Clean-burning wood furnace maker on Iron Range growing faster than expected

About a week after Lamppa Manufacturing moved into a new plant, the owners realized the Iron Range company needed even more space.

The city of Tower, 90 miles north of Duluth, had built the new space and was looking for a tenant for the other half of the building. After a rush of phone calls, city officials stopped their search.

So within a month, the maker of high-efficiency wood furnaces and sauna stoves went from a cramped former creamery building to 9,000 square feet.

"We are growing really fast," Lamppa general manager Dale Horihan. "If we continue at the current rate, we will nearly double revenue this year. We are already out of space" without the rest of the building.

Now, city contractors will soon convert the second half of the building to Lamppa's specifications. And by the end of the year, the company is hopeful it can ramp up production from a few hundred of its technologically advanced furnaces to perhaps thousands.

The move has economic-development officials surprised and giddy. The city of Tower built the plant space with a $1.8 million loan from the Iron Range Resources and Rehabilitation Board (IRRRB), with the hope that it would create more jobs not dependent on mining, especially taconite mining, in northeastern Minnesota.

"We are very pleased. I'm just a little surprised it happened so soon," said Matt Sjoberg, executive development director at IRRRB. "We thought they might need the space in two or three years."

"This is just a great example of diversification into non-mining," Sjoberg said. "While mining is the backbone of the economy up here [on the Iron Range], we need the non-mining related jobs too. They really supplement things."

Thirteen other non-mining projects in northeastern Minnesota received help from the state, totaling about $3.5 million this year. Beneficiaries included Heliene's solar-panel plant in Mountain Iron; American Peat Technology in Aitkin; Swan Machine in Perham; API Outsourcing near Two Harbors; and Airmark/Nelson Wood Shims in Cohasset.

Including Lamppa, the IRRRB-supported company projects total $17.6 million so far this year, compared with $18 million in 2018.

At Lamppa, domestic and overseas developments are driving demand for products. Sauna sales shot up as orders keep spilling in from North America, Israel, Italy, England, Sweden and New Zealand, said Horihan, the plant manager.

At the same time, Lamppa's wood-burning furnaces are enjoying fresh interest after a key Environmental Protection Agency (EPA) test last year showed Lamppa's "Kuuma Vapor-Fire 100" furnace burned wood so much cleaner than oil or propane that it was basically carbon neutral.

The EPA's newer and more stringent emissions guidelines are aimed at slashing particulate emissions standards by 2 grams per hour.

Marshall Helmberger, vice president of the city of Tower's Economic Development Authority, said during the EPA's recent Phase 2 certification test, Lamppa "not only beat the [EPA emission] standard, they beat it by 40%."

So Lamppa's fast growth does not surprise Helmberger.

"I absolutely believe they will even outgrow that space they just moved into. I think [Lamppa] has the potential to be the next Marvin," the iconic family-owned window manufacturer based in the northern Minnesota city of Warroad, Helmberger said. "This wood [gasification] furnace product is unlike anything anyone has built before."

An EPA spokesperson declined to comment about technology specifics, but confirmed that the EPA has certified that Lamppa's Kuuma Vapor-Fire furnace meets the new EPA 2020 emissions standard. Competitor HY-C Home Solutions Company in St. Louis is the only other wood furnace maker to also win EPA certification.

Horihan, the general manager, said Daryl and his team spent 40 years perfecting the efficiency of its furnaces. With one ultraclean model under his belt, Daryl is working to get an even newer furnace model tested to see if it too will meet the EPA's stringent 2020 emissions standard, Horihan said.

Helmberger said the technology lets homeowners heat their entire house with forced-air heat generated by clean burning wood. He acknowledged the wood furnaces are not common in large cities like Minneapolis, but are very popular in rural Minnesota, as well as Wisconsin, Alaska, Montana and Canada.

"There is no doubt they already build the best wood furnace in the world. It is incredibly efficient," Helmberger said. "And these are good paying jobs that are not mine-related. So it's the kind of industrial and light manufacturing that we want to see here."