Waldoboro Transfer Station Committee Chair Bob Butler addresses the meeting Feb. 11. (Alexander Violo photo)
Representatives from Penobscot Energy Recovery Co. were on hand at the Waldoboro Transfer Station Committee meeting on Thursday, Feb. 11 to present their pitch for the continued viability of their waste disposal operation in Orrington.
Vice President of Operations Bob Knudsen, of USA Energy Group, the majority owner of Penobscot Energy Recovery Co., led the presentation, joined by representatives from other companies, who are working with Penobscot Energy Recovery Co. with the goal of creating an environment conducive to sustainable waste disposal at Orrington.
Knudsen said the substantial cooperation present between competitors in the solid waste market is a result of efforts by Penobscot Energy Recovery Co. to create an economical system to handle municipalities’ trash after the 2018 contract expires and the Orrington plant no longer receives above-market rates for the electricity it produces through the existing waste-to-energy facility.
The presenters, including Kevin Tritz, president of Maine Waste Processing, a joint venture between Penobscot Energy Recovery Co., the Casella Waste Systems disposal site at Juniper Ridge, WasteZero, and Exeter Agri-Energy, talked about Penobscot Energy Recovery Co. efforts to ensure the facility remains a viable option for Maine municipalities for years to come and said the company is working on new waste disposal strategies to help municipalities across the state decrease trash tonnage, increase recycling, and cut costs associated with solid waste disposal.
USA Energy Vice President of Operations Bob Knudsen speaks during the Transfer Station Committee meeting Feb. 11. Based in Minnesota, USA Energy is the majority owner of PERC. (Alexander Violo photo)
“We are financially viable, we want your business, and we will remain open,” Knudsen said.
Knudsen said further goals of this cooperative effort are to maintain a high level of environmental performance at the Orrington facility and to keep disposal costs down for municipalities whose waste is processed there.
The year 2018 marks a transitional period for Maine communities as a 30-year contract for solid waste disposal with Penobscot Energy Recovery Co. expires.
The pitch from Penobscot Energy Recovery Co. on Thursday, Feb. 11 followed a workshop featuring Municipal Review Committee Executive Director Greg Lounder, hosted by the Waldoboro Transfer Station Committee on Jan. 19, to discuss the future of solid waste disposal for users of the Waldoboro Transfer Station after 2018.
The Municipal Review Committee is a nonprofit organization formed in 1991 to represent municipalities in their dealings with Penobscot Energy Recovery Co.
Now, the Municipal Review Committee does not view Penobscot Energy Recovery Co.’s as having a feasible plan for the 187 municipalities across the state that Municipal Review Committee represents.
In an effort to provide member communities with an alternative site to manage their waste, the Municipal Review Committee partnered with Fiberight, a Maryland-based company, to construct a solid waste processing location in Hampden.
Lounder said in order for the Fiberight facility to be constructed and operational by 2018, the Municipal Review Committee needs commitments from municipalities totaling 150,000 tons of solid waste by June 2016.
The Hampden site would utilize solid waste to create biogas for sale on the open market for heating and other industry needs.
According to the Municipal Review Committee website, the Fiberight business model for the Hampden site involves front-end processing that recovers recyclable materials and converts the organic material making up 40 percent of solid waste into Biofuel, a product that can be sold on the open market in a similar manner as natural gas.
With the expiration of the Waldoboro Transfer Station’s current contract with Penobscot Energy Recovery Co. approaching, the towns are exploring waste disposal alternatives, notably Penobscot Energy Recovery Co.’s plans for continuing operations at Orrington and the Municipal Review Committee and Fiberight’s plans for a new facility in Hampden.
Knudsen said Penobscot Energy Recovery Co. has a long history in the state that will not end with the 2018 transition.
“PERC is not going to close. For 28 years we have accepted trash, processed it, and turned it into renewable energy,” Knudsen said.
He said $110 million has been invested into the Orrington facility so it will be ready for the next stage of the site’s operations.
“We take pride that we have prepared this unit for the next stage,” Knudsen said.
In 2018, Penobscot Energy Recovery Co.’s power purchase agreement with Emera Maine, based in Bangor, will also expire.
The previous contract guaranteed Penobscot Energy Recovery Co. and, by extension, towns that disposed of their solid waste at the Orrington site, a favorable, above-market rate for its solid waste-based electricity.
However, Knudsen does not see the end of the power purchase agreement as a disadvantage.
“We will have greater flexibility to operate the facility as a for-profit entity. It allows us to look at a different business plan,” Knudsen said.
Among the differences between the two paths available to Maine towns are the ways in which the two corporations dispose of solid waste.
Penobscot Energy Recovery Co. uses a process of incinerating waste to produce energy and Orrington is the state’s largest waste-to-energy facility, where the production of electricity not only provides power to residents and businesses, but also limits the amount of tonnage going into the state’s landfills.
The Municipal Review Committee and Fiberight proposal involves an initiative explored in European markets, but not in domestic waste management.
The future site in Hampden incorporates the development of a state-of-the-art, integrated solid waste management system, which would process solid waste into biogas in a way that maximizes recycling and the processing of waste into products such as biofuels.
Besides the different approaches to turning solid waste into a marketable commodity, different tipping fees are associated with the two disposal sites.
Post-2018 tipping fees at Penobscot Energy Recovery Co. are currently estimated at $85 to $88 per ton, compared to the Municipal Review Committee and Fiberight, where future tipping fees have been predicted to be approximately $70 per ton.
Waldoboro Transfer Station Committee Chair Bob Butler said he is interested in the level of cooperation present in Penobscot Energy Recovery Co.’s proposals.
“I found the presentation to be very interesting,” Butler said.
However, he also said he was not convinced that Penobscot Energy Recovery Co.’s projections indicate long-term profitability, while noting the biogas approach offered through the Municipal Review Committee and Fiberight has its own inherent risks.
“All kinds of claims are being made, resulting in a lot of confusion,” Butler said.
Butler said Waldoboro Public Works Director John Daigle, with the concurrence of the board of selectmen, has decided to hire an engineer to compare the two programs and make recommendations on how to proceed.
