SKOWHEGAN — State education officials and the local school board have approved a borrowing package of up to about $2 million for a biomass boiler system to heat Skowhegan Area High School and nearby Bloomfield Elementary School.

The heating system would burn wood pellets to warm the estimated 850 students at the high school and the 380 students at the elementary school, switching from the high cost of oil to renewable energy, School Administrative District 54 Superintendent Brent Colbry said.

It’s heat that would be made in Maine, he said.

“We started this process a couple of years ago, trying to look toward renewable and biomass to see if was feasible,” Colbry said. “The board came to the conclusion we needed to move toward an alternative energy source; it’s been unanimous.”

He said the board hired engineers and looked into wind power, geothermal, biomass, wood chip and wood pellets. They landed on wood pellets, he said.

Under the work plan, which is to begin next April and be completed by the end of October, there would be a boiler installed in the basement of the high school, with a loop feeding hot water to the heating system at the elementary school. A plan to link the middle school to the heating system has been set aside for now, Colbry said, but could be revisited later.

“We’ll burn a little bit of oil during the shoulder seasons, in the spring and the fall, but the vast majority of the oil will be gone,” Colbry said. “In the first year, the savings would be somewhere between 20 and 30 percent. It’s a hedge against the increased cost of oil.”

Colbry said calculations are based on $3.50 per gallon of No. 2 home heating oil.

The project is being financed by the federal Qualified School Construction Bond for a lease/purchase of the boiler. The overall cost of the system is about $1.5 million. Borrowing will be at zero percent interest over 14-16 years, with annual payments of about $90,000.

At the high school alone, the district is paying for about 50,000 gallons of heating oil per year at a cost of about $175,00, he said. At Bloomfield Elementary School, another 28,000 gallons of oil is burned, for a total cost approaching $275,000.

The cost annually for wood pellets would be about $90,000 for both buildings, Colbry said. Combine that cost with the annual payment on the bond and the total comes to $180,000, well short of current expenses, he said.

Phillips-based School Administrative District 58, in Franklin County, has also installed biomass boilers in recent years at its high school in Salem Township and at elementary schools in Kingfield, Phillips and Strong.

State officials and federal agencies supported the effort, touting the district in 2010 as a leader in a push for energy alternatives that tap renewable sources while promoting industries within the state, such as logging and wood pellet mills.

For the school district’s budget, the switch from oil to wood pellets has meant heating costs are being cut in half, according to a published report.

In Anson-based SAD 74, the district’s four schools are in the process of converting from oil-fueled boilers to wood-pellet ones, for a minimum net savings each year of $70,000, Superintendent Ken Coville said in July.

The project at Garret Schenck School, Carrabec Community School and Carrabec High School, all in Anson, and Solon Elementary School, will likely cost up to $750,000. It will be paid for in part by a 15-year school construction bond at zero-percent interest, Coville said.

Colbry added that the oil-burning boiler at the high school was installed when the building was constructed 45 or 50 years ago. A new wood-pellet system would take the stress off the aging boiler. He said the system change does not have to go to a public vote in the towns of SAD 54 because it is a lease and purchase project, not a traditional bond issue.

Doug Harlow — 612-2367

dharlow@centralmaine.com