HomeMy WebLinkAboutStaff Report 251-10TO: HONORABLE CITY COUNCIL 0'.
FROM: CITY MANAGER DEPARTMENT: PUBLIC WORKS
DATE: MAY 24, 2010 CMR:251:10
REPORT TYPE: INFORMATION
SUBJECT: Status Update on Procurement for Dry Anaerobic Digestion Feasibility
Study and Environmental Review
This is an informational report and no Council action is required. The purpose of this report is to
notify Council on the progress being made towards a detailed feasibility study and environmental
assessment for a dry anaerobic digestion facility in Palo Alto. Staff estimates that a final
Environmental Impact Report would be available for certification by Council no earlier than
Apri12012. Staff expects to have a draft interim financial analysis report in January 2011.
BACKGROUND
On April 5, 2010, COlIDcil directed staff to initiate a feasibility study for dry anaerobic digestion
in Palo Alto. The final approved motion consisted of the following points:
1. Direct staff to initiate the process to hire a consultant to conduct a feasibility study and
prepare an appropriate-level environmental impact report for a dry anaerobic digestion
facility on8 to 9 acres of Byxbee Park adjacent to the Regional Water Quality Control
Plant;
2. Continue the moratorium on commercial waste acceptance at the Palo Alto Landfill;
3. Provide an interim report to COlIDcil regarding the economics of the feasibility study
options;
4. Examine the feasibility of energy conversion technologies (including AD technologies)
during the upcoming Regional Water Quality Control Plant (RWQCP) Master Planning
Process; and
5. Investigate and pursue local partnering opportunities with SMaRT® partners and/or local
organic waste processing companies who are developing private AD or energy
conversion facilities within a 20-mile radius of Palo Alto.
A history of events leading up to the Council action on April 5, 2010 is detailed in CMR:165:10.
DISCUSSION
Staff has initiated the process to procure consultant services for a detailed feasibility study of a
dry anaerobic energy facility in Palo Alto with an environmental assessment of impacts. The
study will examine a facility that would recover energy from methane derived from dry
anaerobic digestion of feedstocks consisting of food scraps, yard trimmings, and, possibly
CMR:251:10 Page 1 of 4
CMR:251:10 Page 2 of 4
wastewater biosolids. Besides energy, the primary end product from the processes would be a
marketable soil amendment material similar to finished compost.
An Initial Study Checklist pursuant to the California Environmental Quality Act (CEQA) would
be prepared as early as possible during the study. Further CEQA work may be performed as
appropriate following the Initial Study Checklist. The location of the proposed Palo Alto facility
would be immediately southeast of the Palo Alto Regional Water Quality Control Plant on an 8
to 9 acre site (with 6 to 7 acres overlying the current Palo Alto Landfill).
Several project alternatives relating to the different possible feedstocks will be examined during
the study. The costs, impacts, and benefits will be compared to a “no action” alternative and to
the alternative of a similar processing facility located outside of Palo Alto, but within 20 miles in
order to minimize the air quality impacts and carbon footprint of trucking.
A proposed conceptual timeline for the overall study is presented in Attachment A. The working
draft request for proposals (RFP) is included as Attachment B. Staff expects the RFP to be
issued in June 11, 2010. Per the timeline, Council will be asked to award a contract for the study
by August 2, 2010 before Council takes recess in August.
Community Input Meeting
The first major task that will be performed by the Consultant is the facilitation of at least one
community input meeting for the study. This public input session will collect ideas and concerns
for the project to help guide the rest of the study. This will be especially helpful for identifying
and costing out suggested environmental mitigation proposals. One such mitigation suggestion
already received from community input is that the facility should include a green roof system
that integrates with the closed landfill cap. A follow-up suggestion from community input
indicated that the Byxbee Park recreational trail system needs to be considered in the design.
Preliminary Economic Analysis
The second major task will be the preparation of a preliminary economic analysis of the
proposed facility funding and operating scenarios. The economic analysis will examine the
project with and without a rent payment for use of the City-owned land. It will also include the
economics of greenhouse gas (GHG) carbon credits and renewable energy credits. The data will
be presented in two formats. The first would be in terms of the total overall costs and benefits to
the City of Palo Alto and the partners of the Regional Water Quality Control Plant. The second
would be in terms of costs and benefits to the individual enterprise funds and general fund (if
applicable). Staff expects to present a draft of the preliminary economic report to Council in late
January 2011. The final preliminary economic analysis is expected to be presented by March
2011 for further Council action and direction on the overall project. Completion of this task will
address item 3 of the Council action on April 5, 2010.
This report is provided to keep Council informed of the process that staff has initiated to procure
consultant services. Based on the conceptual schedule, staff expects to return to Council prior to
the August recess to award a contract for the project. Proposals will be evaluated by an inter-
departmental staff committee using standard Purchasing Division criteria as modified to fit this
project. The working draft proposal review criteria worksheet is enclosed as Attachment C.
RESOURCE IMPACT
Depending on the outcome of Council action at the fmal preliminary report stage (March 2011),
staff could develop a formal capital improvement project (CIP) for the proposed facility's
preliminary design and complete EIR. Additional funding for the consultaht beyond the initial
contract award will be required to continl,le the project at that point. The preliminary cost
estimate would also provide a solid basis to pursue any and all potential grant and stimulus
funding sources for the project at that time. Depending upon the specific outcome of the
preliminary studies and subsequent Council direction, costs for conceptual design of the project
and a complete environmental impact report could range from an additional $200,000 to
$500,000. .
Funding for this study is expected to come from the FY2010-11 operating budget of the relevant
and respective Enterprise Funds. The revised initial study cost estimate is expected to be for
$200,000 to $250,000 depending upon the proposals to be received.
POLICY IMPLICATIONS
The ''no action" scenario and the use of a similar anaerobic digestion facility outside of Palo Alto
represent the current organic waste management policy established in the Zero Waste Operations
Plan. That 2007 policy document recommends using regional facilities to handle organics
processing, however it does state in chapter 1.4 that emerging technologies such as anaerobic
digestion could assist the City with achieving higher rates of waste diversion.
The proposed Palo Alto dry anaerobic digestion facility scenario is consistent with established
Council policies on reducing greenhouse gas emissions, but is not consistent with the
Comprehensive Plan or the 2008 Baylands Master Plan.
ENVIRONMENTAL REVIEW
As requested by Council, staff is also proceeding with an environmental assessment. However,
it is important to note that under Section 15262 of the California Environmental Quality Act
(CEQA) Guidelines a feasibility study that does not commit the City to a particular project or
course of action does not require a formal EIR or negative declaration, but instead requires a
more general consideration of environmental factors. Staff expects that a decision to pursue a
program-level or project-level environmental impact report will be made by Council in
September 2011 when the final feasibility study report is presented to Council for acceptance and
when the scope of the facility is better defined. Prior to that decision, much of the preliminary
technical environmental analysis will have been completed including determination and
quantification of impacts relating to greenhouse gases, traffic, noise, air emissions, lighting,
aesthetics, habitat and biological resources, cultural resources, geology and soils hazards,
hazardous materials, hydrology and water quality, land use and planning, mineral resources,
public services, recreation, and utilities. Staff anticipates that an informational report to Council
will be given in July 2011 to present the draft CEQA Initial Study Checklist along with the
technical analysis to support the checklist.
ATTACHMENTS
Attachment A: Proposed Energy/Compost Study Timeline
CMR:251.1 0 . Page 3 of4
Attachment B: Draft Request for Proposal (Energy/Compost Feasibility Study and
Environmental Impact Initial Study -Scope of Services)
Attachment C: Draft Proposal Review Criteria Worksheet
PREPARED BY:
DEP ARTMENT.HEAD:
CITY MANAGER APPROVAL:
CMR:251.10
.;?t:g22~
MATTHEW A. RASCHKE
Senior En.gineer . ~ 1 &cj-t------
GLENN S. ROBERTS
Director of Public Works
Page 4 of4
5/24/10
6/11110
8/2/10
9/8/10
12/3/10
1124/11
2/11
3/15/11
6115111
7/30/11
8/11
9/30/11
4/15/12
ENERGY/COMPOST STUDY CONCEPTUAL TIME LINE
FEASIBILITY STUDY
Study Timeline Info CMR
RFP Issued
Council Approval of Consultant Contract
I ___ L __ -
I Percent of I
I Contract Funds
m Expended
~ I-~-r~~-
I
ENVIRONMENTAL ASSESSMENT
Community Issues Input Meeting for Feasibility
Analysis
•••••• "1' •••• 9/8/10 Community Issues Input Meeting for Environmental
I Assessment
Consultant Draft of Prelim . Financial/GHG Analysis
Info CMR forwarding Draft Prelim. Financial!
GHG Analysis
Community meetings on Draft Prelim. Financial/
GHG Analysis
I
i
Final Prelim. FinanciallGHG Analysis •••••••••••••••. 3/15/11
[point for possible further Council action] 700/0
I
Consultant Draft of Feasibility Study ····················1···· 6/15/11
I
Info CMR forwarding Draft Feasibility Study ••••••• ~ •••. 7/30/11
Community Meetings ······································1···· 8/11
Final Feasibility Study to Council
Final Feasibility Study to Council
••••••••••••••••••••••• 9/30/11
100%
I
•••••••••••••••••••••• 4/15/12
Consultant Technical Environmental Analysis
CEQA Initial Study/Checklist, including
Greenhouse gasses, traffic, emissions, and
other impacts
Preliminary Consultant Technical Work on
Environmental Assessment Completed
Consultant Draft of CEQ A Initial Study
(CEQA Checklist)
Info CMR forwarding Draft CEQA Checklist
Community Meetings
Recommendation to Council on Timeline for
Completing CEQA Review and Process
Final CEQA Review Documentation to
Council for Certification
• KEY MILESTONE DATES
Additional
Funding
Needed
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ATTACHMENTB
City of Palo Alto
Energy/Compost Feasibility Study and Environmental Impact Initial Study
Scope of Services
GENERAL DESCRIPTION OF WORK
The project is to prepare a Feasibility Study for a Dry Anaerobic Energy/Compost
Facility in the City of Palo Alto, California. The facility would recover energy from
methane derived from dry anaerobic digestion of food scraps, yard trimmings, and,
possibly wastewater biosolids. The chief residual from the processes would be compost.
The Feasibility Study would include an economic, greenhouse gas, and environmental
impact analysis. An Initial Study (CEQA Checklist) pursuant to the California
Environmental Quality Act would also be prepared. (Further California Environmental
Quality Act work may be performed through a Contract Amendment.) Several sub
options will be studied. The costs, impacts, and benefits will be compared to a "no
action" alternative and to the alternative of a similar processing facility located outside of
. Palo Alto, but within 20 miles. The location of the Palo Alto facility would be
immediately southeast of the Palo Alto Regional Water Quality Control Plant on an 8-9
acre site (with 6 to 7 acres overlying the existing Palo Alto Landfill).
BACKGROUND
The City of Palo Alto currently handles organic waste in the following ways:
1. Yard trimmings are composted at the Palo Alto landfill site in uncovered
windrows;
2. Residential food scraps are disposed of with the garbage, transferred at the
Sunnyvale SMaRT® Station and ultimately landfilled in South San Jose;
3. Commercial food scraps are increasingly being source separated and composted
near Gilroy, CA, with the remainder being landfilled in South San Jose;
4. Wastewater Biosolids are dewatered and incinerated at the Regional Water
Quality Control Plant in Palo Alto.
Due to the anticipated closure of the Palo Alto landfill and its associated Compost
Facility, Palo Alto has been exploring its options. City Council appointed a Blue Ribbon
Compost Task Force (Task Force) made up of community members to make
recommendations for organics management. The Task Force recommended dry
anaerobic digestion at or near the Regional Water Quality Control Plant l . On April 5,
2010 council directed2 staff to:
1. Hire a consultant to evaluate dry anaerobic digestion
2. Prepare an environmental impact review focused on 8-9 acres of Byxbee Park.
1 See Palo Alto website for Task Force Report and Supporting documents.
2 See Palo alto website for full text of Council Directive
3. Continue not accepting commercial refuse at the Palo Alto Landfill.
4. Study energy conversion-technologies including anaerobic digestion at Palo
Alto's Wastewater Treatment Plant as part of its Facility Planning process.
5. Pursue partnering opportunities for organics processing within 20 miles of Palo
Alto.
The 8-9 acre site described above is currently on dedicated Parkland. Six to seven acres
of the proposed site are part of an active class 3 municipal solid waste landfill that has not
yet received a final closure cap. The entire site would have to be undedicated by a vote
of the residents before an Energy/Compost Facility could be constructed. A number of
other approvals and permits would also be needed. However, this Scope of Services does
not include working on these approval processes.
Palo Alto already operates its own gas and electric utilities, which are potential users of
gas or energy generated by an anaerobic digestion facility. The electric utility has been
directed to procure 33% ofits electric supply from renewable sources by 2015. The gas
utility is investigating opportunities to supply some load using biogas. The City also
fuels its vehicle fleet with compressed natural gas, which is another potential use for
biogas generated by the facility
PROJECT Al!PROACH
Consultant will evaluate and compare three basic alternatives:
Alternative 1: A new dry anaerobic digestion facility adjacent to the Palo Alto
Wastewater Treatment Plant.
Alternative 2: Sending organic waste directly to a similar Regional Facility adjacent
to the San Jose Wastewater Treatment Plant
Alternative 3: The current facilities and plans which Palo Alto has arranged for its
organics residuals following closure of the Palo Alto Landfill (I.e.
transfer to regional facilities via the SMaRT® Station).
Palo Alto staffwill provide much of the data for the analysis of Alternatives 2 and 3. The
majority of the Consultants work will be on Alternative 1. There are two sites involved
in Alternative 1, the 8-9 acre Landfill site just Southeast of the Wastewater Treatment
Plant, and the Wastewater Treatment Plant itself. Therefore, there will be sub
alternatives to Alternative 1 as follows:
Sub-options to Alternative 1:
la) A new dry anaerobic digestion for yard, food and biosolids on the landfill
site (biosolids in separate cells).
Ib) Dry anaerobic digestion foryard, food and wet anaerobic digestion for
biosolids on the landfill site.
lc) Dry anaerobic digestion for yard and food on the landfill site and wet
anaerobic digestion for biosolids on the Wastewater Plant site.
Id) Dry anaerobi(f digestion for yard and food waste and no methane
production from the biosolids.
The analysis of all four sub-options of Alternative 1 will assume that a common methane
energy recovery facility will be located on the Landfill site. It will also include a
preliminary site engineering analysis relating to the existing landfill. The analysis of all
main options and sUb-options will include:
1. A fmancial analysis;
2. A life-cycle analysis of greenhouse gas emissions; and
3. An analysis of environmental and other impacts.
The analysis of the wet anaerobic digestion process in Alternative 2 and Alternative 3
will be performed through a separate, parallel study: the Wastewater Long Range
Planning process. The consultant selected that study will provide the evaluation of wet
anaerobic digestion to the Consultant selected for the Energy/Compost Feasibility Study.
Following submittal of Preliminary Analysis (Task 4), City will consider whether other
alternatives should be considered as well. For example, it may become apparent that an
alternative of a somewhat larger or smaller Landfill site would be a more cost effective
option, and still be within the intent of the Council Directive to staff from April 5, 2010.
CONSULTANT SERVICES
Task 1
Task2 -
Task 3 -
Task4 -
Task 5 -
Development of Detailed Workplan.
Consultant will prepare a draft detailed Work Plan and meet with City
staff and agree on communication techniques as between the City and
Consultant.
Community Scoping for Feasibility Study and for Environmental Review.
City will arrange for and facilitate a community meeting to solicit input on
the Feasibility Study and the Environmental Review. Following this
meeting and consultation with the City, Consultant will finalize its Work
Plan.
Preparation of Draft Preliminary Financial and Greenhouse Gas Analysis.
Consultant shall collect the data necessary to evaluate the options· and sub
options outlined under "Approach" above and prepare a draft preliminary
evaluation in a data management system format. The key parameters will
be dollars, greenhouse gas emissions, and environmental impacts.
Preparation of Final Preliminary Financial and Greenhouse Gas Analysis
Following review by City, the Preliminary Analysis will be finalized.
Included in this deliverable should be a working Excel model that can be
used by City staff to update inputs to the analysis and see the effect it has
on the project's feasibility.
Preparation of Draft Feasibility Study and California Environmental
Quality Act Checklist
Consultant shall assist the City in presenting the Preliminary Analysis to
the Community and to City Council. Feedback from that process shall be
Task 6 -
Task7 -
Task8 -
used to prepare a Draft Feasibility Study and California Environmental
Quality Act Initial Study (California Environmental Quality Act
Checklist).
Preparation of Final Feasibility Study, California Environmental Quality
Act Ch~cklist, and Workplan for Completion of California Environmental
Quality Act Analysis.
Consultant shall assist the City in presenting the Draft Feasibility Study to
Council and the Community. Feedback from that process shall be used to
finalize the Feasibility Study and California Environmental Quality Act
Checklist.
Preparation of Workplan for Complete California Environmental Quality
Act Analysis.
Following preparation of the California Environmental Quality Act Initial
Study (California Environmental Quality Act Checklist), Consultant shall
confer with City. City will advise the Consultant which type of review on
the Feasibility Study is to be completed (program E~ Project-level EIR
or focused EIR). Consultant shall then prepare a Workplan for the
preparation of that type of Environmental Review. (City may utilize a
contract amendment as the vehicle for completing the needed work.)
Analysis of Energy Generation from Methane
Consultant shall estimate the amount of biogas, percent methane, moisture
content and key contaminant levels for the four sub options identified in
the "Approach" above. Landfill gas from the Palo Alto landfill shall be
considered as an additional source of biogas and recommendations made
on whether to include it in the energy recovery analysis.
Consultant shall consider methane utilization in internal combustion
engines, turbines, fuel cells, compressed natural gas production, and any
other promising technologies. For options requiring heat, cogeneration of
heat and electrical energy shall be considered.
Consultant shall analyze the capital and operating costs of the four sub
options [1a) -1d)] in the "Approach" and determine the net present value
over the project life.
Consultant shall consider the impacts of tax credits, renewable energy
credits, rebates, accelerated depreciation and similar features which
improve financial feasibility. Grants which may be possible to obtain
shall be listed and the likelihood of attaining them analyzed briefly.
Recommendations shall be made as to whether the private sector or
government should own and/or operate the energy recovery plant and/or
the anaerobic digesters. City Staff will provide the consultant with the
commodity sale prices (electricity and natural gas) to be used in the
analysis.
The analysis shall result in overall recommendations with respect to the
options [la) -1d)], the type of methane utilization, and the owner/operator
question. The most cost effective alternative shall be identified.
Task 9 -Proiect~anagement
Consultant and City shall meet monthly to review progress and agree on
priorities for upcoming work.
Consultant shall utilize software graphics which depict 3 dimensions, as
well as, plan and side views for showing facilities in its drawings. All
drawings will be fully compatible with the City's GIS System.
PROJECT TWELINE
September 8,2010
December 3,2010
January 24, 2011
February 2011
March 15,2011
June 15,2011
July 30, 2011
August 2011
September 30, 2011
October 30,2011
Community Scoping meeting (City to lead)
Consultant Draft of Preliminary FinanciaVGreenhouse Gas
Analysis
Revised Draft Preliminary Financial/Greenhouse Gas Analysis
Community meetings on Draft Preliminary FinanciaVGreenhouse
Gas Analysis
Final Preliminary Financial/Greenhouse Gas Analysis
Consultant Draft of Feasibility Study and California
Environmental Quality Act Initial Study (California Environmental
Quality Act Checklist).
Revised Draft Feasibility Study and California Environmental
Quality Act Checklist
Community ~eetings
Final Feasibility Study and Draft Workplan for completion of
California Environmental Quality Act documentation.
Final W orkplan for Completion of California Environmental
Quality Act documentation.
1
2
3
4
5
6
7
8
Draft Prol?osal Review Criteria Worksheet
"
Criteria
Proposal has all required elements .
Proposal is well thought out, clear, and provides clear path to meet project objectives.
Proposers experience, including the experience of staff to be assigned to the project,
with el1gagements of similar scope and complexitv.
Cost to the city.
Proposer has adeQuate financialliabilitv insurance.
Proposer's ability to perform the work within the time specified.
Proposer's prior record of performance with city or others.
Proposer's compliance with applicable laws, regulations, policies (including city council
policies), guidelines and orders governing prior to existing contracts performed by the
contractor .
-
Note:
Score = Weight x Rating.
Rating shall be from 0 to 5; with 0 = poor rating and 5 = good rating .
Rating shall be determined by member of selection committee.
Total score
Proposal is well thought out, clear, and provides clear path to meet objectives.
Consultant A
Weight Rating Score
2 a
3 0
5 0
5 a -
2 0
3 a
3 0
2 0
1\ '1':·.1c ···;,.\·."T'-;! 0
ConsultantB
Weight Rating Score
2 a
3 0
5 0
5 a
2 0
3 0
3 0
2 0
.. '-:'3~-"-, ,-,_~,:~ '; ~ 0
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