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HomeMy WebLinkAboutREAL ESTATE, ENVIRONMENTAL & PLANNING MINUTES 07-17-17Il Central Contra Costa Sanitary District REGULAR MEETING OF THE CENTRAL CONTRA COSTA SANITARY DISTRICT REAL ESTATE, ENVIRONMENTAL & PLANNING COMMITTEE MINUTES Monday, July 17, 2017 9:00 a.m. 2nd Floor Conference Room 5019 Imhoff Place Martinez, California ( nmmittPP- Chair Paul Causey Member Tad Pilecki BOARD OF DIRECTORS: PAUL H. CA USEY President JAMES A. NEJEDLY President Pro Tern MICHAEL R. MCGILL TAD J. PILECKI DA VID R. WILLIAMS PHONE: (925) 228-9500 FAX.- (925) 372-0192 www.centralsan.org Staff. Roger S. Bailey, General Manager Jean -Marc Petit, Director of Engineering and Technical Services Lori Schectel, Environmental and Regulatory Compliance Division Manager Alan Weer, Plant Operations Division Manager Melody LaBella, Program Manager -Resources Recovery Lupe Saldana, Administrative Services Supervisor Cindy Granzella, Senior Administrative Technician 1. Call Meeting to Order Chair Causey called the meeting to order at 9:00 a.m. 2. Public Comments None. 3. Receive update on Letters of Interest and As -Needed Public -Private Partnership (P3) Advisory Services and review draft Position Paper authorizing the General Manager to execute a professional consulting services agreement with CDM Smith with a cost ceiling of $400,000 for As -Needed Public -Private Partnership Advisory Services, District Project 7358 Real Estate, Environmental & Planning Committee Minutes July 17, 2017 Page 2 Mr. Bailey commented that the Bioenergy project addresses solids handling and associated energy production. He stated that P3 arrangements are very complex and the agreement is for as -needed P3 advisory services in support of the Bioenergy project. He stated that the consultant may be asked to assist in the development of the Request for Proposals for Phase 1 of the Bioenergy project later, but that is not included in this agreement. Mr. Petit, referring to the Position Paper and presentation materials, provided the background for initiating the formation of a public-private partnership for the development of a bioenergy facility, reviewed current solids handling and energy production practices, described the Request for Information process, reviewed each of the eight responses received, and said CDM Smith was selected as the lead consultant to provide the P3 advisory services. Mr. Petit noted that the slides were prepared before the interviews and selection of consultant due to agenda submission deadlines. Member Pilecki commented on the potential to exceed incineration capacity in the future and asked if the Bioenergy project will eliminate furnace improvements orjust put it off. Mr. Petit responded that it will buy time and noted that under solids handling Phase 1 the ability to reduce use of expensive lime will be reviewed. Member Pilecki commented that if it is just buying 5-7 years of time, then what is the driving force to doing P3 now? Mr. Petit explained that besides the capacity of the existing solids handling facilities, Central San relies on Cogen for plant power generation that uses a large amount of natural gas. Natural gas has a significant impact on GHG emissions which are regulated. He stated that replacing the Cogen in the next 3-5 years could increase greenhouse gases (GHG) and that the Bioenergy project fits into goals for lowering greenhouse gas non-renewable energy. He said that it makes sense to do the Bioenergy project now and test new technologies associated with combined power and solids handling, thus Bioenergy. Mr. Bailey added that the big decision regarding solids handling is whether to use anaerobic digestion or gasification given the sizeable cost difference. The benefit of doing the project now, through a take or pay arrangement, is the opportunity to test gasification at a lower cost. If successful, this has the potential of significant savings to the District in 5-10 years when a decision has to be made on the overall solids handling process, although there will be some redundancy in the near term. Mr. Petit noted that if the Cogen is replaced in the next three to five years, it will be kept as a backup during testing of the new solids handling methods. Real Estate, Environmental & Planning Committee Minutes July 17, 2017 Page 3 Chair Causey recommended the project take into consideration what will happen if the incinerator goes down. Mr. Petit stated that the incinerator going out due to earthquake or breakdown could be addressed by diversifying solids handling as part of the goals. He stated that energy use is complex and that adding or extracting a component must always be taken into consideration. Mr. Petit further explained that when evaluating this Bioenergy project, we need to make sure the steam system is not impacted as Central San mainly relies on steam blowers so steam demand is critical. He stated that the Bioenergy project could reduce natural gas use, which is one of the main drivers. Member Pilecki commented that he is concerned about availability of landfill gas. Mr. Petit said it could be done without, but fuel costs would increase. Referencing the photo showing the proposed bioenergy facility location, Mr. Bailey commented that consideration is being given to the long-term potential to accept outside green waste as a revenue source in the future. Mr. Petit reviewed the three phases of the Comprehensive Wastewater Master Plan (CWMP) covering years 0-5 (Phase 1), 6-10 (Phase 2), and 11-20 (Phase 3) noting that Phase 2 includes replacing the Cogen and continuing with the solar turbine agreement. Mr. Petit recommended going forward with Phase 1 Bioenergy because if it does not work out, the District will still be on track with the CWMP. However, if it is a success, Phase 2 would include construction of the Bioenergy project, and could further delay or eliminate the need for adding digesters or Cogen replacement. Chair Causey commented that most agencies are doing 1 to 5 megawatts solar and asked how that fits in with the possibility of solar. Mr. Petit explained that the approach with this project is strictly to address solids handling. He added that CWMP Phase 1 will look at replacing steam blowers with electric which would lead to an increase in kilowatt demand but the plan now is to harvest heat from the incinerator and make power from the heat recuperation. He noted that the lights that are on now at the Treatment Plant (such as in the tunnels) could potentially be powered by renewable energy such as solar, however, the consultants were not asked to consider solar. An RFP for a renewable energy project is in the queue and is scheduled for 3rd or 4th quarter this Fiscal Year. Mr. Petit stated there are many issues that need to be addressed with this P3 Bioenergy project such as environmental review, permitting, land use, cost of power production and solids handling, cost to make a kilowatt to handle a pound of solids today, the P3 contract terms and conditions, and duration of the initial agreement. This is why the District is looking at hiring a team of expert consultants. Real Estate, Environmental & Planning Committee Minutes July 17, 2017 Page 4 Chair Causey asked if staff has been in contact with comparable agencies that have done P3 projects in California to understand what they learned and would do differently. Mr. Petit noted that he had contacted agencies by phone and met some at the WEF Innovation conference held in San Francisco last March and that Ms. LaBella referred to other agencies' RFPs to develop Central San's. Mr. Bailey added that he has spoken often with other agencies on this topic and continues to do so and that he has prior experience with these types of projects from working at other agencies. Chair Causey asked if staff had explored the ability to export power to PG&E. Mr. Bailey responded that it could be considered in the long term. Chair Causey shared his opinion that Central San should work closely with Mt. View Sanitary District to encourage partnership because they are a small, close sister agency and it would ultimately benefit the communities and customers. Mr. Petit reviewed the technical, financial and legal services for each of the eight Letters of Interest received. He stated that ultimately three consultants were interviewed and CDM Smith was selected. Mr. Petit stated that a task order will be issued to get started with CDM and then will be brought back to the Board with a more detailed scope and fee if needed. Mr. Petit noted that the initial contract with CDM Smith will be around $80, 000 to $90, 000 to get started and then it will be brought back to the Board with the full scope and budget in August. Chair Causey requested that a Technical Resource Committee be created as an advisory team for the project. The Committee recommended going forward with the agreement for advisory services to develop a Request for Proposal to begin the new Bioenergy alternative solids and energy project evaluation. COMMITTEE ACTION: Received the update and recommended Board approval of the consulting services agreement with CDM Smith for As -Needed Public - Private Partnership Advisory Services, District Project 7358 4. Announcements Ms. Schectel stated that there were two failures in ultraviolet (UV) treatments, one on July 6 for 20 seconds and one on July 8 for 19 seconds, and that the effluent met permit requirements. She stated that notifications have been made to regulatory agencies and submittals completed. Staff is working on implementing corrective actions, including future diversions of water to the basins. Real Estate, Environmental & Planning Committee Minutes July 17, 2017 Page 5 Member Pilecki asked whether 20 seconds was enough time to do a diversion to the basins. Mr. Weer described in more detail the failure occurrences and the corrective actions that will be implemented, and then explained at what point in the process the diversion could be done. Mr. Weer said that automation is being considered but, because the current system sometimes has false reads, if the process were automated it might cause some unnecessary diversions. a. Future scheduled meetings: Monday, August 28, 2017 at 9:00 a.m. Monday, September 25, 2017 at 9:00 a.m. Monday, October 23, 2017 at 9:00 a.m. 5. Suggestions for future agenda items None. 6. Adjournment — at 10:38 a.m.