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Home My WebLink AboutSupplemental Attachments - 4/8/2019JO/K1 SSD Updating Waterloo City Council Facility Plan Update Biogas Update Waste Management April 8, 2019 #14 STRAND ASSOCIATES ecoengIneers peop Historical Update Strand v" Hired to complete Nutrient Reduction Facility Plan Nutrient Reduction plan submitted Y Facility Plan needs to be submitted Ecoengineeers y Hired to evaluate biogas long term funding options v Report being presented today Make decision for future Project Implementation Plant - Lagoon 4/8/2019 1 Wastewater Facility Needs Inefficiencies in existing WWTP operation — using Tess than half of available tankage and loadings exceed "useable" capacity Future nutrient removal requirements Future Equipment Replacement Future Hydraulic Expansion (to avoid EQ Basin overflows if necessary) Consolidating WWTPs Provides Excess Treatment Capacity for Current and Future Needs The City is currently operating above the Easton WWTP's design conditions Operating above design conditions has been a significant contributor to challenges meeting permit requirements during parts of the year r Not recommended to accept significant waste from growth or development without improvements n/o of Design Criteria eter4 Wrrent Operatigrt With Recommended WWTP Consolidation Flow BOD TKN TSS 84% 119% 183% 183% 63% 45% 71% 59% 4/8/2019 2 Ph Phased Implementation of Recommended Plan $100 million of capital improvements identified e Cost Addresses Near -Term (2018- $56.3 2023) million WWTP Capacity and Immediate Needs Mid -Term (2023- $29\5 2028) million Long -Term (2028+) $15. millio Note: Costs in 1St Quarter 2018 Do ars Equipment Replacement Hydraulic Capacity City has proceeded with a portion of this; see next slide Basic improvements to address immediate needs/opportunities (part of the $56.3 million near-term projects) Component of Near -Term Improvements Biosolids Handling Improvements WWTP Digester Gas Improvements TOTAL Cost $14.9 Already doing this; facilities plan needs to be submitted for DNR approval. $6.7 million $21.6 million Addresses -Increase WAS storage capacity -Replace old BFPs - Filtrate equalization -Improve primary sludge pumping hydraulics - Replace TAS pumps, add sludge grinders Necessary improvements to generate revenue from digester gas 4/8/2019 3 Bio -Gas Options What to Recommend? Presently it is a under utilized resource There is great revenue potential There is major capital investment To Best Protect The City's Liability And To Maximum Revenues Biogas Projects Overview Main WWTP - Anaerobic Digesters -250,000 ft3/day Remote Anaerobic Lagoon -800,000 ft3/day Coerati. of Electric ' • Heat Pipeline Injection Direct Vehicle Fueling (CNG Station) 4/8/2019 4 WWTP Biogas Use 250,000 ft3/day Currently biogas is used to heat digesters; about 40- 50% is flared Gas could be cleaned and injected into pipeline or used in vehicles directly u$6.0-6.7 million capital Lagoon Biogas End Use Study 800,000 ft3/day Currently all biogas is being flared Gas could be cleaned and injected into pipeline or used in vehicles directly Additional [optional] cost to improve site access and provide facilities to include hauled waste acceptance —$12.5-16.3 million capital 4/8/2019 5 Lagoon Improvements Required within - 5-10 Years Replace Lagoon Cover in Kind Sludge/Grease Removal —$2.9 million capital cost Optional Upgrades Biogas conditioning system - revenue from gas sales N$9 - $11 million Site upgrades to accept trucked in wastes — revenue from tipping fees x$1.9 million Optional Lagoon Hauled Waste Receiving Improvements Site Access Improvements Allows semi -trailer access from Martin Luther King, Jr. Drive Includes new fences and access gates for site security FOG Receiving System Screens trash and rocks Maintains better lagoon conditions Measure volumes for better hauler accountability and billing CNG or Pipeline Gas Potential site for CNG filling station 4/8/2019 6 4/8/2019 Project Cost Opinion Not Included in $100 million capital expenditures Biogas Conditioning Cover Replacement Sludge Removal Hauled Waste Receiving Station Site Access Improvements TOTAL OPINION OF COST Recommended Improvements without Hauled Waste Receiving $9,620,000 Recommended Improvements With Hauled Waste Receiving $11,540,000 $2,300,000 $600,000 $2,300,000 $600,000 $12,520,000' Not needed now for compliance; but CIP should include within 5-10 years regardless of biogas use decision $1,100,000 $800,000 $16,340,000 EcoEngineers Financial Analysis $5.0o Current Carbon Market $29.00 ,.77y Waterloo's Break Even $11.21 So....How Best to Achieve? EcoEngineers - Financial Analysis 0 Combined Lagoon & WWTP Project Year 1 revenues per MMBtu revenue from credits $ 3,577,000 ($14.81 5 (456,000) 1$ (1.89) Low risk marketing share revenue from gas O&M debt service' Net revenues Medium risk $ 12.92 $ 702,000 $ 2.90 $ (1,300,000)1$ (5.38) $ (1,411,000)1$ (5.83) $ 410,000 $1.70 4 Assumes 100% debt financrng of $22M at 2.0% borrowing rate amortized over 20 year project life. 4 $5.00 breakeven requirements $ 2.90 $ 11.21 Minimum requirements from credits to meet breakeven goal: $ 8.31 Current Carbon Market Options $29.00 More Volume Less Value Natural Gas $2.90 D5 RIN Price $5.28 LCFS Credits 88.05 Potential Value $16.23 Evaluating Options Lagoon PLAN A Plant PLAN B Less Volume More Value Natural Gas $2.90 D3 RIN Price $22.87 LCFS Credits 88.05 Potential Value $33.82 Use long term contract to cover expenses I` Work the market to increase revenue A Blend of the Options is Recommended 4/8/2019 8 EcoEngineers - Financial Analysis Maximum value for Waterloo , ., ,,, Current atueiMMatv Lagoon RNG: 40.1018w/4y_ , WWTP RNG: 180 MMBtu/day` Natural Gas Price $2.90 50 > 133,uUu D5 RIN Price 55.28 50 50 D3 RIN Price $22.87 $0 51,210,000 LCFS Credit Value 58.05 $0 5427,000 Fixed Price $13.00 $2,320,000 $0 Annual Value Total $2,320,000 Annual Value $4,140,000 $17.10 per MM8tu $1,820,000 Risks: No guarantees on WWTP revenues, 6 year guarantee on lagoon revenues w, Recommended Next Steps ,,, Break even Revenue Point will depend on project costs Stand to complete 10-15% design to determine costs , Estimated Costs - $80,000 Complete in 3-4 months From those costs, Ecoengineers can put together long term contracts to best assure city of at least break even revenue Estimated Costs - $10,000 Complete in 2-3 months If feasible, complete design, bid and build project Estimated Costs $22,000,000 e4,4, ,+ Complete in 24-30 months + 4/8/2019 9 Conclusions -Recommendations Finalize and Submit Wastewater Facilities Plan to IDNR City is required to submit a plan for approval Approved plan is required to receive low interest financing Approve resolution on today's agenda Move forward on Biogas Projects' Next Steps V' Contract to complete initial design - refine project costs Further investigate long-term biogas values to better define potential revenue 4/8/2019 10