Anaerobic Digestion Feasibility Study

326 Pages·2014·13.85 MB·English

City of Easthampton -
Anaerobic Digestion
Feasibility Study

Prepared For:

City of Easthampton, Massachusetts

May 2014
Prepared with Support from the
Tighe&Bond
Executive Summary

Executive Summary
With recent changes to the market for solar PV and the slower adoption of land-based wind
in New England, Massachusetts has placed an increasing focus on anaerobic digestion (AD)
as a critical piece of the state’s clean energy future. Anaerobic digestion is a biological
process during which microorganisms break down organic material in the absence of oxygen
to produce biogas containing a high percentage of methane. The methane can then be used
to generate electricity and/or heat. Depending on the type of digester and feedstock,
additional useful outputs may be produced, such as a soil amendment and compost.
AD technology qualifies as a renewable energy technology through the state’s RPS, and
various agencies and offices including the Department of Environmental Protection
(MassDEP), the Massachusetts Clean Energy Center (MassCEC), and Department of Energy
Resources (DOER) have established funding programs to help advance the deployment of
AD projects in the state. In addition to its clean energy benefits, there are other drivers for
AD related to solid waste and materials management. MassDEP’s 2010-2020 Massachusetts
Solid Waste Master Plan calls for the aggressive diversion of food waste and other organic
materials from the solid waste stream. The state’s pending Organic Waste Ban (scheduled
to take effect October 2014), will prohibit the disposal of commercially generated organic
materials at landfills.
With the increased opportunities for AD in Massachusetts, the City of Easthampton has been
approached by numerous private developers with interest in developing an AD project at the
City’s Ferry Street wastewater treatment facility (WWTF). An AD project at the WWTF has
the potential to result in numerous benefits for the City, including:
 Generation of local, renewable energy
 Avoided cost savings for electricity and heat at the WWTF
 Avoided cost savings for wastewater sludge disposal and dewatering
 Potential revenue through lease payments
 Beneficial use of source-separated organic materials that formerly were disposed of
at landfills
To better understand the technical and economic issues associated with such a project, the
City engaged with Tighe & Bond to conduct a comprehensive Feasibility Study of the
project. The Feasibility Study has been funded with a grant from the MassCEC, through its
Organics to Energy (OtE) program. The Feasibility Study involves an evaluation of
technical, site development, economic, and community impact factors to determine the
feasibility of the project. Based on the results of the project, the City may proceed to the
next steps of development, which would include further design, permitting, procurement,
and construction of the project.
Project Site
The project site is located at the Easthampton Wastewater Treatment Facility (WWTF),
situated at 10 Gosselin Drive off of Ferry Street in Easthampton, MA. The project site
consists of two main parcels owned by the City. The WWTF is located on the east parcel,
No. 130/24. The area for potential project development is located in the west parcel, No.
130/23, and is an open cleared area of approximately 2.6 acres. The site is currently used
for materials storage by the Easthampton Department of Public Works (DPW). The parcel
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was formerly associated with the adjoining J. P. Stevens Mills textiles complex, which
operated a textile production mill in the late 1920s until 1960s. The site was used for
disposal of materials from the former textiles production operations until approximately
1969. Since that time, the site has been inactive.
Summary of Evaluations
The Feasibility Study report documents the data, assumptions, calculations and research
used to support conclusions on technical and economic feasibility of an AD project at the
Easthampton WWTF. For the purpose of this Executive Summary, the key findings and
recommendations are provided below.
Site Assessment
The first step of the project involved an assessment of existing site conditions to determine
any potential constraints or fatal flaws to the siting of an AD project. The analysis is based
on a review of desktop and online information, plans and information provided by the City of
Easthampton, and information collected on-site. The Site Assessment also includes a
review of the site’s existing electrical and thermal demand, and an assessment of existing
electrical, heating, and other infrastructure. The results of the detailed site assessment are
provided in Sections 2 and 3 of the Feasibility Study.
 Physical Characteristics: The facility is accessed from Gosselin Drive from Ferry
Street just east of the Easthampton Water Tower. The WWTF and operations
consumes a majority of the parcel. The area to the west of the WWTF is currently
being used by Sewer Department as a stockpile and staging area for current
projects. According to City personal, this is the preferred location for a potential AD
facility. The site is very suitable for the proposed project, since the site is already
engaged in wastewater treatment activities.
 Environmental and Cultural Resources: There are several jurisdictional inland
wetlands and streams located adjacent to and within the project site that are
protected pursuant to the Massachusetts Wetlands Protection Act (WPA). The
western portion of the project parcel contains area of Estimated or Priority Habitat as
mapped by the Natural Heritage and Endangered Species Program (NHESP).
Additionally, Potential Vernal Pools are located approximately 250 feet north of the
site at the Manhan River and 400 feet southeast of the site. Though there are
mapped habitat and vernal pool areas proximate to the site, work is not proposed to
occur within these areas and the project is not anticipated to cause any adverse
impacts to environmental resources. There are no buildings at the WWTF property
or in the immediate vicinity of the project site which are identified as historic
properties. However, the project site is located proximate to areas that are included
in MHC’s Inventory of the Historic and Archaeological Assets of the Commonwealth
which contain MHC Historic Inventoried properties. The entire project is located
within a MassDEP Wellhead Protection Area.
 Zoning: The project site, parcel No. 130/23, is located in the Mixed Use / Mill
Industrial (MI) district. Additionally, the site is partially located within mapped 100-
year flood plain (flood zone AE), however, it is anticipated that the AD project can be
sited outside of the portion of the parcel within the floodplain district. As the entire
site is located within a MassDEP approved Wellhead Protection Area (Zone II), it is
anticipated that the project will need to comply with the Wellhead Protection related
land use restrictions of 310 CMR 22.21(2). Furthermore, since well number
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1087000-07G is approximately less than one-half mile from the project site, it is
assumed that the Aquifer Protection District restrictions may apply.
 Permitting: A summary of anticipated permitting obligations at the local, state, and
federal level is provided in the Feasibility Study report. In addition to approvals that
may be needed with regard to regulated resource areas at the site, this section of
the report also addresses potential permits that may be required regarding air
quality, wastewater, and composting and conversion. It is not anticipated that
environmental or local land use permitting will be a challenge for the project.
 Facility Energy Profile: The WWTF currently consumes approximately 690,000
kWh of electricity per year. Over this period, the average monthly consumption was
approximately 57,700 kWh with a minimum and maximum monthly consumption of
approximately 49,990 kWh and 66,750 kWh respectively. The heating load at the
WWTF is currently met through the use of number two fuel oil, liquefied propane (LP)
and electric heaters. The total annual heating load of the facility is approximately
840 MMBTU with an average monthly heating load is 70 MMBTU. It was estimated
that the WWTP uses 6,000 gallons of number 2 fuel oil and 4,000 gallons of propane
annually.
 Electrical Interconnection: The project site is located within a Western
Massachusetts Electric (WMECo) service area, in the West Central Massachusetts
ISO-NE load zone. As part of this Feasibility Study, a Distributed Generation Pre-
Application form was submitted to WMECo to obtain information about the proposed
point of interconnection. Based on information provided by WMECo, power at the
WWTF and proposed site is provided by the Gunn Substation located at the
intersection of Line and Phelps Street. The voltage at the substation is 22.9kV and is
constructed as four wire multi-grounded neutral Wye. The circuit supplying the
WWTF is 15A5. It is presumed for purposes of analysis that the ultimate transformer
will require a capacity of 1,000 kVA; the existing transformer has a capacity of 300
kVA. Net metering would be accomplished at the secondary voltage of 277/480 Volt
four wire Wye.
The overall conclusion of the site assessment is that no fatal flaws related to environmental
resources, site conditions, or on-site infrastructure exist that would prevent the
development of an AD project at the site. The site is very suitable for the proposed project,
since the site is already engaged in wastewater treatment activities. However, further
coordination with WMECo should occur to determine the scope of a future impact study or
whether system upgrades are required to accommodate the proposed project.
Feedstock Assessment
The Feasibility Study included a consideration of sludge waste generated on-site at the
WWTF and off-site food waste. Organic feedstock generators that will be subject to
MassDEP’s pending organic waste ban within a 30 mile radius of the proposed AD facility
were identified. A radius of 30 miles was selected based on a review of similar studies and
experience from similar projects. The estimate of potentially available feedstock was
determined based on an analysis of data provided by MassDEP and limited additional
research in the vicinity of the project site.
Within a 30 mile radius of the Easthampton WWTF, there are approximately 263
institutional/ commercial entities that are expected to be subject to the one ton per week
limit for the expected waste ban (i.e. generating 50 tons a year or more) that cumulatively
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generate approximately 69,290 tons a year assuming an estimated percentage of
contamination specific to each generator category. The characteristics of organic waste
generated by commercial and industrial sources vary considerably both across generator
sectors and within the sectors themselves. The report provides the general waste
characteristics by industry sector including typical moisture content, contamination levels,
and types.
The Feasibility Study also included a discussion of potential options for the management and
disposal/reuse of the digestate from each the AD process. Estimates of liquid and high
solids digestate were provided. The digestate management and reuse scenario will
ultimately be decided by the project developer.
Technical and Financial Analysis
Based on the identification of potentially available feedstock, and the quantity and
characteristics of this material, a system size and type was identified for the Feasibility
Study evaluation. Following an analysis to determine the suitability and composition of the
SSOM, the following volumes of feedstock were modeled for the AD system: 48 tons per
day (TPD) food waste and 4.9 TPD dewatered sludge.
While the Feasibility Study necessarily established a potential system size based on project
site constraints and the potential availability of feedstock materials, it should be noted that
the report does not represent a specific recommendation of a particular system size, type,
or configuration. It is anticipated that if the City issues a solicitation for the project, it will
allow respondents a level of flexibility with regard to project size and type.
Based on the feedstock inputs to each system, it was estimated that the 600 kW AD system
could produce 7,500 ft3/hr of biogas. The biogas generated by the AD project can be used
to generate electricity and heat. Current electricity and thermal consumption data for the
Easthampton WWTF was reviewed to determine current demands. For the purpose of the
study, we elected to model a reciprocating engine cogeneration system that would use the
biogas generated through the AD process. For the 600 kW system, it was estimated that
4,222 MWh of electricity would be produced annually. Based on current electrical
consumption at the WWTF, the project can offset a significant amount of electrical demand.
The cogeneration system will generate a significant amount of waste heat, even after
diverting a portion of it to the digesters and accounting for downtime for system
maintenance. The excess heat generated by the cogeneration system can be used for space
heating at the WWTF if an interconnection between the AD facility and the heating plant is
made. The preliminary analysis shows that the unit can meet the majority of WWTF’s
heating demand; however during periods of cold weather or system downtimes it is
expected that the facility would require supplemental heating.
Economic Assessment
The Feasibility Study included a life-cycle cost analysis completed for two project scenarios:
a project that would be developed, owned and operated by the City and one that would be
developed, owned, and operated by a private entity. The analysis included development of
an economic pro forma for each scenario that incorporates project costs, financing
mechanisms and incentives, and potential post-construction revenue. Costs include capital
equipment; site development, design, and permitting; operations and maintenance; taxes;
and financing. Revenue includes tax and other incentives; sale of Renewable Energy
Credits, Alternative Energy Credits, CHP Rebates; and tipping fee from the feedstock. In
the private developer scenario, it was assumed that the City would enter into a Power
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Purchase Agreement with the developer for the electricity and Thermal Purchase Agreement
to supply the WWTF’s thermal load.
Under the City-owned scenario, the City of Easthampton would incur the cost of design,
construction, and operation and maintenance of the project. In the private developer
scenario, the developer would develop, own, and operate the AD facility through a PPA
and/or lease agreement with the City. The same system size and associated capital costs
were modeled for both scenarios. Food waste tipping fee revenue remained constant
between both scenarios. Note that the pro forma was completed from the perspective of
the private developer to gauge the financial performance of the project.
The economic pro forma analysis shows that as modeled, only the publicly owned scenario
is economically viable. Key differences between the two models include energy cost
savings revenue to the City in the public scenario, and the impact of tax payments in the
private scenario. Additionally, compared to other renewable energy technologies that can
benefit from federal tax credits of 30% of capital costs, this credit is only 10% for AD/CHP.
While the pro forma assumed the private project could benefit from accelerated
depreciation, the first year 50% bonus was not considered.
In general, the results of the economic analysis point to several key drivers for AD projects;
namely project size, tipping fee, digestate management, O&M costs, and the ability to offset
electrical and thermal load. Most notably, tipping fee revenue and digestate disposal costs
significantly impacted the viability of project modeled in the Feasibility Study. In the private
scenario, revenue streams associated with power sales are not significant enough to
overcome the relationship between tipping fees/ digestate management costs.
The Feasibility Study used conservative assumptions for cost and revenue inputs. The
study includes a sensitivity analysis to test cost and revenue assumptions. Given the
incentives for AD projects and regulatory drivers for organic material diversion,
the initial results of the economic pro forma analysis do not mean that a project is
not economically viable at the site.
Conclusions and Recommendations
This report evaluated the feasibility of the installation of a potential AD system at the City of
Easthampton WWTF. The intent of the study was to help the City determine whether the
site is suited for an AD project and whether such a project could be technically and
economically viable. The analysis modeled a private-development project, in which a
private developer would develop, own, and operate the facility; and a City-owned scenario
in which the City of Easthampton would be responsible to develop, own, and operate the AD
facility.
The above factors affecting the feasibility of an AD project at the Easthampton WWTF are
summarized in Table E-1, below. As shown on Table E-1, the economic evaluation
determined that as modeled in the Feasibility Study only the public scenario is viable. The
economics for the publicly owned project are more attractive due to the significant energy
cost savings revenue enjoyed by the City. Tighe & Bond employed conservative values
in our analysis and assumed revenue would not be produced from the potential
reuse of digestate. Should a private developer be able to utilize additional
revenue sources or reduce digestate disposal costs, the project economics would
improve significantly.
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It should be noted that the quantity of food waste available to the project was based on the
Draper/Lennon study which provided the most comprehensive data source of available
generators in the region. However, the Draper/ Lennon study does not account for current
diversion practices. Based on our outreach efforts with regional generators, several
commercial and institutional entities have initiated practices to reduce waste generated
and/or currently divert their organic waste to other disposal facilities, such as local farms.
The sizing and economics of the project are subject to change depending on the quantity of
feedstock available.
Given the potential benefits of the project to the city and suitability of the site, it is
recommended that the project proceeds to the procurement stage to solicit responses from
the development community.
Recommended next steps to be conducted either by the City or a private developer, and
either prior to procurement or as part of project development, include:
 Confirmation of the availability and composition of feedstock for the project.
 Confirm status of other AD projects in project area, and determine the potential
impact to a project at the Easthampton WWTF.
 Confirmation of project development costs (including modification to the WWTF and
interconnection costs).
 Additional site evaluation, including topographic survey and geotechnical evaluations
prior to design of tanks, footings, and foundations to determine the actual soil
characteristics to design the bearing structures accordingly. A formal wetland
delineation should occur to confirm wetland boundaries on-site.
 Confirmation of current heating demand and estimated thermal costs at the WWTF
 Additional evaluation of water needs for the project, including domestic and fire
prevention needs.
 Consideration of management scenarios and economics associated with digestate
from the AD process
 Further coordination with WMECo with regard to electrical interconnection and
remaining capacity on the proximate circuit
 Pre-permitting consultation with the City of Easthampton to confirm the local zoning
permit requirements and consultation with MassDEP to confirm the air quality
permitting strategy

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TABLE E-1
Easthampton WWTF Anaerobic Digestion Project - Overview of Project Feasibility
Project Owner: City of Easthampton Ownership Private Developer Ownership
Feedstock: WWTF, Sludge & Food Waste WWTF, Sludge & Food Waste
Comments:
Scenario: 1 2
Factor:
Rated Capacity 600 kW 600 kW
As the project site is located within a MassDEP
approved Zone II, it is anticipated that the
Land Use No conflict expected No conflict expected project will need to comply with the Wellhead
Protection related land use restrictions of 310
CMR 22.21(2).
If the project is considered an extension of
Site Plan Review or Special Permit Site Plan Review or Special Permit the WWTF, Site Plan Review is required. If
Zoning
Approval from Planning Board Approval from Planning Board the project is considered a power plant
facility, a Special Permit will be required.
East side of operations building. Existing 3 East side of operations building. Existing
Electrical Interconnection
phase power lines. 3 phase power lines.
Thermal Interconnection Interconnect with WWTF Interconnect with WWTF
50 Tons Per Day Food Waste 50 Tons Per Day Food Waste
Feedstock Assumed for System
10,000 Gallons Sludge 10,000 Gallons of Sludge
Estimated Biogas Production (ft3/hr) 7,500 7,500
Estimated Annual Electrical Generation
4,222 4,222
(MWh)
Estimated Annual Thermal Generation
11,000 11,000
(MMBTU)
Estimated Digestate Production:
Dewatered Digestate (tons/day) 14.5 14.5
Liquid Digestate (gallons/day) 16,800 16,800
Environmental Factors:
Must submit Project Notification Form to
Historic and/or Cultural Resources Minimal/No Impact Minimal/No Impact
Massachusetts Historical Commission.
Project not located within the limits of
mapped Natural Heritage and Endangered
Rare Species No impact No impact Species Program (NHESP) Estimated Habitats
for Rare Wildlife or Priority Habitats for Rare
Species.
Order of Conditions from Conservation
Wetlands Minimal Minimal Commission/Determination of Applicability
likely required.
Comprehensive Plan Approval required from
MassDEP may require modeling and
comprehensive evaluation. Will require
Permitting Requirements Moderate Permitting Effort Moderate Permitting Effort
MassDEP approval to accept organic waste
and local approval via the Industrial
Pretreatment Program.
Economic Factors:
Est. Capital Cost $5,408,500 $5,408,500
Est. O&M Cost $214,579 $214,579
Financial Viability:
IRR (leveraged) 11.5% N/A
NPV (leveraged) $1,189,644 -$3,075,890
Payback Period (yrs, leveraged) 8.4 47.8
Economic Feasibility YES NO
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Table of Contents Tighe&Bond

Executive Summary
1 Introduction
1.1 Site Location & History ....................................................................1-2
1.2 Project Description .........................................................................1-2
1.3 Feasibility Study Overview ...............................................................1-3
2 Detailed Site Assessment
2.1 Physical Characteristics ...................................................................2-1
2.2 WWTF Facility ................................................................................2-1
2.3 Historical Environmental Site Assessment Issues ................................2-2
2.4 Environmental and Cultural Resources ..............................................2-3
2.4.1 Historic and/or Cultural Resources .......................................... 2-3
2.4.2 Rare Species........................................................................ 2-4
2.4.3 Wetlands ............................................................................. 2-4
2.4.4 Protected Open Space/ Drinking Water Resources .................... 2-5
2.5 Zoning ..........................................................................................2-5
2.6 Constraints Map .............................................................................2-7
2.7 Regulatory Assessment ...................................................................2-7
2.7.1 Air Quality ........................................................................... 2-7
2.7.2 Anaerobic Digestion Permitting .............................................. 2-8
2.7.3 Wastewater Discharge Permitting ........................................... 2-8
2.7.4 Wastewater Treatment Facility Permitting ............................... 2-9
2.7.5 Solid Digestate Disposal/Reuse ............................................ 2-10
3 Facility Profile - Utilities
3.1 Existing Electrical/Heating Infrastructure ...........................................3-1
3.2 Facility Energy Profile .....................................................................3-1
3.3 Electrical Interconnection ................................................................3-3
3.4 Thermal Interconnection .................................................................3-4
4 Feedstock Availability
4.1 WWTF Sludge ................................................................................4-1
4.2 Food Waste ...................................................................................4-2
4.2.1 Food Waste Analysis Methodology .......................................... 4-2
4.2.2 Potentially Available Food Waste ............................................ 4-3
4.2.3 Feedstock Characteristics by Sector ........................................ 4-3
4.2.4 Generator Outreach .............................................................. 4-6
4.2.5 Competing Facilities.............................................................. 4-7
4.3 Summary of Feedstock Characterization ............................................4-8
5 Technical Analysis
i