Sappi sells Presumpscot River hydropower sites to Dichotomy Power

The hydropower plant at Gambo Falls in Windham
may be one of the facilities that Sappi North
America has sold to Dichotomy Power LLC of
Buffalo, New York. FILE PHOTO  

Sappi North America Inc., a producer and supplier of diversified paper, packaging products and pulp, announced last week that it will sell its hydroelectric assets on the Presumpscot River in Maine to Dichotomy Power LLC, pending satisfactory completion of regulatory and other approvals.

According to a press release issued by the company, the transaction allows Sappi to focus on its core competencies and is consistent with Sappi's recent restructuring of its Westbrook site.
"We are happy to have found a strategic buyer in Dichotomy Power, a company with a wealth of expertise in this area, so that Sappi can continue to focus on its core competencies," said Mike Haws, President and CEO, Sappi North America.

Dichotomy Power LLC is a New York-based renewable-energy company engaged in the business of acquiring, renovating as needed, and operating eight hydroelectric assets in the United States, principally in the Northeast.

"Dichotomy Power is pleased to have reached an agreement with Sappi North America, Inc. to acquire their Presumpscot River hydroelectric facilities," said Ian Clark, CEO of Dichotomy Power LLC. "We are proud to carry on a history of successful traditions that started in 1878 with mechanical waterpower. Dichotomy looks forward to investing in the facilities to increase renewable energy production while honoring the commitments made to the agencies, communities, regulators and stakeholders who helped craft the new licenses."

The hydroelectric projects involved in the transaction were not named in the press release, but Sappi owns and operates two hydropower facilities in Windham at Gambo and Little Falls.

The Gambo Project has been used almost continuously for hydroelectric generation since its original construction around 1850. It was first developed as a sawmill in the 18th century by Jonathan Lovett and was later part of the Oriental Gun Powder Mill until around 1904. The current dam was constructed there in 1912 by E.I. duPont de Nemours Company, which used the site to manufacture wood flour for dynamite until 1950.

From 1950 to 1960, the Gambo site was owned by the Town of Windham, the U.S. Small Business Administration, and the Commercial Chemical Corp. In 1960, Lawrence Keddy started using the site to provide power to the Little Falls steel mill. He also sold some of the power generated there to Central Maine Power Company.

S.D. Warren (later renamed Sappi North America, Inc.) purchased the Gambo Project from the Commercial Chemical Corporation in 1974.

The Little Falls hydropower site has been used commercially since the 19th century. C.A. Brown and Company purchased the site in 1875 and constructed a wood board mill at that location. The Androscoggin Pulp and Paper mill purchased the property in the early 1900s and operated there for decades. Keddy purchased the site in the 1960s and used the power in his steel mill until S.D. Warren acquired the Little Falls site in 1974, and was later renamed Sappi North America, Inc.

The deal with Dichotomy Power is expected to close by the end of the calendar year subject to regulatory and other approvals.

Sappi North America, Inc. is an indirect wholly owned subsidiary of Sappi Limited, a global company headquartered in Johannesburg, South Africa, with more than 12,000 employees and manufacturing operations on three continents in seven countries and customers in over 150 countries.

According to its website, Dichotomy Power was founded in 2019 and “creates value for stakeholders by working alongside regulators and local communities to enhance the fundamental value embedded in each operated renewable energy facility while preserving the environmental and social contributions these assets carry.” The Buffalo, New York-based Dichotomy Power LLC corporation is backed by Greenbacker Capital Management. <