JAFFREY, N.H. (AP) – Charlie Niebling sees the closing of the Fraser Papers Inc. pulp mill in Berlin as part of a painful, but necessary shift from paper manufacturing to renewable energy development in the Northeast.

“Anything that grows ultimately can be turned into an energy-dense fuel that can be combusted cleanly,” Niebling said. “I think there’s a very bright future for the forests of northern New England as an energy source.”

Niebling, long a spokesman for responsible forest management as former executive director of the New Hampshire Timberland Owners Association, and former policy director at the Society for the Protection of New Hampshire Forests, is now advocating for policies favorable to alternative energy as public affairs coordinator for New England Wood Pellet LLC, of Jaffrey.

The company, which makes fuel pellets from compressed sawdust, can use waste sawdust from lumber mills. But to feed growing demand, it is buying more hardwood logs and chips, which it grinds and dries.

Even before Hurricane Katrina sent heating oil, propane and natural gas prices soaring last fall, pellet stoves were flying out of stores. New England Wood Pellet, the biggest fuel supplier in the region, was unable to meet the demand for its product.

It installed a third pellet-making machine last summer and will add another this spring, bringing its capacity to 100,000 tons a year. It also plans to build new plants in west-central Massachusetts and central New York State in the next year and a half, Niebling said.

“We think the future of pellet fuel isn’t in pellet stoves – it’s in large-scale boilers and furnaces” and electric generating plants, Niebling said. “We’re in the early phases of a technological revolution.”

That technology already is well-advanced in Europe, Niebling said. While there are regulatory hurdles to importing pellet-burning furnaces and boilers, he predicts those barriers will fall soon, thanks to a national push for greater energy independence.

“There’s just tremendous potential there that we’ve barely scratched the surface of,” he said.

At least one prominent innovator agrees. Dean Kamen, inventor of the Segway and head of DEKA Research & Development in Manchester, recently joined the board of New England Wood Pellet.

“He’s providing oversight and guidance” as the company expands, Niebling said.

Kamen could not be reached for comment.

On the Net:

New England Wood Pellet: http://www.pelletheat.com/