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HomeMy WebLinkAboutCOM 0242.001 2010-2012Pacific Waste Keeping Hawaii Beautiful June 22, 2011 The Honorable Dominic Yagong, Chairperson, Hawaii County Council County of Hawaii Hawaii County Building 25 Aupuni Street Hilo, Hawaii 96720 Dear Mr. Yagong, PI VAC Comm. 242 KECEIYEO -lam 1125 f7fit e --Z,pt! .5 1�%' county Council Thank you for your interest in our Pacific Waste/BioEnergy Hawaii projects. We appreciate the opportunity to describe our current Hilo proposal and to make a presentation to the Environmental Management Committee. We are providing this letter with exhibits prior to our presentation on July, 6th 2011 in order to give you a summary of our proposal to operate a Material Recovery Facility (MRF) to be located at the East Hawaii Regional Sort Station ( "Sort Station "). We are also inviting the Mayor's Administrative Personnel to attend, as well, if their schedules do not conflict. To date we have completed initial design studies of the Sort Station to evaluate the facility's features and limitations in order to configure our MRF operations into the existing 20,000 SF Reload Facility building. These studies have provided the basis for developing our solid waste processing system that can sort, separate and recover the highest percentage of desired material in the most efficient and cost - effective manner available. Our proposal provides immediate solid waste diversion solutions, and incorporates opportunities for the integration of future waste reduction practices that would substantially reduce the negative environmental impacts of the County's current waste disposal practices. We have also conducted a review of the County's current proposed plan to utilize the Reload Facility as a "modified" MRF. As outlined in our last presentation to County representatives, our comparison findings indicate that our proposal provides the County with an immediate maximized diversion rate along with substantial saving in avoided cost as well as conforming to the stated objectives of the 2009 County of Hawaii Integrated Resources and Solid Waste Management Plan (IRSWMP). The attached exhibits will provide an overview of our project description, MRF operations projections, summarize the numerous environmental and economic benefits to the County of Hawaii, and outline the basic business structure of our proposal. We are confident that our proposal provides the most cost- effective and low -risk solutions for establishing sound waste reduction policies that address the current and long term needs of the environment, economy and community. Our mission is to incorporate sustainable waste management practices that not only reduce the immediate environmental impacts, but also provide future opportunities for the County of Hawaii. Pacific Waste, Inc. 74 -5610 Alapa Street, Kailua Kona, HI 96740 T (808) 326 -4911 F (808) 326 -1250 �� . / Comm. No. Ref. To: P/E M C Ref. Date, JUL 6 2 011 Pacific Waste Keeping Hawaii Beautiful The Honorable Dominic Yagong, Chairperson Hawaii County Council Page Two In closing, we would like to reaffirm that our original intention was to enter into a Public- Private Partnership (PPP), which would allow us to immediately begin detailed discussions with the County to expedite the completion and operations of the proposed facility. We continue to believe that this would be the best method to pursue, but pursuant to previous discussions with County officials, we understand that it is the County's intention to enter into the procurement process through an RFP for the operations at the Sort Station. Although we do not know the status of the preparation of the RFP, we have, in good faith, provided as much information as possible to the County to adequately describe our project proposal. Our ability to disclose all the terms of our proposal is limited due to the competitive nature of the RFP process and some of the business terms that need to remain confidential until we submit our formal response to the pending County RFP. We still maintain that there are sound and legitimate exemptions to the RFP process that the County could pursue in order to allow the MRF to be up and running in a relatively short period of time. Please feel free to contact any member of our Pacific Waste or BioEnergy Hawaii team if you have any questions regarding the information enclosed. Thank you for your time and consideration. Sincerely, • Clint Knox LEED AP Project Manager Pacific Waste, Inc. BioEnergy Hawaii, LLC cc Billy Kenoi, Mayor Brittany Smart, Chairperson Frank DeMarco, Dept. of Environmental Management, Director Pacific Waste, Inc. 74 -5610 Alapa Street, Kailua Kona, HI 96740 T (808) 326 -4911 F (808) 326 -1250 Pacific Waste Keeping Hawaii Beautiful Project Description: Design - Build- Operation of a Material Recovery Facility to be located at the East Hawaii Regional Sort Station in Hilo Pacific Waste, Inc. proposes to fund, develop and operate a Material Recovery Facility ( "MRF ") that shall provide the capability of processing recoverable components of the Municipal Solid Waste ( "MSW ") stream into beneficial reuses. The facility will also be able to separate organic and biodegradable material that could be utilized in a County compost facility. The MRF operations shall be located at the East Hawaii Regional Sort Station ( "EHRSS ") and incorporated into the existing 20,000 square foot Reload Facility. The EHRSS is located between the Hilo Transfer Station and the South Hilo Sanitary Landfill (SHSL). Project Scope The scope of this project includes the design and installation of a single- stream MRF operation which shall accommodate both commercial and residential waste as well as construction and demolition material. It is anticipated that the proposed MRF will process an approximate 25 — 35 tons per hour. The internal processing equipment shall be oriented in a way that will allow all dumping to occur on the tipping floor within the enclosed MRF building. In addition, this project will require exterior covered storage areas for recovered recyclables and separated materials. Pacific Waste's responsibilities include obtaining appropriate permits, design and construction of the necessary modifications to the existing reload facility, design and installation of the material recovery and sorting equipment, and operation and maintenance for an operating term of not less than 20 years. Pacific Waste shall conduct all necessary sorting and recovery of the recyclable material and separation of organics and compact any non - marketable residuals resulting from the processing activities into County trailers for landfill disposal. Phased Operations Plan The MRF operations will be staged into two phases, Phase I (initial 2 - 4 years) will incorporate advanced material processing equipment to sort, separate, and recover the highest percentage of desired material in order to maximize the County diversion rate and minimize the amount of residuals requiring landfill disposal. Phase II operations will integrate additional processing equipment in order to implement additional management of the residual materials to produce a post - recycled fuel product. Phase II operations would provide the highest diversion rate available. Expedited Schedule Because of the imminent closure of the SHSL, our objective is to develop the MRF operations and achieve substantial waste diversion as quickly as possible. Once an operating agreement is finalized, the proposed facility shall be operational within 9 - 12 month from execution. 1 Pacific Waste Keeping Hawaii Beautiful Material Recovery Facility Operations The specifications below identify the design criteria and projections for the Phase I & II operations of the proposed MRF facility. Hours of operation: Mon. — Fri. 7:00 a.m. — 5:00 p.m., Sat. 7:00 a.m. — 12:00 a.m. Days of operation per week: 6 days (308 days annually) Waste types accepted: Commercial waste, Residential (County transfer trailers), and Construction & Demolition waste PHASE I Operations Incorporate MRF operations and equipment designed to substantially increase the current waste diversion rate and minimize the amount of residuals requiring landfill disposal. A combination of conveyors, processing equipment, and sorting personnel shall be utilized for the recovery of recyclables and the separation of organic materials. MRF Design Criteria/Projections Yearly MSW process capacity: 60,000 — 80,000 tons per year Daily MSW process capacity: 195 — 260 tons per day (based on 308 days) Hourly MSW process capacity: 25 — 33 tons per hour (based on 8 hours) Recycled Material: Cardboard /paper fiber, glass, metals, plastics Separated Material: Organics for compost operations Diversion Rate: Increase existing East Hawaii County rate to 70% Landfill Material: Compacted residual waste and inert material Personnel: 15 sort personnel, 9 facility operations (24 total employees) Commercial Haulers Tipping Fee: $85.00 per ton (match SHSL tipping fee) County Vehicles Tipping Fee: To be provided in response to RFP or negotiated in a PPP (projected cost per ton to be less than the alternative County options) PHASE II Operations Integrate additional equipment into the MRF operations to produce a post- recycled fuel product (also known as Refuse Derived Fuel or "RDF "). Phase II will maximize the County diversion rate through the recovery of recyclables, separation of organics, and the additional production of RDF to be utilized as a renewable fuel source for BioEnergy Hawaii's Bio- Conversion energy facility. MRF/RDF Design Criteria/Projections Yearly MSW process capacity: 70,000 — 90,000 tons per year Daily MSW process capacity: 227 — 292 tons per day (based on 308 days) Hourly MSW process capacity: 28 — 37 tons per hour (based on 8 hours) Recycled Material: Glass, metals and market driven commodities Separated Material: Organics for RDF material and compost operations Diversion Rate: Increase existing East Hawaii County rate to 80% (County wide through BEH facility) Landfill Material: Compacted residual waste (mainly inert material) Personnel: 15 sort personnel, 9 for facility operations (24 total Employees) Commercial Haulers Tipping Fee: $85.00 per ton (match SHSL tipping fee) County Vehicles Tipping Fee: To be provided in response to RFP or negotiated in a PPP (projected cost per ton to be less than the alternative County options) 2 Pacific Waste Keeping Hawaii Beautiful COUNTY BENEFITS Increased Diversion Rate • Immediate increase to the East Hawaii waste diversion rate through the recovery of recyclable materials and separation of organics (for compost) will be achieved in the first year of operation and each year thereafter. • Substantial reduction of the amount of waste residuals requiring landfill disposal. Stabilize the residual material through the separation and removal of organics to minimize greenhouse gas emissions as well as reduce the volume and toxicity of materials sent to landfill. • The fiscal year 2009 -2010 Solid Waste Disposal Summary indicates that the current East Hawaii diversion rate is approximately 36 %. The IRSWMP has projected that the County could increase the diversion rate up to 44% by 2017 (and remain at this rate thereafter). • By incorporating our Phase I MRF operations we project to increase the East Hawaii diversion rate up to 70% in the first year of operations, which would far exceed the County's projected rate. • By incorporating our additional Phase II post - recycled fuel production we would be able to further increase the County diversion rate up to 80 %. 120 100 80 60 40 20 0 Based on fiscal year 2009 - 2010 Data (101,900 tpy: East Hawaii) • County Diversion Rate ( %) • Pacific Waste Diversion Rate ( %) • Residuals to Landfill ( %) County Operations PW Phase I Operations PW Phase II Operations 3 Pacific Waste Keeping Hawaii Beautiful Delay Closure of the South Hilo Sanitary Landfill • Our increased diversion rates would substantially extend the life of the South Hilo Sanitary Landfill (SHSL) beyond the County's current projections of 5 — 8 years of remaining capacity, therefore deferring the closure cost which would equate to millions of dollars in avoided cost to the County. • By extending the life of the SHSL the County will be able to delay or eliminate the need to implement one or both of the current potential options for managing residuals. The two options as defined in the IRSWMP include: trucking the waste to the West Hawaii Sanitary Landfill (WHSL) or construction of a new landfill within the quarry adjacent to the SHSL site. Both options present a number of risks to the County from associated environmental, economic and social impacts. • Cost savings to County by avoiding the need to truck waste from East Hawaii to the WHSL: Projected transportation cost of $82 per ton plus the current WHSL tipping fee of $56.99 per ton (approximatly $6,500,000 annually). • Cost savings to County by avoiding the need to expand the SHSL into the adjacent quarry site: Projected construction cost of $69 - $73 per ton (approximatly $2,200,000 annually). • $ County Cost Annually (based on 2009 -10 amounts) $6,000,000 $4,000,000 $2,000,000 $0 Trucking Option SHSL Expansion PW MRF Operations Pacfic Waste MRF Operations Compared to County "Modified" MRF Operations • Estimated cost savings to County of $900,000 in first year operations and $1,300,000 per year thereafter (avoided costs of County operated facility as identified in the DEM Director's Report, dated November 24, 2010). Additional cost savings of $120,000 per year achieved through the reduction of two positions at SHSL, due to reduced disposal activities. 4 Pacific Waste Keeping Hawaii Beautiful Proposed Business Structure • Pacific Waste will provide and fund all the necessary building modifications and upgrade as well as the cost to design, manufacture and install the proposed MRF processing equipment. • We anticipate approximately 24 new "Green" jobs will be created by this proposal. Pacific Waste will provide and fund the necessary personnel to operate the facility. • Pacific Waste will fund all necessary operations and equipment maintenance costs as well as utility costs for the Reload Facility. • The existing SHSL scale house operations will be moved to the Sort Station (to be operated by County personnel); the facility tipping fee for commercial haulers will match the SHSL tipping fee (currently set at $85 per ton; any increases will coincide with SHSL increases) while County vehicles will be billed at a substantially reduced rate (to be identified in the RFP response or negotiated in a PPP). The facility tipping fee will be collected from all County and commercial haulers and paid to Pacific Waste. Pacific Waste will in turn pay the SHSL tip fee for any residual landfill amount deposited that is greater than the amount of MSW brought to the Sort Station by County vehicles. Disposal at SHSL will be limited to residual material and delivered by County trailers only. • Pacific Waste and County of Hawaii to enter into an Operating Agreement for an initial period of 20 years with two additional 10 year options -to- extend periods. County shall also enter into a Waste Disposal Contract with Pacific Waste with a term of equal length as the Operating Contract, wherein the County agrees to deliver the County- collected MSW from East Hawaii. • Pacific Waste shall process recovered commodities into a marketable form at the proposed facility and market all viable commodities, or may deliver the commodities to another permitted facility for final processing and/or beneficial reuse. As compensation for the work preformed under the Operating Agreement, Pacific Waste shall receive 100 percent of the tipping fees and total gross receipts from sale of marketable material. • County of Hawaii to enter into an agreement with Pacific Waste to establish a Diversion Incentive Program to provide an economic incentive for the marketing of designated commodities recovered from the waste stream for recycling, re -use, and/or re- manufactured material. Pacific Waste will be eligible to receive Diversion Incentive Program payments for the materials diverted under the Operating Agreement. The payments shall be made quarterly based on approved claim reports submitted by Pacific Waste. • Pacific Waste to establish a public fund through a percentage of the Diversion Incentive Program for public education and awareness programs to inform the County of Hawaii residents on the benefits of recycling and waste reduction activities. 5