Nippon Paper Industries' $71 million cogeneration plant project for its Port Angeles mill in Washington will make the company more efficient, reduce overall air pollution and produce 20 megawatts of energy from forestry biomass that is residue from local timber operations, reports Peninsula Daily News.

Harold Norlund, Port Angeles mill manager, told the newspaper that Nippon estimates that the new boiler will cut overall pollutants from the company's paper-making process by 19 percent. This includes significant decreases in major pollutants such as carbon monoxide, particulate matter and sulfur dioxide, although emissions of two pollutants will increase slightly, he adds.

The mill now uses steam from one large biomass boiler, two smaller oil-fired boilers and an electric boiler, according to the article. The new plant will feature a new state-of-the-art steam boiler and a turbine generator, which will be capable of being powered by 100 percent biomass, and produce more steam than the previous one, enough to supply the paper mill and a 20-megawatt turbine generator, according to the article.

Nippon, which owns its own electrical power lines for transmission, plans to sell the power generated by the boiler as renewable energy to power companies.

In December last year, a consortium of manufacturers asked the Obama administration to set new rules requiring utilities to buy power from cogeneration plants.

The Port Angeles mill, which makes paper for telephone books, and other custom paper and newsprint, expects to begin construction later this year after environmental studies have been completed and state and local permits have been approved, according to the newspaper.

The boiler and other equipment should be ready for testing in the second quarter of 2012.

A portion of the company's $71 million investment is expected to be reimbursed up to 30 percent through federal grants. The company could be eligible for a $1.4 million loan and $600,000 grant from the U.S. Department of Commerce.