demonstration site and has provided a real-world example for future facilities. Over 

the past 4 years, numerous visitors have toured the Sealaska pellet boiler, while others are reminded of its wood-energy presence daily as they drive past the outdoor 

pellet silo in downtown Juneau.

Through the first 4 years of operation, Sealaska has avoided using an average of 

35,000 gallons of heating oil per year (table 7). The net present value of cashflows 

associated with oil versus wood-pellet systems shows clear advantages for woodpellet systems at discount rates up to about 10 percent (fig. 10). Also, the economic 

advantages of using wood pellets (versus oil) are clear when pellets cost between 

$250 and $400 ton, assuming annual inflation is 2 percent over the next 30 years 

(fig. 2). Assuming zero inflation, the crossover point for net present value would be 

close to an 8 percent discount rate.

Perhaps the most significant role that the Sealaska system can play is to help 

stimulate wood-pellet use and infrastructure. Although system operation has 

proceeded smoothly, several “learning-curve” items have been solved, and lessons 

learned will be available to future facilities. 

Table 8—Pellet deliveries in 2010 and 2011 to the wood-pellet 

system installed by the Sealaska Corporation in Juneau, Alaska

Start date of delivery period Amount 

Tons

October 15, 2010 27.6

December 15, 2010 51.4

February 15, 2011 49.5

April 15, 2011 32.0

June 15, 2011 44.3

August 15, 2011 36.2

October 15, 2011 10.4

Source: ACEP 2013.
20

GENERAL TECHNICAL REPORT PNW-GTR-922

-

100,000

200,000

300,000

0 5 10 15 20 25 30

E

x

pecte

d annual fuel cost (U.S. d

ollars)

Year (year 1 = 2014)

Heating oil

Pellets at $250 per ton

Pellets at $300 per ton

Pellets at $350 per ton

Pellets at $400 per ton

Figure 10—Expected future fuel costs for heating oil versus wood pellets (assuming a 2 percent 

annual inflation for both fuel types) for the Sealaska Plaza, corporate headquarters of Sealaska 

Corporation in Juneau, Alaska.

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

3 5 7 9 11

Net present value (U.S. d

ollars)

Discount rate %

Pellets

Heating oil

Constants: 

Inflation rate = 2%

Pellet cost =

$85,000 per year 

Heating oil cost =

$151,000 per year 

Figure 11—Net present values of cashflows for wood-pellet versus heating-oil system reported by 

the Sealaska Corporation (assuming an annual inflation rate of 2 percent, pellet costs of $85,000 per 

year, and oil costs of $151,000 per year).
21

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

Discussion 

The past decade has seen significant growth in wood-energy use in Alaska, with 

more than 20 successful systems in operation, which not only provide a broad array 

of community benefits, but are also helping to clarify strategic planning goals for 

renewable energy in Alaska. For example, wide use of wood-pellet fuel in Alaska 

would require sufficient infrastructure and economies of scale. Once pellet transportation, supply, and storage systems are established, others would be able to use 

bioenergy systems with reduced startup costs and less challenging learning curves. 

This network must be fully developed before widespread use of pellet fuels will be 

economical in Alaska.

The presence of a local pellet production facility is perhaps the most vital chain 

in the link of wood energy development. Currently, most of the wood pellets burned 

in southeast Alaska are produced in the Pacific Northwest, then transported by barge 

more than 700 miles to their final markets. For extensive use of pellets to become a 

reality, a full-scale production facility would be needed, serving numerous markets 

and communities across southeast Alaska. Such a facility could create economies 

of scale while providing consumers an economically viable source of wood fuel and 

reducing or eliminating the need to ship fuel long distances. Further, local jobs would 

be created at the production facility, during pellet transport, and at wood energy 

facilities. At the same time, an overriding issue in the coming years will be finding 

markets for woody biomass from the Tongass National Forest—an issue of increasing 

importance as more and more second-growth trees reach merchantable size. Creating wood-pellet fuel from Tongass biomass will require careful examination of how 

wood quality (including the presence of bark and limbs) could influence pellet use.

This case study has examined two substantially different wood-pellet heating 

systems, finding that both can effectively serve different niches. The Sealaska 

system is a relatively large pellet burner supplying heat and domestic hot water to 

one of the larger office buildings in Juneau. The Tlingit-Haida Regional Housing 

Authority system is considerably smaller, running more intermittently and having greater seasonal variations. Yet both burners share the same pellet supply and 

distribution system and have common economic interests in greater regional use 

of pellets. Further, both systems are able to serve as demonstration sites, giving 

prospective wood-energy adopters a firsthand look at successful operation. Already 

this has helped establish another pellet burner in downtown Juneau (at the Walter 

Soboleff Center), with other units under construction elsewhere in Alaska. The 

environmental benefits of these burners, in terms of reduced greenhouse gas emissions, are substantial. Because nearly 300 tons of pellets are burned each year in 

Juneau, this translates to many tons of carbon dioxide already being avoided.
22

GENERAL TECHNICAL REPORT PNW-GTR-922

Perhaps the greates benefit in “testing the waters” with the two Juneau burners 

could be to evaluate whether pellets will indeed become a preferred wood-fuel type 

in southeast Alaska (versus chips, cordwood, or some other densified fuel). Time 

will tell how this story unfolds, and will depend on a host of yet unknown conditions, including markets for fuel oil, forest policy on the Tongass, the development 

path of production infrastructure, the role that Native corporations play, and the 

presence (or lack of) site-specific project champions. 

Metric Equivalents

When you know: Multiply by: To find:

Inches 2.54 Centimeters

Feet .3048 Meters (m)

Miles 1.609 Kilometers

Acres .405 Hectares

Tons .0907 Tonnes

Gallons 3.75 Liters

Pounds 454 Grams

Board feet .00566 Cubic meters

References

Alaska Center for Energy and Power [ACEP]. 2013. A review of commercialscale wood pellet boilers in southeast Alaska. 12 p. http://acep.uaf.edu/

media/62261/ACEP-Final-Project-Report.pdf. (July 15, 2014). 

Alaska Energy Engineering LLC. 2009. Life cycle cost analysis for Sealaska 

Plaza hybrid wood/electric heating system. http://acep.uaf.edu/media/62261/

ACEP-Final-Project-Report.pdf. (October 13, 2009).

American Recovery and Reinvestment Act [ARRA] of 2009. 2009. 

Homepage. http://www.gpo.gov/fdsys/pkg/PLAW-111publ5/html/PLAW111publ5.htm. (January 15, 2015).

Central Council of Tlingit and Haida Indian Tribes of Alaska [CCTHITA]. 

2014. Homepage. http://www.ccthita.org/. (Accessed July 26, 2014). 

Grass, J. 2010. Sealaska switches boiler system to pellet power. http://

juneauempire.com/stories/102710/loc_726731593.shtml. (July 15, 2014).

Maine Energy Systems. 2014. Homepage. http://www.maineenergysystems.com/. 

(July 26, 2014).
23

Case Study Comparison of Two Pellet Heating Facilities in Southeastern Alaska

Maine Energy Systems. 2015. Pellet fuel savings calculator. http://www.

maineenergysystems.com/savings_calculator.htm (January 15, 2015).

Nicholls, D.L.; Brackley, A.M.; Barber, V. 2010. Wood energy for residential 

heating in Alaska: current conditions, attitudes, and expected use. Gen. Tech. 

Rep. PNW-GTR-826. Portland, OR: U.S. Department of Agriculture, Forest 

Service, Pacific Northwest Research Station. 30 p.

Okofen. 2014. Okofen pellet heating. http://www.oekofen-usa.com/en-us/company.

html. (July 26, 2014).

Sealaska Corporation. 2012. Sealaska to convert plaza to biomass fuel. http://www.

sealaska.com/object/io_1259970973175.html. (July 15, 2014).

Soboleff, N. 2011. Sealaska Plaza’s wood pellet boiler and wood pellet delivery 

company. Presented at the Alaska Wood Energy Conference, Fairbanks, 

Alaska. ftp://ftp.aidea.org/2011AKWoodEnergyConference/4-27-2011_

Presentations/1030am-2_Soboleff_Sealaska.pdf. (July 15, 2014).

Tlingit-Haida Regional Housing Authority [THRHA]. 2012. Kake and Angoon 

alternative energy/biomass heating system project. https://omb.alaska.gov/

ombfiles/13_budget/CapBackup/proj58848.pdf. (July 26, 2014). 

Tlingit-Haida Regional Housing Authority [THRHA]. 2014. Homepage. http://

regionalhousingauthority.org/. (July 26, 2014). 



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