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1
Florida Public Service Commission Workshop Renewable Electrical Generation
from Municipal Solid WastePresented by
Joseph R. Treshler Covanta Energy, Inc.
Safe Waste Disposal and Clean Energy Solutions… For Generations To Come.
July 26, 2007
2
Introduction
Highlight the current contribution Energy from Waste (EFW) makes to Renewable Energy Production
Quantify the potential for EFW to provide additional Renewable Energy
Identify vehicles to promote Renewable Energy growth
Background on Covanta Energy
3
Coal50%
Nuclear20%
Oil3%
Natural Gas18%
Hydro7%
Geothermal16%
Wind16%
Biomass67%
Solar1%
88,000 GWh
Total U.S. Electricity Generation
U.S. Non-Hydro Renewable Generation
3,970,000 GWh
The Role of Renewable Electricity Generation in the United States
Source: US Department of Energy, Energy Information Administration 2004 Report
Non-Hydro Renewable
2%
88,000 GWh
9% of electrical generatio
n is renewable
4
Energy from Waste Generates 34% of the Nation’s Biomass Renewable Electricity
• is a leader in renewable generation
• 7,800 GWh produced from Covanta owned and operated facilities
• 32 Energy from Waste Facilities
• 6 Wood Waste Facilities
• 6 Biogas Facilities
• Provides nearly 10% of the Nation’s Non-Hydro Renewable Energy
Source: US Department of Energy, Energy Information Administration 2004 Report
Biomass
67%
= Total U.S Biomass Renewable Generation
Wood 62%
Energy From Waste 34%
Other BioMass 4%
60,000 GWh
5
Clean, renewable electricity
Reduces greenhouse gas emissions
Safe, reliable waste disposal
Recover metal, preserves land and
Ground water
EfW Technology
Dependence on fossil fuels Climate change Population growth Resource management
Metal: 50 lbs
Power: 550 kWh
Ash: 10% of original volume
Inert - no methane generation
Municipal Solid Waste (MSW): 2000 lbs
EfW is a specially designed energy generation facility that uses household waste as fuel and helps solve some of society’s big challenges
6
Industry Overview of Energy from Waste
US EPA -- EFW disposes of 13% of the nation’s waste 89 facilities 29 million tons per year 36 million people served 27 states Generation capacity in
excess of 2,700 MW 16 million MWhrs of
renewable power generated annually
7
Proven, Utility Grade Technology
Exclusive North American licensee for Martin GmbH Reverse Acting Stoker Grate technology – successfully processed more refuse worldwide than any other system available,
8
Florida’s Renewable Generation Capacity is Quite Low
12.2%Oil
13.4% Nuclear
29.4%Coal
29.9% Natural Gas
7.2% Non-Utility & Other*
8% Interchange
*Includes 1080.7 MW Renewable Energy Generation
Source: FL PSC
47% EFW506 MW
1% Waste Water10 MW
2% Landfill Gas20.4 MW
11% Waste Heat
114 MW
22% Black Liquior
230.7 MW
17% Other Biomass
175.6 MW
Current FL generation Capacity
51,569 MW
Current FL renewable generation Capacity
1,081 MW or 2% of the state’s capacity
9
The “Power” of EFW in Florida
One ton of MSW Has the energy equivalent of
One barrel of fossil fuel oil or 10 MCF of natural gas!
EFW is a proven source of Florida renewable energy Annually Floridians generate 31.2 million tons of MSW which is
the energy equivalent of 31.2 million barrels of oil. Currently 6.5 million tons (17,900 tons per day) of MSW can
be processed annually by Florida’s 12 EFW Facilities. This eliminates the need for 6.5 million barrels of oil or 65
million MCF of natural gas. 506 MW of renewable electrical energy is generated on a daily
basis by Florida’s EFW Facilities Saving annually over 8,125 acre feet of precious landfill space
through volume reduction.
10
The Environmental Benefits of EFW
Produces renewable electricity with less environmental impact than almost any other source of electricity
US EPA April 14, 2003
Provides a net reduction in Green House Gas Emissions (GHG)
Displaces CO2 (GHG eqv 1) that would otherwise be generated as a result of producing electricity from other fossil fuels sources
Eliminates the release of uncollectible Methane (GHG eqv 21) from raw Municipal Solid Waste Landfills
Recycling of the Ferrous and Non-ferrous metals recovered following the EFW process avoids the GHG emissions that would be associated with the smelting of virgin ores
11
More EFW is Being Done…
By 2010, Renewable Energy from Florida EFW is planned to increase by 85 MW:
Lee County 20 MW Hillsborough County 17 MW Palm Beach County 28 MW Pasco County 20 MW
Bringing to 591 MW the EFW Renewable Energy made available while processing less than 25% of the Florida MSW being generated.
12
More EFW Can Still Be Done…
Over 18 million tons of raw MSW is still being landfilled every year in Florida. EFW Technology can convert this waste into approximately 1130 MW of
new Renewable Energy A significant number of highly developed areas of the State still heavily dependent
on land filling raw MSW as their primary method of solid waste management.
Orange County 1,820,638 TPY Duval County 1,483,456 TPY Brevard County 704,476 TPY Volusia County 499,242 TPY Collier County 477,095 TPY Manatee County 343,095 TPY Seminole County 303,015 TPY Sarasota County 297,421 TPY
Developing new EFW capacity to manage the nearly 6 million tons of MSW available from these areas alone would increase the State’s Renewable Energy generation by approximately 372 MW while increasing our energy independence by the equivalent of approximately 6 million barrels of oil each year.
This will only be possible with the right incentives
13
Encouraging Florida Renewables
Current Situation 63% of Florida’s electrical generation is fueled by
oil and gas Low energy payment rates and contracting
structures that have been offered since the early 1990’s for new EFW capacity inhibited further development
Florida has no functional wholesale electricity markets to support EFW or other renewable energy development; local utilities are the only buyers
14
Encouraging Florida Renewables
The Future 81% of Florida capacity additions are currently
proposed to be fueled by oil and natural gas Renewables including EFW must be a part of
changing this future Executive Order 07-127 signed by Governor Crist
at the Climate Change Conference limits allowable GHG for electric utilities
Executive Order 07-127 requires utilities to produce substantial additional amounts of electricity from renewable sources
15
Encouraging Florida Renewables
The Future (Continued) Recent Supreme Court Ruling United Haulers Association
Inc. vs. Oneida-Herkimer affecting the landmark 1994 flow-control decision in C&A Carbone vs Clarkstown
New (and renewed) EFW contracted energy generation must be valued based on avoiding the most expensive fossil fuels
Development of a functional and liquid wholesale electricity and renewable credit trading markets will stimulate growth
Long-Term fairly priced energy contracts will encourage new project financing
Encourage/require Renewable Portfolio Standard (“RPS”) to encourage the development of new renewable energy generation in the state
16
Renewables Portfolio Standards
State Goal
☼ PA: 18%¹ by 2020
☼ NJ: 22.5% by 2021
CT: 23% by 2020
MA: 4% by 2009 + 1% annual increase
WI: requirement varies by utility; 10% by 2015 goal
IA: 105 MW
MN: 25% by 2025(Xcel: 30% by 2020)
TX: 5,880 MW by 2015
*NM: 20% by 2020 (IOUs) 10% by 2020 (co-ops)
☼ AZ: 15% by 2025
CA: 20% by 2010
☼ NV: 20% by 2015
ME: 30% by 200010% by 2017 goal - new RE
State RPS
☼ Minimum solar or customer-sited RE requirement* Increased credit for solar or customer-sited RE
¹PA: 8% Tier I / 10% Tier II (includes non-renewables); SWH is a Tier II resource
HI: 20% by 2020
RI: 15% by 2020
☼ CO: 20% by 2020 (IOUs)*10% by 2020 (co-ops & large munis)
☼ DC: 11% by 2022
DSIRE: www.dsireusa.org June 2007
☼ NY: 24% by 2013
MT: 15% by 2015
*DE: 10% by 2019
IL: 8% by 2013
VT: RE meets load growth by 2012
Solar water heating (SWH) eligible
*WA: 15% by 2020
☼ MD: 9.5% in 2022
☼ NH: 23.8% in 2025
OR: 25% by 2025 (large utilities)5% - 10% by 2025 for smaller utilities
*VA: 12% by 2022
MO: 11% by 2020
17
EFW: A Proven Component of Florida’s Renewable Energy Future
Florida (+ 22 other states and Washington DC) define EFW as Renewable Energy
To date 12 states and Washington DC define EFW as eligible for Renewable Portfolio Standards
Efficiently recovers/exports over 550 KWhrs/per ton of MSW processed
EFW is clean - “Exceeds requirements of the Clean Air Act” – US EPA
Most advanced pollution controls of any energy generation source
Reduces landfill requirements in excess of 90% Eliminates the release of toxic emissions and GHG’s (especially
methane) from “raw waste” landfills EFW and recycling are compatible: Recycling rate of EFW
communities exceeds the national average by over 5%
18
Key Elements of a Successful Renewable Portfolio Standard
Establishes clear annual targets that must be met by any load serving entity selling electricity to end-users in the state (private, public, munis, etc.)
Ensures aggressive targets to foster renewable energy innovation and development
Clearly defines qualifying technologies/fuels Allows markets to foster technology development without favoring
specific technologies or fuels Allows Renewable Energy Certificate (“REC”) trading as separate
product from traditional capacity, energy, and ancillary service produced by a generator
Establishes independently operated entity to operate trading markets and monitor/verify REC generation, use, and load serving entity compliance
Contains compliance, enforcement, and penalty provisions Defines Alternative Compliance Payment (“ACP”) in the $50 to
$80/MWh range to be paid by any load serving entity that does not meet the RPS annual target
Uses the funds generated by the ACP to support renewable generation R&D and energy efficiency programs
19
“Florida has a beautiful precious environment that needs to be protected. This
should be our issue”
Gov. Charlie Crist
20
Additional Information
21
Covanta Energy Corporation
The 32 EFW facilities Covanta operates: Dispose of nearly 5% of nation’s waste Process about 15 million tons Produce about 1,200 megawatts of clean, renewable energy. Generate nearly 10% of the Nation’s Non-Hydro Renewable
Energy
In Florida, Covanta operates: 4 EFW facilities:
Pasco County, FL Hillsborough County, FL Lee County, FL Lake County, FL
These facilities: Process over 1.25 million tons per year of MSW Generate about 114.5 megawatts per hour
22
EFW Energy is Renewable Energy
Municipal Solid Waste (MSW) is a sustainable resource for “local” power
MSW is biomass. EFW efficiently converts energy value of MSW to electricity and/or steam EFW contributes to fuel diversity EFW facilities are located near power users, increasing cost efficiency. EFW avoids vehicle fuel consumption/emissions associated with increasingly distant
transportation to landfills. EFW avoids landfill greenhouse gases and toxic emissions
23
EFW: A Success Story
“Upgrading of the emissions control systems of large combustors to exceed the requirements of the Clean Air Act Section 129 standards is an impressive accomplishment. The completion of retrofits of the large combustion units enables us to continue to rely on municipal solid waste as a clean, reliable, renewable source of energy. With the capacity to handle approximately 15 percent of the waste generated in the US, these plants produce 2,800 megawatts of electricity with less environmental impact than almost any other source of electricity.”
-- letter to IWSA from Assistant Administrators Jeff Holmstead and Marianne Horinko, US EPA
February 2003