Transcript CoJ - Palesa Mathibeli - Gauteng Provincial Treasury

Waste Management PPP: City of Johannesburg
Alternative Waste Treatment Technology Project
Municipal PPP Conference
18 February 2010
Contents
_______________________________________________________________________
•
•
•
•
•
•
•
Background
Institutional Arrangements
The Need
Legislative Mandate
Project Planning
CoJ Process
Lessons Learned
2
Background
______________________________________________________________________________________
The Growth and Development Strategy
•
The GDS presents the City’s
understanding of the longer term
strategic direction and future efforts
needed to accelerate growth and
enhance development
Proactive absorption of the poor
Innovative governance solutions
Balanced & shared growth
•
The GDS ensures harmonisation
and alignment with National &
Provincial strategies
Sustainability & environmental justice
Social mobility and equality
•
GDS developmental paradigm
consists of six principles, which
collectively reaffirm the City’s
commitment to its Constitutional
objects and duties
Settlement restructuring
3
Background
______________________________________________________________________________________
The City’s Vision
Proactive absorption of the poor
Social mobility and equality
Balanced & shared growth
Settlement restructuring
Sustainability & environmental
justice
Innovative governance solutions
“In the future, Johannesburg will continue to
lead as South Africa’s primary business city, a
dynamic centre of production, innovation, trade,
finance and services. This will be a city of
opportunity, where the benefits of balanced
economic growth will be shared in a way that
enables all residents to gain access to the
ladder of prosperity, and where the poor,
vulnerable and excluded will be supported out
of poverty to realise upward social mobility. The
result will be a more equitable and spatially
integrated city, very different from the divided
city of the past. In this world class African city
for all, everyone will be able to enjoy decent
accommodation, excellent services, the highest
standards of health and safety, access to
participatory governance, and quality
community life in sustainable neighbourhoods
and vibrant urban spaces”
4
Background
______________________________________________________________________________________
Planning Instruments
1x
IDP*
Jo’burg
GDS
1 x SDF*
7 x RSDFs
13 Sectoral Plans
Precinct Plans / Development
Frameworks / Community
Participation
5
Institutional Arrangements
_______________________________________________________________________
Infrastructure & Services Sector
INFRASTRUCTURE AND SERVICES SECTOR
KEY OUTPUTS
SECTOR FOCUS AREAS
PIKITUP
DELIVERY OF BASIC SERVICES
IMPROVE SERVICE DELIVERY
1.
2.
3.
4.
5.
MAXIMISE REACH
REDUCE BACKLOGS
REDUCE LOSSES
INFRASTRUCTURE UPGRADE
REDUCE OUTAGES
1.
2.
CLEAN CITY 24/7
IMPROVE OPERATIONAL
EFFICIENCIES
MINIMISE WASTE TO
LANDFILLS
WASTE
CITY
POWER
WASTE
ENERGY
JOBURG
WATER
ENERGY
MAXIMISE REACH
REDUCE BACKLOGS
REDUCE LOSSES
INFRASTRUCTURE UPGRADE
WATER
WATER
1.
2.
3.
4.
3.
IMPROVING THE QUALITY OF LIFE OF CITIZENS
6
Institutional Arrangements
_______________________________________________________________________
Waste Management
Regulatory
Environmental
Management
Environmental
Health, Planning,
JMPD
Enforcement
Planning &
monitoring
Infrastructure &
Services
Pikitup
Service
Delivery
7
Institutional Arrangements
Mandate
ISD: Waste Sector
• Develops waste service delivery
framework
• Ensure Pikitup delivers services
in line with Agreement
• Monitors Pikitup performance
• Assess & verify Pikitup
performance
• Reporting to Mayoral Comm &
Portfolio Committees
• Tariff modelling & determination
• Implements strategic projects e.g
LFG & Alternative waste
treatment Technology projects.
8
Institutional Arrangements
Mandate
Pikitup Johannesburg (Pty) Ltd
• Municipal Owned Entity, 100%
owned by CoJ
• Delivers waste services
according to Service Delivery
Agreement (SDA)
• Implements critical priorities as
per GDS, IDP & other priorities
• Develops annual business plans
outlining service levels, methods
• Renumerated by CoJ via service
fee & Capex funding
• Reports monthly, quarterly &
annually
9
The Need
______________________________________________________________________
• Major growth period for the City
• Limited landfill airspace
• Difficulty to establish new landfills due to:
– NIMBY & lack of suitable land
– New Waste Act & Relevant authorities support for new landfills
• IDP requires 15% waste diverted from landfill
10
The Need
______________________________________________________________________
Landfill
Annual
Tonnage
Current Airspace
Knock-on Effect
(Years)
(Tons)
0
0
_
Robinson Landfill
279 568
3
_
Marie Louise
186 484
7
4
63727
10
3
Goudkoppies
156 547
17
3
Private landfills
(Chloorkop, Mooiplats)
Total
200 000
_
_
1 572 652
_
Linbro Park
Ennerdale
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The Need
______________________________________________________________________
12
The Need
______________________________________________________________________
90
80
70
60
50
Pecentage
40
current
30
20
10
0
composting
Builder's
Rubble
recycling
AWT
13
Legislative Mandate
______________________________________________________________________
– The Constitution
• A right to an Environment that is not detrimental to human health
• Schedule 4 & 5
– National Environmental Management Act
• Duty of Care
• Polluter pays principle
– Environmental Conservation Act
• Section 20
– Municipal Systems Act
• Municipalities to ensure universal access to essential services
• Integrated Development Planning (IDP) process
– NEMA: Waste Act
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Legislative Mandate
______________________________________________________________________
• Polokwane Declaration
– 50% of waste away from landfill by 2012
– A plan for zero waste by 2022
• CoJ IDP Targets
– 15% diversion of waste from landfill by 2010
– 50% composting of waste by 2010
Currently only 5-7% diversion achieved
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Legislative Mandate
_______________________________________________________________________
Waste Hierarchy
Cleaner Production
Prevention &
Minimisation
Recycling
Re-use
Recovery
Composting
Treatment
Physical, chemical
destruction
Disposal
Landfilling
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Project Planning
______________________________________________________________________
• Why Waste Treatment Technology (Waste
to Energy)?
– Reduce waste to landfill by about 6080%
– Electricity Generation
– Potential for earning carbon credits
– Proven technology world-wide; Europe
leading
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Project Planning
______________________________________________________________________
Household
Rubbish
• Thermal Treatments
– Incineration
Mixing
Chamber
– Autoclaving
– Emerging Thermal Treatment
• Gasification
• Pyrolysis
Furnace
Incinerator
Bottom Ash
• Biological Treatments
– Windrow Composting
– In Vessel Composting
Heat and
Electricity
Ferrous
metals
extracted
(MBT) and Mechanical Heat
Treatments
Gases
cleaned
Filter to
Landfill
Recycling
– Anaerobic Digestion
• Mechanical Biological Treatments
Gases
Ash
Recycling
plant
18
In Denmark:
• 13 organic
Recycling
Incineration
household
waste
composting
plants
Landfill/Disposal
Building Waste
• 33
incinerators
Commercial Waste
• 120 garden
Industrial Waste
waste
composting
plants
Garden Waste
Bulky Waste
• ~5 biogas
Household Waste
• ~15 major
facilities
Packaging Waste: Recycled
0%
20%
40%
60%
56% (2000) •
80%
100%
landfills
~20 inert
landfills
Ref: COWI
19
Treatment
technology
Is it proven?
Cost (invest /
oper /
revenue)
Landfill
diversion
Input quality
Output risks
MBT - aerobic
Yes. > 60
plants
10 years
Proven
I: Medium
O: High
R: Negative
Low - no RDF)
Medium - with
RDF
Size reduction
RDF off-taker?
Quality of
recyclables
MBT - Anarobic
Yes > 30 plants
10 years
Proven
I: High
O: High
R: Low/neg
Low - no RDF)
Medium - with
RDF
Size reduction
Structure/fiber
material
Compost to
landfill
WtE moveable
grate /rotary
Yes > 1000
plants
100 years
Proven
I: High
O: Low
R: High
High
Very high if ash
recycling
Receives all
except excess
bulky
FGT to H:h
No. Very few
plants
5-10 years
Not proven
I: High
O: Low
R: High
High
Very high if ash
recycling
Size reduction
and sorting
Char, syngas
user?
Landfill of
residue?
Pyrolysis
/gasification
Comparison of treatment technologies Ref: COWI
Ash recycling
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Project Planning
______________________________________________________________________
The optimum combination of technologies for an integrated waste
management system depend on the following key decision-making
parameters:
– Landfill diversion targets
– CO2 reduction / Environmental targets
– Energy recovery and material recovery targets
– Affordability targets (Capex, Opex, household levy /gate fee)
– Procurement, ownership & financing strategy (risk allocation)
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CoJ Process
______________________________________________________________________
1. Mayoral Approval to initiate the project
2. RFI Issued
3. Feasibility Study Conducted in line with PPP guideline
4. Procurement process to follow involving:
– RFQ
– RFP
5. Appointment of preferred bidder
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CoJ Process
______________________________________________________________________
Technical Feasibility Study
1. Needs Analysis – Summary of need for alternative waste treatment
technologies in the City.
2. Technical Solutions Options Analysis – This is a full analysis listing
Technologies available.
3. Technical Options to be considered for Johannesburg
4. Service Delivery Options Analysis- A full review of service delivery
options carried out.
5. Proposed solutions
6. Summary and Recommendations.
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CoJ Process
______________________________________________________________________
Other Aspects of Feasibility Study
1. Detailed Due Diligence of all the key issues associated with the
selected options
2. Execution of a Value Assessment exercise in terms of affordability of
the selection technical options as compared to avoided landfill costs
3. Risks & costing thereof
4. Detailed Procurement Plan for the various options
5. Submission of Report to Treasury & Council
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CoJ Process
______________________________________________________________________
Description
T ons
T otal Cost
Cost per
ton without
Waste-toEnergy
T otal waste disposed
Less: Waste disposed of at M ooiplaats (annualised)
Less: w aste disposed of at C hloorkop (annualised)
1 650 250
80 376
57 600
R
R
R
68 000 000
4 179 552
3 244 800
R
R
R
41.21
52.00
56.33
Waste to landfills
Less: Builders' rubble
Less: Gardening w aste
Less: C omposting
Less: Recy cling
1 512 274
156 768
142 283
29 580
R
R
R
R
R
60 575 648
-
R
R
R
40.06
-
R
-
Waste to landfills after intervention
Less: Waste-to-Energy
1 183 643
500 000
R
R
60 575 648
-
R
R
51.18
-
683 643
R
60 575 648
Waste to landfills after intervention and Waste-to-Energy
Rehabilitation cost as per financial statements
Term in y ears
Interest rate
Payment
R
Cost of landfills including rehabilitation
R
Notes:
C ost does not include cell dev elopment
Rehabilitattion cost as per financial statements
R
-213 243 035
10
11%
32 620 695.19
93 196 343
Cost per
ton with
Waste-toEnergy
R
88.61
R
27.56
R
47.72
R
78.74
R
136.32
25
CoJ Process
______________________________________________________________________
Gate fees Income
Description
Unit Description
Units
Waste
Tonnes/annum
500,000
Fee
Rand per tonne
R112
Total
Rands
R56,000,000.00
26
CoJ Process
______________________________________________________________________
Refit Tariff
Net electricity available
for sale per annum
Price per KWh
Total income
R277,222,713.60
0.76
R210,689,262.34
27
Electrical Connection
• Load Study
– Linbro Complete - Eskom Connection
– Other 4 sites Complete City Power connection
• Embedded Generation Application.
• Systems Use Agreement / Supplementary Supply Agreement.
28
Electrical Connection
REPA/ ISO
Generation plant
Meters
Invoice for K W sold at REFIT
tariff
PPA between ENER-G and
REPA
Invoice for K W sold at Eskom
Tariff
Power delivered to end user
A three party agreement for
systems use
PPA between Municipality and
Eskom
Municipality /
Eskom
29
Power Sale Agreement
• City Power was initially approached to purchase the power.
• NERSA, Renewable Feed In Tariff - April 2009.
• License application with NERSA - May
• Government Notice R.721 - Electricity Regulations Act (4/2006):
Electricity Regulations on New Generation Capacity published in
August 2009
30
Electricity
Amendment Act
• NERSA to draft rules for Independent Systems Operator
(ISO)
• REPA / ISO to purchase power from all Independent Power
producers
• REPA / ISO Tender process
Conditional upon;
• REPA needs Cost recovery Mechanism ( CRM) to be approved.
• IRP 1 - Integrated Resource Plan 1
• National Treasury Support (Guarantee) for the costs of the program
31
CoJ Process
______________________________________________________________________
Key Considerations from Feasibility Study
•
•
•
•
•
•
•
Site Selection
Calorific value of the waste
Hazardous landfill site
Suitability of technology for CoJ purposes
CoJ By-Laws
Financing of the project
How to address the risks & sensitivities
32
Lessons Learned
______________________________________________________________________
•
•
•
•
PPP process requires proper time management & project management
Use the support from National & Provincial PPP Units
Establish a multi-disciplinary Steering Committee
Ensure to procure Transaction Advisor with prior PPP & Project Finance
experience
• Being a 1st in South Africa, international expertise is necessary
• Ensure Buy-in from Senior Management & Politicians
33
Thank You!
Palesa Mathibeli
Director: Waste Sector
Infrastructure & Services Department
Tel: (011) 381 0323
E-mail: [email protected]
34