OXFORD — School officials are re-examining plans to build a biomass boiler at the Oxford Hills Comprehensive High School despite the current low cost of heating oil.

“It’s a very worthwhile project. But how can we do it with oil at $2 a gallon?” Superintendent Mark Eastman asked Tuesday.

The proposal to install a biomass gasification boiler at the high school was scrapped last fall after Gov. John Baldacci announced a $150 million curtailment of state funds for the fiscal year and the price of oil had dropped significantly enough to delay the project.

The proposed $1.5 to $2.2 million conversion project from oil to wood chips at the Oxford Hills Comprehensive High School was planned to address escalating fuel costs and to make the district more energy independent by reducing dependence on foreign oil sources. At that time, the move was initially expected to save more than $400,000 a year in energy costs.

“When oil drops to $2 a gallon you lose a lot of the savings,” Eastman said.

“We really liked the idea and biomass gasification (a burning process that, in this case, utilizes wood chips as fuel),” Eastman said.

He said school officials have taken three steps to try to make the project work. First, space would be utilized within the existing high school instead of building additional space to house the boiler.

“The first goal is to re-engineeer to save construction costs,” Eastman said.

Next, school officials would look for grants. Although that route was unsuccessful before, Eastman said another $7 million is opening up for these projects in January. “We’re excited about that,” he said.

Third, school officials would use qualified zone academy bonds that are underwritten by the Obama administration. The Oxford Hills School District would use Siemens Energy as the required partner. The savings could be anywhere from $274,000 to $700,000, Eastman said.

“That piece alone pays for the $2 a gallon price (of oil),” he said.

Eastman said school officials are now optimistic that the revised construction and new finance plan will make the numbers work.

“It’s a very worthwhile project in my mind,” said Eastman, who will work with other school officials over the next few months to prepare an application for academy bond grants and other work associated with the boiler installation.

“It’s about providing some level of security and protection,” Eastman said of future escalating heating costs.

The Oxford Hills School District would use performance contracts with Siemens Energy for the project. Fifty-eight percent of the work would be paid through a state revolving fund and the rest would be paid back by taxpayers over a set period of years without interest.

School officials say the company would pay the full cost initially and that if the project does not meet the contracted goals in savings, the district is not responsible financially for the overrun.

The school’s finance committee has also recommended going forward with the project.

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