HomeMy WebLinkAboutStaff Report 4550PALO
ALTO
City of Palo Alto
City Council Staff Report
Report Type: Action Items
Meeting Date: 04/2fj/2013
(10 # 4550)
Summary Title: Direct Staff to Pursue the Four-Component Organics Facilities Plan
Title: Staff Requests Direction From Council on Pursuing the Four-Component Organics
Facilities Plan for Food Scraps, Yard Trimmings, and Biosolids, Which Includes:
Recommending No Near-Term Uses for the Measure E Site, Developing New Biosolids
Facilities That May Also Process Food Scraps at the Palo Alto Regional Water Quality
Control Plant, and Continuing With Off-Site Composting of Yard Trimmings in the
Immediate Future, and Rejecting All Proposals in Response to the Energy Compost
Facility or Export Option Request for Proposals
From: City Manager
Lead Department: Public Works
Due to the length and complexity of the above subject-referenced Staff Report ID# 4550
concerning potential Energy/Compost Facilities, staff is providing you this staff report and
its attachments in an early packet submittal to provide additional time for review.
Also, the following new closely-related documents can be found on our website
(www .city ofpaloalto .or g/energycompost ): 1) Palo Alto's Draft Biosolids Facilities Plan;
and 2) Palo Alto's new RFP to select a Program Management Firm to help manage
Wastewater Treatment and Energy/Compost Capital Improvement Projects.
? ~c::
J. Michael Sartor
Public Works Director
PALO
ALTO
City of Palo Alto
City Council Staff Report
Report Type: Action Items
Meeting Date: 04/2fj/2013
(10 # 4550)
Summary Title: Direct Staff to Pursue the Four-Component Organics Facilities Plan
Title: Staff Requests Direction From Council on Pursuing the Four-Component Organics
Facilities Plan for Food Scraps, Yard Trimmings, and Biosolids, Which Includes:
Recommending No Near-Term Uses for the Measure E Site, Developing New Biosolids
Facilities That May Also Process Food Scraps at the Palo Alto Regional Water Quality
Control Plant, and Continuing With Off-Site Composting of Yard Trimmings in the
Immediate Future, and Rejecting All Proposals in Response to the Energy Compost
Facility or Export Option Request for Proposals
From: City Manager
Lead Department: Public Works
Due to the length and complexity of the above subject-referenced Staff Report ID# 4550
concerning potential Energy/Compost Facilities, staff is providing you this staff report and
its attachments in an early packet submittal to provide additional time for review.
Also, the following new closely-related documents can be found on our website
(www .city ofpaloalto .or g/energycompost ): 1) Palo Alto's Draft Biosolids Facilities Plan;
and 2) Palo Alto's new RFP to select a Program Management Firm to help manage
Wastewater Treatment and Energy/Compost Capital Improvement Projects.
? ~c::
J. Michael Sartor
Public Works Director
o
PALO
ALTO
City of Palo Alto
City Council Staff Report
Report Type: Action Items
Meeting Date: 04/2!J/2013
(10 # 4550)
Summary Title: Direct Staff to Pursue the Four-Component Organics Facilities Plan
Title: Staff Requests Direction From Council on Pursuing the Four-Component Organics
Facilities Plan for Food Scraps, Yard Trimming s, and Biosolids, Which Includes:
Recommending No Near-Term Uses for the Measure E Site, Developing New Biosolids
Facilities That May Also Process Food Scraps at the Palo Alto Regional Water Quality
Control Plant, and Continuing With Off-Site Composting of Yard Trimmings in the
Immediate Future, and Rejecting All Proposals in Response to the Energy Compost
Facility or Export Option Request for Proposals
From: City Manager
Lead Department: Public Works
Due to the length and complexity of the above subject-referenced Staff Report ID# 4550
concerning potential Energy/Compost Facilities, staff is p r oviding you this staff report and
its attachments in an early packet submittal to provide additional time for review.
Also, the following new closely-related documents can be found on our website
(www.cityofpaloalto.org/energycompost ): 1) Palo Alto's Draft Biosolids Facilities Plan;
and 2) Palo Alto's new RFP to select a Program Management Firm to help manage
Wastewater Treatment and Energy/Compost Capital Improvement Projects.
""/ ~c::
J. Michael Sartor
Public Works Director
o
PALO
ALTO
City of Palo Alto
City Council Staff Report
Report Type: Action Items
Meeting Date: 04/2!J/2013
(10 # 4550)
Summary Title: Direct Staff to Pursue the Four-Component Organics Facilities Plan
Title: Staff Requests Direction From Council on Pursuing the Four-Component Organics
Facilities Plan for Food Scraps, Yard Trimming s, and Biosolids, Which Includes:
Recommending No Near-Term Uses for the Measure E Site, Developing New Biosolids
Facilities That May Also Process Food Scraps at the Palo Alto Regional Water Quality
Control Plant, and Continuing With Off-Site Composting of Yard Trimmings in the
Immediate Future, and Rejecting All Proposals in Response to the Energy Compost
Facility or Export Option Request for Proposals
From: City Manager
Lead Department: Public Works
Due to the length and complexity of the above subject-referenced Staff Report ID# 4550
concerning potential Energy/Compost Facilities, staff is p r oviding you this staff report and
its attachments in an early packet submittal to provide additional time for review.
Also, the following new closely-related documents can be found on our website
(www.cityofpaloalto.org/energycompost ): 1) Palo Alto's Draft Biosolids Facilities Plan;
and 2) Palo Alto's new RFP to select a Program Management Firm to help manage
Wastewater Treatment and Energy/Compost Capital Improvement Projects.
""/ ~c::
J. Michael Sartor
Public Works Director
o
PALO
ALTO
City of Palo Alto
City Council Staff Report
Report Type: Action Items
Meeting Date: 04/2!J/2013
(10 # 4550)
Summary Title: Direct Staff to Pursue the Four-Component Organics Facilities Plan
Title: Staff Requests Direction From Council on Pursuing the Four-Component Organics
Facilities Plan for Food Scraps, Yard Trimming s, and Biosolids, Which Includes:
Recommending No Near-Term Uses for the Measure E Site, Developing New Biosolids
Facilities That May Also Process Food Scraps at the Palo Alto Regional Water Quality
Control Plant, and Continuing With Off-Site Composting of Yard Trimmings in the
Immediate Future, and Rejecting All Proposals in Response to the Energy Compost
Facility or Export Option Request for Proposals
From: City Manager
Lead Department: Public Works
Due to the length and complexity of the above subject-referenced Staff Report ID# 4550
concerning potential Energy/Compost Facilities, staff is p r oviding you this staff report and
its attachments in an early packet submittal to provide additional time for review.
Also, the following new closely-related documents can be found on our website
(www.cityofpaloalto.org/energycompost ): 1) Palo Alto's Draft Biosolids Facilities Plan;
and 2) Palo Alto's new RFP to select a Program Management Firm to help manage
Wastewater Treatment and Energy/Compost Capital Improvement Projects.
""/ ~c::
J. Michael Sartor
Public Works Director
o
PALO
ALTO
City of Palo Alto
City Council Staff Report
Report Type: Action Items
Meeting Date: 04/2!J/2013
(10 # 4550)
Summary Title: Direct Staff to Pursue the Four-Component Organics Facilities Plan
Title: Staff Requests Direction From Council on Pursuing the Four-Component Organics
Facilities Plan for Food Scraps, Yard Trimming s, and Biosolids, Which Includes:
Recommending No Near-Term Uses for the Measure E Site, Developing New Biosolids
Facilities That May Also Process Food Scraps at the Palo Alto Regional Water Quality
Control Plant, and Continuing With Off-Site Composting of Yard Trimmings in the
Immediate Future, and Rejecting All Proposals in Response to the Energy Compost
Facility or Export Option Request for Proposals
From: City Manager
Lead Department: Public Works
Due to the length and complexity of the above subject-referenced Staff Report ID# 4550
concerning potential Energy/Compost Facilities, staff is p r oviding you this staff report and
its attachments in an early packet submittal to provide additional time for review.
Also, the following new closely-related documents can be found on our website
(www.cityofpaloalto.org/energycompost ): 1) Palo Alto's Draft Biosolids Facilities Plan;
and 2) Palo Alto's new RFP to select a Program Management Firm to help manage
Wastewater Treatment and Energy/Compost Capital Improvement Projects.
""/ ~c::
J. Michael Sartor
Public Works Director
City of Palo Alto (ID # 4550)
City Council Staff Report
Report Type: Action Items Meeting Date: 4/29/2014
City of Palo Alto Page 1
Council Priority: Environmental Sustainability
Summary Title: Direct Staff to Pursue the Four -Component Organics Facilities
Plan
Title: Staff Requests Direction From Council on Pursuing the Four -Component
Organics Facilities Plan for Food Scraps, Yard Trim mings, and Biosolids, Which
Includes: Recommending No Near -Term Uses for the Measure E Site,
Developing New Biosolids Facilities That May Also Process Food Scraps at the
Palo Alto Regional Water Quality Control Plant, and Continuing With Off -Site
Composting of Yard Trimmings in the Immediate Future, and Rejecting All
Proposals in Response to the Energy Compost Facility or Export Option
Request for Proposals
From: City Manager
Lead Department: Public Works
Recommendation
Staff recommends that Council direct Staff to:
1. Reject all proposals received in response to the “Energy/Compost Facility or
Export Option for Food Scraps, Yard Trimmings, and Biosolids” Request for
Proposals (E/CF RFP) process.
2. Begin to pursue the Organics Facilities Plan (OFP, Attachment A) by hiring a
Program Management firm.
3. Apply for a State Water Resources Control Board State Revolving Fund (SRF)
loan for Component One of the Organics Facilities Plan (OFP).
4. Initiate design of Component One of the OFP, Biosolids Dewatering and
Truck Haul-Out Facility, including direction to prepare related modifications
to the Regional Water Quality Control Plant (RWQCP) partner agency
agreements.
City of Palo Alto Page 2
5. Initiate predesign of Component Two, Development of a Thermal
Hydrolysis Process Wet Anaerobic Digestion (THP AD) facility, at the
RWQCP; Component Three, Food Scrap Preprocessing; and Component
Four, Yard Trimmings Processing of the OFP, including the following:
a. Determine the price of electricity that the RWQCP will receive for power
generated by the facility;
b. Establish the optimum size of the THP AD facility built to accommodate
biosolids for a 30-year planning horizon as well as capacity for food
scraps, which Palo Alto and any other jurisdiction would commit to bring
to the facility;
c. Establish a list of contributing partner agencies who commit to bring
food scraps to the facility;
d. Finalize a financing plan for Component Two of the OFP;
e. Determine the appropriate purchasing and project delivery mechanisms
that should be utilized to develop the OFP; and
f. Determine the required CEQA documentation for the Components of
the OFP.
6. Update the existing timeline and schedule in December, 2014 for all
Components of the OFP including next steps for the development of
Component Four, Processing of Yard Trimmings, where Staff will seek to
identify and pursue technologies to harness the energy and resource
potential of yard trimmings that could be located on the relatively flat 3.8-
acre portion of the Measure E site or elsewhere.
Executive Summary
Rather than select any of the proposals submitted in response to the E/CF RFP,
staff instead recommends that the City of Palo Alto pursue an OFP, which staff
has developed in concept based on the review of proposals submitted in response
to the E/CF RFP and the draft Biosolids Facilities Plan (BFP).
(www.cityofpaloalto.org/energycompost)
The OFP provides the City and the Regional Water Quality Control Plant (RWQCP)
partners the best option for short-term resilience, long-term cost savings, energy
production, and reduction in greenhouse gas emissions (GHG). A Graphic
Summary of the OFP is presented on the last page of Attachment A.
City of Palo Alto Page 3
In brief, the OFP consists of four components:
Component One: Biosolids Dewatering and Truck Haul-Out Facility.
Component Two: Wet Anaerobic Digestion Facility utilizing the Thermal
Hydrolysis Process.
Component Three: Food Preprocessing Facility; Preprocessed food scraps
would then be fed into the anaerobic digester
(Component Two above).
Component Four: The pursuit of technologies to harness the energy and
resource potential of yard trimmings.
In connection with its approval of the OFP, staff recommends that the City Council
reject all proposals submitted in response to the E/CF RFP. Staff’s
recommendation is based on issues related to economics, competitiveness,
operational issues, as well as legal procurement considerations.
Table 1 compares the costs and GHG emissions for the OFP, E/CF RFP Proposals
(Synagro, Harvest Power, and We Generation (Cambi Services)), and current
conditions (biosolids incineration, off-site composting of commercial food scraps,
and all yard trimmings):
Table 1
Comparison of the OFP, E/CF RFP Proposals, and Current Conditions
Organics
Facilities
Plan Synagro
Harvest
Power
We Gen
(Cambi)
Current
Conditions
Net Present Value
(20 years) of all costs $76.8 M $98.9 M $97.1 M $107 M $98 M
Annual Greenhouse
Gasses (MT CO2e)
Total (includes truck trips)
-5,260 MT 1,153 MT -3,263 MT -5,291 MT 3,057 MT
From an economic and competitive perspective, the costs for the OFP are lower
than any of the three E/CF RFP proposals available to the City at this time.
Existing proposals submitted in response to the E/CF RFP cannot be modified, or
combined to implement the OFP that staff proposes here. As a threshold matter,
City of Palo Alto Page 4
the OFP is substantially different, and more advantageous as compared with the
scope of work requested in the E/CF RFP and proposed by bidders in response.
Key differences include:
The OFP contemplates the City acting as the owner-operator of the
Anaerobic Digester (AD) facility, while the E/CF RFP asked proposers to
provide a privately funded and operated facility. This structural change
results in significant financial benefits over time, including efficiencies in
staffing and management.
Reduced overall cost resulting from the recently announced 30-year loan
terms available to the City and its regional wastewater partners, through
the State Revolving Fund (SRF) loan program;
Reduced risk to the City and its ratepayers through a phased approach to
development that matches investment in capital facilities with the growth
of the food scraps program.
While two of the bidders have subsequently offered to combine and modify their
proposals in an attempt to match staff’s improved OFP proposal, this combined
proposal would not comply with the existing RFP which requested a third party
operated facility. However, the current bidders would not be barred from
submitting subsequent proposals and bids. Further, now that staff has better
refined its preferred approach staff believes it will receive additional and more
cost effective proposals and bids in response to more narrowly focused RFPs and
Invitation For Bids (IFB).
For these reasons, staff recommends that the Council exercise its authority
pursuant to section 2.30.470(b) of the Palo Alto Municipal Code and reject all
proposals submitted in response to the City’s E/CF RFP.
All four components of the OFP will be initiated and pursued as soon as possible,
through a series of new RFPs. The existing E/CF RFP proposers may reference
their existing proposals in new RFP submittals beginning with the first RFP to
select an overall Program Management Firm. Subsequent RFPs will select Project
Designers, and potentially Design/Build or Design/Build/Operate firms as
appropriate. The existing timeline will be updated this fall and submitted to
Council. Key next steps and tentative milestones are contained in the “Next steps”
Section, below.
City of Palo Alto Page 5
Background
The organic waste streams of wastewater solids (also called sewage sludge), food
scraps from municipal solid waste, and yard trimmings, can be converted from
sources of GHG emissions to fuels for renewable energy generation, which would
dramatically reduce the City’s carbon footprint. Two factors contributed to a
reconsideration of the current organics’ processing options. First, capping the
closed Palo Alto Landfill led to the closure of the Palo Alto Composting Facility, a
facility that had been in operation for 30 years. Secondly, the RWQCP Long Range
Facilities Plan called for the replacement of the incinerators due to their advanced
age and regulatory concerns.
Passage of Measure E in 2011 and the BFP Evaluation
These two events were brought together by the citizen initiated Measure E,
passed in 2011, which called for consideration of processing all three waste
streams (biosolids, food scraps, and yard trimmings) on 10 acres of the closed
Palo Alto landfill, adjacent to the RWQCP. As part of the Action Plan developed
after the passage of Measure E (the 2011 Action Plan), the E/CF RFP was
developed and issued to proposers in March, 2013. The E/CF RFP allowed
proposers to use the 10-acre Measure E site as well as a half-acre site within the
RWQCP.
Concurrent with the E/CF RFP process , the BFP evaluated a range of options for
biosolids along with the E/CF RFP. Both the E/CF RFP proposals and the BFP
evaluation indicate the development of proven wet AD as the preferred
technology for biosolids treatment and food scraps. All of the competitive E/CF
RFP proposals utilized aerobic composting for the processing of yard trimmings.
These conclusions yielded an OFP that provides significant GHG reductions for the
City by generating local energy while increasing the RWQCP’s sustainability and
operational resilience. The OFP does not define a specific use for the Measure E
site and would limit any future use of the Measure E site to the “flat” 3.8-acre
area. This would free up the remaining 6.2 acres to be reconsidered as parkland.
Council and Community Involvement
Progress towards the recommendation of this report and development of the OFP
can be found in Staff Report ID# 4051, which accompanied the February 10, 2014,
Council study session. Since the study session, Staff continued an open dialog with
City of Palo Alto Page 6
the community. Staff had direct conversations with citizen panel members, who
represent both the groups that supported and opposed the November 2011
Ballot Measure E. The OFP was also presented to the public at community
meetings on April 1 and 5, 2014; and at a RWQCP Partners’ meeting on April 7,
2014.
A summary of the questions and discussion from Council, the community, and the
six-member community panel are included in Attachment B. Staff also discussed
the OFP with representatives from Harvest Power and We Generation (Cambi
Services), two of the competitive proposers. A fundamental question discussed
with all parties and reflected in the summary of the questions addresses the
exploration of options available to modify the E/CF RFP, modify a proposal, or
combine the proposals, in order to allow for a low risk, cost competitive and more
timely project. Discussions were held to identify a legal and effective way to
modify the E/CF RFP process for procurement of an organics processing facility.
However, based on legal, purchasing, and competitiveness concerns, a path
forward to develop a project using the current E/CF RFP proposals is not possible.
Therefore, staff recommends canceling the E/CF RFP as necessary to move
forward with the procurement steps for the OFP. The rationale for E/CF RFP
cancelation is discussed in greater detail in the Discussion section.
Discussion
Staff Recommends that the Council Direct Staff to Initiate and Pursue the
Organics Facilities Plan (OFP).
The OFP includes four components:
Component One: Biosolids Dewatering and Truck Haul-Out Facility
Wastewater Treatment Fund
City Owned and Operated
Component Two: Wet Anaerobic Digestion Facility utilizing the
Thermal Hydrolysis Process
Wastewater Treatment Fund and potentially
Refuse Fund
City Owned and Operated
Component Three: Food Preprocessing Facility, which feeds the Wet
Anaerobic Digester
City of Palo Alto Page 7
Refuse Fund
Component Four: The pursuit of technologies to harness the energy
and resource potential of yard trimmings
Refuse Fund
Components One, Two, and Three are fundamentally interrelated to process both
wastewater solids and food scraps. Work can begin concurrently on all four
components, but the components will not be completed by the same date.
The development of Component Four, yard trimmings research and development,
has little bearing on the development of Components One, Two, and Three, and
will be planned somewhat independently. A more complete discussion of the
timeline for the development of the Four Components is included in
Timeline/Next Steps section below. A graphic summary of all four components of
the OFP is presented on the last page of Attachment A.
Staff has prepared the following preliminary list of Next Steps. These will be
reviewed further as the existing project Timeline is updated and submitted to
Council in December, 2014.
1. Coordination Meetings with the RWQCP Partners Apr 2014
2. Issuance of Program Management Firm RFP Apr 2014
3. Present Proposed Electric Price (Under PA Clean
Program) to the Utilities Advisory Commission
Jun 2014
4. Selection of Program Management Firm Sept 2014
5. Deliver Updated Project Timeline to Council Dec 2014
6. Issue Component One Design/CEQA RFP Jan 2015
7. Commence Pre-Design Work on Components Two
through Four
Feb 2015
8. Finalize Coordination with RWQCP Partners (Food
Scraps and Financing)
Mar 2015
9. Develop Financing Plan for Components One and
Two
Mar 2015
10. Completion of Component One 2018 - 2019
11. Initial Retirement of Incinerators 2018 - 2019
12. Demolish Incinerators 2019 - 2020
13. Completion of Component Two 2020 - 2022
City of Palo Alto Page 8
14. Completion of decision making & potential
construction of Components Three & Four
2020 - 2022
Component One of the OFP: Development of Biosolids Dewatering and Truck
Haul-Out Facility
Overview
The City’s consultant, CH2M HILL, produced a BFP, which builds on the RWQCP’s
Long Range Facilities Plan. Component One, a Biosolids Dewatering and Truck
Haul-Out Facility is a key priority in the plan. This facility will provide the
necessary resilience to allow the RWQCP to transport biosolids in the case of a
disaster, emergency, or failure of the primary (current or future) biosolids
handling system. With proper planning the facility can be built ahead of, and still
be compatible with, various options for Component Two (see Attachment C Q7).
The Biosolids Dewatering and Truck Haul-Out Facility will allow the RWQCP to
decommission the sewage sludge incinerators and reduce GHG emissions by
2,343 tons per year. Additionally, the demolition of the incinerators will open-up
another half-acre at the RWQCP and allow more site planning options for
Component Two, the Thermal Hydrolysis Process AD Facility.
Estimated Cost and Timeline
Component One is both essential for the RWQCP’s reliable operations and a
necessary first step towards the development of an AD facility. It is anticipated to
cost $12 million (2015 dollars) and be completed by 2018. Annual operational
costs are estimated to be $1.6 to $2.0 million, depending on the final
transportation and disposal costs of the biosolids. Two currently viable and
environmentally preferable destinations for the dewatered solids are: (1) the
Synagro Central Valley Compost Facility in Merced County, the same facility in the
Synagro E/CF RFP proposal, and (2) the East Bay Municipal Utility District
(EBMUD) wastewater treatment plant in Oakland, CA. Other options may be
identified as part of Component One.
Component Two: The Development of Thermal Hydrolysis Process (THP)
Anaerobic Digester (AD)
Overview
City of Palo Alto Page 9
Component Two is the development of THP AD. Anaerobic digestion is a proven
wastewater technology for stabilizing sludge and biogas generation. Wastewater
treatment plants worldwide use wet AD systems to treat sludge. Due to the high
water and low solids content of sludge, wet AD is an appropriate technology, and
still compatible with the addition of the higher solid food scraps. At least two
publicly-owned wastewater treatment plants in the Bay Area – EBMUD in Oakland
and Central Marin Sanitation Agency in San Rafael – are using wet AD to process
and “co-digest” combined wastewater solids and food scraps.
The BFP provides an evaluation of three wet AD technologies and preprocessing
options. The option that provides the greatest biogas yield, smallest physical
footprint, and the highest quality biosolids, was the combination of THP with wet
AD. The smaller physical footprint offers a significant advantage for dealing with
site planning constraints within the available area. According to the BFP
recommendations, THP AD technology provides clear non-monetary benefits for
treatment and disposal of sewage sludge and favorable overall project economics.
See Table 1 above.
THP AD Technology
The most established THP AD system under development in North America is a
proprietary technology sold by CAMBI, Norway; CAMBI is also the technology
provider included in the We Generation (Cambi Services) E/CF RFP proposal. The
CAMBI THP technology has been installed and operated at 40 wastewater
treatment plants throughout Europe, South America, Japan, and Australia. A new
CAMBI THP system will begin operation in July 2014 at the Washington, D.C. Blue
Plains wastewater treatment plant, the first CAMBI THP system in North America
and largest in the world. A CAMBI THP system is in design for the Hampton Roads
Sanitation District wastewater treatment plant in Virginia Beach, VA. The San
Francisco Public Utilities Commission (SFPUC) Southeast Wastewater Treatment
Plant is evaluating the use of a CAMBI THP system as part of its new digester
project. The SFPUC project is also contemplating co-digesting food scraps into the
CAMBI THP AD system. SFPUC staff have successfully pilot tested the co-digestion
of food scraps with their wastewater solids.
Pre-design, Estimated Cost and Timeline
Prior to moving forward with Component Two, design development (predesign) is
needed to answer vital questions related to project sizing, the use and sale of
City of Palo Alto Page 10
electricity, project financing, site considerations, project delivery options, and
RWQCP Partner approval considerations. It is anticipated to cost $57 million (2015
dollars) and be completed between 2020-2022. Initial annual operational costs
are estimated to be approximately $400,000.
Biogas generated by the THP AD facility would fuel an onsite combined heat and
power system. The energy is 100 percent renewable power and heat for the
RWQCP, offsetting purchased power, and providing 4,560 tons of GHG reduction
per year.
Ultimately, moving forward with Component Two will require selecting a project
delivery method that takes into account the costs, speed of delivery, quality of
the project, ability to operate, risk, and City control. Staff will consider both
design-bid and design-build project delivery options.
The predesign of Component Two (THP AD), which will define the project, is
estimated to take about seven months when staff can return to Council with the
next steps to release an RFP for the design or a design-build contract for the THP
AD system. The CEQA process could also begin at this next step.
The project can take advantage of the area in the RWQCP opened up by the
decommissioning and demolition of the incinerators. The goal would be to
complete the design phase of the THP AD development by 2018. Construction
could begin shortly thereafter with the THP AD facility fully operational for the
processing of biosolids in 2022. These preliminary time frames will be reviewed
and an updated Timeline will be submitted to Council in December, 2014.
Component Three – Food Scrap Preprocessing
Overview
In order to successfully process food scraps in a THP AD, the food scraps must be
preprocessed so that contaminants are removed and the food can be pumped
into the THP AD facility. Since food scraps provide energy potential by increasing
the digester’s biogas output, the marketplace has been active in developing new
technologies to preprocess food scraps.
City of Palo Alto Page 11
The City currently collects commercial food scraps (12,100 tons annually) but not
residential food scraps (estimated at 3,400 tons annually). Staff plans to evaluate
the costs and benefits for increased collection and handling costs needed to
separate food scraps from the residential garbage and yard trimmings, and will be
reporting back to Council in fall 2014. THP AD facility predesign will identify the
initial available excess capacity for food scraps. This capacity will help determine
how much additional food could be accepted into the facility or if additional THP
AD capacity should be built to accommodate available feedstocks.
Food waste tonnage and its source(s) will also help define not only the size of the
preprocessing equipment but also its potential location. Despite the constrained
footprint of the RWQCP, the preprocessing facilities might be able to be located
on the RWQCP site next to the THP AD facility. Conversely, the food scrap
preprocessing could be located at an off-site location where the food scrap loads
could be tipped, preprocessed into slurry and consolidated into larger trucks to be
pumped into the THP AD facility. Staff observed an example of this in the We
Generation (Cambi Systems) proposal submitted in response to the E/CF RFP,
which included the Shoreway Environmental Center in San Carlos as a
preprocessing site. Other material recovery options could include transfer
stations, like the Sunnyvale Material Recovery and Transfer (SMaRT) Station,
where Palo Alto is a partner.
Inclusion of Palo Alto’s commercial food scraps in the digester has the potential to
increase biogas production and further reduces the City’s GHG emissions by 1,825
tons of CO2e. Collecting residential food scraps suitable for an AD system presents
some unique challenges. Staff may recommend the co-composting of residential
food scraps with yard trimmings as a more cost effective, convenient, and
sustainable processing option. Staff also will continue to actively support and
encourage home composting.
Estimated Costs and Timeline
Due to the uncertainty about the sizing and location of a preprocessing facility,
staff’s cost estimates for Component Three are preliminary, and will be later
refined as the research noted above is completed. At this time, and subject to
later revision, capital costs are estimated at $8.9 million. The capital costs along
with RWQCP treatment costs will be recovered through food scrap tipping fees.
The preliminary food scrap tipping fee estimate is $46 per ton, also refined later.
City of Palo Alto Page 12
The development time for a food preprocessing system could be relatively short.
The technology is modular and relatively compact. However, for food
preprocessing and digestion in Component Three to begin, the RWQCP must be
certain that the THP AD facility is fully operational and that it meets regulatory
requirements. Therefore, the full deployment of Component Three would be
completed between 2020-2022, at least one year after the THP AD facility begins
operation.
Component Four – Yard Trimmings Processing
While aerobic composting is an established and environmentally sound
processing option, new technologies are being developed to harness the energy
and resource potential of yard trimmings. The San José/Santa Clara Regional
Wastewater Facility recently approved a one-year small scale demonstration
project to gasify wood waste with biosolids. Staff will continue to follow these
emerging technology developments and improvements in composting technology
to evaluate whether a local facility on the 3.8-acre relatively flat portion of the
Measure E site is a sustainable option. Staff recommends no change to the
current yard trimmings compost operations in the near term.
Staff Recommends that the Council Reject all Proposals Submitted in Response
to the E/CF RFP
In connection with its approval of the OFP, staff recommends that the City Council
reject all bids submitted in the E/CF RFP. Staff’s recommendation is based on
issues related to economics, competitiveness, as well as legal procurement
considerations. A description of the E/CF RFP and the specific proposals received
is described in detail in the February 10, 2014 staff report (Staff Report ID# 4051).
The E/CF RFP was designed to provide firm pricing and test the market for novel
or new technologies to process food scraps, yard trimmings, and biosolids. The
expectation was that there would be synergy associated with processing the three
waste streams together and that would warrant the associated risk. However, the
technologies proposed were generally considered conventional with a limited
amount of risk. Therefore, while the three E/CF RFP proposals were competitive,
the shift in staff understanding of the cost-benefit potential of a THP AD system
based on the findings in the BFP and the realization that a City owned-and-
City of Palo Alto Page 13
operated facility would provide long-term savings with minimal risk exposure has
led staff to recommend canceling the E/CF RFP and rejecting proposals. The We
Generation (Cambi Services) proposal provides a technology solution similar to
the OFP. Unfortunately, due to the low score and the fact that the We Generation
(Cambi Services) was also the highest cost proposal, the E/CF RFP process was not
an appropriate procurement vehicle to secure the THP AD technology. Staff, as
shown in the cost section, has illustrated how it can deliver a more robust project
at a lower cost over the 20-year term than the proposals.
While not the goal of the E/CF RFP process, staff noted that the E/CF RFP
proposals validated the technology suite (AD and composting) that forms the
basis of the OFP. Both the proposers and city consultants have confirmed that
staff should focus on these technologies. Technologies like dry AD and gasification
do not appear to be viable solutions in the near term. Staff would allow the E/CF
RFP proposers to reference their proposals in any subsequent OFP procurement
process.
Economic and Competitive Factors Support Rejection of all Proposals.
The four-component OFP provides the City with a more cost effective,
environmentally robust, and flexible option for processing food scraps, yard
trimmings, and biosolids, than the E/CF RFP proposals. To illustrate this, staff
compared the three competitive E/CF RFP proposals to the OFP and current
operations. The key parameters being compared are costs, GHG, and technical
factors. For a full description of the E/CF RFP proposals and how the proposals
were screened, see Staff Report ID# 4051 from February 10, 2014.
Cost
To compare the overall costs of the project, staff converted proposal data into
equivalent terms for key criteria in order to determine the comparable net
present value for the different project proposals. For the economic model, staff
used an inflation rate of 2.5 percent per year, a net present value discount rate of
4 percent, a sale price of energy at 10.4 cents / kilowatt hour (kWh), a 20-year
financing period, a borrowing rate of 4.5 percent for privately funded projects,
and a borrowing interest rate of 2.5 percent for publicly funded projects. The
different alternatives used the same assumptions for the three feedstocks.
Changing any of these variables would have an impact on the overall economics
of any project. The price that the City’s utilities will pay for any renewable energy
City of Palo Alto Page 14
generated by the project can be an important variable that influences projects
economics when comparing an export option for biosolids and food with an
onsite AD.
Table 2 compares the proposals submitted in response to the E/CF RFP with the
OFP and current conditions as follows:
1. The Four-Component Organics Facilities Plan
2. The Synagro (export) proposal
3. The We Generation (Cambi Services) proposal with outside food scraps
4. The Harvest Power proposal with outside food scraps, and
5. Current conditions (biosolids incineration, off-site composting of food
scraps and yard trimmings)
While the E/CF RFP responders each proposed multiple alternatives, the chart
includes only the option that provides the most favorable pricing to the City over
a 20-year term. A 30-year option is also presented for the OFP and the Harvest
Power proposal – the only E/CF RFP proposal to include a 30-year option.
Table 2
Comparison of the OFP, E/CF RFP Proposals, and Current Conditions
Organics
Facilities
Plan Synagro
Harvest
Power
We Gen
(Cambi)
Current
Conditions
Net Present Value
(20 years) of all costs $76.8 M $98.9 M $97.1 M $107 M $98 M
Annual GHG Emissions
(MT CO2e)
Total (includes truck trips)
-5,260 MT 1,153
MT
-3,263
MT
-5,291
MT 3,057 MT
Annual Truck Trip
Greenhouse Gasses (MT
CO2e)
284 MT 748 MT 142 MT 253 MT 291 MT
RFP Rank Scoring
(1 = Best) -- 1 2 3 --
Notes: 20 year term, all three feed stocks (food scraps, yard trimmings, biosolids)
2.5% Inflation
4% Net Present Value Discount Rate
City of Palo Alto Page 15
City Financing at 2.5% Interest
Private Financing at 4.0% Interest
Harvest Power and We Generation (Cambi Services) will accept outside food scraps
The OFP provides the lowest overall net present value (NPV) over the 20-year
time horizon ($76.8 million NPV). This is a result of the lower borrowing costs for
the City (2.5% interest) as compared to the private sector (4% interest).
Additionally, the bulk of the expense in the OFP, especially for biosolids, is a
capital expense, which does not increase over the 20-year term. The E/CF RFP
proposals have much higher operating and maintenance costs that were
estimated to escalate over the term annually at a 2.5% inflation rate. The
operation and maintenance of a City-operated facility can be completed with
existing staff. Therefore, this escalation yields an overall higher net present value
for the E/CF RFP proposals and the current conditions.
An additional Synagro proposal to export and process only biosolids (not shown in
the table) is the lowest priced option ($53 million NPV). When considering the
addition of composting food scraps at Z-Best into the Synagro proposal ($70
million NPV), the OFP ($64 million NPV) comes in at a lower price.
CH2M HILL, in their analysis of the E/CF RFP proposals noted the relatively low-
cost estimates the proposers provided for capital costs and voiced concerns that a
project built by the proposers would need to be “replaced” after a 20- or 30-year
term. The quality of materials used for the BFP cost estimate (concrete digesters,
full redundancy for major equipment, etc.) is distinctly different than the quality
of materials (and expected life) assumed in the E/CF RFP proposals. On the other
hand, the OFP engineering estimates provide for facilities that are designed to
have a 30-year functional life and could be extended to 50 years (as is true at
other wastewater treatment plants). The OFP may be a higher capital cost, but it
will be less expensive over a 30-year term and provide a reliable facility long into
the future.
Greenhouse Gas (GHG) Emissions
GHG emissions estimates are based on the latest 2013 emissions estimates for
the RWQCP incinerators, the 2011 Energy/Compost Facility Feasibility Study
completed by Alternative Resources Inc. (ARI), and the analysis provided by CH2M
HILL in the BFP. As mentioned earlier, a large reduction in CO2 equivalent
anthropogenic GHG is a result of the decommissioning of the RWQCP sewage
City of Palo Alto Page 16
sludge incinerator. The RWQCP will see its annual GHG emissions change from its
current 3,057 metric tons to a new 714 metric tons (2,343 metric ton reduction
per year) by constructing a solids dewatering and truck haul-out facility, retiring
the incinerators, and hauling to the Central Valley. Staff will continue evaluating
hauling the sludge to either the Central Valley for composting or to EBMUD in
Oakland; the hauling price with EBMUD is still negotiable. EBMUD offers an
option where GHG emissions would offset RWQCP GHG emissions approximately
1,660 metric tons because EBMUD already has existing digesters and electricity
producing equipment and sells renewable energy to the Port of Oakland.
By adding THP AD, the City will see a further change in emissions from producing
714 metric tons of CO2e to offsetting 3,846 metric tons (i.e., a total 4,560 metric
ton reduction). The OFP, the We Generation (Cambi Services) proposal, and the
Harvest Power proposal, all achieve similar greenhouse gas emission reductions.
The Synagro proposal, which uses aerobic composting to process biosolids and
food scraps, is an improvement over the current operations, but does not achieve
the reductions associated with digestion and the generation of renewable energy.
Food scraps added to the THP AD system will provide dramatic increases in biogas
production. The addition of Palo Alto’s commercial food waste will result in nearly
5 million kWh of renewable power every year. When compared to the existing
composting operations, the resulting power will yield a reduction in GHG
emissions by 1,795 metric tons of CO2e.
Implementing the OFP will see emissions drop by over 8,000 metric tons of CO2e –
the equivalent of removing over 1,500 cars from the road.
Technical Analysis
The BFP compared a variety of different technologies, including the three
technologies offered by the E/CF RFP: composting by Synagro; traditional AD with
thermal drying by Harvest Power; and THP AD by We Generation (Cambi
Services). The BFP compared cost, energy output, and a number of different
qualitative factors; the BFP identified the THP AD technology as the best long-
term option for the RWQCP with traditional mesophilic AD as a close second
option. Aerobic composting of biosolids or transport to EBMUD for AD were seen
as good interim solutions during construction of an on-site facility. CH2M HILL
City of Palo Alto Page 17
also provided technical support on the E/CF RFP evaluating and supporting the
efficacy of the technology in the proposals.
The City’s consultant, Alternative Resources Inc. (ARI), supported staff in the
evaluation of the E/CF RFP proposals. The proposal scoring was 50 percent
technical (or non-cost) and 50 percent cost. The costs are evident in the table. The
nonmonetary evaluation was comprised of six sections:
1. Quality of Proposal (5%)
2. Technical Resources and Experience (15%)
3. Financial Resources/Strength of Proposal (15%)
4. Record of Performance/Reliability of Technology (25%)
5. Technical Approach (25%)
6. Business Proposal (15%)
Seven reviewers who represented the City Departments of Public Works, Utilities,
and Administrative Services, along with representatives from Stanford and the
City of San José, provided scores, which were based on the submitted proposal
and an interview.
Proposal Qualitative Score Cost Rank
Synagro 66.00 1
Harvest Power 57.29 2
We Generation (Cambi Services) 51.43 3
Five of the seven reviewers ranked Synagro number one and two ranked Harvest
Power number one.
Legal Considerations Support a Rejection of All Proposals
The current RFP contemplated a third party operated facility, rather than one
operated by the City. While the proposals technically comply with the
requirements in the RFP, the RFP process itself has convinced staff that certain
third party owned and operated facilities are no longer the best approach. In
addition, while the RFP contemplated an emerging technology (though did not
require it), none of the bidders proposed it. Accordingly, the more conservative
risk allocation structure contained in the RFP served to add unnecessary cost to
City of Palo Alto Page 18
the proposal. While some of the proposals technically comply with the RFP, the
RFP no longer represents staff’s modified OFP proposal.
While two of the bidders have subsequently offered to combine and modify their
proposals in an attempt to match staff’s improved OFP proposal, this combined
proposal would not comply with the existing RFP which requested a third party
operated facility. However, the current bidders would not be barred from
submitting subsequent proposals. Further, now that staff has better refined its
preferred approach staff believes it will receive additional and more cost effective
proposals and bids in response to more narrowly focused RFPs and Invitations For
Bids.
Responding to Key Issues
In the development of the OFP, Staff has received many comments from the
Council, the E/CF RFP proposers, RWQCP partner agency staff, the six-member
community group of Measure E supporters and Byxbee Park open space
advocates, and formal community meetings. Staff has provided response to the
comments received in Attachment C to this staff report.
Timeline/Next Steps
Staff has prepared the following preliminary list of Next Steps. These will be
reviewed further as the existing project Timeline is updated and submitted to
Council in December, 2014.
1. Coordination Meetings with the RWQCP Partners Apr 2014
2. Issuance of Program Management Firm RFP April 2014
3. Present Proposed Electric Price (Under PA Clean Program) to the
Utilities Advisory Commission
Jun 2014
4. Selection of Program Management Firm Sept 2014
5. Deliver Updated Project Timeline to council Dec 2014
6. Issue Component One Design/CEQA RFP Jan 2015
7. Commence Pre-Design Work on Components Two through Four Feb 2015
8. Finalize Coordination with RWQCP Partners (Food Scraps and
Financing)
Mar 2015
9. Develop Financing Plan for Components One and Two Mar 2015
10. Completion of Component One 2018 - 2019
11. Initial Retirement of Incinerators 2018 - 2019
City of Palo Alto Page 19
12. Demolish Incinerators 2019 - 2020
13. Completion of Component Two 2020 - 2022
14. Completion of decision making & potential construction of
Components Three & Four
2020 - 2022
Resource Impact
In the following sections, the resource impact for the Wastewater Treatment
Fund, the Refuse Fund, and the Gas and Electric Funds are discussed. Components
One and Two will be budgeted primarily in the Wastewater Treatment Fund and
Components Three and Four will be budgeted primarily in the Refuse Fund. As
referenced in the “Recommendations” section of this staff report Council
authorization to pursue a design contract is only being requested for Component
One. As this plan, if approved by the City Council, moves forward, staff will bring
forth related resource impact descriptions to the City Council.
Wastewater Treatment Fund Financial Resource Impacts
The project and operating costs for the Component One (biosolids dewatering
and haul-out), and Component Two (THP AD) facilities will be funded by the City
of Palo Alto Wastewater Treatment Fund. For more information on how partners
fund the Wastewater Treatment Fund, see Attachment C Q12. At Council
direction, staff will initiate work with all five partner agencies to modify
agreements, as needed, and bring the recommended project to partner agencies
for approval before bringing back the modified agreements to Council for final
approval.
For Components One (dewatering and haul-out facilities) and Two (biosolids THP
AD), the Wastewater Treatment Fund’s new debt service expense (approximately
$3.3 million / year) will be recovered through partner and sewer fund billing and
paid to the State of California under terms of an SRF loan (discussed under project
delivery in Attachment C Q16). Staff will return to Council for adoption of the
resolution authorizing the application of the SRF loan. As of March 2014, the state
SRF loan rate is 1.9% on a 30-year repayment term, which is a public financing
rate much more favorable than that available to the RFP proposers through
private financing. Staff will return to Council for authorization of a funding
agreement for the loan. Financing tables for a $69 million SRF loan are included in
Attachment E.
City of Palo Alto Page 20
A THP AD facility, especially one designed in part for food scrap digestion, is a
strong candidate for grant funds. CalRecycle and the California Air Resources
Board have prioritized food scrap AD as an excellent technology to reduce GHG in
the solid waste sector. Grant funds are generally made available to “shovel-ready”
projects in the construction stage after design, permitting, and environmental
work has been completed. While staff cannot currently secure any grant funds,
staff can evaluate the general availability of grants and will pursue grants to
reduce capital cost, improve project financing, and reduce ratepayer impact.
There will be no net change in total personnel to operate the system. Similar to
other wastewater plants, staff recommends that a post-construction startup and
support phase be included to ensure safe and reliable operation and proper
transfer to city operations staff.
Wastewater Treatment Fund Operating Cost Reductions
Implementing Component Three (food preprocessing) and using surplus THP AD
capacity may reduce operating cost impacts in the Wastewater Treatment Fund.
The project may also be eligible for grants, which will be pursued if the project
meets requirements. Specific financial grant opportunities are summarized in the
BFP report.
Food scrap revenue estimates are preliminary and at the early investigative stage.
Food scrap revenue can be realized by setting the tipping fee for potential
customers at a point that is below or at market rate and above the treatment
costs. Staff believes that the market rate is approximately $45 to $50/wet ton
tipping fee for treatment of food scraps. Collection and transport costs vary by
agency. Treatment costs for a new food scrap system are still being estimated and
depend on the commitment period required for return on investment as well as
available surplus capacity in the THP AD over time. Because of the need for cost
recovery for the initial capital cost of an onsite food processing system, it appears
that little available revenue from receiving food scraps would be available to
defray wastewater treatment fund operating expenses. Taking in food scraps
from offsite pre-processing systems might offer better wastewater treatment
fund cost defrayal opportunities and yield higher long-term operational reliability.
More research is needed. Given the speculative nature of food scrap revenue and
the lack of current commitments for solid waste food scrap treatment, staff is not
currently considering this revenue as guaranteed over the life of the digester
City of Palo Alto Page 21
facility. Partner agencies will be granted first rights of refusal to available surplus
capacity on a first-come, first served basis; surplus capacity is estimated at 19,000
dry pounds per day (9.5 dry tons per day), which is approximately equivalent to
the tonnage of Palo Alto commercial food scraps currently collected. Staff has
been and will continue to evaluate interest and commitment level from partner
agencies.
Refuse Fund Resource Impacts
Staff believes that there would be no adverse Refuse Fund impacts from
participating in the OFP. The Refuse Fund currently pays its hauler to accept
commercial food scraps for composting at the Z-Best Composting Facility near
Gilroy. The City’s agreement term with GreenWaste of Palo Alto terminates in July
2017 unless extended. With a new or revised contract the City could divert its
food scraps to a City operated organics facility. The tip fee is not defined at this
time.
While the Refuse Fund can take advantage of surplus digester capacity, some
additional upsizing might be needed for the food wastes (or use standby
equipment). A rough estimate of a capital costs needed ($8.9 million) for an
onsite food scrap handling system is in addition to the estimated $69 million
needed for the wastewater treatment equipment for biosolids handling
(Components One and Two). To offset the capital costs, the Refuse Fund would
most likely pay a “tip fee” to the Wastewater Fund. The Refuse Fund would need
a 20- to 30-year commitment to process food scraps at the RWQCP in order for
the project to be economically feasible.
Electric and Gas Fund Resource Impacts
An AD project’s economics are very sensitive to the price that Utilities will pay for
any renewable energy generated from the project. The project’s electric rate is a
critical factor in realizing local benefits. The price of electricity must be approved
by Council following recommendations and discussions among Public Works,
Utilities, and ASD. Activities to discuss the price of electricity are shown in the
Next Steps and include starting discussions with the Utilities Advisory Commission
in June, 2014 and returning to Council by year end.
Total RWQCP energy use in 2013 was 16,493 MWh/year in electric use and
412,129 therms of natural gas. The Component One biosolids dewatering and
City of Palo Alto Page 22
truck haul-out component of the project will reduce the RWQCP’s natural gas and
electric expenses by approximately $441,0001 and $151,8782 per year,
respectively (approximately 400,000 therms of natural gas and 1,487 MWh/year
of electricity).
Component Two, the THP AD system, produces more energy than it needs to run
itself. A summary table is shown below; net energy for the THP AD system for
biosolids only is 15,573 MWh/year. Adding food scraps as part of Component
Three will produce an additional 5,424 MWh/year of power.
Table 3
Summary of Energy for Component 2 THP AD (biosolids only)
Parameter Unit Quantity
Conversion
kWh/unit
Energy
kWh/year
Truck Vehicle Miles Miles/year 91,276 n/a n/a
Diesel Petroleum
Consumed Gallons/year 14,488 38 549,828
Natural Gas Consumed MBTU/year 0 293 0
Power Consumed kWh/year 1,722,857 1 1,722,857
Power Produced kWh/year -14,231,597 1 -14,231,597
Heat Produced MBTU/year -12,333 293 -3,614,523
Landfill Emissions
dry tons
landfilled/year 0 n/a n/a
-15,573,436
Natural gas will not be used initially and in negligible amounts in later years of the
system (i.e., there are some minor needs for backup fuel, waste gas burners, and
auxiliary equipment). Net heat produced (3,615 MWh/year) will be used to heat
the biosolids building and for process heat. The electric energy produced
(14,231,597 kWh/year from two 800 kW engines) would be subject to an
Interconnection Agreement between City of Palo Alto Utilities (CPAU) and the
RWQCP providing for the interconnection with the City grid; the agreement would
be subject to Council approval. If purchased by CPAU, the potential 14,232
MWh/year of produced RWQCP electric energy would supply approximately 1.5%
1 $441,000 is approximately 1.13% of the adopted FY 14 budget’s $38,866,000 expected annual gas fund revenue
2 $151,878 is approximately 0.11% of the adopted FY14 budget’s $135,255,000 expected annual electric fund
revenue
City of Palo Alto Page 23
of CPAU’s electric needs of 972,000 MWh/year3, and it would add to the City’s
renewable energy portfolio.
The RWQCP’s produced electric energy can either (a) offset RWQCP electric needs
and/or (b) be sold to electricity buyers. More specifically, options include:
1. Offset RWQCP power (currently purchased at 10.214 cents/kWh under E-
18/E-18G) and pay standby charges pursuant to rate E-7 when the engines
are offline, not producing electricity; or
2. Sell the produced power:
a. Sell all produced power to CPAU at market value (currently about 9.53
cents/kWh) through a 20-year power purchase agreement (PPA) subject
to Council approval, retaining the option to offset plant power and pay
standby charges under rate E-7-G; or
b. Sell all produced power on the open market (e.g., to Stanford, PG&E,
etc.) through a 20-year PPA and pay a “wheeling charge” for the
transmission costs; or
c. Sell all produced power to CPAU through a 20-year PPA subject to
Council approval capturing the benefits of a yet-to-be-determined
incentive rate for renewable baseload power (feed-in-tariff rate for local
solar is currently 16.5 cents/kWh). This option is not yet available but
the current 20-year levelized value of local baseload (24 hours/day)
renewable energy production is 9.53 cents/kWh. This would require a
change to Council policy.
Using biogas energy to offset RWQCP power needs instead of selling the power to
CPAU may provide a greater financial benefit for the RWQCP, unless a buyer
offers a purchase price much higher than the 20-year electric expenses of the
RWQCP. In January 2013, Council approved a policy on the pricing of energy that
would be purchased by CPAU from potential green waste-to-energy facilities
(Staff Report #3432). The policy states that CPAU committed to purchasing the
electricity at the market rate for renewable energy (including any avoided
transmission or other costs) at the time the contract is signed. Based on current
market conditions staff estimates that price to be about 9.53 cents/kWh for a 20-
year purchase commitment. In the interest of providing some level of certainty
around the energy price, the resolution also committed CPAU to purchasing the
3 Fiscal Year 2012 purchase = 972 GWh
City of Palo Alto Page 24
electricity at a default floor price of 7.7 cents/kWh. Both the 7.7 cents/kWh and
the 9.53 cents/kWh is well below the price needed to make the project financially
viable for RWQCP partners. Utilities Department staff have indicated that a price
equivalent to the 16.5 cents/kWh Palo Alto CLEAN rate for local solar generation,
would result in a cost increase of approximately $1 million/year for the Electric
Fund, which is equivalent to an electric retail rate increase of 0.9% to all electric
rate payers in Palo Alto. Staff expects to begin the discussion about the value of
local energy and the community’s desire to pay a higher price with the Utilities
Advisory Commission in June 2014 and bring a recommendation to Council by the
year end.
Project Delivery
Staff recommends that the City employ the resources of consultants to design and
manage the project. Staff will utilize a program manager to obtain services for the
loan application and manage scope development for the numerous RFPs needed
for project delivery. The anticipated RFPs are listed in Attachment F (Wastewater
Major CIP Projects Delivery). Staff will return to Council in approximately
September 2014 for program manager contract approval. See Attachment C Q16
and Q17 for more information on project and service delivery.
Policy Implications
Implementing Components One, Two, and Three of the OFP will yield significant
reductions in GHG emissions (over 8,000 CO2e MT) to help Palo Alto reach its
Climate Action Plan goals. The OFP supports the recommendations in the
RWQCP’s Long Range Facilities Plan, Council’s directive to decommission the
incinerator, and provide a beneficial use for biosolids. The OFP allows for the City
to maximize the beneficial use of commercial and residential food scraps by
creating energy and compost as specified in the 2007 Zero Waste Operational
Plan. Ultimately, the OFP provides a sustainable path forward for organics
management by creating local, reliable renewable energy, keeping costs down,
and reducing citywide GHG emissions.
Environmental Review
The project’s CEQA process for Components One, Two, and Three is expected to
be either a Mitigated Negative Declaration (MND) or an Environmental Impact
Report (EIR). If Council selects a proposal or if a Component Four (Yard Trimmings
technology) project is considered that utilizes any of the 10-acres defined in
City of Palo Alto Page 25
Measure E, an EIR would likely be prepared and the process may take up to two
years.
Attachments:
Attachment A: Organics Facilities Plan (PDF)
Attachment B: Graphic Summary of the Organics Facility Plan (PDF)
Attachment C: Answers to Council and Related Questions (PDF)
Attachment D: Draft Biosolids Facilities Plan Executive Summary (PDF)
Attachment E: Financing Analysis Tables (PDF)
Attachment F: Wastewater Major CIP Projects Delivery (PDF)
Attachment G: Key Terms (DOCX)
Attachment A
Palo Alto Organics Facilities Plan – April 2014
The Organics Facilities Plan (OFP), has resulted from Palo Alto’s review of
proposals submitted in response to the “Energy/Compost Facility or Export
Option for Food Scraps, Yard Trimmings, and Biosolids” Request For Proposals
(E/CF RFP) and the draft Biosolids Facilities Plan (BFP). The OFP provides the City
of Palo Alto (City) and the Regional Water Quality Control Plant (RWQCP) partners
the best option for short‐term resilience and long‐term cost savings, energy
production and a reduction in greenhouse gas emissions (GHG1) of greater than
8,000 metric tons CO2e.
The OFP consists of four Components:
Component One: Biosolids Dewatering and Truck Haul‐Out Facility
Component Two: Wet Anaerobic Digestion (AD) Facility Utilizing the
Thermal Hydrolysis Process (THP)
Component Three: Food Preprocessing Facility
Component Four: The Pursuit of Technologies to Harness the Energy
and Resource Potential of Yard Trimmings
Components One and Two, recommendations from the Biosolids Facilities Plan
(BFP) prepared by CH2M Hill, address Biosolids from the RWQCP and will be paid
for by the Wastewater Fund. Components Three and Four will be funded by the
City Refuse Fund. Components One, Two, and Three are interconnected and will
be planned concurrently. Work can begin concurrently on all four components,
but the components will not be completed by the same date.
Component One is a Biosolids Dewatering and Truck Haul‐Out Facility. This will
allow the RWQCP to both operate during emergencies and to decommission the
sewage sludge incinerators as soon as practical, per Council direction. The
incinerators are the City’s largest point source of City‐generated GHG.
The development of the Component One Biosolids Dewatering and Truck Haul‐
1 Reported as annual metric tons (MT) of anthropogenic CO2‐equivalent greenhouse gas emissions throughout
report
Out Facility can begin immediately and can be completed by 2018 at an estimated
cost of $12 million. Once this dewatering and haul‐out facility is constructed, the
City will export its dewatered sludge for further treatment, retire the incinerators,
and provide an approximate annual reduction of 2,343 tons of GHG.
Component Two develops a THP2 AD facility at the RWQCP to process sewage
sludge into biosolids for ultimate disposal. Component Two uses Component One
for final dewatering and truck load‐out. The THP AD process beneficially creates
biogas (e.g., methane), which combusts into renewable energy.
The THP AD facility can also receive food scraps under the OFP’s Component
Three. Under Component Three, staff will evaluate potential preprocessing
technology options and locations.
Predesign and financial analysis of the Component Two THP AD Facility and the
Component Three Food Preprocessing Facility requires staff to define the price for
the facility’s renewable energy output and its optimal size (i.e., quantifying
capacity for food scraps). Component Two is estimated to cost $57 million.
Component Four, yard trimmings research and development, involves research
into emerging technologies to capture the energy and resource potential
embedded within yard trimmings. The deployment of such a technology could be
on the 3.8‐acre flat portion of the 10‐acre Measure E site on the closed Palo Alto
Landfill or another location. Until such a facility is developed, the current aerobic
composting conducted near Gilroy, CA, provides the best value for the City with
relatively moderate GHG. The development of Component Four is independent of
the development of Components One, Two, and Three, and will be planned
separately.
2 THP is a high‐pressure steam pretreatment for downstream AD systems; the thermal hydrolysis step disintegrates
cell structures and dissolves naturally occurring cell polymers into an easily digestible feed for AD; the
pretreatment step also makes the sludge more flowable, allowing a smaller footprint for the digesters, which is a
real advantage for the constrained 25‐acre RWQCP site; THP increases organic biodegradability, yielding more
biogas and energy and offsetting more GHG than other AD systems; THP yields a final dewatered solids up to 40%,
much higher than traditional AD systems at 28% solids, resulting in less hauling and land application costs; the final
THP dewatered biosolids are sterilized and pathogen free due to 165C treatment for 20 minutes
More detail on the four Components follows:
1. Component One: The Development of Wastewater Solids Dewatering and
Truck Haul‐Out Facility
CH2M HILL has completed a final draft of the Biosolids Facilities Plan.
Component One is a is a key priority. The Wastewater Solids Dewatering and
Truck Haul‐Out facility will provide the necessary resilience to allow the
RWQCP to transport solids in the case of a disaster, emergency, or failure of
the current solids handling system. The facility can be designed and built
ahead of Component Two.
Component ONe allows the RWQCP decommission and demolish the sewage
sludge incinerators. This component reduces 2,343 annual tons of GHG. The
demolition of the incinerators opens up another half‐acre for efficient design
and construction of the Component Two.
Component One is both essential for the RWQCP’s reliable operations and a
necessary first step towards the development of an AD facility. It is anticipated
to cost $12 million (2015$) and be completed by 2018. Annual operational
costs are estimated between $1.6 and $2.0 million. Design and construction
details and cost will vary depending on the final disposition of the dewatered
solids. Two currently viable and environmentally preferable destinations for
the dewatered solids are: (1) aerobic composting at the Synagro Central Valley
Compost Facility in Merced County, the same facility in the Synagro E/CF RFP
proposal, and (2) anaerobic digestion and energy recovery at the East Bay
Municipal Utility District (EBMUD) wastewater treatment plant in Oakland, CA.
2. Component Two: The Development of THP AD
Component Two is the development of THP AD. Anaerobic digestion is a
proven wastewater technology for stabilizing wastewater solids (also referred
to as sludge) and biogas generation. Wastewater treatment plants worldwide
use wet AD systems to treat sludge. Wet AD is an appropriate technology for
high water and low solids content sludge. Wet AD is compatible with the
addition of the higher solid food scraps3. At least two wastewater treatment
plants in the Bay Area (EBMUD in Oakland and Central Marin Sanitation
Agency in San Rafael) are using wet AD to process and “co‐digest” combined
wastewater solids and food scraps.
The BFP evaluated three wet AD technologies and preprocessing options. The
option that provides the greatest biogas yield, smallest physical footprint, and
the highest quality biosolids, was the combination of the THP with wet AD.
According to the BFP recommendations, THP AD technology provides clear
non‐monetary benefits for treatment and disposal of sewage sludge and
favorable overall project economics. THP AD is a proprietary technology
currently sold by CAMBI, Norway; CAMBI is the technology provider to the We
Generation E/CF RFP proposal. The CAMBI THP technology has been installed
and operated at 40 wastewater treatment plants throughout Europe, South
America, Japan, and Australia. New CAMBI THP systems will begin operation in
July 2014 at the District of Columbia Wastewater Treatment Plant, the first
CAMBI in North America and largest in the world. A CAMBI system is in design
for the Hampton Roads Sanitation District Wastewater Treatment Plant in
Virginia Beach, VA. The San Francisco Public Utilities Commission (SFPUC)
Southeast Wastewater Treatment Plant is evaluating use of a CAMBI THP
system as part of its new digester project. The SFPUC project could also
incorporate food scraps into the CAMBI THP AD system.
Prior to moving forward with Component Two, design development
(predesign) is needed to answer vital questions related to project sizing and
site considerations.
A THP AD Facility would supply electric energy through biogas combustion
generated by the AD units. The energy is 100 percent renewable electric
energy and provides 4,560 tons of GHG reduction.
3 Much of the debate in the Measure E campaign revolved around the potential to use dry AD. The Feasibility Study
in 2011 also looked at dry AD for much of the analysis. Since wastewater solids made up the majority of the
material to be processed, dry AD was deemed infeasible. One E/CF RFP proposal included dry AD technology, but
did not meet minimum qualifications and was not considered. Dry AD was also not likely to be an appropriate
technology for the food scraps and yard trimmings only due to the ratio of the material. The dry AD facility recently
constructed in San Jose has a yard trimming to food scrap ratio of 20:80, while the Palo Alto ratio of materials is
closer to 50:50. This ratio would provide a low biogas yield, resulting in poor project economics.
2a Project Sizing
The THP AD system will be designed to accommodate the projected 30‐year
increase in wastewater solids loads based on population growth projections
from the Association of Bay Area Governments (ABAG). While THP AD systems
allow for some modularity for future expansion (e.g., adding a tank), the
system will be designed to accommodate future capacity. The THP AD system
will have that initial extra capacity available for the addition of food scraps as
part of Component Three.
There are many questions that remain on sizing the food scrap systems. A food
receiving station, energy generation equipment, and dewatering equipment
may require upsizing to accommodate food scraps. Food scraps can be
processed to maximize THP, digester, and dewatering use of surplus capacity
until the initial excess capacity is needed for wastewater solids. This initial
excess capacity might allow a THP AD system at the RWQCP to process most,
and possibly all of Palo Alto’s commercial food scraps for a period of time
which would be determined during the predesign phase.
2b Site Considerations
The THP AD facility will impact existing RWQCP operations. The RWQCP has
numerous underground utilities including large diameter pipes. The half‐acre
location set aside in the E/CF RFP for on‐site digestion can be used, but cannot
be optimized for Component Two until the incinerator is decommissioned and
demolished. The removal of the incinerator prior to construction of the THP
AD system will allow for the optimal design and minimal disturbance to
existing operations.
Careful consideration will need to be given to truck ingress and egress. Food
waste trucks would arrive at the site (either small local haul trucks with
approximately 6 tons of capacity or larger consolidated trucks with
approximately 22 tons of capacity). The number of trucks will depend on the
capacity of the facility and the acceptance of outside sources. Trucks will also
leave the site transporting residual solids for either land application, further
composting, or for further processing or energy production such as at the
regional Bay Area Biosolids to Energy Project.
Closely linked to the site considerations is the location, on the RWQCP or
offsite, of the food preprocessing component (Component Three). Onsite
preprocessing requires a truck scale, a fully enclosed tipping floor to contain
odors, and space for the preprocessing equipment to remove contaminants
from the food scraps and turn the scraps into a slurry for injection into the THP
AD system. An offsite food scraps processing facility handles the
preprocessing, but the onsite RWQCP system requires a food receiving station
with rock trap, dilution water tank, pumps, and screening facility to protect the
THP AD System. Onsite solid waste facilities at the RWQCP require permits
from CalRecycle through the Local Enforcement Agency (LEA) at Santa Clara
County.
3. Component Three – Food Scrap Preprocessing
Preprocessing of food scraps involves removal of contaminants and physical
conversion into a pumpable mixture for delivery into the THP AD Facility.
Food scraps provide energy potential by increasing the digester’s biogas
output and the marketplace has been active in developing new technologies
for efficient preprocessing.
The City collects an estimated 12,100 tons of commercial food scraps. The City
does not currently collect the estimated 3,400 tons of residential food scraps.
Staff is evaluating the effectiveness of the Residential Two‐Cart Pilot Program,
which is, in part, designed to evaluate the potential to capture residential food
scraps. Staff will evaluate the costs and benefits for increased collection and
handling costs needed to separate food scraps from the residential garbage
and yard trimmings, and will be reporting back to Council in the fall 2014.
The THP AD facility predesign will identify the initially available excess capacity
for food scraps. This will help determine how much additional food could be
accepted into the facility or if additional THP AD capacity should be built to
accommodate available feedstocks. Additionally, the food waste tonnage and
its source(s) will help define not only the size of the preprocessing equipment
but also its potential location. The preprocessing facilities may be located on
the RWQCP site next to the THP AD Facility despite the limited space.
Conversely, the food scrap preprocessing could be located at an alternate
location where the food scrap loads could be tipped, preprocessed into slurry,
and consolidated into larger trucks to be pumped into the THP AD Facility. The
We Generation (Cambi Systems) proposal included the Shoreway
Environmental Center in San Carlos as a preprocessing site. Other material
recovery options include transfer stations, like the Sunnyvale Material
Recovery and Transfer (SMaRT) Station, where the City of Palo Alto is a part
investor.
The cost estimates are rough due to the current uncertainty regarding the
sizing and location of a preprocessing facility. Capital costs are estimated at
$8.9 million for preprocessing and digester preparation of the food scraps.
Operating costs with built‐in capital recovery in the tip fee is estimated at
$46/per wet ton. Further research is needed to refine these estimates.
The development time for a food preprocessing system could be relatively
short. The technology is modular and relatively compact. However, for food
preprocessing and digestion in Component Three to begin the RWQCP must be
certain that the THP AD Facility is fully operational and that it meets regulatory
requirements. The full deployment of Component Three would be completed
between 2020 and 2022 which is at least one year after the THP AD Facility
begins operation.
The inclusion of food scraps in the digester increases biogas production and
further reduces the City’s GHG. Nevertheless, staff continues to support home
composting and may consider the co‐composting of residential food scraps
with yard trimmings as a suitable and sustainable processing option.
4. Component Four – The Evolution of Yard Trimmings Processing
Aerobic composting is an established and environmentally sound processing
option. However, new technologies are being developed to harness their
energy and resource potential. The San José/Santa Clara Regional Wastewater
Facility recently approved a demonstration project to gasify4 woody waste
with biosolids. Staff will continue to follow these technology developments
and improvements in composting technology to evaluate whether a local
facility is a sustainable option.
4 Gasification is a thermal process using extremely high temperatures in the absence of oxygen that transforms a
solid material into a synthesis gas that can be combusted to create energy. While gasification is a thermal process,
it does not yield the same air pollutants as incineration. See BFP gasification Technical Memorandum on status of
gasification for biosolids.
Attached is a visual representation of the OFP.
Organics Facilities Plan
1
Interim
Hauling
Biosolids Dewatering
and Truck Off‐Haul
Component #1
Anaerobic Digestion
Component #2
Food Scrap
Pre‐processing
Component #3
Yard Trimmings
Component #4
Design and Construction
B
Contracting
and DesignBF
Proposed Organics Facilities Plan
F
Y
Add Food to Digester
Construction
Food Scrap
Preprocessing
Development
Consider Alternatives to Current Aerobic
Composting and New Locations
B Biosolids – Wastewater Treatment Fund
F Food Scraps – Refuse Fund
Y Yard Trimmings – Refuse Fund
Emergency Back up
Biosolids
Processing
1
Interim
Hauling
Biosolids Dewatering
and Truck Off-Haul
Component #1
Anaerobic Digestion
Component #2
Food Scrap
Pre-processing
Component #3
Yard Trimmings
Component #4
Design and Construction
B
Contracting
and Design B F
Proposed Organics Facilities Plan
F
Y
Add Food to Digester
Construction
Food Scrap
Preprocessing
Development
Consider Alternatives to Current Aerobic
Composting and New Locations
B Biosolids – Wastewater Treatment Fund
F Food Scraps – Refuse Fund
Y Yard Trimmings – Refuse Fund
Emergency Back up
Biosolids
Processing
Attachment C
Answers to Council and Related Questions
1. What are the major differences between the Organics Facility Plan (OFP) and
the proposals submitted in response to the Energy/Compost Facility or Export
Option for Food Scraps, Yard Trimmings, and Biosolids Request for Proposal
(E/CF RFP)?
Answer:
City as Owner-Operator
The OFP is based on the City acting as the owner-operator of the anaerobic
digestion facility. The E/CF RFP was designed to limit the risk to the City in
adopting a less-proven technology like gasification or Dry anaerobic digestion
(AD) for biosolids and having the proposers own and operate the facility. The E/CF
RFP proposals included proven technologies like Wet AD and aerobic composting,
which coincided with the BFP recommendations for biosolids treatment. Staff
identified significant long-term operations and maintenance (O & M) cost savings
by acting as the owner-operator.
Site Constraints
The OFP allows for the optimal use of the RWQCP site. The THP AD facility size
impacts existing RWQCP operations. The RWQCP has numerous large diameter
underground utilities. The half-acre location set aside in the E/CF RFP for on-site
digestion can be used, but cannot be optimized for Component Two until the
incinerator is decommissioned and demolished. The removal of the incinerator
prior to construction of the THP AD system will allow for the optimal design and
minimal disturbance to existing operations.
Careful consideration will need to be given to truck ingress and egress. Food
waste trucks would arrive at the site (either small local haul trucks with
approximately 6 tons of capacity or larger consolidated trucks with approximately
22 tons of capacity). The number of trucks will depend on the capacity of the
facility and the acceptance of outside sources. Trucks will also leave the site
transporting residual solids for either land application, further composting, or for
further processing or energy production such as at the regional Bay Area Biosolids
to Energy Project.
Closely linked to the site considerations is the location of the food preprocessing
component (Component Three). No final decision on location has been made. On-
site preprocessing requires a truck scale, a fully enclosed tipping floor to contain
odors, and space for the preprocessing equipment to remove contaminants from
the food scraps and turn the scraps into slurry for injection into the THP AD
system. An off-site food scraps processing facility handles the preprocessing, but
the onsite RWQCP system requires a food receiving station with rock trap,
dilution water tank, pumps, and screening facility to protect the THP AD system.
Onsite solid waste facilities at the RWQCP require permits from CalRecycle
through the Local Enforcement Agency (LEA) at Santa Clara County.
Due to the accelerated timing of the E/CF RFP proposals, their AD facilities were
limited to a half acre, which would present significant logistical and planning
challenges for the RWQCP.
RWQCP Operations
Lastly, the component approach in the OFP will allow the RWQCP to ensure that
the AD facility and the later inclusion of food scraps will not adversely impact the
other operations and permit restrictions of the RWQCP.
2. What are the reasons for rejecting the E/CF RFP proposals?
Answer: The E/CF RFP proposals do not provide the best value for the City and
long-term GHG reductions. Staff developed the OFP with Component Two (THP
AD Facility) as an owner-operated facility after the E/CF RFP proposals were
evaluated.
The Synagro (export) proposal scored as the highest technical analysis and lowest
cost option, but this proposed solution does not provide the other benefits
identified by the City of Palo Alto as critical elements of an organics facilities plan.
Staff believes that there is long-term value to the City in stabilizing sewage sludge
on-site, reducing GHG emissions, and generating local energy, which is why Staff
recommends canceling the E/CF RFP and pursuing an onsite organics facility. The
We Generation (Cambi Services) proposal, the proposal using the preferred
technology identified in Component Two, was the lowest scoring of the three
proposals under consideration and would render it less preferable for selection.
3. Can we modify the E/CF RFP to accommodate our preferred project and
service delivery method?
Answer: No. The differences between the E/CF RFP and the OFP are too great.
The most significant difference being the shift from a contractor owned and
operated facility to a City owned and operated facility.
The AD and composting technologies proposed in the E/CF RFP proposals
validated the conclusions in the BFP and the cost savings possible with an owner-
operated facility. Had staff known that only proven and well-established
technologies would be submitted in the E/CF RFP process, staff could have issued
an addendum to the E/CF RFP for an owner-operated option. However, this was
not a viable option at the time. Issuing a new RFP for the Components will allow
for new proposers to participate.
4. Can we negotiate with the proposers for a modified or joint contract?
Answer: No.
Competitiveness
Staff would like to encourage new proposals to satisfy the requirements in the
OFP. Further, the likely project description of Component Two of the OFP that
calls for the construction of a THP AD facility may include the CAMBI technology
but there are other technology providers that may be interested in participating
in a bid. At the start of the THP AD design, staff will return to Council with a
request for sole source approval for CAMBI should other emerging THP
technology provider(s) be unreliable and unproven in the wastewater treatment
market.
Purchasing/Fairness
If the City were to allow a combined proposal of multiple proposers, this would
set an unfair precedent to the other bidders and future bidders. For example, if
the City elected to combine the Harvest Power proposal with the We Generation
(Cambi Services) proposal, that opportunity should be provided to other
proposers or potential proposers who did not submit under the original E/C RFP.
Any RFP process is designed to provide an equal playing field for the proposers,
where the City cannot “pick-and-choose” whatever scenarios it wants despite the
results of the process. Selecting We Generation (Cambi Services) or some
combination of the proposals would violate the integrity of the purchasing
process and potentially invite protests and claims from the other proposers.
Other teams, who either proposed or elected not to propose, would need to be
provided with the same opportunity to create this type of proposal. A desire to
create this combination would require the development of a new RFP.
5. What is the risk to the City if the facility is owned and operated by the
RWQCP?
Answer: Staff does not believe that the Four-Component OFP is risky. The AD
technology is proven and established. Staff has always planned to consider
publicly financed and owner operated biosolids treatment systems alongside the
E/C RFP proposals. The original RFP was developed with the intent of
procurement through a design-build-own-operate and maintain (DBOOM) project
and service delivery model. The primary reason for selecting the DBOOM model
was to reduce risk exposure inherent with selecting a novel approach or emerging
technology that could handle all three waste streams. Through the E/CF RFP
process, and with the responses received, it became apparent that at this time
the options available to the City (wet AD and aerobic composting) are, in fact,
relatively standard and can be more economically implemented, with the RWQCP
as the owner-operator. Through discussions with consultants and technology
vendors (including CAMBI, Norway) the City staff is confident that, with the
appropriate engineering and project management assistance, the City can control
the remaining risk exposure by taking the time to identify and answer the
appropriate questions needed to craft the OFP’s component RFPs.
6. How much planning is required before initiating Component One (Biosolids
Dewatering and Haul-Out Facility)?
Answer: The bulk of the planning was completed as part of the RWQCP’s Long
Range Facilities Plan in 2012. The initial step will be to hire a program manager to
oversee and develop Components One and Two.
7. Can Component One (Biosolids Dewatering and Haul-Out Facility) be designed
and built without limiting future options? How does this affect the overall sizing
of the Facilities?
Answer: Yes.
Compatibility
The dewatering and truck haul-out facility is necessary for and can be designed to
be fully compatible with the THP AD technology in Component Two. The provider
of thermal hydrolysis technology, CAMBI, has confirmed that Component One can
be designed and installed prior to installation of Component Two. Combining the
pre- and post-dewatering into one building with reduced redundancy in
dewatering equipment is feasible. This option was suggested by a proposer.
However, staff recommends separating these systems and using independently
redundant equipment for pre- and post-dewatering necessary for the THP
process.
Project Sizing
Components One and Two will be designed for a projected 30-year growth in
wastewater solids loads. While the facilities allow for some modularity for future
design (e.g., adding a tank), the facilities likely will need to be designed to allow
for the future capacity to be in place on the first day of operations. In other
words, the facilities will have extra capacity on operational day one to account for
the future solids loading.
The THP AD system will be designed for a projected 30-year (2045) growth in
wastewater solids loads, which results in excess capacity upon commissioning.
Hence, the excess capacity of the THP AD system can be used at the beginning of
the planning period to accommodate food scraps, which can be co-digested with
the wastewater solids. If and when growth occurs in the RWQCP service area, the
THP AD system might need to be expanded to accommodate both service area
growth and projected growth of the food waste program. This allows for a
cautious approach to infrastructure investment, while opportunistically leveraging
the economics of the excess capacity of the system. It allows Palo Alto to better
assess the economics of the co-digestion program; so, in the future, when
expansion is required either to accommodate more material for co-digestion or
more solids loading from growth, then an informed decision can be made as to
how best to expand the system based on the historical economic and
environmental performance. At that time there will also less uncertainty
regarding the quantity of co-digestion material, such as food scraps, that are
available.
8. Would incinerators be kept as a back-up?
Answer: No. Incinerators will not be kept as a backup. After a successful startup of
Component One (Biosolids Dewatering and Truck Haul-Out Facility) the
demolition of the incineration building can begin so that space is made available
for Component Two (THP AD Facility).
9. Can the City save time (i.e., have a facility up and running earlier than the
OFP) by utilizing the E/CF RFP and not canceling it?
Answer: Staff does not believe that using the E/CF RFP is an appropriate option
for legal, purchasing, and business reasons. Nevertheless, even if Staff could
recommend using the E/CF RFP, the construction of a privately owned and
operated facility would not yield significant time savings. The core time
uncertainties revolve around contracting and permitting. All documentation to
comply with the California Environmental Quality Act (CEQA) must be completed
prior to executing a design-build contract. This environmental documentation
process may be completed in one to two years. The timing of this type of project
delivery in the E/CF RFP (design-build-own-operate-maintain or DBOOM) relies on
the assumption that all contracting issues will be resolved prior to the completion
of the CEQA documents. However, due to the complexity of operating a private
facility within the operational area of the RWQCP, the contracting relationship
may require more time to develop, which could add an additional year to the
schedule.
In addition to City land use approvals, permitting a facility at the RWQCP requires
a wastewater discharge permit amendment and approvals from the San Francisco
Bay Regional Water Quality Control Board, the Bay Area Air Quality Management
District, and CalRecycle. All projects, whether privately owned or City owned will
need to obtain these approvals. The permitting process is complex and requires
significant City involvement. Permitting could easily add one year to a project
schedule.
Any proposal, like Harvest Power’s proposal, that uses the Measure E site would
require additional permitting and could be subject a legal challenge. Tying the
development of Component One, the Biosolids Dewatering and Truck Haul-Out
Facility, to the Measure E site may result in unforeseen delays in the vital
decommissioning of the incinerators. While it is important to develop the energy
generation THP AD project in Component Two (or as proposed by Harvest Power
and We Generation (Cambi Services)), a large reduction in GHG and quick way to
create a more sustainable use for biosolids is to develop Component One without
delay. As noted earlier, there are many unresolved concerns, including the sizing
of the facility for food scraps and energy considerations that need to be resolved
before designing and constructing a THP AD facility.
10. What is the over-all timing for the OFP?
Answer: The timing for Components One, Two, and Three are linked. While the
specific steps and a detailed timeline are being developed by staff and will be
presented to Council in fall 2014, staff can provide a basic outline of the major
milestones. The overall program goals include: decommissioning the incinerator
and completing Component One (Biosolids Dewatering and Truck Haul-Out
Facility) by 2018; would be to complete the design phase of the THP AD
development by 2018. Construction could begin shortly thereafter with the THP
AD facility fully operational for the processing of biosolids sometime between
2020 and 2022. Food scraps, as part of Component Three, could be added to the
THP AD system between 2020 and 2023. Staff will provide a more detailed
timeline for Component Four (Yard Trimmings technologies) in fall 2014.
11. Will the proposed AD Facility import wastes from other communities?
The City Manager and Mayor have sent letters to neighboring cities and RWQCP
partners to gauge their interest in sending food scraps to a future AD Facility at
the RWQCP. To date, no other agencies have made commitments.
There are many questions that remain on sizing food scrap systems. New capacity
would be needed for some facilities and surplus capacity can be utilized for
others. A food receiving station, energy generation equipment, and dewatering
equipment require upsizing for food scraps. Food scraps can be processed to
maximize THP, digester, and dewatering use of surplus capacity until the initial
excess capacity is needed for wastewater solids. This additional capacity might
allow a THP AD system at the RWQCP to process most, and possibly all of Palo
Alto’s commercial food scraps for a period of time which would be determined
during the predesign phase. Utilizing surplus digester capacity for food scraps
might defray some operational and maintenance costs for the RWQCP’s
wastewater treatment fund partners, however further study is needed to quantify
this amount.
12: How are the RWQCP Partners being involved?
The Wastewater Treatment Fund recovers costs from the Palo Alto Wastewater
Collection Fund and from the City’s five partner agencies. Each agency bills their
respective sewer ratepayers for associated sewer and treatment costs.
Approximately 230,767 residents are served by the six agencies contributing
sewage to the RWQCP. For biosolids dewatering, digestion, and haul-out facilities,
the Wastewater Treatment Fund’s new debt service expense (approximately $3.3
million / year) will be recovered through partner billing and paid to the State of
California under terms of an SRF loan. The billing share will be based on a
contract-defined treatment capacity allocation. The expected capacity share
allocation for this project is shown below and is based on the existing contract
capacity share allocation for major capital improvement projects.
Agency Capacity
MGD* Capacity %
Palo Alto 15.30 38.16
Mountain View 15.10 37.89
Los Altos 3.80 9.47
East Palo Alto Sanitary District 3.06 7.64
Stanford University 2.11 5.26
Los Altos Hills 0.63 1.58
Totals 40.00 100.00
* Capacity expressed in annual average flow, million gallons per day
Funding of design and construction requires debt financing. The design and
construction project will need to be approved by the Mountain View and Los
Altos City Councils, Stanford University, and the Board of the East Palo Alto
Sanitary District as part of an agreement requirement with each of the Plant
partners; these four partners have “veto” rights for capital projects. A veto has
never occurred since agreements were originally authorized but is a possible
outcome. The agreement with Los Altos Hills does not require partner approval
for the construction project, however, Los Altos Hills is being kept apprised of the
project. Over many years, staff met with partner agencies at the staff and
board/council level, explaining the need to both retire the existing sewage sludge
incinerators and build a new solids handling system. Staff at the partner agencies
met regarding this project (most recently on April 7, 2014); staff continues to
keep our partners informed of progress. Meetings are being scheduled for spring
2014 for a Los Altos city council study session and with the East Palo Alto Sanitary
District engineering committee; staff are assisting Mountain View staff who
intend to communicate to their Council with informational reports and study
sessions, as warranted. At Council direction, staff will initiate work with all four
partner agencies to modify agreements, as needed, and bring the recommended
project to partner agencies for approval before bringing back the modified
agreements to Council for final approval.
13. Should the City prioritize the development of yard trimmings compost on
the 3.8 acre Measure E site?
At this time, there is no local composting generation in Palo Alto other than from
home composters. Two advantages can be realized if the City elected to compost
yard trimmings on the Measure E site: (1) the City would have control over the
operations and not rely on a contractor for capacity; and (2) the City would
achieve a small reduction in GHG due to a decrease in truck vehicle-miles
traveled. However, the GHG levels resulting from transportation are relatively
insignificant compared to the overall benefits of the OFP. Components One, Two,
and Three result in a net GHG emissions benefit of removing nearly 5,000 metric
tons of CO2e from the atmosphere. Of the 267 metric tons of anthropogenic CO2e
GHG emissions related to composting yard trimmings, 157 metric tons of CO2e are
emissions resulting from transportation. The transportation related to yard
trimmings is only 3 percent of the total OFP GHG emissions. Relocating aerobic
composting technology 50 miles to the north (from Gilroy to Palo Alto) also will
require a significant capital investment. This expense does not achieve significant
value for the City or reduce greenhouse gases significantly.
Additionally, new technologies are being developed and refined to harness the
energy potential in yard trimmings and wood waste. The City of San José is
developing a pilot project to gasify wood waste and biosolids at the San
José/Santa Clara Regional Wastewater Facility. Staff believes these technologies
will continue to mature and could be an appropriate activity on the 3.8-acre
Measure E site, on the RWQCP, or elsewhere, as part of Component Four of the
OFP. If that were to happen, then local compost would again be available to
residents. The cost estimate to develop an aerated static pile composting facility
that could manage all of the City’s yard trimmings was estimated and presented
to Council as part of the Blue Ribbon Task Force on Composting efforts in 2009.
The estimated 2009 capital cost of $3 million adjusted for inflation at 3% per year
is approximately $3.5 million in 2014 dollars; however, capital costs may be more
expensive as new stormwater and air quality regulations have been promulgated
since the 2009 estimate.
14. What are the rates of home composting and what are the trends? Would
more aggressive home based programs change the need for a local composting
facility?
Answer: Staff does not keep a record of the number of home composters in Palo
Alto. While home composting is the best, most sustainable method to deal with
the City’s residential yard trimmings and food scraps, there are not nearly enough
residents currently composting at home to manage all of the City’s yard trimmings
to impact the projected sizing of Components Two, Three, and Four in the OFP.
However, with the implementation of an expanded home composting campaign
in 2014, Staff will be able to reassess the impact of home composting on
projected tonnages of yard trimmings and food scraps.
This expanded home composting campaign will be a focused outreach and
incentive-based campaign that will augment and add emphasis to the City’s
traditional, ongoing, multi-partner program for home composting, water
conservation, and pollution prevention programs. The goals of the expanded
campaign are to: 1) raise awareness about the benefits of home composting; 2)
increase the number of people composting at home; and 3) increase the number
of people using compost in their yard/garden.
The expanded campaign will encourage residents to compost at home through
education of how composting conserves water and energy while reducing waste
and pollution, and through incentives, such as the City providing a limited number
of free home composting bins to Palo Alto residents. Bins have been given away
at the Great Race for Saving Water on April 19, 2014, and at all Palo Alto compost
workshops during 2014. Staff will also be holding a free compost give-away event
on May 17, 2014, at the entrance to the closed Palo Alto Landfill.
15. Can we include levee protection and have Partner agencies share cost?
The new facilities built as part of the OFP will be designed above the Base Flood
Elevation (elevation 7.7) in order to provide 100-year flood protection for the new
facility. Reduction of the risk from tidal flooding and storm surge in Palo Alto,
including at the RWQCP, is part of a regional study being conducted by the US
Army Corps of Engineers (USACE), with substantial support from the Santa Clara
Valley Water District. The regional and federal project is the optimum solution for
providing tidal flood protection. Staff recommends that no levees be included in
the proposed projects for the Organics Facilities Plan. Isolated sections of levee
improvements would not be effective in providing flood protection to the RWQCP
and surrounding areas.
The USACE South San Francisco Bay Shoreline Study is currently evaluating levee
improvements in Alviso. The next stage of the study will be the northern portion
of the Santa Clara County shoreline, which will be funded 50/50 by the USACE and
Santa Clara Valley Water District (i.e., the local sponsor). Construction of levee
improvements along Palo Alto’s shoreline may be identified in the USACE study;
the future improvements can be funded through a combination of federal and
local sources (i.e., a 35/65 local/federal cost share, minimum, up to a 50/50
local/federal cost share, maximum). It is too early to commit to a local source for
the funding. A local assessment district is one potential mechanism to generate
the required matching funds. Because the RWQCP is one of the many parcels at
risk in Palo Alto’s tidal flood zone, the RWQCP partner agencies and the Palo Alto
Wastewater Collection Fund would be obligated to share in any assessed fees for
the levees, as ultimately approved by Council.
16. How is Component Two (THP AD Facility) delivered (design and
construction) and how are services provided (ownership)?
Answer
Project Delivery
Staff recommends that the City employ the resources of consultants to design and
manage the project. After completion of California Environmental Quality Act
(CEQA) review, staff will evaluate the merits of a design-bid-build (DBB) approach
and a design-build (DB) approach. The design-build approach is not expected to
significantly alter the project timeline, so the evaluation between these two
approaches will focus on potential cost savings, innovation, risk exposure and the
level of needed control over the quality of the design by the City.
The E/CF RFP allowed for less-common, innovative, and/or emerging technologies
to be proposed like gasification and dry AD. To reduce the risk to the City, the
E/CF RFP asked proposers to take on all of the financial and performance risk
through a design-build-own-operate-maintain (DBOOM) procurement process.
The City would pay a “tipping fee” for each feedstock only if the proposer could
guarantee performance. Since no gasification proposals were received and no dry
AD proposals progressed past the minimum criteria evaluation, staff reevaluated
the risk issue associated with being the owner operator of a wet AD. A wet AD
system is a well-established technology and often owner operated.
Most importantly, the City realizes significant savings as the owner-operator of a
THP AD system. The 20-year net present value of the City OFP is over $20 million
less than the most competitive E/CF RFP proposal with expenses shifting from
operations and maintenance to long-term capital.
Traditionally, projects at the RWQCP have been secured using the design-bid-
build project delivery process. This process is a step-by-step approach to project
delivery. The City prepares a scope of work for the design of a project, an RFP is
released, environmental design engineering firms respond, and the City selects a
consultant to complete final design of the project. The City then prepares a bid
package for the construction of the project. The construction contract is awarded
to the lowest responsive bidder. There are a few shortcomings of this process:
one, the process to respond to differences between the design and the needed
construction fixes can result in change orders; two, the procurement process
takes additional time with two bid periods; and three, the procurement requires
the selection of the lowest responsive bid.
As a response to tradeoffs with design-bid-build process, many communities
employ design-build project delivery. The initial engineering is more conceptual
and the engineering and construction tracks begin simultaneously. The
construction is also able to adapt more quickly to changes on the ground.
However, some conceptual design must be completed prior to the preparation of
a DB project and CEQA documents must be completed prior to a DB award. The
DB process can be structured to allow more (or less) control by the City, but
requires strong project management.
Another significant risk related to the DB process is that the contractor is
incentivized to reduce construction costs (value engineering) that may be at the
expense of operational costs. One solution to this problem is to couple DB with
operations (aka, DBO). This forces the DB contractor to consider the long-term
operational costs. However, as noted earlier, the City could save over $1 million a
year by operating the facility. This would make the DBO option less attractive.
However, another project delivery option is design-build-own-operate-transfer
(DBOOT). This delivery option is similar to the DBO option, but has the contractor
finance the facility and transfer or sell the facility to the public entity. This option
allows for the RWQCP to set the terms of the transfer (3-5 years) and use lower
interest rates to finance the subsequent years of the project. In some cases, the
private entity can take advantage of tax breaks unavailable to public agencies.
Like DBOOM, the DBOOT provides fewer opportunities for oversight by the owner
as compared to design-bid-build. Staff does not see Components One or Two as
candidates for DBO or DBOOT models. However, a DBO procurement model may
be more appropriate for Components Three and Four.
After Council acceptance of the OFP recommendations, staff will direct CH2M
HILL to begin a Component One (Biosolids Dewatering and Truck Haul-Out
Facility) predesign report (Staff Report ID # 3383, C13147733, Task 11). Staff has
developed a scope of work for program management; proposals are expected in
May 2014. Staff will return to council in approximately July 2014 for program
manager contract approval. The program manager will manage the contracting
for the major capital improvement work and apply for a financial SRF loan for the
project. Program management for the RWQCP’s Long Range Facilities Plan covers
$197 million of work over a 10-year timeframe; annual program management
costs are estimated to be $450,000 with the expense for preparation of a state
SRF loan expected to be approximately $100,000. The initial tasks of the program
manager will be to:
Assist with preparation of an SRF application and SRF specific
environmental reporting requirements,
Prepare of a design RFP for Component One Biosolids Dewatering and
Truck Haul-Out Facility,
Prepare the RFP for pre-design on the AD system,
Provide support services during the bid phase, and
Provide engineering services during the construction management phase.
The work of the program manager is for the biosolids project and the other major
capital projects of the wastewater treatment fund shown below:
Project Title
Project
Start
Year
Project Cost
Program Management Services 2014 $4,600,000
Solids Handling Facility 2014 $69,000,000
Primary Sedimentation Tank Rehabilitation 2014 $7,313,000
Lab & Environmental Services Building 2014 $17,903,763
Fixed Film Reactors Structure and Equipment 2017 $19,420,440
Headworks Facility (including Grit Removal System 2020 $38,856,627
Recycled Water Filters and Chlorine Contact Tank 2022 $14,209,044
Joint Interceptor Sewer 2022 $30,800,000
Total Long Range Facilities Plan (Major CIP) $202,102,874
The State Water Resources Control Board (SWRCB) Division of Financial
Assistance funds publicly-owned wastewater treatment projects with low-interest
loans through the Clean Water State Revolving Fund. The City of Palo Alto will be
the applicant for a loan for Component 1 and 2 (approximately $69 million). Staff
will return to Council for adoption of the resolution authorizing the application of
the SRF loan. The SWRCB will review the application for funding eligibility and
prepare a standard agreement for funding the project. After drafting the
agreement, staff will return to Council for authorization of the agreement. The
terms of an SRF loan would be a 30-year term with the first payment due
approximately one-year after construction completion. The City likely would apply
for an agreement for funding. The SWRCB would review the application for
funding eligibility and prepare a standard agreement for funding the project.
The SRF loan interest rate is one-half of the current state general obligation bond
rate. As of March 2014, the SRF loan rate is 1.9% on a 30-year repayment term,
which is a public financing rate much more favorable than that available to the
RFP proposers through private financing. The loan can fund hard costs (e.g.
construction) as well as soft costs, which include program management,
environmental documents, planning, design, value engineering, construction
management, and administration costs. Land and right-of-way costs are ineligible.
However, no new land or right-of-way is needed for the project. The Wastewater
Treatment Fund will be responsible for loan payments to the State. The partner
agreements will be modified to include approval of this project and a
commitment to repay debt obligations by each agency. Financing tables for a $69
million SRF loan are included in Attachment E.
Wastewater Treatment Fund Staffing and Service Delivery
There will be no net change in total personnel to operate the system; a change in
the type of personnel is needed, subject to Council approval of the budget for
staffing. When the incinerator is retired, staff expects to eliminate approximately
2.0 FTE WQC Plant Operator II (SEIU Job Class #509) positions through attrition.
The new system will require some operational attention and some specialized
maintenance:
The new dewatering and AD systems will be highly automated so the new
facilities will not require the level of close operator attention that the City’s
current sewage sludge incinerator and air pollution control systems have
needed for the last 42 years; and
The new Combined Heat and Power system (CHP) system (a.k.a., turbines
or internal combustion engines) will convert biogas into electricity; these
are specialized engines requiring skilled mechanics for maintenance. Nearly
all Bay Area wastewater plants with anaerobic digesters utilize a CHP to
convert biogas to energy.
For proper maintenance of the new digestion and CHP system, the RWQCP will
need to fill approximately 2.0 new FTE Maintenance Mechanic positions (SEIU Job
Class #505). After startup, the City will utilize a service contract for the engines to
ensure RWQCP staff is properly trained on operation and maintenance.
17: Can the City operate the Component One and Two biosolids handling and
treatment systems?
Local municipalities commonly own and operate facilities similar to the
recommended biosolids facilities in Components One and Two of the OFP. In
correspondence and conversations with the CAMBI-US managing director,
engineering consultants, and other municipal operators of the CAMBI thermal
hydrolysis system, all indicated that a municipally owned wastewater treatment
plant, such as the RWQCP, could operate and maintain a CAMBI thermal
hydrolysis process (THP) system. The District of Columbia Sewer and Water
Authority (DC Water) will be starting up a CAMBI THP system in July 2014; DC
Water is the first CAMBI THP system in North America and will be the largest in
the world. The DC Water wastewater treatment facility is about 16 times larger
than the RWQCP. The Hampton Roads Sanitation District Atlantic Treatment Plant
(slightly larger than the RWQCP) is in the design stage on a CAMBI THP system.
These agencies will also be the owner operator of the CAMBI THP system.
Similar to other wastewater plants, staff recommends that a post-construction
startup and support phase be included to ensure safe and reliable operation and
proper transfer to City operations staff, specifically:
The City will require six months of smooth and successful operation with
the new facility;
After construction of the thermal hydrolysis and AD system, qualified THP
staff from the THP provider will operate the thermal hydrolysis system
onsite for approximately eight months and train City staff on safe and
reliable operation;
Following the THP training and startup, the City will require a two year
service contract for THP operational support (offsite support);
After startup of the thermal hydrolysis process and AD facility and prior to
the addition of food scraps, the new facilities will require one year of
successful operation prior to the addition of any food scraps; and
The addition of pre-processed food scraps will be progressively staged in a
phased manner while staff gains experience operating the new system.
18. Can the THP AD system biogas be converted into renewable fuel instead of
renewable electricity?
Converting biogas into a renewable fuel is technically feasible but not pursued for
the project. An analysis of biogas energy value showed that use of the electricity
to meet THP AD process heat demands was a far more efficient use of the energy
than combusting a biofuel in a vehicle. Similarly, clean-up and compression of the
biogas for injection into the City gas distribution system is relatively complex and
not as valuable a use compared to converting the embedded energy into
renewable electricity. Converting the biogas into electricity maximizes the use of
the project’s energy production. The electric energy has four times the value of
biofuel energy (approximately $12/million BTU versus $3/million BTU).
Executive Summary
Introduction
The City of Palo Alto has operated the Regional Water Quality Control Plant (RWQCP) to consistently provide
reliable, cost-effective, and environmentally responsible wastewater treatment for its citizens and regional
partners for more than 45 years. The City’s vision for future biosolids management encompasses the need
to address the RWQCP’s aging solids handling infrastructure, to proactively comply with changing and
uncertain regulations affecting biosolids, and to respond to community goals to increase the beneficial use
of recovered organic resources city-wide. Palo Alto strives to create renewable energy and offset
greenhouse gas emissions while being mindful of the financial impact on the RWQCP’s rate payers.
This Biosolids Facility Plan (BFP) provides a long-term roadmap to enable the City to reliably and sustainably
manage and beneficially reuse the wastewater solids produced at the RWQCP through year 2045.
The focus of the BFP is to develop and evaluate sustainable biosolids-only processing and reuse alternatives.
In parallel with the BFP, the City of Palo Alto is evaluating how other recovered organics (i.e., food scraps
and yard trimmings) can possibly be processed with biosolids. As part of this evaluation of integrated
organics management, the City of Palo Alto is comparing the results of the City’s Energy/Compost Facility or
Export Option for Food Scraps, Yard Trimmings, and Biosolids Request for Proposals in concert with the
outcomes of the BFP. Together, the BFP and the energy/compost projects offer an important opportunity to
define a comprehensive and integrated approach to organics management and recovery.
Palo Alto’s City Council has prioritized the decommissioning of the RWQCP multiple-hearth furnaces (MHFs)
by the year 2019. The MHFs currently incinerate the RWQCP wastewater residuals; therefore, the City must
evaluate options for wastewater residuals management. Hence, the City prepared the BFP to select a cost-
effective biosolids management strategy to protect public health and the environment and to position the
City to respond to rapidly evolving biosolids regulatory, technological, and end-use opportunities.
This BFP is developed as a companion document to the City of Palo Alto Long Range Facilities Plan for the
Regional Water Quality Control Plant Final Report (LRFP) (Carollo Engineers, 2012). The BFP builds on the
LRFP, allowing solids processing recommendations in the BFP to move forward in concert with other
planned improvements at the RWQCP (as defined in the LRFP). Together, the two documents provide a
comprehensive long-term plan for the RWQCP.
Summarized in this Executive Summary, the BFP includes:
• RWQCP residuals projections
• Description of evaluation methodology
• Development of viable alternatives
• Alternatives evaluation results
• Description of the recommended alternative
• Phasing and implementation plan
RWQCP Residuals Projections
Based on a planning period of 30 years from the base year 2015, the 2045 maximum month projections for
primary sludge, secondary or waste activated sludge, and fats/oils/grease were used for alternative facility
sizing and associated capital costs estimation, while the 2015 annual average solids projections were used
for the evaluation of annual operations and maintenance costs. The projected quantities are summarized in
Table ES-1. Note that for the BFP, food scraps and yard trimmings were not included in the analysis;
PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT ES-1
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EXECUTIVE SUMMARY
however, the onsite alternatives could be designed to coprocess food scraps with the primary sludge and
waste activated sludge.
TABLE ES-1
Primary Sludge, Waste Activated Sludge, and Fats/Oils/Grease Projections
Parameter
2015 Average Annual
(dry pounds per day)
2045 Maximum Month
(dry pounds per day)
Primary Sludge and Waste Activated Sludge Dry Mass 44,460 64,516
Fats/Oils/Grease/Scum Dry Mass 2,200 2,200
Alternatives Evaluation Methodology
Generally, for biosolids facility projects, the wastewater residuals stabilization technology is initially dictated
by the biosolids end-use options. For this project, in addition to the end-use options, the selection of the
treatment technology and final biosolids end–uses will be determined by the evaluation criteria. The criteria
are reflective of Palo Alto staff and stakeholder values. The key criteria to evaluate biosolids management
alternatives are listed here and also shown in Figure ES-1:
• Technical viability and reliability
• Potential impacts on and benefits for the community and the environment
• Capital and operation and maintenance costs
• Minimizing greenhouse gas emissions
• Finding a beneficial use for the biosolids generated
• Producing renewable energy
• Managing organics and residuals at the local level
• Potential to integrate recovered organics from the Zero Waste Program with the biosolids
• Meeting current and future regulations
• Minimizing odors and other environmental impacts
Figure ES-1
Value Hierarchy and Criteria Categories for Palo Alto RWQCP Alternatives Evaluation
NPV
Impact on Community
Capital
Outside Funding Incentives
Energy
Labor
Chemicals
Hauling
O&M
Economic
Performance
Traffic
Odor
Noise
Safety risk to O&M
staff
Social
Performance
GHG Carbon Footprint
Renewable Energy Generation
Beneficial use of
biosolids
Level of integration of PA
organic waste streams
Other Environmental
Impacts (Other than GHG)
Environmental
Performance
Level of Complexity
Maintenance Expertise Required
Outside Entity Involvement
Diversity of Biosoilds
End-use Options
Sidestream Impacts
Technical
Performance
Sustainability
Triple Bottom Line +
ES-2 PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT
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Development of Viable Alternatives
Specific to the Palo Alto RWQCP, the viable options for biosolids management include onsite biosolids
processing solutions (e.g., anaerobic digestion) and solutions that involve trucking dewatered raw sludge for
further processing at an offsite processing facility.
Production of an anaerobically digested Class B biosolids cake will require management of the product in a
land- based solution. Production of a Class A biosolids cake would allow for more beneficial land-based
reuse opportunities, as well as alternative reuse opportunities, should the City decide to create a product for
local public distribution. For example, the City of Tacoma, Washington, blends its Class A cake with sawdust
to produce Tagro™, which is distributed to the public and sold in home and garden stores alongside
conventional soil amendments. Production of a thermally hydrolyzed and anaerobically digested Class A
biosolids can be sold or used as a soil amendment by blending with soil or another amendment such as
recovered wood chips. These onsite anaerobic digestion options allow for integration of food scraps
collected through the Palo Alto Zero Waste program.
For bulk agricultural land application in Northern California, there is currently not a clear advantage to
producing a Class A product rather than a Class B product. However, given that local management of
organics has been expressed as a community value for the City and given the ongoing pressure on land
application sites in California, production of a Class A product opens up future opportunities for biosolids
management, either locally or through production and distribution of a bulk material. In the long term
(during the course of the BFP planning period), the City of Palo Alto will want facilities that can produce a
Class A product, leaving multiple outlets and reuse opportunities available for RWQCP biosolids.
The following technology alternatives were considered for biosolids management:
1. Dewater and Haul (Raw Sludge) Solutions:
a. Synagro Central Valley Compost Facility
b. East Bay Municipal Utility District (EBMUD) Anaerobic Digestion
c. Kirby Canyon Landfill Facility
d. Future Synagro Bay Area Compost Facility
e. San José/Santa Clara Regional Wastewater Facility
1. Zero Waste Energy Natural Gas Production Demonstration Project
2. Anaerobic Digestion at San José/Santa Clara Regional Wastewater Facility
2. Onsite Processing Solutions (with truck haul to land application, or landfill alternative daily cover):
a. Mesophilic Anaerobic Digestion with Biogas-fueled Combined Heat and Power
b. Temperature Phased Anaerobic Digestion with Biogas-fueled Combined Heat and Power
c. Thermal Hydrolysis Process and Mesophilic Anaerobic Digestion with Biogas-fueled Combined Heat
and Power
d. Dewatering and Landfill Gas-fueled Thermal Drying
e. Dewatering and Thermal Drying/Gasification
To develop a robust analysis of each alternative, non-financial criteria were developed and analyzed in
addition to the economic analysis. The process, called multi-attribute utility analysis, includes a structured
evaluation of the risks and benefits of a decision in comparison to costs. Multi-attribute utility analysis is
recommended in situations where making a wrong decision could result in substantial financial risk,
collaboration and buy-in is essential to achieving desired outcomes, and the complexity or number of
alternatives is high. This type of analysis enables a decision-making process that explains the financial
benefits and risks inherent in the strategies considered, and is used to prioritize multiple activities so the
balance of economic, technical, environmental, and social factors is optimized.
PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT ES-3
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Alternatives Evaluation Results
During the initial screening of possible alternatives, two of the dewater and haul alternatives (Alternatives
1d and 1e, above) were identified as non-viable at this time and dropped from additional consideration.
Partnership opportunities with other wastewater agencies were reexamined to confirm the current viability
of the remaining dewater and haul options. The remaining eight viable alternatives were further developed
to allow for a planning-level evaluation. The financial analysis results from this evaluation are summarized in
Table ES-2, with the net present worth of the alternatives illustrated in Figure ES-2. The net present worth
for each alternative was estimated for the planning period of 30 years using a real discount rate of 1.5
percent.
TABLE ES-2
Alternatives Evaluation Financial Summary
Alternative
Biosolids
Classification
Biosolids
End-use
Capital
($million)
2015 Annual
O&M
($million/year)
2015 Net
Present
Worth
($million)
1a Dewater and Haul to Synagro Central Valley
Compost Facility
Class A Compost 14 1.6 53
1b Dewater and Haul to EBMUD Anaerobic
Digestion
Class B Land application 14 2.0 62
1c Dewater and Haul to Kirby Canyon Landfill Unclassified Landfill 14 2.3 69
2a Mesophilic Anaerobic Digestion with Biogas-
fueled Combined Heat and Power
Class B Land application 53 0.5 64
2b Temperature Phased Anaerobic Digestion
with Biogas-fueled Combined Heat and Power
Class A Land application 70 0.5 83
2c Thermal Hydrolysis Process and Mesophilic
Anaerobic Digestion with Biogas-fueled
Combined Heat and Power
Class A Land application 69 0.4 79
2d Dewatering and Landfill Gas-fueled Thermal
Drying
Class A Land application 57 1.6 95
2e Dewatering and Thermal Drying/Gasification Ash Landfill 53 2.2 106
Of the viable alternatives, two of the three sludge dewater and haul solutions emerged as economically
most feasible in comparison to the onsite processing solutions. Hauling to the Synagro Central Valley
Compost Facility (Alternative 1a) achieved the lowest positive (best) net present worth, followed by hauling
to EBMUD (Alternative 1b). It is recognized that beneficial use of biosolids is a project goal and that there
are increasing pressures to reduce or eliminate the disposition of unclassified sludge in landfills. Therefore,
Alternative 1c, which assumes the landfilling of unclassified sludge (not alternative daily cover), is recognized
as the least desirable dewater and haul alternative, and only considered as an emergency backup solution
for the RWQCP.
Of the onsite biosolids processing solutions, mesophilic anaerobic digestion (Alternative 2a) achieved the
lowest net present worth, followed by the thermal hydrolysis process (Alternative 2c) and temperature
phased anaerobic digestion (Alternative 2b). The anaerobic digestion solutions include a combined heat and
power system to beneficially utilize biogas generated by the anaerobic digestion process, thereby, resulting
in the most economical long-term solution. The thermal drying and gasification alternatives (Alternatives 2e
and 2f) were the highest cost alternatives.
ES-4 PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT
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EXECUTIVE SUMMARY
Figure ES-2
Alternatives Net Present Worth Comparison
Net energy and anthropogenic greenhouse gas (GHG) emissions were estimated for each alternative as
summarized in Table ES-3, and illustrated in Figures ES-3 and ES-4, respectively.
Relative to the existing solids handling system, the anaerobic digestion solutions, Alternatives 2a, 2b, and 2c
result in significant net energy production since these include a combined heat and power system to
beneficially utilize energy from biogas from the anaerobic digesters. Alternative 1b (Dewater and Haul to
EBMUD Anaerobic Digestion) also results in net energy production based on the energy recovered by the
combined heat and power system at EBMUD from the sludge that would be sent from the RWQCP.
These anaerobic digestion alternatives also result in significant GHG emission offsets. Both of these criteria
(net energy production and GHG emission offsets) are recognized as two of the most significant
environmental benefits of the anaerobic digestion solutions in comparison to the existing solids handling
system as well as the other biosolids processing alternatives evaluated. In addition to these, the volume of
anaerobically digested and dewatered biosolids to be hauled offsite and the related number of truck trips
annually are substantially lower than hauling dewatered sludge. With the thermal hydrolysis process
upstream of anaerobic digestion, greater volatile solids destruction would occur, further reducing the
quantity of biosolids hauled and also enhancing energy production.
PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT ES-5
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EXECUTIVE SUMMARY
TABLE ES-3
Alternatives Environmental Analysis Summary
Alternative
Net Energya
(MWh/year)
Anthropogenic
GHG Emissionsb
(MT CO2e/year)
Hauling Miles
(truck
miles/year)
Number of Trucks
from RWQCP
(vehicles/year)
1a Dewater and Haul to Synagro Central Valley Compost
Facility
-2,576 714 311,300 1,354
1b Dewater and Haul to EBMUD Anaerobic Digestion 5,482 -1,660 101,500 1,354
1c Dewater and Haul to Kirby Canyon Landfill -1,255 3,104 92,000 1,354
2a Mesophilic Anaerobic Digestion with Biogas-fueled
Combined Heat and Power
13,481 -3,642 135,900 755
2b Temperature Phased Anaerobic Digestion with Biogas-
fueled Combined Heat and Power
12,515 -3,335 129,500 719
2c Thermal Hydrolysis Process and Mesophilic Anaerobic
Digestion with Biogas-fueled Combined Heat and Power
14,219 -3,846 91,280 507
2d Dewatering and Landfill Gas-fueled Thermal Drying -4,706 1,061 55,590 397
2e Dewatering and Thermal Drying/Gasification -341 101 4,170 61
a Negative net energy represents net energy consumption, while positive net energy represents net energy production.
b Negative GHG emissions represent reduction in emissions, while positive GHG emissions represent increase in emissions.
MT CO2e/year = metric tons equivalent carbon dioxide per year.
MWh/year = megawatt-hours per year.
ES-6 PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT
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EXECUTIVE SUMMARY
Figure ES-3
Alternatives Net Energy Production Summary
PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT ES-7
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~ • c
~
20,000
1 5,000
10,000
5,000
o
-5,000
a:; -10,000 z
-15 ,000
-20,000
• Net Energy Production
.WOO>
E>osting
Solids
Handling
System
-15,007
Net Energy Production
(energy produced minus energy demand)
I -• I
Thermal Haulingto Haulingto Thermal "'" WM Gasification HaulingtoCV Hydrolysis EBMUD Kirby Drying
14,21'1 13,481 12,515 5,482 -341 -1,255 -2,576 4,~
~ • c
~
20,000
1 5,000
10,000
5,000
o
-5,000
a:; -10,000 z
-15 ,000
-20,000
• Net Energy Production
.WOO>
E>osting
Solids
Handling
System
-15,007
Net Energy Production
(energy produced minus energy demand)
I -• I
Thermal Haulingto Haulingto Thermal "'" WM Gasification HaulingtoCV Hydrolysis EBMUD Kirby Drying
14,21'1 13,481 12,515 5,482 -341 -1,255 -2,576 4,~
~ • c
~
20,000
1 5,000
10,000
5,000
o
-5,000
a:; -10,000 z
-15 ,000
-20,000
• Net Energy Production
.WOO>
E>osting
Solids
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System
-15,007
Net Energy Production
(energy produced minus energy demand)
I -• I
Thermal Haulingto Haulingto Thermal "'" WM Gasification HaulingtoCV Hydrolysis EBMUD Kirby Drying
14,21'1 13,481 12,515 5,482 -341 -1,255 -2,576 4,~
EXECUTIVE SUMMARY
Figure ES-4
Alternatives Anthropogenic Green House Gas Emissions Summary
The non-financial criteria were evaluated for each alternative to assist in the identification of the preferred
alternative. The total benefit scores for the alternatives were compared as illustrated in Figure ES-5.
Alternative 2c (Thermal Hydrolysis Process and Mesophilic Anaerobic Digestion with Biogas-fueled
Combined Heat and Power) received the highest benefit score.
Hauling to Synagro Central Valley Compost Facility and to the EBMUD anaerobic digestion system
alternatives involve the hauling of unclassified sludge, leaving the sludge processing and final biosolids
product disposition to outside parties, outside the control of the RWQCP. These dewater haul solutions
were evaluated as viable near-term solutions for the RWQCP, but they are likely not viable solutions for the
entire 30-year planning period. Although the dewater and haul alternatives have relatively low net present
worth values, the net energy, GHG offsets, and non-financial scores were not as favorable as the anaerobic
digestion alternatives.
Alternative 2c (Thermal Hydrolysis Process and Mesophilic Anaerobic Digestion with Biogas-fueled
Combined Heat and Power) received the highest benefit score, the best net energy production, and highest
GHG offsets, thereby emerging as the recommended approach to sustainable biosolids management that
best reflects Palo Alto and its stakeholders’ interests and values.
ES-8 PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT
Draft
EXECUTIVE SUMMARY
Figure ES-5
Alternatives Total Benefit Score Comparison
Recommended Biosolids-only Alternative
The recommended alternative for biosolids management is Alternative 2c: Thermal Hydrolysis Process and
Mesophilic Anaerobic Digestion with Biogas-fueled Combined Heat and Power. As presented in Figure ES-6,
primary sludge, waste activated sludge, and fats/oils/grease are blended and predewatered, and then
undergo thermal hydrolysis followed by mesophilic anaerobic digestion. The digested solids, which are a
Class A Equivalent product (Exceptional Quality), are dewatered and land applied; however, many other
end-use distribution options are available to Palo Alto with this end product.
The biogas produced by anaerobic digestion is routed to a cogeneration system for production of power and
heat. By combining the captured landfill gas with the biogas, it is estimated that the system could produce
1.6 megawatts of power (equivalent to powering approximately 1,000 homes) and sufficient heat to sustain
the treatment process without supplemental fuel. Hence, the recovered resources from the system include
the nutrients in the biosolids reused by land application, energy converted to renewable power, and heat for
use by the RWQCP.
Cambi technology is assumed for the thermal hydrolysis process, as it is the most proven to date. Other
vendor processes, such as Veolia Kruger Exelys, can also be considered during predesign of the system.
Cambi has experience with food hydrolysis and digestion, which is an added benefit of this technology if the
City decides to coprocess food waste at the RWQCP in the future. The source-separated food would be
hydrolyzed making the more recalcitrant material amenable to anaerobic digestion, thereby improving the
PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT ES-9
Draft
EXECUTIVE SUMMARY
biogas production and helping Palo Alto beneficially utilize food scraps as part of its overall organics
management program. Other advantages of the thermal hydrolysis process are improved dewatering and
lower odor associated with the biosolids end-product. After blending with soil, the biosolids product could
be locally distributed by Palo Alto or a third party, such as Synagro.
Figure ES-6 shows the process flow diagram for Alternative 2c, including 2015 mass/energy balance and key
design criteria for the major unit processes.
Figure ES-6
Process Flow Diagram for Alternative 2c: Thermal Hydrolysis Process and Mesophilic Anaerobic Digestion with
Biogas-fueled Combined Heat and Power
TPS+TWAS+FOG
170,263 gpd
46,860 dppd Biosolids Cake
9.2 dtpd
30 .6 wtpd
Biosolids
48,645 gpd
19,304 dppd
6.1 MMBTU/H
THP Sludge
48 ,645 gpd
44 ,517 dppd
Filtrate
143,574 gpd
Filtrate
62,810 gpd
Ave TKN: 1571 ppd
Ave NH3: 1310 ppd
Landfill Gas
396,000 cf/d
6.6 MMBTU/h
Mesophilic Digestion
No.of units 2
Diameter 43'
Vol/unit 0.52 MG
Total volume 1.04 MG
Post-dewatering (Belt Filter Press)
Duty units 2
Standby units 2
Belt width/unit 1m
Solids loading 1000 lb/hr/m
Solids capture 95%
Cake conc 30%
CHP
Active units 2
Standby units 1
Electric/unit 800kW
Installed 2,400kW
Biogas
313,728 cf/d
8.0 MMBTU/h
Recycle to headworksSidestream
Treatment
Biogas
Storage Tank
(100' dia)
TPS+TWAS+FOG
26,689 gpd
44,517 dppd
Thermal Hydrolysis Design (TBD)
Land Application
Cake Storage & Loadout
Total volume 147 CY
Steam System Design (TBD)
1.6 MW
Dilution Water
Pre-dewatering (Centrifuge)
Duty units 4
Standby units 2
Solids loading 1800 lb/hr/unit
Solids capture 95%
Solids conc 20%
To WWTP
and Grid
Solids stream
Liquids stream
Energy flow path
TPS+TWAS: Co-thickened Primary Sludge & Waste Activated Sludge
FOG: Fats, oils, and grease
Average Flow, gallons per day (gpd)
Average Mass, dry pounds per day (dppd)
(cf/d = cubic feet per day; CHP = combined heat and power; CY = cubic yards; dppd = dry pounds per day; dtpd = dry
tons per day; FOG = fats, oils, and grease, gpd = gallons per day; kW = kilowatts; lb/hr/m = pounds per hour per meter;
m = meter; MG = million gallons; MMBtu/h = million British thermal units per hour; ppd = pounds per day; MW =
megawatts; TBD = to be determined, THP = thermal hydrolysis process, TKN = total Kjeldahl nitrogen, TPS = thickened
primary sludge; TWAS = thickened waste activated sludge; wtpd = wet tons per day; WWTP = wastewater treatment
plant.)
ES-10 PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT
Draft
EXECUTIVE SUMMARY
Phasing and Implementation
Because of the requirement to decommission the MHFs by 2019, several unknowns regarding the quantity
and approach to organics management in Palo Alto, and final disposition of the Energy/Compost Facility, a
phased approach to implementation is recommended:
• Component 1: Design and construct a sludge dewatering and loadout facility onsite at the RWQCP. This
facility can be planned, designed, and constructed by the end of 2017. To ensure the best hauling and
tipping fee rates, it is recommended that the RWQCP continue to negotiate with both EBMUD and
Synagro as potential sludge receiving facilities. Once the facility is in service, after a typical 6 month
testing and performance period, the decommissioning and demolition of the MHFs may commence,
with completion by the end of 2018. This will open up more space on the RWQCP site for the
Component 2 facilities, in the central part of the site.
• Component 2: Design and construct Alternative 2c (Thermal Hydrolysis Process and Mesophilic
Anaerobic Digestion with Biogas-fueled Combined Heat and Power) facilities that would utilize the
dewatering and loadout facility (Component 1). The development of Component 2 can occur in parallel
with the construction and startup of Component 1, with construction of the Component 2 facilities
planned to begin immediately after the demolition of the MHFs. During this phase, it is recommended
that the RWQCP continue to explore the most economical end-use options for the biosolids product.
Construction of Component 2 facilities can be completed by the end of 2021. During start-up, the new
biosolids facilities would be integrated with the existing dewatering and loadout facility and then the
performance period of the entire system can be conducted.
The implementation schedule for Components 1 and 2 is summarized in Figure ES-7.
Figure ES-7
Overview of Implementation Schedule for Components 1 and 2
PALO_ALTO_RWQCP_BIOSOLIDS_FACILITY_PLAN_DRAFT ES-11
Draft
Attachment E - Wastewater Treatment Fund
Financing Analysis: Overview for Wastewater Treatment Fund
Table 1
CAPACITY
SHARE FLOW SHARE
Debt Payment1
Expense
Reduction (i.e.
savings) by
Retiring
Incinerators
with THP AD
Alternative
New Annual
WWT2 Fund
Expense for
Project
Year "A""B" "A" - "B"
2019 $3,296,657 $1,462,469 $1,834,189
2020 $3,296,657 $1,499,030 $1,797,627
2021 $3,296,657 $1,536,506 $1,760,151
2022 $3,296,657 $1,574,919 $1,721,739
2023 $3,296,657 $1,614,292 $1,682,366
2024 $3,296,657 $1,654,649 $1,642,008
2025 $3,296,657 $1,696,015 $1,600,642
2026 $3,296,657 $1,738,416 $1,558,242
2027 $3,296,657 $1,781,876 $1,514,781
2028 $3,296,657 $1,826,423 $1,470,234
2029 $3,296,657 $1,872,083 $1,424,574
2030 $3,296,657 $1,918,885 $1,377,772
2031 $3,296,657 $1,966,858 $1,329,800
2032 $3,296,657 $2,016,029 $1,280,628
2033 $3,296,657 $2,066,430 $1,230,227
2034 $3,296,657 $2,118,091 $1,178,567
2035 $3,296,657 $2,171,043 $1,125,614
2036 $3,296,657 $2,225,319 $1,071,338
2037 $3,296,657 $2,280,952 $1,015,705
2038 $3,296,657 $2,337,976 $958,682
2039 $3,296,657 $2,396,425 $900,232
2040 $3,296,657 $2,456,336 $840,322
2041 $3,296,657 $2,517,744 $778,913
2042 $3,296,657 $2,580,688 $715,970
2043 $3,296,657 $2,645,205 $651,452
2044 $3,296,657 $2,711,335 $585,322
2045 $3,296,657 $2,779,118 $517,539
2046 $3,296,657 $2,848,596 $448,061
2047 $3,296,657 $2,919,811 $376,846
2048 $3,296,657 $2,992,806 $303,851
$98,899,716 $64,206,323 $34,693,394
1: State SRF Loan=$69 mn, i = 2.5%, 30-y term, 1st payment starts 1-y after construction completion
2: WWT = Wastewater Treatment
Attachment E: Page 1 of 2 4/14/201411:16 AM
Attachment E - Wastewater Treatment Fund
Financing Analysis: Expense Impact by Contributing RWQCP Partner Agency
Table 2
Year
Palo Alto WWC
Fund Mountain View Los Altos EPASD1 Stanford
Los Altos
Hills
2019 $699,780 $691,318 $167,994 $158,120 $83,609 $33,368
2020 $685,825 $677,373 $164,389 $155,777 $81,364 $32,900
2021 $671,520 $663,080 $160,694 $153,375 $79,063 $32,420
2022 $656,858 $648,429 $156,906 $150,912 $76,704 $31,928
2023 $641,829 $633,413 $153,024 $148,389 $74,287 $31,424
2024 $626,425 $618,020 $149,045 $145,802 $71,809 $30,908
2025 $610,635 $602,243 $144,966 $143,150 $69,269 $30,378
2026 $594,451 $586,072 $140,786 $140,432 $66,665 $29,835
2027 $577,862 $569,496 $136,500 $137,646 $63,997 $29,279
2028 $560,859 $552,506 $132,108 $134,791 $61,262 $28,709
2029 $543,430 $535,091 $127,606 $131,864 $58,458 $28,125
2030 $525,566 $517,240 $122,991 $128,864 $55,585 $27,525
2031 $507,255 $498,944 $118,261 $125,789 $52,639 $26,911
2032 $488,486 $480,190 $113,413 $122,637 $49,620 $26,282
2033 $469,248 $460,967 $108,443 $119,406 $46,525 $25,637
2034 $449,529 $441,264 $103,350 $116,095 $43,353 $24,976
2035 $429,317 $421,068 $98,129 $112,701 $40,102 $24,298
2036 $408,600 $400,367 $92,777 $109,222 $36,770 $23,603
2037 $387,365 $379,148 $87,292 $105,656 $33,354 $22,891
2038 $365,599 $357,400 $81,669 $102,000 $29,852 $22,161
2039 $343,289 $335,107 $75,906 $98,254 $26,264 $21,413
2040 $320,421 $312,257 $69,999 $94,413 $22,585 $20,646
2041 $296,981 $288,836 $63,944 $90,477 $18,815 $19,860
2042 $272,956 $264,829 $57,738 $86,443 $14,950 $19,054
2043 $248,330 $240,222 $51,376 $82,307 $10,989 $18,229
2044 $223,088 $215,000 $44,856 $78,068 $6,928 $17,382
2045 $197,215 $189,148 $38,172 $73,723 $2,766 $16,514
2046 $170,695 $162,649 $31,322 $69,270 ($1,500) $15,625
2047 $143,512 $135,487 $24,300 $64,705 ($5,872) $14,714
2048 $115,650 $107,647 $17,103 $60,026 ($10,354) $13,779
$13,232,578 $12,984,811 $3,035,060 $3,440,313 $1,259,857 $740,775
1: East Palo Alto Sanitary District
2: WWC = Wastewater Collection
Share Palo Alto Mountain View Los Altos EPASD Stanford
Los Altos
Hills
FLOW 38.17% 38.14% 9.86% 6.41% 6.14% 1.28%
CAPACITY 38.16% 37.89% 9.47% 7.64% 5.26% 1.58%
Attachment E: Page 2 of 2 4/14/201411:16 AM
Wastewater Major CIP &
Organics Facility Plan Program Management
& Projects Delivery
First RFP Overall Program Management (Consultant)
Development of RFPs
Applying for Grants and Loans
Pre-Design Work on Components No. 2-4
Prepare Financing Plans and Timelines for Each Component
Second RFP Component No. 1 Design
(Possibly Design/Build)
Third RFP Component No. 2 Design
(Possibly Design/Build)
Fourth RFP Component No. 3 Design/Build/Own/Operate/Maintain
(Possibly Fewer Functions)
(Possibly Outside Palo Alto & “No Project” Needed)
Fifth RFP Component No. 4 Design/Build/Own/Operate/Maintain
(Possibly Fewer Functions)
(Possibly Outside Palo Alto & “No Project” Needed)
Attachment G: List of Key terms
Anaerobic Digestion (AD): Anaerobic digestion is a collection of processes by
which microorganisms break down biodegradable material in the absence of
oxygen
Anthropogenic and biogenic greenhouse gas emissions: Anthropogenic GHG
emissions originate from human activity, which are different from biogenic GHG
emissions originating in the natural world. For example, the combustion of biogas
from a digester is considered biogenic while the combustion of natural gas and
other fossil fuels is considered anthropogenic.
Bay Are Biosolids to Energy Project (BAB2E): The RWQCP is 1 of 19 partners in
the Bay Area Biosolids to Energy Project (BAB2E). BAB2E is evaluating two
technologies: AquaCritox by SCFI and gasification by MaxWest. MaxWest
Environmental Systems, Inc., has been selected to enter into negotiations for a
20-year contract to design, build, own, and operate a biosolids management
system to benefit BAB2E project. This commercial-scale gasification facility
proposed by MaxWest Environmental Systems, Inc., will process 67,000 wet tons
of biosolids per year. The facility will be hosted at a BAB2E coalition member’s
site, though not in Palo Alto, and will also receive biosolids from neighboring
Coalition members. MaxWest was not a proposer for the E/CF RFP.
Biosolids: Biosolids is a term used to describe stabilized sludge, that is, the
wastewater solids after treatment. The term sludge and wastewater solids are
interchangeable; they refer to the residual material separated from the liquid
stream in the wastewater treatment process. The solids are residual material
prior to stabilization or pathogen removal. Biosolids is a term used to describe
stabilized sludge, that is, the wastewater solids after treatment. Biosolids are
highly regulated through the Environmental Protection Agency Title 40 Code of
Federal Regulations Part 503 Rule (often referred to as the “503 Biosolids Rule”).
Biosolids, which are high in organic carbon and nutrients, can be used as a
fertilizer, land amendment, alternative daily cover for landfills, and as a fuel.
Technically, wastewater solids off-hauled and not stabilized through treatment
should be referred to as sludge or wastewater solids and not biosolids.
Dewatering: Dewatering removes water from sludge so that AD systems are
properly sized, to reduce hauling costs, and to maximize biogas production and
treatment efficiency. Combining the pre- and post-dewatering into one building
with reduced redundancy in dewatering equipment is feasible but increases risks
from an operational reliability perspective. This option was suggested by a
proposer. A fundamental reason for having separate facilities is that the THP and
AD process provide a pathogen free exceptional quality biosolids product.
Handling of these treated and untreated solids streams in the same building, and
indeed with the same equipment, presents the opportunity for cross
contamination; hence, staff recommends separating these systems and using
separate and independently redundant equipment for pre- and post-dewatering.
Dry Anaerobic Digestion: Much of the debate in the Measure E campaign
revolved around the potential to use dry AD. The Feasibility Study in 2011 also
looked at dry AD for much of the analysis. Since wastewater solids made up the
majority of the material to be processed, dry AD was deemed infeasible. One E/CF
RFP proposal included dry AD technology, but did not meet minimum
qualifications and was not considered. Dry AD was also not likely to be an
appropriate technology for the food scraps and yard trimmings only due to the
ratio of the material. The dry AD facility recently constructed in San Jose has a
yard trimming to food scrap ratio of 20:80, while the Palo Alto ratio of materials is
closer to 50:50. This ratio would provide a low biogas yield, resulting in poor
project economics.
Gasification: Gasification is a thermal process using extremely high temperatures
in the absence of oxygen that transforms a solid material into a synthesis gas that
can be combusted to create energy. While gasification is a thermal process, it
does not yield the same air pollutants as incineration. See BFP gasification
Technical Memorandum on status of gasification for biosolids.
Greenhouse Gas (GHG): Reported as annual metric tons (MT) of anthopogenic
CO2-equivalent greenhouse gas emissions throughout staff report
Mesophilic Wet Anaerobic Digestion: Mesophilic digestion takes place optimally
around 30 to 38°C to develop proper micro-organisms – about the same
temperature as the human body.
State Revolving Fund (SRF): The State Water Resources Control Board Division of
Financial Assistance administers the SRF loan program. The SRF loan can fund
wastewater treatment projects. Between February 2005 and March 2014, SRF
interest varied between 1.7 and 3.0% with an average of 2.37%, standard
deviation of 0.29%; the interest rate used in the Biosolids Facilities Plan is 2.5%;
between 1989 and January 23, 2014, the SRF loan term was capped at 20 years
with limited exception; as of January 23, 2014, new SRF projects including the
city’s biosolids project can take advantage of 30-year terms.
Thermal Hydrolysis Process (THP): THP is a high temperature and pressure
pretreatment process upstream of AD systems; the thermal hydrolysis step
disintegrates cell structures and dissolves naturally occurring cell polymers into an
easily digestible feed for AD; the pretreatment step occurs at a very high
concentration and also makes the sludge more flowable, allowing a smaller
digester volume and footprint, which is a significant advantage for the
constrained 25-acre RWQCP site; THP increases organic biodegradability, yielding
more biogas and energy and offsetting more GHG than other AD systems; THP
yields a final dewatered solids at 30-40%, much higher than traditional AD
systems at 18-25% solids, resulting in less hauling and land application costs; the
final THP dewatered biosolids are sterilized and pathogen free due to 165C at 20
minute treatment. CAMBI, Norway, is one of the providers of THP technology.
Other technology providers of THP do not have the same patents as CAMBI and
are in earlier stages of development (e.g,. Veolia Kruger Exelys); staff will continue
to monitor other THP technology providers.