The Ontario Regional Municipalities of York and Durham, located immediately north and east of Toronto, recently issued a request-for-proposal to design, construct, operate a waste to energy (WTE) facility of municipal solid waste.
One of five pre-qualified companies will be the winner of a contract worth an estimated $200 million in capital costs and up to $16 million per year in operation and maintenance fees. Their proposals are due by the RFP closing date of January 15, 2009. Once built, the facility will handle 140,000 tonnes per year with a design life of 25 years.
The selection of a vendor and specific technology for the proposed facility is part of an environmental assessment (EA) process currently being undertaken by both Durham and York Regions to examine ways in which to manage residual waste.
Durham and York began working together on a solution for residual municipal waste in 2005, and the business case for a proposed WTE facility was accepted by Durham council in the spring of 2008. The EA’s next steps include a number of site-specific studies to address any potential air, land or water impacts, in addition to related health concerns.
Below is a summary of each of the pre-qualified companies.
1. Veolia Environmental Services Waste to Energy Inc.; AMEC/Black & McDonald. Veolia (NYSE: VE) is the world’s largest waste services company with operations 42 countries. It has more than 20 years experience in the WTE industry and currently operates 80 WTE facilities worldwide, with 10 being in North America. AMEC is a large multi-disciplinary consulting firm with 19,000 employees in 25 countries. AMEC has a strong presence in Ontario. Black & McDonald is a privately held Canadian contracting company with over 3,000 employees.
2. Covanta Energy Corporation. A subsidiary of Covanta Holding Corporation (NYSE: CVA), the company operates 37 WTE facilities worldwide. It has over 20 years of experience. (See article, page 29.)
3. Green Conversion Systems LLC. The company was recently formed and consists of six partner companies. WRSI (Waste Recovery Seattle International) is a consulting company founded in 1998 and reference one thermal treatment facility in Germany that was constructed in 1999. DESC provides comprehensive energy solutions. Fisia Babcock Environment GmbH specializes in the engineering and construction of plants for thermal waste treatment and flue gas cleaning plants and references 460 combustion units in 22 countries. Kiewit is one of North America’s largest and construction organizations. Mor gan Stanley is an investment bank. Babcock and Wilcox is well known for its technology used to control power plant emissions.
4. Wheelabrator Technologies Inc. The company’s experience in WTE dates back to 1975. Wheelabrator is a wholly owned subsidiary of Waste Management, Inc., the largest provider of comprehensive waste management services in North America. It currently operates 16 WTE facilities, all of them in the USA.
5. Urbaser SA. Headquartered in Spain, Urbaser SA is subsidiary of the ACS Group. The company manages four WTE plants and 20 bio-gas plants. It is currently planning and constructing four additional WTE plants. The company’s services include design, construction, finance, and operation.
The business case
Depending on what side of the debate one sits, the Regions of York and Durham should be commended for committing to a local solution that ensures that residents have control over the future waste management. A WTE plant located within the region will provide a stable and viable long-term waste management solution. It will also reduce the exposure of the municipalities to market uncertainties, particularly rising fuel costs and tipping fees for the long haul of waste.
Anti-incineration and fiscally-conscious critics can point to the predicted cost of a WTE facility. In a study commissioned in 2007, it was estimated that under a best case scenario, WTE will cost 55 per cent to 90 per cent high-er on a per unit basis than current Michigan landfill disposal costs. However, the Province of Ontario has an agreement with Michigan not to ship municipal waste to that state beginning in 2010.
What will it take to win?
The short list does not contain any underdogs. All five teams competing for the estimated $200 million plus contract are more than capable of designing, building, and operating a first-rate facility. The winner may the one with the lowest price.
Contrary to opponents of the low-bid ethos, a low bid from any of these companies will still result in a world-class facility. The bid document requires that the facility meet or exceed the European Union (EU) monitoring and measurement standards and commit to Maximum Achievable Control Technology (MACT) for emission standards and monitoring.
John Nicholson, M. Sc., P. Eng., is a consultant based in Toronto, Ontario. Contact John email@example.com