PA Clean Power Climate Plan Comments: Waste-To-Energy Recovery Council

DEP held its first listening session on EPA’s Clean Power Climate Plan requirements Tuesday in Harrisburg and heard from a variety of groups, including these comments from the Energy Recovery Council representing the waste-to-energy industry, including six facilities in Pennsylvania--

Good evening.  My name is Ida Shiang, and I am speaking on behalf of the Energy Recovery Council (ERC), the national trade association representing companies and local governments engaged in the waste-to-energy sector.  

I appreciate the opportunity to provide input on Pennsylvania’s process related to designing a state plan that will implement the Clean Power Plan (CPP) under section 111(d) of the Clean Air Act.  

ERC urges the Commonwealth to take advantage of the opportunities afforded by the CPP to utilize waste-to-energy as a tool to reduce greenhouse gases from the power sector.  There is a tremendous opportunity to benefit from reduced greenhouse gases made possible by Pennsylvania’s past and future investment in waste-to-energy facilities.   

There are 84 waste-to-energy (WTE) facilities in the United States, which produce clean, renewable energy through the combustion of municipal solid waste in specially designed power plants equipped with the most modern control equipment to minimize emissions.  

America’s waste-to-energy plants process approximately thirty million tons of trash per year, enabling them to send nearly 15 million megawatt hours of electricity to the grid, as well as export steam to local users.  In addition, waste-to-energy facilities recover and recycle more than 700,000 tons of metals per year.  

Pennsylvania is home to six WTE facilities, located in Chester, Conshohocken, Harrisburg, Lancaster, Morrisville and York.  These facilities process more than 8,700 tons of trash per day and have an electric baseload capacity of 268 megawatts.  

In 2012, these WTE facilities, produced roughly one-third of Pennsylvania’s non-hydro renewable electricity, while reducing the emission of more than three million tons of greenhouse gases.

The Clean Power Plan recognizes waste-to-energy as an eligible compliance tool that can be included in state plans.  Pennsylvania should incorporate waste-to-energy into its state plan for the following reasons:

— WTE reduces greenhouses gases;

— WTE is baseload power;

— WTE is compatible with recycling;

— WTE boosts local jobs and economies; and

— WTE is a cost-competitive source of renewable energy and GHG reduction.

WTE Reduces Greenhouse Gases

The climate benefits of WTE technology are well-documented, both internationally and in the U.S.    According to U.S. EPA, life cycle emission analysis show that waste-to-energy facilities actually reduce the amount of greenhouse gases expressed as CO2 equivalents (GHGs or CO2e) in the atmosphere by approximately 1 ton for every ton of municipal solid waste (MSW) combusted.   

Waste-to-energy achieves the reduction of greenhouse gas emission through  three separate mechanisms: 1) by generating electrical power or steam, waste-to-energy avoids carbon dioxide (CO2) emissions from fossil fuel based electrical generation, 2) the waste-to-energy combustion process effectively avoids all potential methane emissions from landfills thereby avoiding any potential release of methane in the future and 3) the recovery of ferrous and nonferrous metals from MSW by waste-to-energy is more energy efficient than production from raw materials – thereby avoiding CO2 from fossil fuel combustion.  

While the Clean Power Plan only recognizes avoided GHGs from the power sector, Pennsylvania can use WTE in its state plan to leverage other GHG reductions.

WTE is Baseload Power

It is important to consider that waste-to-energy plants supply power 365-days-a-year, 24-hours a day and can operate under severe conditions.  Waste-to-energy facilities average greater than 90 percent availability of installed capacity.  The facilities generally operate in or near an urban area, easing transmission to the customer.  

Waste-to-energy power is sold as “baseload” electricity to utilities that can rely upon its supply of electricity.  There is a constant need for trash disposal, and an equally constant, steady, and reliable energy generation.

WTE is Compatible with Recycling

Statistics compiled for nearly two decades have proven that waste-to-energy and recycling are compatible. Since research on the subject began in 1992, communities that rely upon waste-to-energy maintain, on average, a higher recycling rate than the national EPA average and very much in line with the recycling averages of the states in which they serve.

In a paper entitled, “A Compatibility Study: Recycling and Waste-to-Energy Work in Concert, 2014 Update,” Eileen Berenyi with Governmental Advisory Associate, Inc. researched the recycling characteristics surrounding 80 waste-to-energy facilities in 21 states. Recycling data was obtained from 700 local governments, as well as statewide data from the 21 states covered in the report.

In 2011, the report shows that communities with waste-to-energy have an average recycling rate of 35.4 percent. The national average for recycling as estimated by EPA is estimated at 34.7 percent, while BioCycle/Columbia University estimate it to be 28.9 percent.   

Recycling compatibility is borne out by the recycling rates of European countries as it relates to their reliance upon waste-to-energy or landfilling.

The most progressive countries recycle a lot, recover energy as much as possible, and landfill little. Less advanced countries landfill as much as possible, while doing little to no recycling or energy recovery.

WTE Boosts Local Jobs and Economies

In addition, waste-to-energy has a very positive economic impact on the communities in which these facilities are located.  In Pennsylvania alone, the waste-to-energy industry directly employs approximately 400 people with salary and fringe benefits in excess of $33 million per year.  

In addition to direct employees, the WTE sector creates an additional 751 indirect or induced jobs, which pay salary and benefits of more than $38 million per year.  The total economic impact of revenues for waste-to-energy in Pennsylvania is $586 million, including the $299 million  produced by the waste-to-energy sector directly. Every dollar of revenue generated by the waste-to-energy industry puts a total of 1.95 dollars into the economy through intermediate purchases of goods and services and payments to employees.

WTE is a Cost-Competitive Source of Renewable Energy and GHG Reduction

The U.S. Department of Energy’s Energy Information Administration (EIA) uses Levelized Cost of Energy (LCOE) to measure the competitiveness of a particular energy resource.  EIA defines LCOE as:

“Levelized cost is often cited as a convenient summary measure of the overall competiveness of different generating technologies. Levelized cost represents the present value of the total cost of building and operating a generating plant over an assumed financial life and duty cycle, converted to equal annual payments and expressed in terms of real dollars to remove the impact of inflation.  Levelized cost reflects overnight capital cost, fuel cost, fixed and variable O&M cost, financing costs, and an assumed utilization rate for each plant type.”

The average LCOE from a new WTE facility is approximately $85 per megawatt hour.  This places WTE higher than combined cycle natural gas; comparable to onshore wind, hydro, and geothermal; and less than offshore wind, solar, biomass, coal with carbon capture and storage, and nuclear.  

This is comparable to other recently published values for WTE’s levelized cost, including those in a recent peer‐reviewed article by Duke University scientists ($94 / MWh)  and a 2014 report coauthored by Bloomberg and the Business Council for Sustainable Energy ($48 ‐ $130 / MWh) (see figure in the testimony).

In addition, WTE is a large source of low-cost GHG reductions upon which states can rely to meet their obligations under the Clean Power Plan.   

WTE facilities can achieve GHG reductions of 70 million tons (megatons) of CO2 equivalents per year, with a GHG abatement cost of approximately $9 per ton CO2e (2005$), if the U.S. moves to a more sustainable waste management practices modeled after the European Union.  

The abatement cost is comparable to that of onshore wind, and well below the cost of many other GHG abatement technologies including solar PV, biomass co‐firing, and coal electrical generation with carbon capture & storage as reported in the latest McKinsey GHG abatement cost report prepared for the United States.   

Incorporating WTE in the State Plan

The CPP clearly identifies WTE as an eligible compliance tool to displace electric generation from fossil fuel-fired electric generating units.  Since the Clean Power Plan is implemented by states, it is imperative that Pennsylvania include WTE as part of its approved state plan to ensure that the benefits of WTE can be realized in Pennsylvania.  

The type of state plan adopted can have a significant impact on the ability of a state to achieve its specific policy objectives.  

For example, in a rate-based state plan, only generation from post-2012 renewable facilities can be used by regulated electric generating units to adjust their emission rates.  This would make it impossible for existing (pre-2013) renewable facilities from monetizing their GHG reductions under the CPP.

States have greater flexibility to provide policy support to existing and new renewables (including waste-to-energy) under a mass-based plan through an allocation of allowances as well as complementary state measures.  

Pennsylvania’s compliance plan should support the investment in WTE made by local governments by ensuring that this reliable municipal waste infrastructure is supported with tradable compliance instruments (e.g. allowances).  

Under a mass-based plan, states should allocate allowances to existing waste-to-energy facilities in recognition of historic and future GHG reductions.  This support will provide financial stability to GHG-reducing WTE facilities, which operate in incredibly difficult markets dominated by cheap wholesale electricity, cheap landfilling rates, and extremely volatile commodity prices for recycled metal.  

Through support for existing, as well as new, WTE facilities, Pennsylvania can ensure that the investment made in WTE can continue to provide long-lasting GHG reductions.  

It is important to remember that if a WTE facility closes, and its waste supply is diverted to landfills, GHG gas emission in the state will increase immediately.  This risk can be mitigated by treating WTE appropriately in the state plan.  

The result will help protect local investment, keep disposal costs low for local governments, support local jobs and the economy, and reduce GHGs from fossil electric generators and landfills.

In summary, the Energy Recovery Council urges Pennsylvania to develop a state plan under the CPP that reinforces the Commonwealth’s solid waste hierarchy and supports the investment that local governments have made in waste-to-energy.  

Failure to support the waste-to-energy sector in the CPP plan will have the unfortunate impact of increasing the release of greenhouse gases, reducing renewable generation, and increasing the difficulty and cost of complying with the CPP.  Thank you.

A copy of the complete testimony is available online.

For more information and a schedule of the remaining sessions, visit DEP’s Climate Change webpage. Comments on the Clean Power Plan can be submitted online.  Click Here to see comments submitted by others so far.

[Note: Crisci Associates represents Covanta Energy which operates five energy-from-waste facilities in Dauphin, Delaware, Lancaster, Montgomery and York counties and an electronics waste recycling facility in Philadelphia.]

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