WASTE. Veolia Environmental Services In China Our Presence & Future. Joe A. Zorn Chief Operating Officer Veolia Environmental Services Asia

Transcription

1 Veolia Environmental Services In China Our Presence & Future Joe A. Zorn Chief Operating Officer Veolia Environmental Services Asia ~ April 26, 2007 ~ WASTE A Social and Economic By-Product

2 Background Background

3 Major Treatment & Disposal Options Sorting & Recycling o Formally and informally going on in every country. o Usually takes care of a small fraction of MSW; larger volume needs treatment and/or disposal. o Above the street level, even the more advanced countries do not achieve a high recycling rate if not for government intervention. Secured Landfills o Modern landfills manage waste, leachate and gas in an environmentally safe manner. o Flexible; ability to handle various types of wastes. o Optimal minimum size is 1,000 tpd; as the tpd increases, the unit operating cost decreases. Major Treatment & Disposal Options Thermal Combustion o Modern systems satisfy stringent environmental parameters including the latest EU and US standards. o Optimal treatment capacity ranges from 300 to 600 tpd per production line. o Not a comprehensive solution as there are other wastes to be treated such as ashes, hazardous materials and noncombustible wastes. Criteria for Selection of Options o All are viable options. o Common decisive factors include: social-economic factors; geographical conditions, waste characteristics; regulatory policies.

4 Major Treatment & Disposal Options Criteria for Selection of Options (cont d) FACTORS Space requirements Site conditions Waste quantity Waste quality By-products Energy recovery Capital investment Unit cost After use LANDFILL Large footprint Dependent Up to 15,000 tpd Flexible Leachate and gas Landfill gas to electricity or town gas In phases Variable Country park, golf courses Restricted development THERMAL COMBUSTION Small footprint Independent 300~600 tpd per line x 1~4 Sensitive to heat value Leachate (variable) Ash needs disposal or reuse Steam to electricity Primarily up front; Limited expansion More expensive Flexible after demolition of the plant Quality of Proposed Waste Management Solutions Sustainable? o Whether or not the option is a long-term solution considering economic, environmental and political objectives. Practicable? o Distinguish between practicable and unrealistic proposals. o Prequalification of bidders is important. Efficient and effective? o Production and operation efficiency; meets applicable environmental standards. Economically viable? o Consideration for investment, operating costs, after use and decommissioning. Other benefits? o Energy recovery and reuse, potential for CDM or VER credits.

5 Common Factors Affecting Our Decisions Waste Volume o Commitment by Government to control the flow of waste and ensure waste volume. Concession Rights o Best to have concession rights for certain districts / areas to ensure adequate waste volume. Put or Pay o Government needs to guarantee the minimum amount of waste or minimum operating fees. Waste Quality o Particularly for thermal combustion projects as heat value of waste affects combustion efficiency and therefore power production. Common Factors Affecting Our Decisions Reasonable Contract Duration o Need time to recover investment. o Reasonable duration: 5 years+ for collection contracts; 10 years+ for landfills; 15 years+ for thermal combustion projects. Competition o The amount of waste available and the number of competing facilities in the same catchment area is balanced.

6 Common Factors Affecting Our Decisions Attractive Projects Project has the right economy of scale Reasonable risk profile (e.g. cost index adjustments) Security of getting paid on a long-term basis Other benefits to offset cost (e.g. CDM or energy sales) Synergies with existing projects and management in the vicinity Well-structured local master plan for waste management Examples in Asia Operations Overview New contracts in 2006/2007 Cities where we are present

7 VES Presence Laogang Landfill Shanghai Projects in China Laogang Landfill Location Laogang MSW Landfill Phase 4 is located at the east end of Laogang Town, Nanhui, Shanghai, located approximately 60 km from Shanghai central. It covers an area of 361 hectares. Length is 4200m, width 800m. Laogang Landfill

8 Projects in China Laogang Landfill Overview Commenced design and construction: Dec 2003 Formal commencement of operations: Dec 2005 Ownership: Shanghai Government Operating entity: Shanghai Municipal Solid Waste Treatment Company, a joint venture between foreign partners (VES & CITIC Pacific) and local partner Shanghai Chengtou. VES brings the design, construction & operational expertise to the Project. Concession agreement to the operating entity: - Design, construction and operations for 20 years Landfilling capacity: 80 million cbm Current in-take: 6,300 tpd with majority delivered by barges; less than 10% is delivered by trucks from Nanhui District Land and space available well after the 20-year contract Projects in China Laogang Landfill Overview The landfill treats waste from 11 districts of Shanghai. It is the largest municipal waste sanitary landfill in China. Investment of initial phase: RMB 505 million Structure of funding: - JV Registered Capital: RMB 170 million (~USD 22 million) - World Bank Loan: US$ 33 million - Private Funding: RMB 107 million (~USD million)

9 Projects in China Laogang Landfill Site Layout 1b 1a Ⅳ 期 库 区 近 期 取 土 区 Soil Borrow Zone 远 期 库 区 Future Landfill Site 老 港 Ⅰ Ⅱ Ⅲ 期 填 埋 库 区 Phase I-III Landfill Site Projects in China Laogang Landfill Foundation Treatment Facility Laogang Phase 4 Design intake tpd 4900 Original Design Life 20 years VES Extended Facility Life 45 years Increase as a % 225% Adopt ground reinforcing technique to increase the airspace in limited area. 3,000 kilometers of drainage wicks installed in Phase 1 Save land resource, and increase the utilization rate of the land and the life service of the landfill.

10 Projects in China Laogang Landfill Construction and Operation Sequence Projects in China Laogang Landfill Staging Treatment Platform 30 mpd 45 mpd Final waste mass

11 Projects in China Laogang Landfill Embankment Embankment geotube construction Top: Western embankment constructed from sand geotube Left: Western sand embankment Projects in China Laogang Landfill Perimeter Berm 450m of 15m-wide concrete road and 350 m of 10 m wide concrete road has been built at north separation berm 10.8km of 7.5m-wide bitumen road has been constructed around the entire perimeter of Phase m wide road East side perimeter bund 7.5m wide perimeter road

12 Projects in China Laogang Landfill Groundwater Management A vertical cut-off wall (k 1x10-8m/s) was constructed to 16 m deep around the full perimeter of Phase 4 which minimizes groundwater coming into Phase 4 (Inverts of cells are excavated below sea level). A cut-off wall (k 1x10-9m/s) was constructed around Phases 1 to 3 to minimize leachate migration out of the old landfill. A woven geotextile and gravel drainage layer has been installed under the double liner to enable groundwater to be extracted creating inward groundwater hydraulic gradient. Projects in China Laogang Landfill Vertical Cut-off Wall Slurry wall around 1-3 Cut-off wall around Phase 4

13 Projects in China Laogang Landfill Liner System Waste Woven geotextile 600mmGravel Non-woven 1.5mmHDPE Geocomposite 1.5mmHDPE Non-woven Gravel Woven geotextile Subgrade Projects in China Laogang Landfill Liner System

14 Projects in China Laogang Landfill Weighbridges 4 weighbridges can be operated twodirectional, static and dynamic weighing efficient, fully automatic with upload of data to the Shanghai Government daily Projects in China Laogang Landfill Operations Entered trial operations on Feb 21, 2005 and commercial operations Dec 2, average waste intake 4,900 tpd Anticipate around tpd by mid 2007 for next 3 years Operating hours generally 7:30 am to 3:30 pm with local Nanhui District waste delivered from 5:00 am quantity (ton) Tonnes Waste Supply Plan 2007 Jan Feb Mar April May June July Aug Sep Oct Nov Dec Total Waste Delivered to Laogang Phases 1to month Apr-06 May-06 Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07 Month Minimum average Maximum

15 Projects in China Laogang Landfill Tipping Area Steel slag road combined with the mobile steel plate road to provide semi permanent road and temporary roads in landfill cells respectively Tipping platforms with more than 1,500 tpd capacity each are used to ensure the acceptance of the waste Projects in China Laogang Landfill Leachate Treatment LTP uses UASB plus SBR biological processes to treat leachate to class 3 standard, plus reduction in ammonia and nitrogen. The effluent is discharged to municipal sewage water treatment plant. Design capacity 1,500 tpd; ultimate capacity 3,000 tpd.

16 Projects in China Laogang Landfill Leachate Treatment COD (mg/l) NH3-N (mg/l) Raw Leachate ~ ~ 800 Treated Leachate 1500 ~2500 close to 0 Projects in China Laogang Landfill Flare and blow to atmosphere Short-term 18 months after start of landfilling Landfill gas LFG Facility Generate electricity Landfill Gas Collection Comprehensive LFG collection and management system. System of horizontal and vertical collection wells. LFG treated through LFG to electricity engines and excess gas flare if necessary. Use first 2.5 MW power for on-site power requirements.

17 Projects in China Laogang Landfill Environmental Monitoring Dust and litter control Daily cover Flies control 洒 水 车 移 动 式 防 飞 散 网 Projects in China Laogang Landfill Environmental Monitoring Long term monitoring program with Shanghai Environmental Monitoring Center In the process of obtaining ISO14001& OHSAS18001 certification Monitoring of surface water and river slits Monitoring of landfill gas Monitoring of underground water

18 Projects in China Laogang Landfill Quality Control Inclinometer Set out and settlement monitoring Settlement meters Projects in China Laogang Landfill Quality Control Landfill has numerous levels of quality assurance & control including in-house staff, construction quality assurance and other consultants

19 Projects in China Laogang Landfill Staff Composition GM with comprehensive experience on international landfill design, construction and management. 129 staff including 38 managerial, engineering and office staff. 62% bachelor s degree and 26% master s degree. Several relevant master s degrees, such as environmental engineering and water treatment Operators on-site mostly come from Laogang Landfill Phase 1 3; very experienced with new EHS concept as an employee of an international group. 12% 62% 26% master's degree or above bachelor's degree college or below VES Presence Other Projects in China

20 Projects in China Xingfeng Landfill Location:Baiyuan District, Guangzhou; 38 km from city Area: 84 hectares (including expansion areas) Capacity of Phase I: million cbm Commenced Construction: Nov 2000 Formal Commencement of Operations: Mar 2003 Current waste in-take: average 6,800 tpd Current electrical power converted from landfill gas: 2MW Ownership: Guangzhou Government. Construction and major equipment capital provided by Government Contract to VES: - Design, design coordination and 8 years operation - One year aftercare for phases completed during operations CDM: Guangzhou Government recently signed an agreement with British global warming solutions company, Icecap. Icecap will pay US$50 million to the Guangzhou Government in exchange for 5 million tonnes of carbon dioxide emissions credit. Projects in China Xingfeng Landfill

21 Projects in China Foshan Landfill Location: Gaoming District, Foshan City, Guangdong Province Area: 95 hectares Capacity: 30 million cbm Commenced Construction: Oct 2003 by Foshan Government Formal Commencement of Operations: Jan 1, 2006 Ownership: VES through the 30-year BOT agreement Contract with VES: 30-year concession agreement for the investment, design, construction and operations of the landfill Current waste in-take: average 1,600 tpd Landfill gas-to-energy: expect to be operational by early 2008 Bank financing: Standard Chartered Bank; current interest rate at 6.075%. Projects in China Foshan Landfill

22 Projects in China Landfill Gas-to-Energy Hangzhou Tianziling Landfill Gas-to-Energy Plant o Cooperative joint venture with local Government o Desgin, build, and operate for 15 years since 1998 o Current output: 2 MW o Power price: RMB /kWh (USD ) Guangzhou Datianshan Landfill Gas-to-Energy Plant o Cooperative joint venture with local Government o Desgin, build, and operate for 20 years since 1999 o Current output: 3 MW o Power price: RMB 0.63/kWh (USD ) Projects in China Landfill Gas-to-Energy Acquisition of Cleanaway Operations in 2006 Nanjing: Shui Ge Landfill o Total waste capacity of 12 million tons ( ) o LFG operation started in 2002 o Capacity: 3.9 MW by 3 engines o Can be expanded to 5 engines o Contract term: 15 years (until 2016) o Power price: RMB 0.45 /kwh (USD ) Xi an: Jiang Cun Gou Landfill o Total waste capacity of 50 million tons ( ) o LFG operation started in 2004 o Capacity: 5.2 MW by 4 engines o Can be expanded to 12 engines o Contract term: 26 years (until 2027) o Power price: RMB 0.47/kWh (USD )

23 Projects in China Landfill Gas-to-Energy Acquisition of Cleanaway Operations in 2006 (cont d) Beijing: Asuwei Landfill o Total waste capacity of 12.5 million tons ( ) o LFG operation started in Nov 2006 o Capacity: 2.6 MW by 2 engines o Can be expanded to 6 engines o Contract term: 25 years (until 2028) o Power price: RMB /kwh (USD ) Projects in China Guangzhou Likeng WTE Location: Baiyuan District, Guangzhou City, Guangdong Province Capacity: 1,000 tpd Commenced Construction: Dec 2002 by Guangzhou Government Formal Commencement of Operations: Apr, 2006 Ownership: Guangzhou Government Contract with VES: 10 years Operations and Maintenance contract Capacity output: 21 MW Power price: RMB 0.47/kWH (USD ). Share of revenue from power sales: VES will get 50% of the power sales if the power generation exceeds the designed level

24 Projects in China Guangzhou Likeng WTE Projects in China Shanghai Puxi WTE Location: Jiangqiao, Puxi, Shanghai Capacity: 1,500 tpd Commenced Construction: Nov 2000 by Shanghai Government Formal Commencement of Operations: Dec 2003 Ownership: Shanghai Government Contract with VES: - Owner s Assistance Agreement providing testing and commissioning services - 20 years Operations and Maintenance contract Capacity output: 20 MW Power price: RMB 0.427/kWH (USD ).

25 Projects in China Shanghai Puxi WTE Projects in China Tianjin Hazardous Waste A sino-foreign joint venture with VES taking 44% equities; providing technical and management assistance. Scope of services: o Collection and treatment of hazardous industrial waste o Treatment of medical waste Major Processes: o Incineration capacity: 13,500 tpy o Landfill capacity: 40,000 tonnes in total o PCT: 10,000 tpy o Stabilization: 5,000 tpy Operational since September 2004 Current waste volume: 942 tonnes per month of industrial waste 301 tonnes per month of medical waste Bank financing: China Construction Bank; current interest rate is 6.73%.

26 Projects in China Tianjin Hazardous Waste Projects in China Huizhou Hazardous Waste Location: Huizhou, Guangdong Province Structure: Partnership with local environmental company. The JV signed a 30-year concession agreement with the Provincial Environmental Protection Bureau covering collection and treatment of hazardous waste in 5 cities of Guangdong, one of which also includes medical waste. Scope of services: o Incineration capacity: 10,000 tpy (total of 22,300 tpy with the addition of the second incinerator) o Landfill capacity: 3 million tonnes; expect to receive 40,000 tonnes for the first year o Will add in WEEE recycling in Phase II of the project. Commenced Construction: Jun 2005 Bank financing: Standard Chartered Bank; current interest rate is 6.075%.

27 Projects in China Huizhou Hazardous Waste Schedule of major treatment processes: o Landfill: trial run in March 2007 o PCT and stabilization: May 2007 o Incineration: Target completion in July 2007 followed by testing and commissioning Projects in China Latest Development Medical Waste Treatment Facility in Foshan, Guangdong Province o Location: Gaoming Landfill operated by VES o Capacity: 15 tpd through incineration o Contract with VES: BOT for 28 years

28 Projects in China Laogang Landfill Laogang Landfill World Bank s Support Benefits Acted as a catalyst to assist the Shanghai municipal government in the planning and development of a modern waste management system. Helped ensure the tender was conducted in an open, fair and just manner according to international best practices. Loan conditions at the time when World Bank s support was offered were more favorable than those offered by the financial institutions in the market. Projects in China Laogang Landfill How would the Laogang Landfill project have evolved if World Bank was not involved?

29 Projects in China Laogang Landfill Considerations for Future Projects Lengthy tender and contract approval procedures may impact projects that may have an operational urgency or time implication. Direct payment and/or reimbursement payment system and procedures may be streamlined. Loan recipient is traditionally a state-owned entity. However, with the diversified company structure that has evolved over time, consideration can be made to allow the JV / foreign company operating the project to be more directly involved. Full disclosure to the operating entity on items related to the loan requirement will be beneficial. Reasonable conditions for early repayment of loan if beneficial to the Project JV. Projects in China Laogang Landfill Considerations for Future Projects World Bank loan costs have become unattractive with the addition of commitment fee and penalty for early repayment, particularly at a time when China s economy surges. Local bank re-financing easily done. Borrowing in local currency is preferred to mitigate foreign exchange risk. Monitoring and follow-up on the project should not be limited to environmental, procurement and financial audit but should also include review of the commercial contract.

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