Ramsey/Washington Recycling and Energy Board: Facility Committee. June 23, 2016 Meeting

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1 Ramsey/Washington Recycling and Energy Board: Facility Committee June 23, 2016 Meeting

2 Item IV. a. R&E Center Operations Update

3 Item IV. b. Odor Mitigation Study Update

4 2017 Facility Budget Recommendations June 23, 2016

5 Item IV. c Budget Recommendations

7 Budget and Finance Processes Budget Process Facility Committee 2016 Budget Committee Monthly Operations Report Budget Status Report 2017 Budget Adjustment April 2016 Facility status report Discuss Facility issues to be addressed in 2017 budget addenda June 2016 Facility status report Identify Facility issues to be forwarded to Budget Committee March 2016 Operating budget review Initial Capital Expenditures Committee process April 2016 Operating and Joint Activities Budget status report Receive Facility Committee issues related to 2017 budget Discuss possible changes to 2017 budget 2017 Budget Adjustment June 2016 Operating and Joint Activities Budget status report Recommend 2017 budget addenda to full R&E Board 2016 Budget Monitoring August, October 2016 Facility status report Identify Facility issues to be forwarded to Budget Committee 2016 Budget Monitoring August, October 2016 Operating and Joint Activities Budget status report Make recommendations to R&E Board on necessary budget issues

8 Facility Budget Overview Operates as an enterprise fund Direct expenses; reimbursement of GRENS Budget approved October 2015: Best guess Operating Reserve Fund role Revisions to 2017 budget based on operating history January May 2016

9 Addendum to 2017 Facility Budget Account Description 2016 Approved 2017 Approved 2017 Proposed Revision 2017 Change Salary & Fringe Benefits Facility Manager, Asst. Facility Manager 300, , ,559 11, Xcel Fuel Supply Agreement 4,727,700 4,727,700 5,028, , Operating Fee Transition Facility Operator 1,100, , , Operating Expenses 3,484,381 3,484,381 4,532,065 1,047,684 Personnel Costs 6,665,352 6,831,986 6,966, , Consulting Labor Relations 175, , ,000 75,000 Consulting IS Superior Services 1,500 1,500 1, Landfills 2,005,973 2,005,973 1,943,538 62, Payment In Lieu of Taxes 386, , , Transportation 5,329,618 5,329,618 6,208, , Contingent 1,155,029 1,157, ,157, Transfer RC Bonds 0 1,096,775 1,059,150 37,625 Transfer Washington Co 0 399, ,730 30, Equipment Repair and Maintenance Fund 818, , , ,198 Facility Management Expense Total 26,149,842 27,696,779 28,544, , Proposed 2016 Approved 2017 Approved Estimated Revenue/Reserve Fund Revision 2017 Change Tipping Fees 26,950,000 26,950,000 26,950,000 0 Sales of Recylable Materials 1,237,467 1,237, , ,467 Needed from Operating Reserve Fund (2,037,625) (490,688) 894,306 1,384,994 Facility Management Revenue Total 26,149,842 27,696,779 28,544, ,527

10 Action Requested: Recommend that the Budget Committee approve and forward the Addendum to the 2017 approved Facility Budget to the R&E Board.

11 Item IV. d. Update on Waste Designation Planning

12 Designation Process Statute sets out specific details to be included in a Designation Plan. Each county must also amend its current solid waste master plan. Approval sought at July 28 th R&E Board meeting. Then by both county boards in August. Approval by MPCA expected Fall Entire process estimated to take 18 months.

13 Designation Process If approved, each county holds public hearing. R&E Board then negotiates with licensed haulers to enter into contracts requiring delivery to R&E Center. After hauler contracts, R&E Board may proceed with implementing designation via county ordinance in Waste designation in both counties could be in place 2018.

14 Stakeholder input sought through early July City and township administrators, elected officials, and staff Recycling coordinators Haulers Ad hoc planning committees Business community Online at Draft available around June 20 th

15 Jul. 28, 2016 R&E Board approves and recommends Master Plan Amendment, Designation Plan to County Boards Aug. 16, 2016 Ramsey & Washington County Boards approve Master Plan Amendment, Designation Plan, submit to MPCA for approval Dec. 31, 2016 MPCA review and approval Of Master Plan and Designation Plan (120 day review period) Apr Ramsey & Washington County Boards discuss and approve submitting proposed designation ordinances and contracts for MPCA review Feb. Mar R&E Board negotiates waste delivery agreements with haulers and others Jan Public hearing to take testimony on Designation May Jul MPCA review of contracts and ordinances (90 day review period) Aug. Nov County Boards approve contracts and ordinances; includes 60 day statutory waiting period Dec Designation is implemented

16 Item V. a Capital Improvement Budget Update

17 Item VI. a. Updates on Emerging Technologies

18 Update on Emerging Technologies for MSW and RINs R&E Board Facility Committee meeting June 23, 2016

19 Emerging Technologies for MSW Game Changers Gasification Pyrolysis Plasma Arc Mixed Waste Processing Plastics to Fuel

20 Emerging Technologies In 2013 Barrel of Oil was $ Gallon of Gasoline $4.28 Number of Companies 165 In 2016 Barrel of Oil is $46.21 Gallon of Gasoline $2.05 Number of Companies < 20

21 Emerging Technologies So what happened? Grant/loan funding dried up Cost/benefit went away Technical issues Show me

22 Where Did the Funding Go? DOE and USDA grants and loans dried up $250,000,000 from for USDA $23,000,000 from for USDA ARRA - $600,000,000 for DOE in 2008 In 2016 $90,000,000 for DOE

23 Cost/Benefit Capital costs are $200M or more Private equity challenging Concept not proven at large scale Investor risk Output costs down over 50%

24 Technical Issues Indian River Bioenergy Center It is all in the bugs Fulcrum/Sierra Biofuels Construction expected late 4 th quarter 2014 Biorefinery expected to reach commercial operation early 3 rd quarter 2016 Enerkem Edmonton Still in Commissioning Abengoa Now EPCM for Fulcrum

26 Technical Issues Agilyx Contamination and supply challenges Now focused on Polystyrene Plasma Power Left Iowa because they learned MSW to be extremely political and very competitive Air Products Offloads two large plasma gasifiers in Teesside (operational challenges)

27 Not ALL Bad News Clearing the decks Enerkem is in the lead Fulcrum issued $200M for procurement for their Nevada plant Ineos Bio has indicated they would be producing ethanol in 2016 Other technologies focused on plant feedstock to avoid the variability of MSW

28 Not ALL Bad News Plant in Tennessee using gasification on wood waste, scrap tires and sewage sludge. Produce electricity Europe opportunities available RES Polyflow plastic to fuel plant in Ashley, Indiana Pearl Harbor has waste gasifier (10 TPD) Enerkem considering entering the TC market

29 Mixed Waste Processing Proven technology Commodity markets for recyclables make private investment difficult New machinery to separate by density and shape at the same time Needed to meet higher recovery/recycling goals Likely to be led by public agencies

30 Where is this Going? PUBLIC/private partnerships Securing funding sufficient to construct No free lunch Europe may see faster growth Continue to see small scale plants Twin Cities market ideal

31 Why Produce Ethanol from Waste? Economics RINs (renewable identification number)

32 RIN Codes Fuel Types and RIN D Codes

33 RIN Needs Renewable Fuel Standard (RFS) Mandate, by Type,

34 Show Me The Money Corn Ethanol Cellulosic Ethanol

35 Take Aways Using Emerging Technologies (even AD) that produces transportation fuels has income from RINs Understand the market dynamics with RINs and impacts to development If gasification can produce 100 gallons of ethanol per ton, RINs can be >$100 per ton!

36 Conclusions Emerging Technologies are not Dead! Projects will be more Public/private partnerships Positive financial benefits for waste to ethanol continue If it works

37 Questions

39 Item VI. b. Enerkem and SKB Gasification Project

40 Item VI. c. Process for New Technology Evaluation and Site Visits

41 Alternative Technology Pathway Task Waste sorts X X Processing equipment X X Request for Expressions of Interest for MWP X X Request for Proposals for MWP X Installation and operating MWP X X Facility improvements X X Organics X Permits X X Financing X

42 Alternative Technology Site Visits Options: 1) Southern tour half day MWP equipment Education center Blue Bag organics hand sort 2) Northern tour half day MWP equipment Anaerobic digestion discussion Question: When should site visits be scheduled?

What is the Real Story about Emerging Technologies? Materials Management as a Waste Management Strategy

What is the Real Story about Emerging Technologies? Materials Management as a Waste Management Strategy Presentation overview Presented to the National Association of Counties Susan Robinson, WM Government