ORRINGTON, Maine — A Nebraska-based engineering firm hired by the majority owner of the Penobscot Energy Recovery Co. to study the waste-to-energy plant’s operations released a report this week stating the facility can survive for 20 more years, “provided that appropriate capital repairs and replacements are completed.”
The Maine plant has been in the news recently because one of its three partners, an organization known as the Municipal Review Committee, is planning to end its relationship with PERC. In February, the group that represents the trash disposal interests of 187 Maine towns and provides a lot of the solid waste used to fuel PERC, signed an agreement to develop a solid waste recycling and processing facility in Hampden that would turn trash into biofuel.
The 158-page report by HDR Engineering Inc., provided by Minneapolis-based USA Energy Group LLC, which controls approximately 52.7 percent of the plant, highly praised the 75 or so PERC workers for maintaining the equipment used to change municipal solid waste into electricity.
“The major front end processing equipment, the combustion system, the boiler, the air pollution control equipment, the turbine, along with the balance of plant equipment which support the operation of these major components, has been kept in very good condition by the operator,” the report’s executive summary states.
This is a result of good preventative and routine maintenance programs and practices, the summary states.
The PERC facility is called a refuse-derived fuel waste-to-energy plant and takes garbage from Municipal Review Committee member towns, some southern Maine communities, and some out-of-state waste to fuel two boilers that produce steam to make electricity.
“We have a great team in place and our commitment to regular maintenance and investment has clearly paid off,” John Noer, president of USA Energy, said in a press release. “There should be no doubt about this plant’s long-term viability as an important part of Maine’s solid waste management hierarchy, which favors re-use, recycling and waste-to-energy over putting waste directly in landfills.”
The HDR summary states “there are several areas where facility improvements and end of life replacements and/or refurbishments are required. These include, but are not limited to, an improved means to reduce the spillage of materials from conveyer systems, condenser retuning, economizer replacement, and potentially additional waterfall replacements.
“Provided that appropriate capital repairs and replacements are completed and that the facility continues to operate and maintain the facility under the current operations and maintenance practices, it would be expected that the PERC facility should be capable of continuing to process waste … until at least the year 2035,” it states.
The HDR reports includes a graph itemizing maintenance, refurbishment and capital improvement cost projections for 2015 to 2013, which totals just over $131 million.
To run at capacity, the 25 megawatt incineration plant needs 300,000 tons of materials to burn, and the MRC typically contributes about 180,000 tons annually, or about 60 percent, with the rest coming from southern Maine or out of state.
Members of the Municipal Review Committee, which owns 23 percent of PERC, have said after looking at the financial books that they do not believe the plant would be profitable after a lucrative contract with Emera Maine expires in 2018, which is why they started working on their own facility.
The HDR report accurately recognizes the facility is well-maintained and has excellent employees, but it only considers mechanical feasibility, not economic feasibility, Greg Lounder, executive director of the Municipal Review Committee, said in a Wednesday press release.
“It contains no new information that would alter our fact-based assessment that PERC will not work for the MRC communities after the conclusion of the current contracts in 2018,” Lounder said.
Emera Maine will not continue its contract with PERC after 2018, Susan Faloon, company spokeswoman, said in a recent email interview.
“Under the PERC contract, Bangor Hydro (now Emera Maine) has been obligated to buy most of the power the plant generates at above market prices and to sell that power in the market at a loss,” Faloon said. “That loss is recovered from ratepayers in the ‘stranded cost rate’ included in the delivery component of the electricity bill.
“When the PERC contract ends, a typical residential customer will save about 11 percent of their electricity delivery cost and about 6 percent of their total electricity bill,” Faloon said.
Robert Knudsen, vice president of operations for USA Energy, recently said the tonnage amounts company leaders are budgeting for future operation at PERC is 210,000 tons.
He said Wednesday the company is crunching the numbers and plans to release projected post-2018 tipping fees at the end of the month.
“We are going to commit to that tipping fee,” Knudsen said. “It is a risk, but that is a risk we’re willing to take.”
About $500,000 of PERC’s 2015 budget was set aside to pay for Knudsen and lobbyists to meet with town officials to persuade them to continue to bring their trash to PERC.
“While the current waste contracts with municipalities and the energy supply contract with Emera Maine end in 2018, PERC is already at work on new agreements with municipalities,” the press release states.
“Nobody has signed up because nobody has seen the pricing,” Knudsen said.