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HomeMy WebLinkAbout07. Approve HYPOWERS Pilot Project for CEQA and permitting purposes, DP 7358 Page 1 of 13 Item 7. CENTRAL SAN BOARD OF DIRECTORS POSITION PAPER MEETING DATE: FEBRUARY21, 2019 SUBJECT: APPROVE THE HYDROTHERMAL PROCESSING OF WASTEWATER SOLIDS (HYPOWERS) PILOT PROJECT FOR CALIFORNIA ENVIRONMENTAL QUALITYACT (CEQA) AND PERMITTING PURPOSES, DISTRICT PROJECT (DP) 7358 SUBMITTED BY: INITIATING DEPARTMENT: AMANDA SCHMIDT, ASSOCIATE ENGINEER ENGINEERING AND TECHNICAL SERVICES- PDS-PLANNI NG AND APPLI ED RESEARCH REVIEWED BY: DAN FROST, SENIOR ENGINEER DANEA GEMMELL, PLANNING AND DEVELOPMENT SERVICES DIVISION MANAGER JEAN-MARC PETIT, DIRECTOR OF ENGINEERINGAND TECHNICAL SERVICES Roger S. Bailey General Manager ISSUE Board approval of the HYPOWERS Pilot Project, DP 7358 is required priorto the filing of a Notice of Exemption under Central San's CEQA Guidelines and to apply for necessary permits from local, regional, and state agencies. BACKGROUND In 2016, Central San agreed to be the host site for the HYPOWERS pilot project that will test an emerging technology to produce renewable fuels from wastewater solids. A consortium led by the Water Environment and Reuse Foundation was chosen by the Department of Energy(DOE)to design a waste- to-energy pilot project. The consortium includes Central San, DOE's Pacific Northwest National February 21, 2019 Regular Board Meeting Agenda Packet- Page 31 of 111 Page 2 of 13 Laboratory(PNNL), Genifuel Corp., Marathon Petroleum Company(previouslyAndeavor, Tesoro), and other partners. The HYPOWERS system integrates with wastewater processing to enhance existing wastewater treatment processes and achieve substantial environmental benefits, including reduced fossil fuel consumption and mitigating emissions of greenhouse gases. Presently, Central San uses conventional methods for solids separation which includes centrifuges to dewater the sludge stream before incineration with multiple hearth furnaces coupled with waste heat recovery. The HYPOWERS project will divert, dewater, and process a portion of the wastewater solids (approximately 16.5 wet US tons per day, which equates to approximately 8% of Central San's solids) and produce biofuels, instead of incinerating and recovering waste heat from them. How It Works HYPOWERS utilizes Hydrothermal Processing (HTP)technology to convert organic solids to biofuels. I n the first step, known as Hydrothermal Liquefaction (HTL), dewatered sludge is processed at high temperature and pressure, converting a portion of the organic content to biocrude. Next, the biocrude is separated, the HTL aqueous effluent is recycled to the headworks of the wastewater treatment plant. Provisions will be made to enable a portion of the HTL effluent water to be processed in the PNNL's Catalytic Hydrothermal Gasification (CHG) mobile unit. In this second step, the remaining organic matter is converted into a gas, primarily consisting of methane and carbon dioxide. Within the project, this gas is referred to as biogas, which lacks sulfur, siloxanes, and other impurities typically found in biogas produced in anaerobic digesters. Potential Benefits/Strategic Plan Tie-In Central San's existing furnaces and waste heat recovery system continue to serve Central San well. While Central San continues to rely on the remaining life of those systems, exploration will continue on new, innovative solids handling and resource recovery alternatives that could provide long-term cost savings, and minimize greenhouse gas emissions and dependence on imported fuels. Central San's continued participation in the HYPOWERS project is a key success measure in Central San's fiscal year(FY) 2018- 20 Strategic Plan Goal Six: Embrace Technology, Innovation and Environmental Sustainability. Phases 1 & 2 From 2017 to present, Central San has been participating in Phase 1 of the HYPOWERS project, which includes various planning, research, and preliminary design activities. The anticipated completion of the Phase 1 work is March 2019. Phase 2 consists of final design, construction, operation, and decommissioning of the pilot system and is anticipated to begin in Summer 2019. Central San's role in Phase 2 of the pilot is to continue to participate as a key project team member, to host the pilot system at the treatment plant, and to provide access to Central San wastewater solids and other utilities required (e.g. electricity, natural gas, water, and instrument air). Prior to starting Phase 2 (Summer 2019), an agreement will be developed between Central San and the HYPOWERS pilot owner/operator. The agreement will clarify roles and responsibilities related to the project addressing various topics such as liabilities, insurance requirements, decommissioning, utilities, emissions compliance, liquid return stream requirements, lease/access agreements, and operational coordination agreement. The proposed agreement and project budget with estimate of in-kind Central San contributions will be brought to the Board for consideration in late Spring/early Summer 2019. Budget for the HYPOWERS project is included in the Capital Improvement Budget under DP 7358 for FY 2018-19. CEQA Staff has concluded that the entire HYPOWERS pilot project is exempt from CEQA under Central San's CEQA Guidelines Section 15262, Feasibility and Planning Studies, since the project involves only February 21, 2019 Regular Board Meeting Agenda Packet- Page 32 of 111 Page 3 of 13 feasibility or planning studies for possible future actions which the agency, board, or commission has not approved, adopted, or funded. The project does not require the preparation of an Environmental I mpact Report or Negative Declaration, but does require consideration of environmental factors. Staff believes that the impacts of the HYPOWERS process would not be significantly greater than treating the same amount of solids through Central San's current, conventional method. The Phase 2 design scope of work includes studies to verify this assumption and ensure compliance with regulatory standards. Other factors considered by staff include that the project will be located inside an award-winning treatment plant and well buffered from sensitive receptors, such as residences. This section does not apply to the adoption of a plan that will have a legally binding effect on later activities. Approval of this project will establish the Board's independent finding that this project is exempt from CEQA. ALTERNATIVES/CONSIDERATIONS The Board may delay or decline to approve the pilot project. If the Board does so, Central San may not be able to continue to participate as a key project team member and as the project host site. This could adversely impact the ability for HYPOWERS to complete the demonstration project. FINANCIAL IMPACTS This Position Paper only requests approval of the project for CEQA and permitting purposes; it does not approve a project agreement, nor award a construction contract. A separate Position Paper for the agreement and Central San budgetary commitment will be brought to the Board in late Spring/early Summer 2019 for consideration. COMMITTEE RECOMMENDATION The Real Estate and Environmental Planning Committee reviewed this item on January 28, 2019 and recommended approval of the pilot project for CEQA and permitting purposes. RECOMMENDED BOARD ACTION Approve the HYPOWERS Pilot Project for CEQA and permitting purposes. Strategic Plan Tie-In GOAL SIX: Embrace Technology, Innovation and Environmental Sustainability Strategy 2- Reduce reliance on non-renewable energy, Strategy 3- Encourage the review and testing of technology to optimize and modernize business operations ATTACHMENTS: 1. Location Map 2. HYPOWERS Project Update Presented to REEP on January 28, 2019 February 21, 2019 Regular Board Meeting Agenda Packet- Page 33 of 111 Page 4 of 13 DETAIL • AREA a haw,nez �• r 242 s - concord tic Pleasant * Bill +; ,ten d r, fl� IT IMF N x C� E Project u Location w o �o � 000 o N a 0 800 District-Owned Property Feet c� N � � ��► I Hydrothermal Attachment CENTRALSAN Processin of Wastewater Solids � (HYPOWERS) Pilot Project Location Z February 21, 2019 Regular Board Meeting Agenda Packet- Page 34 of 111 Page 5 of 13 Attachment 2 ow HYDROTHERMAL PROCESSING OF WASTEWATER SOLIDS (HYPOWERS) PROJECT UPDATE Dan Frost, Senior Engineer Real Estate & Environmental Planning Committee Meeting January 28, 2019 HYPOWERS CONVERTS WASTEWATER SOLIDS INTO BIOFUELS I HydrothermalBiocrude Wastewater & Biogas Solids Processing Technology Possible Nutrient Recovery ➢ High temperature & pressure processes convert wet biomass into biofuels ➢ Targets state &federal renewable energy incentives ➢ Minimizes biosolids disposal needs CENTRALSAN 1 February 21, 2019 Regular Board Meeting Agenda Packet- Page 35 of 111 Page 6 of 13 HYPOWERS LEVERAGES LEADING RESEARCH, UTILITY, & INDUSTRY EXPERTISE THE 0 J,S.DEPARTMENT OF Water ENERGY Pacific Northwest Research NATIONAL LABORATORY F O U N DAT I O N ❑❑:© M E R R I C K' ❑[]❑ & COMPANY Gerufuel m CC)RPORATI(]N C.M.W. . car�orFw'r,1 ban Company _ AI/k SempraEnergyutLity° ' metravancouver p CENTRAL CONTRA COSTA 'O Brown AND SANITARY DISTRICT N,�,oe,o E„a,„EE„,„a Caldwe1( MARATHpAI O leidos 0, BLACK8VEATCH Over 16 Public Agencies&Other Project Partners Not Shown AW 3 PROJECT ROLES CENTRAL SAN a�& HYPOWERS • Host Agency for the Pilot • Overall Project • Lead Public Agency for Management California Environmental • Design, Fabrication, & Quality Act (CEQA) Site Construction Compliance • Own, Operate, & Maintain • Air & Liquid Permitting Pilot Coordination • Regulatory Compliance • Participate throughout Project CENTRALSAN 2 February 21, 2019 Regular Board Meeting Agenda Packet- Page 36 of 111 • . , • . A • ■ 16.5 Tons Per Day 14,000 Cubic Feet (or 8%) of 328 Gallons Per Day Per Day Biogas Central San Solids Biocrude Oil Possible (Mobile Unit Will Process Less) 1 Ton Per Day 2.4 Gallons Per 16 Gallons Per Nutrient Rich Minute Minute Ash Slurry Hydrothermal Liquid Dewatering Liquid to Treatment Plant to Treatment Plant �cC CENTRALSAN Pre-2017 2017 2018 2019 2015 - 2016 WRF* (Water Research Foundation) Conducts Independent Evaluation of er 1 Genifuel Technology r�sd.rcir.nBecomes WRF Most 1i • ogy T *WERF has since changed their acronym to WRF. J CENTRALSAN Page 8 of 13 PHASE 1 TIMELINE • - • 2016 WRF Submits Proposal for DOE (U.S. Department of AL-kA Energy) Funding, - _ with Central San as the Host Agency PHASE 1 TIMELINE • 2017 U.S. DEPARTMENT OF ' ENERGY Selects & Awards $1.21VI for HYPOWERS Project Phase 1 (Planning & Design) CENTRALSAN 4 February 21, 2019 Regular Board Meeting Agenda Packet- Page 38 of 111 Page 9 of 13 PHASE 1 TIMELINE Pre-2017 , • 2017 - 2018 ✓ Validation Testing, Sampling, & Bench Testing s i ■ 9 CENTRALSAN PHASE 1 TIMELINE Pre-2017 ' = = • 2018 - 2019 Yonceptual Design .'ermting Strategies raft Technical, Economic, & Other Report Deliverables it repare Plan for Phase 2 Additional $3M California Energy Commission (CEC) Grant Funding led by SoCal Gas 5 February 21, 2019 Regular Board Meeting Agenda Packet- Page 39 of 111 Page 10 of 13 PHASE 1 TIMELINE Pre-2017 2017 • 2019 ❑ Request Board of Directors Approval of Project for CEQA & Permitting Purposes (February 2019) ❑ Finalize Phase 1 Deliverables ❑ Phase 1 Completion (March-April 2019) ❑ Request Board of Directors Approval for Pilot Agreement (Spring/Summer 2019) Anticipated Phase 2 Start (Summer 2019) PHASE 2 ANTICIPATED TIMELINE im Lllllllllllllllll� =I & 2020 ❑ Complete Final Design ❑ Equipment & Contractor Procurement ❑ Pilot Fabrication & Testing ❑ Site Modifications/Construction 6 February 21, 2019 Regular Board Meeting Agenda Packet- Page 40 of 111 Page 11 of 13 PHASE 2 ANTICIPATED TIMELINE 1 1 1 1 EM 2021 - 2022 ❑ Develop Operating Procedures ❑ Operate Pilot ❑ Test Products & Co-Products ❑ Update Techno-Economic Evaluations ` 13 PHASE 2 ANTICIPATED TIMELINE 2023 ❑ Finalize Project Reports ❑ Demobilize Pilot & Restore Site February 21, 2019 Regular Board Meeting Agenda Packet- Page 41 of 111 Page 12 of 13 PRELIMINARY DESIGN - PILOT LOCATION Watery ;0 7snstrumentAir � N•(P t 1r.i Co gv`�d�ng 1 - „�9 jam' ' {;t,,' •�• PRELIMINARY DESIGN 3-D LAYOUT .W�41-p 1 r February 21, 2019 Regular Board Meeting Agenda Packet- Page 42 of 111 Page 13 of 13 RECOMMENDATION Board of Directors approval of the HYPOWERS Pilot Project (DP7358) for CEQA and permitting purposes 11� QUESTIONS OR COMMENTS eL 9 February 21, 2019 Regular Board Meeting Agenda Packet- Page 43 of 111