WASTE MINIMISATION AND LANDFILL LIFE EXPECTANCY AT QUEENSTOWN LAKES DISTRICT COUNCIL

Transcription

1 WASTE MINIMISATION AND LANDFILL LIFE EXPECTANCY AT QUEENSTOWN LAKES DISTRICT COUNCIL William Clifford 1 *, John Cocks 1, Linda Wright 2 1 MWH NZ Ltd; 2 One World Consulting Ltd * P O Box 4, Dunedin, william.m.clifford@mwhglobal.com, (03) ABSTRACT Queenstown Lakes District is the fastest growing district in New Zealand. Between 2003 and 2006 the waste quantity disposed to landfill increased at an annual average rate of 13%. There is one landfill that serves both Queenstown Lakes and Central Otago Districts. Concern about the increase in waste quantities and its impact on landfill life led to a study being commissioned. The study was undertaken to determine the rate of the landfill s airspace consumption, estimate the remaining life of the landfill for various waste minimisation scenarios, and quantify unit disposal costs under these scenarios. Costs not currently covered by gate charges were also identified. The study found that gate charges needed to increase by 12% to cover all current and future known costs. Consideration was given to Queenstown Lakes District Council s wider solid waste management system, in particular the impact of its proposed waste minimisation initiatives on system costs. The study found that diverting 25% of waste from the landfill would entail approximately 60% increase in costs. However, the estimated landfill life is extended by approximately 8 years. The paper covers the background, methodology and results of the study and concludes with a discussion on the value of waste minimisation in extending the life of landfill. 1 of 17

2 2 INTRODUCTION 2.1 Background In the 1990 s Queenstown Lakes District Council (the Council) undertook a major review of its solid waste management services. The outcome of this was a centralised system run under two contracts: a contract for waste collection and the operation of transfer stations, and a contract to provide landfill services. In 2005 anecdotal reports of high airspace consumption rates at the Council s landfill, as well as the need to understand the costs of implementing its waste management strategy, led to MWH being commissioned to undertake a study on behalf of the Council. 2.2 Scope of Study The scope of the study consisted of two main parts: Part One comprised the estimation of the full life cycle costs of the Victoria Flats landfill, including development, operating, closure and aftercare costs given the consented capacity and potential capacity of the site and taking account of different waste minimisation scenarios Part Two comprised the assessment of the financial implications of implementing the Waste Management Strategy. 2.3 Queenstown Lakes District a Description Statistics New Zealand notes that: Of New Zealand's 74 territorial authorities the highest population growth rate is projected to be for Queenstown-Lakes District, with a 79 percent increase from 18,000 in 2001 to 32,000 in (Statistics New Zealand, 2005) Table 2-1 shows the population projections to 2026: Table 2-1: Council Population Projections Year Forecasted Residential Population in Queenstown Lakes District Forecasted Residential Population in Central Otago District 20,472 26,100 32,167 38,380 45,817 15,997 17,233 18,565 20,000 N/A Total 36,468 43,333 50,732 58,380 Note: 1. N/A Not available at the time of the study 2 of 17

3 At the time of the study Queenstown was experiencing rapid growth, particularly in the tourism sector. This brought with it a boom in construction, and a consequential increase in waste generation. 2.4 Victoria Flats Landfill The Victoria Flats Landfill is approximately 27 km from Frankton along the Kawarau Gorge Road, State Highway 6. It is located near the Victoria Bridge, on the true right bank of the Kawarau River. Resource Consents were issued for the Victoria Flats Landfill in May 1998 and are due to expire in October Currently, the construction and operation phase of the landfill is being carried out under a BOOT contract to Queenstown Lakes District Council (i.e. the contractor provides a service to the district on behalf of the Council, and in return the contractor recovers his cost and profit through the at-the-gate charge). The at-the-gate charge is adjusted from time to time by a cost fluctuation provision of the contract. An agreement permits waste collected in Central Otago District to be disposed at the landfill for the duration of the BOOT contract. Table 2-2 below shows the quantities of waste being disposed at the landfill. Table 2-2: Annual Quantities of Waste to Victoria Flats Landfill Year 99/00 00/01 01/02 02/03 03/04 04/05 QLDC Waste to Landfill (t) 13,545 12,691 14,336 16,379 18,449 20,323 CODC Waste to Landfill (t) 8,165 7,845 7,859 8,389 9,099 N/A Commercial/Private & Demolition Waste (t) 5,561 5,986 4,863 5,074 6,289 N/A Total Waste to Landfill (t) 27,252 26,521 27,058 29,842 33,837 38,316 Annual Growth (%) Note: 1. N/A Not Available at the time of the study 2.5 Waste Management Strategy The Council adopted a Waste Management Strategy in 2003, comprising 43 initiatives including waste minimisation measures such as the provision of resource recovery parks, green waste and composting facilities, and kerbside recyclable collection services. It was estimated at the time of the Strategy s adoption that, with the programmed implementation of initiatives in the first 2 years (i.e. up until 30 June 2006), the District could reduce waste to landfill by up to 35% in the third year. 3 of 17

4 3 METHODOLOGY 3.1 Part One: Full Life Cycle Costs of the Victoria Flats Landfill Overview Full landfill costs were identified by considering the landfill life chronologically. A landfill life comprises the phases of: Pre-construction phase: planning, securing land, investigations, resource consents, procuring landfill development and operation services Construction and operation phase: construction and operation, which includes contract administration, environmental monitoring and landfill closure and may include resource consent changes and renewals, contract renewals and meeting requirements of any regulatory changes Aftercare phase: environmental monitoring, maintaining integrity of landfill cover, operating landfill gas, leachate and stormwater systems, and maintaining the landfill site generally. Whilst the at-the-gate charge currently covers the cost of the BOOT contract, there are other costs that the Council incurs or will incur. This is illustrated in Figure 1 overleaf: 4 of 17

5 Known costs covered by the at-the-gate charge Known costs not covered by the at-thegate charge Possible costs that have not been modelled Costs that have been modelled time Construction & Operations Phase Pre-Construction Phase Closure & Aftercare Phase Costs covered by landfill charge Costs not covered by landfill charge Figure 1: Costs Associated with Victoria Flats Landfill Figure 1 indicates that most of the cost occurs during the construction and operations phase and is covered by the existing contract between the Council and the landfill operator. However, during this phase there are known costs not covered by the contract. The figure also indicates that in the pre- and post-operation phases costs are not covered by the existing contract. Finally, the diagram indicates some possible costs that may occur between now and the end of the landfill s lifecycle. A modelling tool (Landfill Full Cost Accounting Model, Ministry for the Environment, 2002) was used to assess the full life-cycle costs associated with the Victoria Flats Landfill. The modelling tool provides an indicative base cost (or IBC) for landfills, expressed in $/tonne of waste disposed. The IBC corresponds to the price (in real terms i.e. present-day dollars) that should be charged over the operational life of the landfill in order to recover all whole-of-life costs. It does not incorporate any profit margin in it. 5 of 17

6 3.1.2 Model Inputs Model inputs are numerous, but can be summarised under the following types: Physical constraints Regulatory Constraints (e.g. adherence to landfill management plan) Available Airspace Airspace consumption to date Recorded Consumption Recorded Waste Quantities Population Projections & Future Waste Quantities Cost inputs, including planning, development, operation, closure, aftercare, administration, and other indirect costs. Assumptions For the purpose of the model, assumptions were made in using council population projections. It was assumed that: waste quantities are proportional to residential population population progression between given data points is straight line there are zero growth rates from 2021 for the COD and 2026 for the QLD the growth rate from 1996 to 2001 for the QLD was the same as between 2001 and 2006 Typically, the population growth projections indicated an annual increase of approximately 3% averaged over the landfill operation life. Historical unit disposal factors (average mass of waste/person/year disposed to Victoria Flats) were calculated using the population data and waste disposal records. These are summarised in Table 3-1 below: Table 3-1: Unit Disposal Factors for Victoria Flats Landfill Unit Disposal Factor in 2001 QLD COD Resident Population (2001 Census) 16,895 14,466 Waste Quantity (2001) (t) 16,390 10,130 Unit Disposal Factor (kg/person/year) Given the high growth in waste quantities in QLD and COD from 2001 to 2005 (cf. Table 2-2), the unit disposal factors were indicated to rise to 1,400 kg/person/year and 1,100 kg/person/year respectively before reducing. If waste minimisation initiatives in QLD were implemented, the unit disposal factor for the QLD was indicated to rise to 1,100 kg/person/year before reducing. 6 of 17

7 3.1.3 Outputs There were two main outputs from the full life cycle analysis of the Victoria Flats Landfill: landfill operational life and landfill costs. The landfill life depends on available airspace and on the filling rate. Scenarios were modelled to allow for different filling rates ( with waste minimisation and with no waste minimisation ). The model output gave an indicative base cost (IBC) that covers the pre-construction phase, the development and operation phase and the aftercare phase of the landfill. This cost was an estimate of the at-the-charge (i.e. $/ tonne of waste disposed of in the landfill) that was necessary to cover the whole life cycle costs of the landfill. However, it excluded a profit margin and contractor s risk costs. Contractor s risks include the cost of finance, and the actual costs of development and operation, and after care. Typically, increasing waste quantities would tend to reduce the contractor s risk and decreasing waste quantities would tend to increase the contractor s risk given the contractor is paid on a fixed per tonne of waste basis (adjusted only through a cost fluctuation provision of the contract). 7 of 17

8 3.2 Part Two: Full Life Cycle Costs for Implementation of Waste Management Strategy Overview The implementation of the Waste Management Strategy has financial and other implications that required consideration. Net present value analysis was undertaken to estimate the full cost of the solid waste management services provided by the Council. The cost model was designed to replicate Council costs between 2005 and 2032, the year when resource consents expire for Victoria Flats Landfill Description of Existing and Proposed Solid Waste Systems The existing residual solid waste system provided by the Council comprised: refuse collection services at Queenstown, Frankton, Wakatipu Basin (selected areas), Arrowtown, Glenorchy, Kingston, Wanaka, Albert Town, Hawea, and Luggate litter bins transfer stations at Frankton and Wanaka transport of residual waste from the transfer stations to Victoria Flats landfill Victoria Flats landfill. The planned waste minimisation system comprised: kerbside recyclables collection services at Queenstown and Wanaka, resource recovery parks in Queenstown and Wanaka to process and to market collected recyclable materials transport of recyclable materials to reprocessing markets greenwaste composting at Queenstown and Wanaka, including windrow composting at both sites and a in-vessel composting unit at the Queenstown site Assumptions Assumptions were made during the model construction. These are as follows. 1. Future waste quantities for each waste stream were assumed to grow at the same rate. For example, where projections indicate an increase of 5% in waste quantities to the Victoria Flats Landfill, it was assumed that there would be the same percentage increase in quantities at the Frankton and Wanaka transfer stations. 2. It was assumed that the relative percentages of waste from each of the various waste streams (e.g. the various transfer stations, the household collections) would remain the same. For example, approximately 25% of the waste disposed at the landfill comes 8 of 17

9 through the Frankton transfer station. It was assumed that in the future this percentage would remain the same. 3. The at-the-gate charge at the landfill was based on the quantities of waste used for Part 1 of the Study (i.e. current at-the-gate charge plus the estimated additional charge to recover full cost in each scenario) 4. The administration costs were assumed to remain constant from 2006 at $426,000 per year 5. Collection costs and transfer costs were assumed to increase at the same rate as the district waste growth rate 6. Costs associated with litter bins were assumed to increase at the same rate as the district waste growth rate. 7. Time based costs associated with the running of the Frankton and Wanaka transfer stations were assumed to remain constant 8. Future capital expenditure was depreciated over the lifetime of the proposed Waste Management Strategy assets. (For proposed the Lower Shotover Composting Site and the proposed Queenstown Resource Recovery Park, costs were depreciated over 50 years. The In-Vessel Composter was depreciated over 10 years.) Costs Costs for each component of the residual waste system and the waste minimisation system were determined on the basis of: estimated full landfill disposal costs determined in the previous part of the study (cf. section 3.1.) administration costs provided by the Council actual contract costs for the existing residual waste service of refuse collection, litter bins, transfer stations provided by the Council estimated costs provided by the Council for waste minimisation services Quantities Waste quantities for each scenario were those determined for Part One of the study for the Queenstown Lakes District. Where waste quantities were not allocated to a council, these were distributed to each council in proportion to the identified total quantity of waste from each district Time Period The period of modelling was 2005 to 2032 (the expiry date of the resource consents at Victoria Flats Landfill). 9 of 17

10 4 RESULTS 4.1 Part One: Full Life Cycle Costs of the Victoria Flats Landfill The full life cycles costs were estimated on the basis of no waste minimisation and 25% waste minimisation. Particular attention was paid to costs that were not covered by the contract price (i.e. at-the-gate charge), which included: Contract administration Aftercare costs (administration, resource consent compliance, site inspections, maintenance of site, leachate, stormwater and gas systems, and removal of facilities at end of aftercare period); the after care period used in the model was 30 years Final cover (if site has to be fully closed at end of contract) Landfill gas system (required as a result of the National Environment Standard 2004) (gas collection infrastructure and flare) Contract renewal costs (2029) Resource consent renewal (2032). For the modelled scenarios the estimated other costs in dollars per tonne of waste are shown in Table 4-1 below: Table 4-1: Estimated Known Landfill Costs not Covered by the At-The-Gate Fee Cost Item $/t No Waste Minimisation $/t 25% Waste Minimisation Contract administration Aftercare Landfill gas system Final cover Contract renewal costs Resource consent renewals and changes Total Note: 1. Rate reduces with increasing waste quantities 2. Assumed to be small (i.e. <$0.01/t) The estimated costs did not include allowances for GST, recovery of the pre-construction phase costs, any council publicity and education costs, or contractor s profit. Circumstances that would result in further costs include: meeting all resource consent and designation requirements should there be any departures 10 of 17

11 changes in waste quantities that would require changes to any levies in order to recover the costs targeted by the levies (e.g. model results are based on an assumed rate of waste disposal; lower quantities would increase the unit costs and, conversely, increased quantities would decrease the unit costs, as illustrated); a decrease in waste quantities relative to quantities used in the model would result if the Central Otago District ceased to dispose solid waste at the landfill meeting new regulatory requirements (e.g. meeting Class A Landfill Standard if it were to become mandatory) meeting high standards imposed by new resource consents implementation of a national or local waste minimisation levy. The estimated time to fill the currently consented airspace for the modelled scenarios is given in Table 4-2 below: Table 4-2: Variation in Landfill Life for Various Waste Minimisation Scenarios Scenario No Waste Minimisation 25% Waste Minimisation 35% Waste Minimisation Consented Airspace filled by: It was noted that the model results were sensitive to projected waste quantities. A sensitivity analysis was undertaken for a further scenario that modelled waste quantities based on population growth plus and annual increase of 2% in the unit waste generation rate. The results of this sensitivity analysis are shown overleaf in Figure 2: 11 of 17

12 Plot of Landfill Life versus Percentage Waste Diversion (2054) (2045) (2034) (2037) 0% 10% 20% 30% 40% 50% 60% 70% 80% Percentage Waste Diversion Waste Quantities Based on Population Growth - Case 1 Waste Quantities Based on Population Growth Plus 2% per Annum Increase in Waste Generation Rate - Case 2 Figure 2: Sensitivity Analysis 12 of 17 Landfill Life (from Opening in 1999)

13 4.2 Part Two: Full Life Cycle Costs for Implementation of Waste Management Strategy The two scenarios that were modelled are: No waste minimisation, which involved modelling the residual waste management system handling 100% of the solid waste 25% waste minimisation, which involved modelling the residual waste management system handling 75% of the solid waste and the waste minimisation system handling 25% of the solid waste. The results of the modelling are summarised in Table 4-3 below: Table 4-3: Unit Cost ($/t) for Modelled Scenarios Scenario Cost ($/t) No Waste Minimisation $ 108 /t 25% Waste Minimisation $ 169 /t 13 of 17

14 5 DISCUSSION An investment in the waste minimisation system would result in significantly higher waste management costs than staying with the existing residual solid waste system. At the time of the study, the residual waste management system comprised kerbside collection services, transfer services and landfill disposal services. The waste minimisation system would comprise kerbside collection services, resource recovery park services (equivalent to a transfer station but more complex), greenwaste composting services, and greenwaste and recyclables disposal services involving marketing and transport to markets. The main difference between the two systems is the disposal component, where residual solid waste is disposed at the Victoria Flats Landfill and greenwaste and recyclables are sold to local or distant markets. It can be expected that the cost of the collection and transfer station components of the residual solid waste system will be similar to the cost of collection and resource recovery park components of the waste minimisation system. Having two systems effectively doubles the cost of having one system. The cost of having two systems will be offset when the cost of disposing a tonne of recyclables or greenwaste is less than the cost of disposing a tonne of waste at a landfill. Waste minimisation system costs will reduce where markets are local and recyclable materials are in demand. Currently, markets for many recyclable materials are in the North Island or overseas. Thus transport costs are high. Demand is influenced by the quality and the price. Maintaining high quality recyclable material is demanding and quality is influenced by how those disposing of recyclable materials and greenwaste present these materials (i.e. clean and sorted versus contaminated and unsorted), methods of collection and sorting, and methods of packaging and transport. Landfill disposal costs will increase with any new landfill standards or the need to transfer residual solid waste to a future distant landfill. Such circumstances will occur when the Victoria Flats landfill is full. To illustrate the effect of rising solid waste disposal costs and increasing waste minimisation, the model was run on the basis of waste disposal costing $150 /tonne (as may result with long haul distances and higher at-the-gate fees), increased waste minimisation, and waste minimisation costs remaining steady (i.e. increased value of recyclables and greenwaste offsets additional costs of handling large quantities). The results are shown in Table 5-1 below: Table 5-1: Example Showing Benefit of Waste Minimisation when Unit Disposal Cost is High Scenario Cost ($/t) No Waste Minimisation (residual waste system only) $201 /t 65% Waste Minimisation (residual waste system & waste minimisation system) $ 177 /t 14 of 17

15 6 CONCLUSION Nationally there is a trend of fewer landfills and longer haul distances to landfill. Waste disposal charges are increasing both because of higher landfill standards and longer haul distances. Economies of scale at larger landfills tend to offset the magnitude of cost increases. The currently consented airspace available at the Victoria Flats Landfill site is valuable. Once this airspace is full (whether this occurs before or after the expiry of the current consents), the Council will need new resource consents to increase the airspace. If these consents are not secured, then waste generated in the District will need to be disposed in a new landfill or to an existing landfill out of the district. Given the experience of securing the Victoria Flats landfill site and the recent experiences of others in securing sites, it is considered that there would be uncertainty about developing a new in-district landfill. The alternative of using an existing landfill elsewhere would result in large waste haul distances and an associated significant increase in haulage costs. The potential for waste minimisation by diverting greenwaste and recyclables away from the landfill, with a consequential increase in landfill life, is high given the results of analyses of the District s solid waste streams and the reported achievements of other councils. However, realising a high waste diversion rate will require commitment and leadership by the Council, investment in good waste minimisation systems, investment in effective waste minimisation information, publicity and education, diligent administration of contracts and regulations to ensure compliance, and the cooperation of those in the District and those in the Central Otago District. 15 of 17

16 7 UPDATE SINCE 2005 Since the study was undertaken the Council has proceeded with the implementation of its Waste Management Strategy. Kerbside recycling collection services for Queenstown and Wanaka are in place with resource recovery parks in both towns. Consents have been issued for a green and kitchen waste composting facility and tenders are being prepared for an organics waste collection service in Queenstown. CBD recycling containers are in place and event recycling is up and running. Wanaka Wastebusters are running an education programme. The Council has a few more key initiatives to implement, including a solid waste bylaw and the tackling of construction and demolition waste recycling. 16 of 17

17 REFERENCES CAE, 2000: Landfill Guidelines: Towards Sustainable Waste Management in New Zealand. MfE, 2002: Landfill Full Cost Accounting Guide for New Zealand, MfE. Queenstown Lakes District Council, 2003: Waste Management Strategy: Towards Zero Waste and a Sustainable District. Statistics New Zealand, 2005: Subnational Population Projections: 2001 (base) 2026 Update, Cat Set 04/ Tchobanoglous, G.; Theisen, H.; Vigil, S. A., 1993: Integrated Solid Waste Management, McGraw Hill. 17 of 17