1A Thomas Mackie Presentation

8/14/2019 1A Thomas Mackie Presentation

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Renewable Energy CreditsRenewable Energy Creditsand Emerging Technologyand Emerging Technology

SWANA Massachusetts ChapterSWANA Massachusetts Chapter

5th Annual Solid Waste & Recycling Conference &5th Annual Solid Waste & Recycling Conference &

TradeShowTradeShow

Thomas A. MackieThomas A. Mackie


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How doHow do renewable energyrenewable energycreditscredits (RECs) apply to wastes(RECs) apply to wastesand how will they affect theand how will they affect themarket?market?

Certain wastes can generateCertain wastes can generate

RECsRECs

$ from sale of RECS can$ from sale of RECS can

subsidize disposal costs.subsidize disposal costs.


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Renewable Energy CreditsRenewable Energy Credits

and Emerging Technologyand Emerging Technology

Recent DevelopmentsRecent Developments

AugAug--Sept. 2007 Three Mass.Sept. 2007 Three Mass.C&D facilities file for conversionC&D facilities file for conversionto MSWto MSW

August 2007August 2007 BoralexBoralex stopsstopsaccepting C&D woodaccepting C&D wood

August 2007 MA DOER issuesAugust 2007 MA DOER issuesnew REC regulationsnew REC regulations

July 2007 Conn. DPU enforcesJuly 2007 Conn. DPU enforcesnew C&D rulenew C&D rule

Spring 2007Spring 2007 ZeGenZeGen pilot plantpilot plantopensopens

2007 NH bans combustion of2007 NH bans combustion ofC&D WoodC&D Wood

June 2006 Mass. bans landfillJune 2006 Mass. bans landfilldisposal of wooddisposal of wood

Mass. DEP permits 12 C&DMass. DEP permits 12 C&D

processorsprocessors


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What is a Mass. REC worth?What is a Mass. REC worth?

$54.04$54.04

January 2007, MTC sold 24,000January 2007, MTC sold 24,000MRECs for an average price ofMRECs for an average price of$54.04.$54.04.

This resulted in $1.3M inThis resulted in $1.3M in

MRECs sold by Schiller Station,MRECs sold by Schiller Station,a 50MW wood burning plant ina 50MW wood burning plant inPortsmouth, NH.Portsmouth, NH.

Long term value of RECs isLong term value of RECs isuncertain. However, the MTCuncertain. However, the MTC

Massachusetts Green PowerMassachusetts Green PowerPartnership provides long termPartnership provides long termREC contracts designed toREC contracts designed tomaintain REC market stability.maintain REC market stability.


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and Emerging Technologyand Emerging Technology What is the potential REC valueWhat is the potential REC value

per ton of waste?per ton of waste? $48.60$48.60

Assume a 30MW power plantAssume a 30MW power plantaccepting 800 TPD ofaccepting 800 TPD of organicorganicrefuse derived fuel.refuse derived fuel.

Assume nominal operations ofAssume nominal operations of24 hours x 365 (no down time)24 hours x 365 (no down time)

= 8760 hrs. per year= 8760 hrs. per year

8760 x 30 MW=262,800 MWH8760 x 30 MW=262,800 MWH

Nominal REC revenue is $54 xNominal REC revenue is $54 x262,800 = $14,191,200262,800 = $14,191,200

Assume 800 tons of ORDF perAssume 800 tons of ORDF perdayday

800 x 365 = 292,000 tons800 x 365 = 292,000 tons Divide REC revenue ofDivide REC revenue of

$14,191,200 by 292,000 tons of$14,191,200 by 292,000 tons ofORDF = $48.50 REC revenueORDF = $48.50 REC revenueper ton of ORDF.per ton of ORDF.

Similar to electricity price at 5Similar to electricity price at 5cents per KWh.cents per KWh.


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Who is GeneratingWho is Generating RECsRECs*?*?

20 Landfill Gas Projects have20 Landfill Gas Projects havequalified for Massachusettsqualified for MassachusettsRECsRECs

6 of these are in Massachusetts:6 of these are in Massachusetts:Attleboro, Granby, Chicopee,Attleboro, Granby, Chicopee,Randolph, Fall River and GreaterRandolph, Fall River and Greater

New BedfordNew Bedford 99 BiomassBiomass facilities havefacilities have

qualified for MRECsqualified for MRECs 3 Maine facilities use wood, including3 Maine facilities use wood, including

C&D wood.C&D wood. No Mass. facilities use C&D wood.No Mass. facilities use C&D wood.

00 waste to energywaste to energy facilitiesfacilitieshave qualified for MRECs.**have qualified for MRECs.**

0 MSW gasification facilities0 MSW gasification facilitieshave qualified for MRECs.have qualified for MRECs.

*From DOER*From DOERs RPSs RPS--Qualified New Renewable Generation UnitsQualified New Renewable Generation Units** After December 31, 1998,** After December 31, 1998, waste to energywaste to energy fromfrom conventionalconventional

municipal solid waste plant technology in commercial usemunicipal solid waste plant technology in commercial use was nowas nolonger eligible for RECs. G.L. c. 25A, Sec. 11F (b).longer eligible for RECs. G.L. c. 25A, Sec. 11F (b).


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How Much Wood and Who Takes ItHow Much Wood and Who Takes It

Massachusetts generatesMassachusetts generatesapproximately 571,000 tons/year ofapproximately 571,000 tons/year ofC&D wood. DOER WoodyC&D wood. DOER Woody BioMassBioMassSupply StudySupply Study

About 50,000 tons/year ofAbout 50,000 tons/year ofMassachusetts C&D wood is usedMassachusetts C&D wood is usedas fuel.as fuel.

Currently, no facility is acceptingCurrently, no facility is accepting

C&D wood fuel from Massachusetts.C&D wood fuel from Massachusetts.Until August, the only facilitiesUntil August, the only facilitiesaccepting C&D wood fuel fromaccepting C&D wood fuel fromMassachusetts were the MaineMassachusetts were the MaineBoralexBoralex facilities which had afacilities which had a400,000 ton/year capacity.400,000 ton/year capacity.


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What is a REC?What is a REC?

A REC is credit that can beA REC is credit that can be

used by a retail electricityused by a retail electricity

supplier to meet thesupplier to meet the

Massachusetts RenewableMassachusetts RenewableEnergy Portfolio StandardEnergy Portfolio Standard(RPS). One REC is created(RPS). One REC is created

when a generator of electricitywhen a generator of electricity

has produced one megawatthas produced one megawatt

hour (MWh) of electricity from ahour (MWh) of electricity from aqualified renewable energyqualified renewable energygenerating source.generating source.


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What wastes qualify forWhat wastes qualify for RECsRECs??

Eligible Biomass Fuel:Eligible Biomass Fuel: Fuel sources including brush, stumps,Fuel sources including brush, stumps,

lumber ends and trimmings, wood pallets,lumber ends and trimmings, wood pallets,bark, wood chips, shavings, slash andbark, wood chips, shavings, slash andother clean wood that are not mixed withother clean wood that are not mixed withother solid wastes;other solid wastes;

Agricultural wastes, food material andAgricultural wastes, food material and

vegetative material as those terms arevegetative material as those terms aredefined, or may be subsequently defined,defined, or may be subsequently defined,by the Department of Environmentalby the Department of EnvironmentalProtection at 310 CMR 16.02;Protection at 310 CMR 16.02;

Energy crops;Energy crops;

Biogas;Biogas; Organic refuse derived fuel that is collectedOrganic refuse derived fuel that is collected

and managed separately from municipaland managed separately from municipalsolid waste; andsolid waste; and

NeatNeat biodieselbiodiesel and other neat liquid fuelsand other neat liquid fuelsthat are derived from such fuel sources.that are derived from such fuel sources.

Also landfill and anaerobic digesterAlso landfill and anaerobic digestermethane gas . . .methane gas . . .


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What is Organic Refuse DerivedWhat is Organic Refuse DerivedFuel?Fuel?

ORDF is not defined but hasORDF is not defined but hasincluded C&D wood in the past.included C&D wood in the past.

Is Conventional Waste to EnergyIs Conventional Waste to Energyeligible?eligible?

225 CMR 14.02225 CMR 14.02

NOTNOT waste to energy, which is awaste to energy, which is acomponent of conventionalcomponent of conventionalmunicipal solid waste technology inmunicipal solid waste technology incommercial usecommercial use (expired 12/31/98)(expired 12/31/98)


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What are acceptable technologies?What are acceptable technologies?

Eligible Biomass Fuels must beEligible Biomass Fuels must beused in aused in a low emission, advancedlow emission, advancedbiomass power conversion unitbiomass power conversion unit ananundefined term.undefined term.

Statute referencesStatute references gasificationgasification asasexample of advanced technology.example of advanced technology.QueryQuery: What does: What does gasificationgasification mean?mean?See EPA, DOE, IRS definitions. SeeSee EPA, DOE, IRS definitions. SeeCT DPU ruling on Plainfield RenewableCT DPU ruling on Plainfield RenewableEnergy.Energy.

DOER has issued Advisory Rulings thatDOER has issued Advisory Rulings thathave approved fluidized bed and relatedhave approved fluidized bed and relatedcombustion technologies for C&D wood.combustion technologies for C&D wood.

Focus has been on ability to meet theFocus has been on ability to meet theemissions requirements.emissions requirements.

New rules effective August 16, 2007New rules effective August 16, 2007would allowwould allow advanced stoker.advanced stoker.Previous rules excludedPrevious rules excluded pile burn andpile burn andstoker combustion.stoker combustion.

DOER Guidelines establish lowDOER Guidelines establish lowemissions standards to be met.emissions standards to be met.


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What is the Massachusetts RenewableWhat is the Massachusetts RenewableEnergy Portfolio Standard or RPS?Energy Portfolio Standard or RPS?

By statute, every retail electric supplier inBy statute, every retail electric supplier inMassachusetts must annually demonstrate that theMassachusetts must annually demonstrate that theelectricity it supplies includes a certain percent ofelectricity it supplies includes a certain percent ofelectricity generated from renewable energyelectricity generated from renewable energysources. G.L. c. 25A, 11F. The RPS grows 1/2%sources. G.L. c. 25A, 11F. The RPS grows 1/2%per year until 12/31/09 to 4% and then by 1% (untilper year until 12/31/09 to 4% and then by 1% (untilsuspended by the DOER).suspended by the DOER).

The RPS refers to the minimum annual percent ofThe RPS refers to the minimum annual percent ofrenewable energy required by law.renewable energy required by law.

Suppliers can satisfy the RPS by either generatingSuppliers can satisfy the RPS by either generatingelectricity from renewable sources or acquiringelectricity from renewable sources or acquiringRECs from renewable sources.RECs from renewable sources.

Suppliers who do not satisfy the RPS must pay anSuppliers who do not satisfy the RPS must pay anAlternative Compliance Payment (ACP), currentlyAlternative Compliance Payment (ACP), currently

$57.12 per$57.12 per MWhMWh. In 2005 DOER collected about. In 2005 DOER collected about$20M in$20M in ACPsACPs.. RPS programs exist in 30 states including Maine,RPS programs exist in 30 states including Maine,

Vermont, Connecticut, Rhode Island, New York,Vermont, Connecticut, Rhode Island, New York,New Jersey, Pennsylvania, Maryland, DelawareNew Jersey, Pennsylvania, Maryland, Delawareand in certain midand in certain mid--western and western states.western and western states.Database of State Incentives for Renewables &Database of State Incentives for Renewables &EfficiencyEfficiency


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What is the Policy UnderlyingWhat is the Policy Underlyingthe RPS Standard?the RPS Standard?

Increase the Share of ourIncrease the Share of ourelectricity generated byelectricity generated by newnewrenewable resourcesrenewable resources

Decrease atmospheric pollutionDecrease atmospheric pollutionfrom the regional fleet of powerfrom the regional fleet of powerplants that serve Massachusettsplants that serve Massachusettscustomerscustomers

Diversify the fuels used toDiversify the fuels used togenerate power that servesgenerate power that servesMassachusetts customersMassachusetts customers

Decrease the reliance ofDecrease the reliance of

Massachusetts on fossil fuelsMassachusetts on fossil fuelsimported from other regionsimported from other regions

Moderate electricity priceModerate electricity pricevolatility in Massachusettsvolatility in Massachusettscaused by reliance on importedcaused by reliance on importedfossil fuels*fossil fuels*

DOER Summary of the Proposed Final Regulations for theDOER Summary of the Proposed Final Regulations for theMassachusetts Renewable Energy Portfolio Standards at 225Massachusetts Renewable Energy Portfolio Standards at 225CMR 14.00 November 6, 2006CMR 14.00 November 6, 2006


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What is aWhat is a MWhMWh??

A megawatt (MW) is one millionA megawatt (MW) is one millionwattswatts

Watts (W) are the yardstick forWatts (W) are the yardstick formeasuring power. A one hundredmeasuring power. A one hundredwatt light bulb, for example, is ratedwatt light bulb, for example, is rated

to consume one hundred watts ofto consume one hundred watts ofpower when turned on. If such apower when turned on. If such alight bulb were on for four hours itlight bulb were on for four hours itwould consume a total of 400 wattwould consume a total of 400 watt--hours (Wh) of energy.hours (Wh) of energy.

Watts measure instantaneousWatts measure instantaneouspower while wattpower while watt--hours measure thehours measure the

total amount of energy consumedtotal amount of energy consumedover a period of time. For instance,over a period of time. For instance,a 100 MW rated wind farm isa 100 MW rated wind farm iscapable of producing 100 MWcapable of producing 100 MWduring peak winds.during peak winds.

One MWh is the amount of energyOne MWh is the amount of energyproduced by a facility generatingproduced by a facility generatingone million watts for one hour.one million watts for one hour.


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How much power is aHow much power is a MWhMWh??

A rule of thumb is that oneA rule of thumb is that onemegawatt will power 1,000megawatt will power 1,000homes.homes.

According to 2001 EnergyAccording to 2001 EnergyInformation Administration (EIA)Information Administration (EIA)data, New England residentialdata, New England residentialcustomers consume the leastcustomers consume the leastamount of electricity, averagingamount of electricity, averaging653 kilowatt hours (kWh) of load653 kilowatt hours (kWh) of loadin a month.in a month.

SEMASSSEMASS CovantaCovanta producesproducesabout 650,000about 650,000 MWhMWh/year/yearequivalent to a 75 MW plant.equivalent to a 75 MW plant.


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How much renewable energy isHow much renewable energy isbeing supplied?being supplied?

More thanMore than of the 2005 RPS wasof the 2005 RPS wassupplied by renewable energy.supplied by renewable energy.

According to DOER in 2005 664,000According to DOER in 2005 664,000MWhMWh of renewable energy wasof renewable energy was

delivered out of a total of 51.6delivered out of a total of 51.6MMWhMMWh of electricity.of electricity.

This is the equivalent of one 75 MWThis is the equivalent of one 75 MWrenewable energy facility running 24renewable energy facility running 24hours/365 days/yr. The averagehours/365 days/yr. The averagebiomass plant would provide 35biomass plant would provide 35

MWhMWh.. For 2007 to fulfill the RPS = 176For 2007 to fulfill the RPS = 176MWhMWh, more than double the 2005, more than double the 2005level.level.


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MassDEPMassDEP Solid Waste MasterSolid Waste MasterPlan on use of waste to energy?Plan on use of waste to energy?

MassDEPMassDEP will maintain thewill maintain the

municipal waste combustionmunicipal waste combustion

moratorium to maintainmoratorium to maintainprogress that has been made inprogress that has been made inreducing mercury emissionsreducing mercury emissionsunder the stateunder the states Zero Mercurys Zero Mercury

Action Plan.Action Plan.


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MassDEPMassDEP RegulationsRegulations

Effective July 1, 2006,Effective July 1, 2006,MassDEPMassDEP banned thebanned the

disposal or transfer fordisposal or transfer fordisposaldisposal at landfillsat landfillsof wood.of wood.

310 CMR 19.017310 CMR 19.017 Recycling does not mean toRecycling does not mean to

recover energy from therecover energy from the

combustion of a material.combustion of a material.310 CMR 16.02310 CMR 16.02

Mass DEP will giveMass DEP will give BUDsBUDs forforproperly processed C&Dproperly processed C&D

wood fuel.wood fuel.


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MassDEPMassDEP GuidelinesGuidelines

MassDEPMassDEPss April 2007 Best AvailableApril 2007 Best AvailableControl Technology (BACT) GuidanceControl Technology (BACT) GuidanceBiomassBiomass--Fired Electric GeneratingFired Electric GeneratingUnitsUnits

Guidance on Best Available ControlGuidance on Best Available Control

Technology (BACT) for biomass fuel andTechnology (BACT) for biomass fuel andtechnology combinations for whichtechnology combinations for which MassDEPMassDEPhas experience (solid biomass fuel).has experience (solid biomass fuel).

MassDEPMassDEPss March 2007 DraftMarch 2007 DraftAddendum toAddendum to Revised Guidelines forRevised Guidelines forDetermining Closure Activities atDetermining Closure Activities atInactive Unlined Landfill Sites, July 6,Inactive Unlined Landfill Sites, July 6,

20012001 Use of Construction andUse of Construction andDemolition Fines and ResidualsDemolition Fines and Residuals

Maximize Diversion of Clean WoodMaximize Diversion of Clean WoodCleanCleanwood shall be separated from the C&D wastewood shall be separated from the C&D wastestream to the maximum extent feasible priorstream to the maximum extent feasible priorto processing and shall be diverted toto processing and shall be diverted torecycling/reuse activities.recycling/reuse activities.


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What has happened inWhat has happened inMassachusetts?Massachusetts?

No current proposals for energyNo current proposals for energyconversion of MSW or foodconversion of MSW or foodwastewaste

C&D wood power conversionC&D wood power conversionprojectsprojects ZeGenZeGen--In pilot stages.In pilot stages.

Russell BiomassRussell Biomassdropped C&Ddropped C&Dwood due to local oppositionwood due to local opposition

EcopowerEcopowerdropped proposed Newdropped proposed NewBedford projectBedford project

GenPowerGenPowerproposed Barre projectproposed Barre projectunknown statusunknown status

Others in pipelineOthers in pipeline


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and Emerging Technologyand Emerging Technology ConclusionConclusion

Certain wastes can qualify as aCertain wastes can qualify as arenewable fuel sourcerenewable fuel source

RECs can be a significant source ofRECs can be a significant source ofrevenue and offset disposal costsrevenue and offset disposal costs

Traditional Waste to Energy will notTraditional Waste to Energy will notqualify for RECsqualify for RECs

Advanced gasification or other fuelAdvanced gasification or other fuelcreation technology will be required forcreation technology will be required forMSW to be a renewable fuelMSW to be a renewable fuel

Landfill gas is a well established RECLandfill gas is a well established RECgeneratorgenerator

Biomass (wood) is a well establishedBiomass (wood) is a well establishedREC generator with some C&D woodREC generator with some C&D wood

included (Maine only)included (Maine only) C&D wood can be the next renewableC&D wood can be the next renewable

fuelfuel

New solid waste facility development willNew solid waste facility development willlikely incorporate energy generation tolikely incorporate energy generation totap into REC revenue streamtap into REC revenue stream

Documents

1A Thomas Mackie Presentation