Conversion Facility Chosen for Palm Desert, California

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Courtesy of BioCycle Magazine

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Committee rates responses to RFQ, which covered landfill diversion and renewable energy by-products, before selecting an “in-vessel” anaerobic digestion process that is expected to be permitted by fall 2005.

IN THE fourth quarter of 2002, Waste Management (WM) of the Desert was awarded a contract to build and operate the Edom Hill Transfer Station in Palm Desert, California. As a condition of the award, WM of the Desert with support from a team of engineers and scientists was tasked with evaluating conversion technologies for this waste stream. The original contract specified that a request for information (RFI) be performed. After an initial meeting with the Riverside County (California) Waste Management Department, and the Coachella Valley Association of Governments (CVAG), the agreement was modified to a request for qualification (RFQ).

Instead of soliciting literature from dozens of vendors, the team decided to advance the request and to simultaneously sort the vendors using a conservative set of criteria. The team consisted of members from WM, WM of the Desert, CVAG, and Riverside County Waste Management Department. While the team was intensely interested in any viable technology, it decided early on “key factors” for its selection process. These factors were designed to minimize the risk of failure as the project moved forward.

Key factors for the RFQ included the following: Quantifying the landfill diversion (above 60 percent), Modular design to operate for 20 years, Capital cost for 100,000 tpy facility, Markets for end products, Full-scale operating facilities using the technology that could be toured, Intellectual properties covered by technology, Labor requirements, and Five year proforma analysis.

In spring 2003, the RFQ was distributed to more than 40 conversion companies, and 16 responded with a wide array of technologies. These technologies covered Ethanol (hydrolysis and fermentation), Mixed alcohols for feedstocks, Pyrolysis, Plasma gasification, In-vessel fermentation for electricity, Autoclaving/pulp recovery, Catalytic thermal reformer, and Microwave reduction.

Analysis of the 16 respondents was reduced to spreadsheets, and we were surprised to see the diversity of the end products proposed. Many technologies were very complex. Several had entered values for by-products with no established markets. Finally, the presumption on energy values was theoretical at best.

Products proposed covered methane gas, electricity, heat, daily cover, fertilizer, carbon dioxide offsets, renewable energy credits, diesel, gypsum, MRF recyclables, compost, alcohol, mixed alcohol, carbon black, protein cream for cattle, and hydrogen.

The committee looked at the 16 major products and quickly realized that there was a wide range of values claimed for the energy produced. In addition, many proposed products could easily become a liability in a “down market” or an “infant market.” The team also looked at the actual value of green energy in the Riverside County area. While consumer electricity costs were $0.18/kw per hour peak and $0.12/kw per hour off peak, the value of green energy sent to the grid was really only $0.05/kw per hour. When the project proforma analyses were evaluated using realistic energy values, product valuations and our ability to visit a full-scale facility, the list of qualified candidates was reduced to six.

SUMMARY OF ANALYSIS

Of the 16 respondents, four had pilots that operated intermittently and ranged from five to 50 tons/day. Two facilities were operating at a range between 51 and 100 tons/day. Only four companies had operating experience on facilities over 100 tons/day.

Nine technologies were European. Of the other seven, one was from Japan, four from the U.S., one from Australia and one from Israel. Current California diversion rules made several of the vendors unacceptable. These included two acid hydrolysis technologies followed by fermentation vendors (ethanol) and several pyrolysis or gasification vendors.

While the California diversion rules have been established since 1989 with the passage of AB939, current rules created a tough evaluation for the team. Regardless of the percent conversion, if there was no diversion credit, the technology could not move forward at the present time.

Capital costs ranged from $9 million to $56 million. Closer examination showed increased costs by at least 10 percent and in one case 25 percent. Flaws in the offers included presumptions on purity of the waste stream and inexperience in converting end-products to electricity.

Operation and maintenance ranged from $900,000/year to in excess of $5.9 million/ year. In one technology, maintenance escalated to as much a $14 million/year when key components had to be replaced. Operating power requirements ranged from 25 HP to as much as 1.1MW.

The Edom Hill property is located in a desert climate. Several vendors required several hundred thousand gallons of water per day, which is a disadvantage in the local climate. Many vendors were simply not in a geographical region conducive to their potential end products. Products such as gypsum, wet pulp, carbon black, protein cream, hydrogen and mixed alcohols have no local markets, and transportation to the nearest industrial base was cumbersome. This weighed negatively on the projected economics.

Many of the proposing companies failed to assemble a team that had successfully permitted a facility in California. Behind the scenes, the term “View Scape” was brought up. Was this proposed facility going to change the view of the surrounding community? It became obvious that blinking lights from distillation or gasification towers could be an issue. The surrounding communities didn't want a heavy industrial park.

By the early summer of 2003, the committee rated the bidders. Each of the four team members chose their top four providers. The team selected four companies. One was a local pyrolysis supplier and the other three were in-vessel fermentation to methane producers. All three fermentation vendors proposed converting methane to electricity and selling into the electrical grid.

DISCUSSION AND RESULTS

The final four prepared a presentation for the selection team. In December 2003, the selection team unanimously ended up with two “in-vessel” fermentation companies. Key components of this preliminary selection included the following:

Both had operating facilities in a scale comparable to our required 300 tons per day, Each of the two technology vendors had teamed with engineering experts in California permitting, The two engineering firms were also experts in converting methane to electricity, Capital costs were in the mid-range of proforma's provided, and The required increase in tip fee seemed manageable.

In the winter of 2004, the team detailed their results to CVAG and discussed options for moving forward. With the blessing of the CVAG board, the team issued a request for proposal to the two remaining technology providers. The team specifically asked for the following items: Reconstruct 20 year proforma at $0.05/KW-hour for electricity, Take no credit for unsecured contracted products other than electricity, Provide a water balance, Provide private financing for the facility capital requirements, Provide sorting requirements, waste mix and a tip fee, and Detail graphically a project timeline and break out an engineering cost.

By the third quarter of 2004, the team selected the patented “in-vessel” anaerobic digestion process supplied by the team of Waste Recovery Systems Inc. (WRSI), Valorga International SAS, and Shaw Environmental/EMCON. Table 1 lists facilities in operation or startup using the Valorga technology.

As this report is written in spring 2005, the 13 communities and three Indian tribes that make up CVAG are checking the economic projections, building an acceptable diversion credit system for each community and analyzing the impact of change in tip fee. Presuming all goes well, the plant may be operating in late 2007. The projected cost increase for people and businesses using the Edom Hill Transfer Station is about $10/ton. This increase corresponds to about $1.66/month for a family of four if the cost is spread over the entire tonnage at the transfer station. Key to this approach being economical has been Waste Management's ability to route sort high value fermentation waste streams and avoiding a complete sort of the entire waste stream at the transfer station. Engineering and permitting will go forward by the fall of 2005 if the communities agree.

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