Mike Hutchings / Reuters Visitors watch as steam rises from the ground at the Craters of the Moon Geothermal Park near Taupo, September 28, 2011. Regions of geothermal and volcanic activity draw thousands of visitors to New Zealand each year and are also used to drive turbines to produce electricity. REUTERS/Mike Hutchings (NEW ZEALAND - Tags: TRAVEL SOCIETY)

A forestry town is working to re-invent itself as a renewable energy leader with a project that promises community revitalization from the ground up.

The mountain village of Valemount, British Columbia, located along the Rocky Mountain trench is eyeing the nearby Canoe Reach hot springs -- one of the hottest surface hot springs in Canada -- as a source of geothermal heat and renewable electricity generation.

"Valemount used to be a typical northern forest town," Silvio Gislimberti, head of the Valemount Geothermal Association, told DeSmog Canada. "But now we would like to create a geothermal industrial park."

An old mill that shut down in 2007 provides a near perfect location for Borealis Geopower, the company working with the community to make something of the region's geothermal potential.

Craig Dunn, chief geologist with Borealis Geopower, said Valemount is one of the best-known hot spots for geothermal development in all of Canada.

"The resource opportunity is pretty incredible all the way down the Rocky Mountain trench, including opportunities like Radium and Fairmont, which are all a part of the system."

Valemount has a "competitive advantage" according to Gislimberti.

"We know we have a good heat source, that heat source is -- relatively speaking -- close to the surface, so 1.5 to two kilometres down, and we have easy road access to the Kinbasket Canoe Reach region from existing forestry roads," he said.

Valemount sits on the end of a long power line, which means any electricity generated in the area could be fed back into the provincial grid. Unlike large-scale hydro projects like the Site C dam, geothermal has a very small environmental footprint. And unlike wind and solar, geothermal can provide base-load electricity production even when the sun isn't shining or the wind isn't blowing.

"I think the concept is great," said Steve Grasby, geochemist with Natural Resources Canada. "Instead of looking at where the high potential regions are in Canada -- which can sometimes be far from demand -- they're starting with the demand."

Grasby said it just makes sense to explore heat resources "near a town that is closer to people and demand."

"The question is can they find a reliable heat source," Grasby said. "My understanding is there hasn't been any exploration drilling done yet. That will be the telltale thing."

Grasby added geothermal is similar to oil and gas exploration: "You just don't know until you start drilling," he said.

Borealis began to engage with the community in Valemount in 2010 after the company received a geothermal exploration permit from the B.C. government. The permit grants Borealis the opportunity many other geothermal developers across the border in Alberta are desperate for -- taking a commercial geothermal project from the drawing board to the drill bore.

But for Borealis, and for the villagers of Valemount, the geothermal dream amounts to much more than power generation.

Borealis hopes to build a 15-megawatt power plant that will supply power back to the BC Hydro grid but the community envisions a "holistic energy development program," as Dunn put it, that will support a whole host of community-led projects.

"Places like Iceland are getting more and more use of what is called heat-cascading," Dunn said. "So you have a high-temperature resource that may be used for power, then it may be used for brewing applications, and then greenhouses and in the end it may be used to make sure your sidewalk doesn't freeze."

Beyond that, Dunn said locals already have plans for the residual heat leftover from the proposed 15-megawatt power plant Borealis wants to power with steam-driven turbines.

"That creates an opportunity for what looks like an eco-village or a geo-park...That means we can have a number of organizations like greenhouses, fish farming, brewery, silviculture, or timber industry applications in close proximity and they can actually take advantage of each other's opportunities, trading CO2 with each other if necessary from the brewery back to growing operations."

The local Three Ranges Brewery is already lined up to use the geothermal resources developed by Borealis.

"Three Ranges brewery is one of the Robson Valley highlight reels of new development in the area. It's a small microbrewery that brews incredible beer -- if I do say so myself," Dunn said with a laugh.

Three Ranges owner and brewer Michael Lewis said he is excited to incorporate geothermal energy into his operations.

"As a brewery we use a lot of temperature control -- both on the hot side and the cooling side. My options here are either propane and electric and we use primarily electric, but it would be nice to have a renewable energy resource like geothermal that we could use on the heating and cooling sides and get the best bang for our buck."

"It would make us the first geothermal brewery in Canada," Lewis said.

Lewis said the village was quick to establish a Direct Use Heat Committee and the Valemount Geothermal Society when the idea of developing the heat source first arose.

"There's a rising tide making sure we get something going and become the first geothermal village in the entire country."

The idea of creating a new zero-waste community while also using geothermal heat is exciting, Lewis said.

"It has the potential for being a really ticketable showcase to show the world what can be done with geothermal."

Despite the excitement, there is still the issue of the high upfront cost of geothermal. "It's significantly more expensive because it's not highly practiced."

Lewis said even transitioning his brewery to use a geothermal heat-exchange system is going to cost him. "It's more expensive than doing something with natural gas, but it's smarter."

"It's a part of that pioneering spirit that is this valley."

Alison Thompson, president and founder of the Canadian Geothermal Energy Association, said the community of Valemount has exhibited an extraordinary amount of interest in geothermal, which puts the project at a huge advantage.

"You can have an association, you can have government, industrial project proponents pushing for projects, but there's something to be said for pull," Thompson told DeSmog Canada.

"The villagers are very well informed. That's what really sets them apart."

Thompson added the community established a Geothermal Committee and has sought out independent experts to weigh in on questions that come up about the project.

"I think this is what is so unique in Valemount -- it's not one person or one committee, or one business, or group: it is the village."

"For other communities that are interested, I think they could take a lesson from the way Valemount has nurtured this and rolled it out to be inclusive," Thompson said.

Corie Marshall, president of the Valemount Geothermal Society, said locals are prevented from growing food beyond the short summer season so the community is planning on using warm water leftover from the proposed geothermal power plant to heat greenhouses throughout the colder months.

"A lot of times in the winter we can get minus 35, sometimes minus 40...We tend to get a lot of snow. There are also times in the summer where people lose their tomatoes because of frost."

Many people feel conflicted about burning wood for heat and even for heating greenhouses because of the impacts on air quality, Marshall said.

"We're at the end of a transmission line that comes up from Kamloops. There are times when a branch falls near Kamloops and we're out of power, three hours away," she noted.

Geothermal electricity production offers a way to both stabilize the local grid as well as limit the need for electricity from direct heat use, Marshall said.

Marshall said that at this stage the project needs financial support to take it to the next step. Borealis is currently on the hunt for project investors.

"The biggest thing is we need to actually drill holes. Borealis Geopower has done lots of surface studies, a lot of good science, good information but at one point we need to drill holes. The drilling is expensive but now is the best time to do it because so many of the drill rigs are out of work in Alberta."

"Somebody needs to find -- or fund -- the first drills and then we go from there."

When asked when she hopes that will happen, Marshall smiled and said, "yesterday."

- Carol Linnitt, DeSmog Canada