ORRINGTON, Maine — The leader of the organization representing the trash disposal interests of 187 Maine communities voted against part of the 2015 budget for the Penobscot Energy Recovery Co. because part of the waste-to-energy plant’s revenue is earmarked to pay for lobbying activities.
“I voted against the passage of the budget because the budget contained a $500,000 expense line dedicated to underwrite the activities of a law firm that was unilaterally and improperly engaged by [USA Energy LLC] and that the spending amounted to a waste of resources, a breach of fiduciary duty and was harmful to the [PERC] partnership and the [Municipal Review Committee] communities,” Greg Lounder, executive director of the Municipal Review Committee, said in a Tuesday email.
The Municipal Review Committee filed an April lawsuit against USA Energy over previous lobbying bills. The Municipal Review Committee believes that the lobbying costs should be covered by USA Energy, not by diverting funds from PERC, a waste-to-energy plant in Orrington used by and partially owned by the Municipal Review Committee.
PERC is a private-public partnership that is 77 percent owned by Minneapolis-based USA Energy Group LLC and PERC Holdings and 23 percent by the original member towns and cities that joined the Municipal Review Committee before 1998.
Part of the proposed $44 million PERC budget for 2015 is $500,000 set aside for Doyle & Nelson, an Augusta law firm hired by USA Energy for lobbying. The budget vote took place Thursday and was split into two ballots, with the second tally specifically about the lobbying money, Robert Knudsen, vice president of operations for USA Energy, said by phone Monday.
“The vote was 3-0 on the budget and 2-1 on the $500,000 with Lounder indeed dissenting,” Knudsen said.
USA Energy has already paid Doyle & Nelson about $1 million since 2012, in part to lobby for the passage of LD 1483, which became law in March. The law requires licensed facilities to align with the state’s solid waste management hierarchy. The hierarchy requires recycling first with landfilling as the last option for waste. The bill that passed was scaled back significantly from the original version that would have added landfill fees to fund a solid waste stabilization account to support waste-to-energy plants, including PERC.
Lounder issued a strongly worded letter to the Municipal Review Committee member communities last week explaining why he was voting against the lobbying funds, and he listed several activities supported by the funds that include opposing the Municipal Review Committee’s post-2018 plans.
Knudsen said he could not talk about the pending lawsuit but responded to Lounder’s accusations by saying, “That’s his opinion.”
“Doyle & Nelson has not been hired to oppose the [Municipal Review Committee] plans but to work with the DEP and us to help to facilitate a fully integrated solid waste facility for the entire state,” Knudsen said.
They have been hired to educate PERC customers about what is going to happen when a lucrative contract for electricity between PERC and Emera Maine, and other beneficial contracts expire in early 2018, he said.
PERC receives 16 cents per kilowatt hour for electricity it produces by burning trash, but after 2018, it will have to sell the electricity on the open market, where it is now selling for 4 to 6 cents per kilowatt hour, PERC plant manager Peter Prata said recently.
The Municipal Review Committee does not think PERC will continue to operate after the loss in revenue in 2018 and five years ago began its plans to open an integrated solid waste and recycling facility for its member communities. The Municipal Review Committee applied in April for a public benefit determination from the Department of Environmental Protection for a landfill that only member communities would use and learned last month that the Department of Environmental Protection issued a draft decision denying the Municipal Review Committee application.
Knudsen said that Doyle & Nelson was tasked with answering questions that arose after the Municipal Review Committee filed its public determination application. He said that USA Energy hasn’t officially opposed the Municipal Review Committee’s plans.
“We started a program this summer reaching out to our customers and educating them about what is going to happen between now and 2018 and what our efforts are to extend operations at PERC after 2018,” Knudsen said. “That is when all the existing contracts terminate.”
PERC should not be counted out just yet because USA Energy is in the process of hiring a consulting firm to analyze operations at the waste-to-energy plant, Knudsen said.
“[They] will review the current plant and advise them in commercial technologies out there to increase operations as well as material recovery,” Knudsen said, referring specifically to removing metals and aluminum from the waste PERC receives.
Recovery of recyclables such as glass, newspaper, cardboard or organics, which are the major components of the Municipal Review Committee’s plan, would need to happen before it got to the plant, the USA Energy official said.
“What the [Municipal Review Committee] is doing is separate from what we’re trying to do,” Knudsen said. “They’re following a path, and we’re following a different path.”
The Municipal Review Committee withdrew its public determination application with the Department of Environmental Protection at the end of September. Lounder said that the Department of Environmental Protection’s denial will not stop the Municipal Review Committee’s plan to increase what is recycled and reduce what is placed in a landfill by its member communities.
“We’ve already started moving forward, both with planning for the construction of a state-of-the-art waste processing facility and for an alternative landfilling solution for the unavoidable residuals from that facility,” he said later. “We’re exploring a wide range of options and are hoping to have some additional news to report, particularly regarding the processing facility, in the near future.”
The Municipal Review Committee board’s fall meeting is scheduled for 10 a.m. Oct. 22, at the Orono Town Hall.