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HomeMy WebLinkAboutStaff Report 323-10TO: FROM: DATE: HONORABLE CITY COUNCIL CITY MANAGER AUGUST 2, 2010 DEPARTMENT: UTILITIES AND PUBLIC WORKS CMR: 323:10 REPORT TYPE: CONSENT SUBJECT: , Utilities Advisory Commission Recommendation that Council Approve the Use of Up to $75,000 in Calaveras Reserve Funds to Partially Fund a $2~0,000 Energy/Compost Feasibility Study and Environmental Impact Initial Study EXECUTIVE SUMMARY On April 5, 2010, Council directed staff to conduct a feasibility study of an anaerobic digester that would use yard waste, food waste, and possibly sewage sludge to produce biomethane. The biomethane could be used either directly as a substitute for natural gas or burned in a generator to produce electricity. Staff is recommending under a separate agenda item approval of a contract to prepare this feasibility study. This report and recommendation would provide a portion of the funding for the feasibility study. The feasibility study is expected to cost about $250,000, of which 25% will from the Electric Fund. Staff and the Utilities Advisory Commission recommend that the Electric Fund's share of the cost of this study be funded from the Electric Fund account known as the Calaveras Reserve. REQUEST Staff and the Utilities Advisory Commission (UAC) recommend that the Council approve the funding of 25 percent of the cost of an Energy/Compost Feasibility Study and Environmental Impact Initial Study, up to a total of $75,000, from the Calaveras Reserve. BACKGROUND The City of Palo Alto currently handles organic residuals in the following ways: 1. Yard trimmings are composted at the Palo Alto landfill site in uncovered long, thin rows, or windrows; 2. Residential food scraps are disposed of with the garbage and 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 (RWQCP) inPalo Alto. 323:10 Page 1 4 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 RWQCP. On April 5,2010 Council directed staff to: 1. Hire a consultant to evaluate dry anaerobic digestion; 2. Prepare an environmental impact review focused on 8 to 9 acres of Byxbee Park; 3. Continue not accepting commercial refuse at the Palo Alto Landfill; . 4. Study energy conversion-technologies including anaerobic digestion at the R WQCP as part of its Facility Planning process; and 5. Pursue partnering opportunities for organics processing within 20 miles of Palo Alto. On May 24, 2010, Council received an information report (CMR: 251 :10 -attached to this report as Attachment B) that described the plan to engage a consultant to complete the feasibility study as directed by Council. The report states that the funding for the study will come from the relevant Enterprise Funds. On January 12, 2009, Council directed staff to work with the UAC to review possible projects that would benefit electric ratepayers for consideration of funding from the calculated "excess" Calaveras Reserve Fund (CMR: 110:09). On June 15,2009, as recommended by staff, the UAC, and the Finance Committee, Council approved changes to the Calaveras Reserve guidelines (CMR: 275:09), including a provision that, to the extent that there are funds available in excess oflong~term stranded cost needs, staff will work with the UAC to identify and recommend projects for Council consideration and approval. Such projects shall be to the benefit of electric ratepayers. DISCUSSION The Public Works Department will manage the consultant contract and Utilities staff will work closely with Public Works staff to complete the feasibility study. The consultant will prepare a feasibility study for a dry anaerobic energy/compost facility, which 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 will include an economic, greenhouse gas, and environmental impact analysis. Pursuant to the California Environmental Quality Act (CEQA), an Initial Study (CEQA Checklist) will also be prepared. 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. Three basic alternatives and four sub-alternatives will be evaluated in the study: 1. A new dry anaerobic digestion facility adjacent to the RWQCP. There are two potential sites for this -the 8 to 9 acre landfill site just southeast of the RWQCP, and the RWQCP site itself. Therefore, there will be sub-alternatives to Alternative 1 as follows: CMR: a. A new dry anaerobic digestion facility for yard waste, food waste and biosolids on the landfill site. :10 Page b. Dry anaerobic digestion for yard, food and wet anaerobic digestion for biosolids on the landfill site. c. Dry anaerobic digestion for yard and food on the landfill site and wet anaerobic digestion for biosolids on the R WQCP si,te. d. Dry anaerobic digestion for yard and food waste and no methane production from the biosolids. 2. A similar regional facility adjacent to the San Jose Wastewater Treatment Plant 3. The current facilities and plans which Palo Alto has arranged for its organics residuals following closure of the Palo Alto Landfill. 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. The analysis of all main options and sub­ options will include: 1) a financial analysis; 2) a life-cycle analysis of greenhouse gas emissions; and 3) an analysis of environmental and other impacts. Utilities will ensure that the feasibility study will include a proper evaluation of the value of the biomethane and/or electricity produced from an anaerobic digester facility. This evaluation will take into account the value of the: 1) energy produced; 2) green attributes of the energy produced; 3) avoided electric transmission losses and gas transportation and electric transmission costs; and 4) local capacity. COMMISSION REVIEW AND RECOMMENDATIONS The UAC considered the staff recommendation to fund the Electric Fund's share of the Energy/Compost Feasibility Study and Environmental Impact Initial Study from the Calaveras Reserve at its meeting on June 2, 2010. The UAC discussed whether there was any benefit to Utilities from the feasibility study as the project was initiated to address an issue in the Refuse Fund. Utilities was determined to have an interest in the study to ensure that the output from the. digester is valued appropriately and that Utilities considerations are incorporated into the study. Some commissioners agreed that the request for funding from the Calaveras Reserve was consistent with the intentions for projects that would be funded from that reserve since the digester would be a locally-sited generator of renewable energy. One commissioner felt that the Calaveras Reserve was for large projects, not for such small sums for studies, and suggested that the requested funds should come from the Electric general operating budget. The UAC voted to recommend that the Council fund the Electric Fund's 25 percent share of the Energy/Compost Feasibility Study and Environmental Impact Initial Study, up to $75,000, from the Calaveras Reserve by a vote of 4 to 1 with Chair Melton voting no. The excerpted notes from the UAC meeting are provided as Attachment C. RESOURCE IMPACT The feasibility study is expected to cost $250,000. The Electric Fund's expected expense is 25 percent of the total $250,000 cost of the study, or $62,500. To allow for contingencies and potential additional related studies, up to $75,000 is requested for funding from the Electric Fund's Calaveras Reserve. If funding of up to $75,000 for this feasibility study from the CMR: 323:10 Page 3 4 !.':, Calaveras Reserve is approved, sufficient funds would remain in the Calaveras Reserve to cover stranded costs of the electric portfolio. POLICY IMPLICATIONS The conduct of the Energy/Compost Feasibility Study and Environmental Impact Initial Study is aligned with Council policy and creates no new Councilor City policy. ENVIRONMENTAL REVIEW As part of this project, the City is preparing an Environmental Impact Report Initial Study. ATTACHMENTS A. CMR: 251: 10 -Status Update on Procurement for Dry Anaerobic Digestion Feasibility Study and Environmental Review B. Council Direction from the AprilS, 2010 meeting C. Excerpted Draft Minutes from the June 2, 2010 UAC meeting PREPARED BY: Utilities Assistant Director, Resource Management . IDLBOBEL Environmental Compliance Manager, RWQCP DEPARTMENT APPROVAL: GLENN ROBERTS CITY MANAGER APPROVAL: Di O'OfPUblitD'm e:;OAMES KEENE j .;...0---City Manager CMR: 323:10 Page 4 of4 ATTACHMENT A TO: HONORABLE CITY COUNCIL (!)" FROM: CITY MANAGER DEPARTMENT: PUBUCWORKS 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 infonnational report and no Council action is required. The purpose of this report is to notify Council on the progress being made iowards 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 April 2012. Staff expects to have a draft interim fmancial analysis report in January 2011. BACKGROUND On AprilS, 2010, Council 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 on 8 to 9 acres of Byxbee Park adjacent to the Regional Water Quality Control Plant; 2. Continue the moratorium on commercial waste acceptance atthe Palo Alto Landfill; 3. Provide an interim report to Council 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 localpartnering 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, 201 0 is detailed in CMR: 165: 1 O. 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 of4 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 (OHO) 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 proj ect. Completion of this task will address item 3 ofthe 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. CMR:251:10 Page 2 of4 RESOURCE IMPACT Depending on the outcome of Council action at the fmal preliminary report stage (March 2011), staff could develop a fonnal 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 diversi.on. 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 fonnal 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 COWlcil in September 2011 when the fmal feasibility study report is presented to Council for acceptance and when the srope of the facility is better defmed. Prior to that decision, much of t4e 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 infonnational 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.:25 1.1 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 PREP ARED BY: DEP ARTMENT.HEAD: CITY MANAGER APPROVAL: CMR.:251.10 ~~ MA tTHEW A. RASCHKE Senior Engineer '/L 1 Rj-t----- GLENN S. ROBERTS Director of Public Works AI ENE Page 4 of4 5/24/10 6/11110 8f1JIO 9/8/10 1213/10 1124/11 2111 3/15111 6115111 7/30111 . 8/11 9130111 4/15/12 ENERGY/COMPOST STUDY CONCEPTUAL TIMELINE FEASmlLITY STUDY Study TimeJine Info Cl\fR RFPIssued J _,.,...e. -L_ - ---. I Percent of I J Contract Funds I I Expended I ... J ~-_ ..... _ ..... __ Council Approval of Consultant Contract I I ENVIRONMENTAL ASSESSMENT Community Issues Input Meeting for Feasibility ...... .,. ..... 9/8/10 Community Issues Input Meeting for Environmental Analysis I Assessment I Consultant Draft of Prelim. Financial/GHO Analysis I Info C.MR forwarding Draft Prelim. Financial! GBG Analysis . Community meetings on Draft Prelim. FinanciaV GHO Analysis I I I I I I Final Prefun. FinanciaJ/GHG Analysis ................. 3/15/11 {point for possible farther Council action} 70% I Consultant Draft ofFeasihility Study ·····.·· .. ···········1···· 6/15/11 • Info CMR forwarding Draft Fe;lSibDity Study ....... ~ ...... 7130/11 -Co~unity Meeting~ ·········~···-··········· .. ·············i···· 8111 Final Feasibility Study to Council ........................... 9130111 100% I Final Feasibility Study to Council ......................... 4115/12 . Consultant Technical Environmental Analysis CEQA Initial Study/Checklist, including Greenhouse gasses, traffic, emissions, and other impacts Preliminary Consultant Teehllical Work on Environmental. AsSes5ment Completed Consultant Draft of CEQA Initial Study (CEQA Checklist) InfoCMR forwarding Draft CEQA Checklist Community Meetings Recommendation to· Council on Timeline for Completing CEQAReview and Proeess Final CEQA Review Documentation. to Councn for Certification ~ KEYMILESTONEDATES Additional Funding Needed ~ > n i > ATIACHMENTB City ofPaio 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 P~o Alto Regional Watet 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 Plantl . On AprilS, 201 0 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. :I 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 djgestion 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 ate part of an active class 3 municipal solid waste landfill that pas not yet received a fmal 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 riot 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% of its 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 APPROACH 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 s~mi1ar 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 (Le. transfer to regional facilities via the SMaRT® Station). Palo Alto staff will provide much of the data for the an8lysis 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 Alternatiye 1: la) A new dry anaerobic digestion for yard, food and biosolids on the landfill site (biosolids in separate cells). 1 b) Dry anaerobic digestion for ,yard, 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 anaerobic 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 financial 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 AprilS, 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 consulmtion with the City, Consultant will fina1i~ 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 1n 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 fmalized. 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 Task6 - Task? - Task3 - 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 Environmel1tal 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 EIR, 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 [la) -Id)] 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 ot government should own andlor operate the energy recovery plant andlor the anaerobic digesters. City Staff will provide the consultant with the coriunodity 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) -Id)], the type of methane utilization, and the owner/operator . question. The most cost effective alternative shall be identified. Task9 -Project Management 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 TIMELINE September 8, 2010 December 3, ~01O 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 Financial/Greenhouse Gas Analysis' , Revised Draft Preliminary FinanciallGreenhouse Gas Analysis Community meetings on Draft Preliminary Financial/Greenhouse Gas Analysis Final Preliminary Financial/Greenhouse Gas Analysis Consultant Draft of Feasibility Study and' California Environmental Quality Act Initial Study (Califoniia Environmental Quality Act Checklist). Revised Draft Feasibility Study and California Environmental Quality Act Checklist Community Meetings Final Feasibility Study and Draft Workplan for completion of California Environmental Quality Ad documentation. Final Workplan for Completion of California Environmental Quality Act documentation. 1 2 3 4 5 6 7 8 Draft Proposal Review Criteria Worksheet Criteria Propasalhas all reQuired elements. Proposal is well thought out, clear. andprov~es clear path to meet project objectives. Proposers experience, including the experience of staff'to be assigned to the project, with enaaaements of simitar SCOPe and commexity. Cost to thecilv. Proposer has adeQUate financial liability insurance •. Proooser's abilitv to Derform the work within the time sPecified. Proposer's 'Prior record of DeIformance with citY or others. Proposer's compfiance with applicable laws, regulations, policies (including city council pollcies),guidelines and orders governing prior to existing contracts performed by the contractor. . ~ Score = Weight x Rating. Rating shall be frQm a to 5; with 0 = poor rating and 5 = good rating. Rating shall be determined by member of selection committee. Tolalscore Proposal is well thought out, clear. and provides clear path to meet objectives. Consultant A WelaM Rating Score 2 0 3 0 5 0 5 o - 2 0 3 0 3 0 2 0 ' '. "-.' ''c '0;._' 0 Consultant B Weight RatIng Score 2 0 3 0 5 0 5 ();. 2 0 3. 0 3 0 2 a .~.: •........ ." 0' ," , ~. ~ I n !ATTACHMENT B April 5, 2010 City Council Meeting Results Action Minutes Excerpt on Item No. 11: Energy Recovery/Compost Facility The following is an excerpt from the April 5, 2010 Council Meeting Action Minutes concerning an Energy Recovery/Compost Facility in Palo Alto. It shows the motion passed by Council and the approved amendments. This constitutes the April 5, 2:010 COUNCIL DIRECTIVE TO STAFF: MOTION: Council Member Klein moved, seconded by Mayor Burt to: 1) Dir~ct Staff to initiate the process to hire a consultant to evaluate the dry anaerobic digestive system, 2) Prepare an applicable level EIR, focused on the 8-9 acres of Byxbee Park adjacent to the Regional Water Quality Control Plant as a prospective site, 3) Continue not allowing commercial waste acceptance, and 4) Review a policy that the lease revenue to the General Fund (OF), net of any costs to the GF, would first be used to develop Byxbee Park. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER that within the feasibility study an interim report would return to Council on the cost analysis. INCORPORA TED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to examine the feasibility of energy conversion technologies (including AD technologies) during the upcoming Regional Water Quality Control Plant (RWQCP) Master Planning Process. AMENDMENT Council Member Holman moved, seconded by Council Member Schmid to adopt Staff recommendation Number 3; 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. AMENDMENT PASSED: 5-4 Burt, Klein, Price, Shepherd, no Council Member Klein withdrew Item Number 4 from his Motion; Review a policy that the lease revenue to the GF, net of any costs to the GF, would first be used to develop Byxbee Park. MOTION PASSED: 5-4 Espinosa, Holman, Schmid, Yeh, no ATTACHMENT C EXCERPTED DRAFT MINUTES OF UTILITIES ADVISORY COMMISSION Meeting of June 2,2010 ITEM 3: ACTION ITEM: Use of Up to $75,000 in Calaveras Reserve Funds for an Energy/Compost Feasibility Study and Environmental Impact Initial Study Assistant Director Jane Ratchye explained that the Council directed that a feasibility study for an anaerobic digester be completed and that the cost was expected to be $250,000. City staff had determined that a fair split of the total cost would be for the Refuse Fund to pay half of the cost and the remaining half split equally between the Electric Fund and the Regional Water Quality Control Plan. Utilities staff is proposing that the Calaveras Reserve be the source of funds for the Electric Fund's share of the cost, up to a total of $75,000. Commissioner Foster indicated that the decision seemed easy and that he supported the recommendation. Chair Melton asked why the Electric Fund was aSSigned any part ofthe cost and why the Gas Fund did not get any cost assignment since one outcome could be that gas would be produced from the digester. Fang stated that the project could have benefits to the Electric Fund since local generation would be evaluated and Utilities would want to make sure it was properly valued, but that the Gas Fund was unlikely to be a beneficiary since biomethane, if it was the project's product instead of electricity, would be used directly rather than cleaned up to pipeline quality. Commissioner Waldfogel stated that if Electric Fund was to be tapped, the Calaveras Reserve would be the appropriate source of funds since it fits with the types of projects that were sought for funding from that reserve -local, renewable generation. PUBLIC COMMENT: Herb Borock expressed his opposition to the proposal. He stated that the proposal assumes that the decision on how to divide the costs between funds, rather than ask for policy direction to set that split. In addition, he said that 25% of the $250,000 study would only mean $62,500 is needed, not the $75,000 requested. Finally, we said that the project is entirely a Refuse Fund project and· that no Utilities funds should be used at all, despite the challenging situation of the Refuse Fund. He concluded that the Calaveras Reserve was being tapped since it is available, but that it is not a good policy. Commissioner Eglash asked Council Member Yeh if it was normal for Council to let staff decide funding sources. Yeh said that he didn't know the rationale of the proposed split of funding. Fong added that the Refuse Fund is the largest source of funds at 50% of the total cost. Yeh said thCilt the City Manager would be involved since it must ultimately go to the Council for a decision. He wanted to make sure that the costs are reflective of the benefits for each fund. Commissioner Waldfogel stated that it has been established that there is a bene'rit to the Electric Fund, but not the Gas Fund so that he supported the recommendation. Chair Melton stated that he thought that the Electric Fund's contribution should not come from the Calaveras Reserve since the money involved is too small and that, instead, it should come from the general Electric Fund operating costs. " ACTION: Commissioner Waldfogel made a motion to recommend that Council approve the funding of 25 percent of the funding, up to $75,000, for an Energy/Compost Feasibility Study and Environmental Impact Initial Study from the Calaveras Reserve. Commissioner Berry seconded the motion. Commissioner Melton made a substitute motion to change the funding source from the Calaveras Reserve to the Electric Supply Rate Stabilization Reserve. The substitute motion died for the lack of a second. The original motion passed by a vote of 4 to 1, with Chair Melton voting no.