WE RUN A TIP: WHY NOT A WASTE–TO–POWER PLANT?

A thought struck Bandicoot yesterday (29 Oct) after his visit to the shire’s ‘War on Waste’ forum in Dromana. It was no epiphany, more a humble chimerical speculation that might strike a creature who is unlettered in the mysteries of business and which he might regret ever having made public.

Cr Hugh Fraser and chief operating officer Niall McDonagh had barely finished their excellent exposition on the shire’s recent visit to five Chinese waste-to-electricity facilities when the thought struck.

The team that toured China get a warm welcome.

china-1It followed this logic. What is now “waste”, aka rubbish, that for aeons was fit only for throwing into holes in the ground, has now transmogrified into useful fuel – feedstock that, like coal or gas, heats furnaces to create steam, which spins turbines to generate electricity, which is fed into the grid for the benefit of us all.

Suddenly our throwaway household and garden waste has a value, as furnace feedstock – equivalent to expensive coal and gas. It is now in demand to create electricity in giant power stations, to run industry and supply households.

What a transformation!

Possibilities arise. We were told at the Dromana forum this waste is now so precious it is being “mined” from tips in some places to feed these insatiable furnaces, which require constant feeding. Bandicoot has heard of a Welsh plant that, miscalculating the tonnage of feedstock needed, had to import it from considerable distances away – English rubbish in a Welsh furnace!

Bandicoot was having the vision splendid of a cut in his annual rates bill. His (and your) rubbish, now having attained a value, would surely mean, at the very least, a threefold saving.  Below – the process.

china-2■ First, the state government’s waste levy would no longer be charged to the shire, since it would be sending no (or extremely little) waste to landfill.

■ Second, the furnace receiving Bandicoot’s (and your) rubbish each week would involve payment to the shire instead of a gate fee, as occurs now when the trucks reach the landfill site.

■ Third, the shire (that is, we ratepayers) would be paid for the electricity being pumped incessantly into the grid.

Triple bottom line!

Then, when Bandicoot was feeling sparky and buoyant, he got an electric shock. On page 19 of the ‘Waste to Energy Study Tour China’ report, came the statement that the plant was “likely to be privately owned, financed and built”.

Why?

We must go back a step or two here.

china-3The China tour, which included two councillors and two officers from the City of Greater Dandenong, plus the mayor, as well as representatives of the Victorian Metro Waste and Resource Recovery Group, were joined by state government trade and investment officers on the high-profile tour.  

Above – just another industrial plant. No smoke, no odour. 

The mission:

■ To “gain a first hand understanding of potential waste to energy technologies”.

■ To ascertain the “suitability of the technology to meet [the shire’s] needs”.

■ To study the benefits re waste diversion from landfill, and energy generation.

■ To study the size of the facility to suit the task.

■ To investigate the waste volumes (aka feedstock) required to fuel the facility.

An alternative waste technology plant, such as those now operating in China, Europe and Asia, has been on the shire wish list for at least a decade. Now it is getting close to reality. But it would have to be a joint venture, servicing more than one shire.

The South-East Metropolitan Region councils would, it appears, be the perfect group to supply waste to the final furnace the study group inspected – the Guofeng New Energy facility, which burns 800 tonnes of feedstock each day (292,000 tonnes/year) in two furnaces.

Clearly Mornington Peninsula Shire (MPSC), which sends only 31,000 tonnes of kerbside waste a year to landfill at Rye, needs to be part of a group feeding a furnace such as the Guofeng plant. Even the six-council South-East Metro group – MPSC, Frankston, Kingston, Dandenong, Casey and Cardinia – may not produce the required 300,000 tonnes annually. Perhaps business waste could be incinerated, too, at the plant’s 850C.

china-6So, why should a Guofeng, (pictured) costing $85 million to build, be constructed and operated by a private company, especially when the plant is estimated to pay for itself in 10 years or less?

It would cost each of the six South-East Metro councils on average $15 million, or less. Our shire was, a few years back, planning to spend twice, possibly thrice that on the Southern Peninsula Aquatic Centre which, when built, would probably have been a cost to the budget indefinitely. That’s the reality of service infrastructure such as pools and pavilions.

Bandicoot enthuses over the shire’s SPA plan. He is an advocate for government providing community services: our rates at work for the community.

It appears the study group’s report simply assumes the waste-to-energy plant could not possibly be run by six (or more) municipalities driven by the need to get rid of rubbish in an economical and profitable way.

Is it the group’s assumption that a private operator would get its feedstock for nothing? Possibly. Is it also assumed that a private operator would retain the money from feeding electricity into the grid? Almost certainly. Why?   The full story in ‘Private Eye’.

eyeA short diversion: Australian governments fund much infrastructure by way of PPPs – public-private partnerships. These include the building of such things as roads and hospitals. The incentive is to get debt off the government books, even though governments can borrow money cheaper than private enterprise.

In Britain these contracts, known as Private Finance Initiatives, have become so widely and loosely undertaken under Neoliberal ideology that they have become farcically expensive for UK taxpayers.

British Labour has begun campaigning to “buy back” some or all of Britain’s 700 PFIs.

Here’s an example of why this should occur: in 2014 a National Health Service trust bought back a PFI hospital contract from a private consortium, a deal so expensive that the trust found it was able to pay £15 million to the consortium to terminate the contract and still save £3.5 million a year – £65 million over the remaining life of the contract.

Business does not always do it cheaper than government, especially when many PPP contracts are kept from the public gaze by governments, and councils, citing “commercial in confidence”.

End of diversion.

Local government entities combining to build a high-temperature incinerator would engage consultants to deal with the intricacies of contract negotiations for all aspects of the plant, from building to operating it. All this could occur through a corporate structure separate from the shires but answerable to them.

Benefits for local communities?

■ No government landfill surcharge, paid by ratepayers.

■ A freeze, or reduction, in the shire’s waste levy now paid through rates.

■ A financial return on the electricity fed from the plant into the grid.

■ Improved air quality.

■ Better environmental outcomes.

Additionally, the state government could well back such a waste proposal, since it does not add debt to the state budget – and it could cause the government to rethink the kneejerk to engage in PPPs as a way to prevent accusations that – gasp! – government debt is on the rise.  Trucks unload feedstock in a spotless waste-to-electricity plant.

china-4aHenry Bolte ran Victoria on debt for years, before the rise of the Friedmans and the other fiscal fanatics (Margaret Thatcher, John Howard, the IMF, the World Bank) whose fashionable no-debt doctrine distorted economies and created trickle-up, which enriched a great many at the expense of the many, many more, with the GST one of the greatest thefts in the annals of government.

■ The shire has posted the ‘Waste to Energy Study Tour China’ on its website, at https://www.mornpen.vic.gov.au/About-Us/News-Media-Publications/Initiatives/War-on-Waste. Download the file Waste to Energy study. Bandicoot recommends you read it carefully, noting that waste to landfill drops to 1–5% and other residual material is used to make bricks or is used to build roads.

The report includes facts and figures on all five plants, including Everbright International, which services the city of Nanjing – population 10 million, heading for half of Australia’s entire population. The plants are spotlessly clean, landscaped and produce no emissions or odour.

Sounds perfect for a carbon neutral shire!