compa"'68
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An environmental protection publication in the solid waste management
series (SW-6p). Mention of commercial products does not constitute
endorsement by the U.S. Government. Editing and technical content of
this report were accomplished by the Resource Recovery Division of the
Office of Solid Waste Management Programs.
Single copies of this publication are available from Solid Waste
Information, U.S. Environmental Protection Agency, Cincinnati, Ohio 45268.
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USE OF SOLID WASTE AS A FUEL
BY INVESTOR-OWNED ELECTRIC UTILITY COMPANIES
Proceedings: EPA/Edison Electric Institute Meeting
This report (SW-6p) was prepared from minutes of the meeting
held March 5 and 6, 1975, in Washington, D.C.
by ROBERT A. LOWE
U.S. ENVIRONMENTAL PROTECTION AGENCY
1975
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PREFACE
The U.S. Environmental Protection Agency and the association of investor-
owned electric utility companies, the Edison Electric Institute, sponsored
a meeting in Washington on March 5 and 6, 1975, to discuss the factors
affecting a utility company's decision to use solid waste as a fuel. This
paper presents a summary of the discussions that took place at that meeting.
The meeting opened with a keynote address, presented by Dr. Donald
D. Dunlop, Vice President of Florida Power & Light Company. Dr. Dunlop
served as chairman of the meeting. There followed four concurent
workshop sessions: (1) Technical Aspects; (2) Air Pollution; (3)
Economics and Financing; (4) Contract Negotiating and Contract Terms.
The summaries of these workshops presented in this publication
reflect the major topics discussed at the meeting, although they are not
intended to provide a comprehensive discussion of those topics. The name
of the utility official who served as chairman for each workshop is
included in the proceedings.
The meeting was attended by over 100 persons, including almost 50
persons from over 40 utilities. About 35 Federal, State, and local
government officials participated in the conference. A list of
attendees is presented at the end of this paper.
It became apparent to me at this meeting that, in the interval
since the previous EPA/EEI Conference held in December 1973, government
and utility officials have acquired a better understanding of the concept
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of firing solid waste as a supplementary utility bo.iler fuel. Government
officials have come to appreciate the utility's apprehension about firing
a new fuel whose combustion properties and effects on boiler operations and
air emissions are not fully documented. Government officials are
also learning that, to an electric utility, reliable electric
generation takes priority over solving a community's solid waste
disposal problem and that each utility has its own special characteristics,
equipment, and problems that must be understood and accommodated.
Most utilities have recognized the advantages of accepting processed
waste: a stable supply of fuel at a net price comparable to other
fuels, and the appreciation of the public in performing a service to the
community. Utilities are now generally willing to cooperate with
governments to study the local feasibility of the concept, to initiate
large scale trial firings, and to enter into long-term contracts to
accept solid waste fuel.
This mutual understanding of benefits and problems is very encouraging
and indicates that utilities and governments will be able to work cooperatively
to implement systems where feasible. Both groups are to be
commended for their constructive and professional approach to energy
conservation and better solid waste management.
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But, as Dr. Dun!op points out in his address, not all the
problems are solved. And, in response to Dr. Dunlop's challenge,
a utility-industry task force is being formed, with EPA serving
in an advisory capacity, to propose solutions to the broad problems
while the dialogues between communities and utilities continue at
the local level.
—ROBERT A. LOWE
Office of Solid Waste Management Programs
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CONTENTS
Keynote Address: Electric Utilities and Solid Waste: 1
What Role Should We Play?
Technical Aspects Session 7
Air Pollution Session 15
Economics and Financing Session 20
Contract Negotiating and Contract Terms Session 23
VI
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KEYNOTE ADDRESS: ELECTRIC UTILITIES AND SOLID WASTE:
WHAT ROLE SHOULD WE PLAY?
by Donald D. Dunlop, Vice President, Florida Power & Light Company
The presence of each of us here this evening says very clearly
to me that utility involvement in the solid waste business is here:
the only question is what form shall it take and how deep shall the
involvement be?
This evening I would like to do a modified technology assessment
of solid waste handling as I see it, particularly with respect to its
relevance to the utility industry. Following this I would like to make
a suggestion as to what we, the utilities, ought to do in order to get
on top of this problem.
Introduction
With every human being disposing of about 4 to 5 pounds per day of
solid waste, our increasing population tells us very clearly that we have
a problem. Municipalities, strapped for money and technological expertise,
are increasingly faced with the problem of what they should do about solid
waste. Recent technological successes in the area of burning solid waste
to generate electricity have intrigued many in our society; and the
increasing cry is that utilities have a social responsibility or role
to play in this problem. I feel we must develop a positive response
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to this overture from society rather then pointing out the many problems
that would be faced with our involvement and the difficulties that we
would encounter. Perhaps the most important thing I think we need to
do is to decide jointly what we want. I increasingly hear pleas from
those in the environmentalist movement asking, "What do you want, utilities?"
I am often embarrassed that I cannot say what it is that we want; so this
evening, let's see if we can't review the problem, and I'll try to
interest you in a potential solution to the problem.
Information
Before attempting to solve any problem obviously we need to gather
some facts. The question is, just what information do we need to know
about solid waste? Simply stated, we need a systematic-appraisal of
alternative solid waste disposal approaches which take account of all
the costs involved. In table one, I have made an effort to summarize
what these costs are:
Relevant Costs of Alternatives
Solid Waste Disposal Systems
A. Dollar Costs
1. Collection costs
2. Transportation costs
3. Processing costs
4. Reclamation costs
5. Land costs
6. Cost of money (value of alternatives foregone)
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B. Energy Costs
1. Construction and operation of collection and disposal
equipment
2. Construction and operation of recovery facilities
3. Value of energy regained through combustion
4. Relative energy requirements in use of recycled vs virgin
materials
C. Resource Costs
1. Amount of raw materials reclaimed in processing
2. Amount of raw materials lost in disposal or combustion
3. Value of converted materials
D. Environmental Costs
1. Social/economic values
2. Air, water and land pollution
3. Land use considerations
Source: (An Analysis of the Role of Energy in Solid Waste Utilization and
Disposal: A Plan for the State of Florida, 2/14/75.)
We, as utilities, need to become fully aware ourselves that State
and local government planners know the relative advantages and disadvantages
associated with each of the many alternative schemes which are being
proposed to deal with solid waste. For example, they need to know
the following:
- Which process is most energy efficient?
- Which process creates the most useable energy?
- Which process has the greatest engineering compatibility
with the needs of the electric utilities and the customers
they serve?
- What long-term contractual commitments in terms of prices
availability, input resources, financing, tax provisions and
the like might electric utilities need if their relationship
is to be an equitable one for both sides over the long term?
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Electric utilities themselves need to explore very thoroughly
the whole problem of financing solid waste disposal and help governments
develop creative financial approaches for a variety of special situations.
Frankly, gentlemen, I was a little disappointed in talking with
those most knowledgeable of the technology and economics of burning
solid waste that there did not appear to be a unanimity of opinion
on the question of a viable tax climate: indeed, in some cases, the
question had not been carefully thought through.
Taxes are not the only incentives which might be required in
order to make the projects economically viable. Certainly the capital
gains treatment, investment tax credits, accelerated depreciation
provisions, perhaps depletion allowances, and other factors are
certainly relevant; however, there is also the question of discriminating
freight rates in rail, truck, and ocean shipping. There are also
restrictions on the type of carrier: U.S. vs foreign flag and union
vs non-union that may have an effect on the economics of a particular
project. Then finally, there are the production, safety, performance,
and procurement standards imposed both directly and indirectly upon
us by both Federal and State government.
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Project Format
Fortunately or unfortunately, the technology has developed to
the point where we might expect a liquid, solid, or gaseous fuel to
be produced from waste or the waste may be burned directly to
produce steam. In each case we have a myriad of technological
questions which must be answered before we will be able to determine
which of the variables is most appropriate to any given situation.
What Shall He Do?
In the past few minutes I've attempted to highlight the
situation as it has been explained to me by those much more
knowledgeable than I in the business. I hope this description
is a reasonably accurate one of the information that I have been
provided. The question now is, what actions should we begin taking
as electric utilities?
Throughout my discussion with the experts, one theme has
predominated. That is, that the economic question is completely
unresolved.
I'd like to propose an industry task force approach to solve
the problem. I think the task force should be interdisciplinary
and decidedly problem oriented and have the objective of working
with specific government agencies to make specific quantitative
proposals to get things moving in their areas of responsibility
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and authority. I think the membership should consist of electric
utilities only, however, I think EPA, EPRI, vendor trade organizations
and perhaps others should be represented on an advisory committee.
I think the authority of the task force should be to investigate,
to recommend and to report to the Administrators of ERDA, FEA, EPA,
and the Director of Internal Revenue. To further assist our cause,
it would be useful to submit our findings to the governors of the
several states as well as to the Congress of the United States and
the news and information media.
Having submitted its report, I think the task force should be
charged with the responsibility of doing the necessary contact work
to make certain that its recommendations are implemented. I think
we would be extremely remiss as an industry if we continue to say
"I don't know" when we are asked what will it take to make industry
municipality cooperation in the area of trash disposal economically
feasible?
Mr. Young of EEI and Mr. Hickman of EPA, I challenge you to
accept my recommendation. Set up the task force, and let's stop
talking about the solid waste problem. Let's solve it.
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TECHNICAL ASPECTS SESSION
David L. Klumb, Chairman
The Technical Aspects Session began with a summary of Union Electric
Company's (UE) area-wide system in St. Louis, described by David L. Klumb,
Chairman of this session and general manager of UE's Solid Waste
Utilization System. There followed a summary of the energy recovery
activities in the several communities that were represented. Finally,
three of the largest boilermakers offered their observations.
Union Electric Company's System
UE has designated its subsidiary, Union Colliery Company (UC) to
design, build, and manage a system that will: (l) accept 8,000 tons
per day of raw solid waste at transfer stations; (2) process the
waste at the Meramec Plant (2,000 tons per day) and at the Labadie
Plant (6,000 tons per day) to recover fuel, magnetic metals, and
i
other materials as markets develop; (3) burn the fuel fraction in
existing boilers as a supplement to coal; and (4) dispose of the
residue in an acceptable manner. UC is a wholly-owned subsidiary
of UE. UC has placed orders for about $25 million worth of equipment,
including air classifiers, hammermills, storage silos, and containers.
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Each processing line will be designed to handle 100 tons per hour.
Each line will include a 2,000 hp primary shredder, a 1.250 hp secondary
mill, 600 hp for air classification, and 400 hp in conveyors and
feeders, for a total of 4,250 hp excluding transfer stations and
transportation. Solid waste will provide up to 20 percent of the
boiler heat input. Waste fuel will be cut off automatically if the
boiler load drops below 75 percent of capacity in order to maintain
the proper flame temperature and to get good combustion of the waste.
DC plans to sell the burnable fraction of the processed solid
waste to UE at the equivalent cost of other fuel. UC is currently
unregulated. UC intends to comply with solid waste regulations and
expects UC's competition to do the same. UC has obtained approval from
the Missouri Environmental Improvement Authority to finance the project
through environmental improvement bonds and has filed a petition with
the U.S. Internal Revenue Service asking for a tax-free ruling on the
bonds. The IRS petition was filed November 6, 1974, but no ruling has
been issued. Start-up is scheduled for March 1977 at Meramec and in
June 1977 at Labadie.
UE is no more worried about solid waste corrosion than they are
about coal corrosion; it is considered a dollars and cents issue, not
a "stopper." Particulate emissions have not yet been clearly defind
(see section on Air Pollution). As to particulate size of the shredded
fuel, UE will shred the waste to 90 percent less than 1 inch. With respect
to pneumatic pipelines, UE is concerned with pipe erosion and the weight
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of the pipes on the boiler structure. To solve these problems,
UE is considering the use of ceramic-lined fiberglass pipes. However,
the cost of this pipe is higher than plain carbon steel, schedule 40
pipe; and no decision about pipe material has been made to date.
Status Reports on Other Systems
Ames, Iowa. Construction is nearly complete on this $2.8 million,
(including boiler modifications) 200-ton-per-day system. The primary
boiler is a tangentially-fired suspension unit; two stoker-fired
boilers will serve as back-up. Commercial operation is scheduled for
Summer, 1975. The system is patterned after St. Louis: first stage
shredding to 5 inches; magnetic separation; second stage shredding
to 1 1/2 inches; air classification; heavies to a Combustion Power
Company aluminum magnet, followed by screening to recover glass.
Fuel will be prepared eight hours per day, five days per week.
A 500-ton storage bin allows 24-hour operation. The project is
financed through 5.3 percent general obligation bonds. Fuel value
will be based on current coal costs.
The tangentially-fired boiler was manufactured by Combustion
Engineering, Inc. The waste fuel will be inserted just above the
top coal nozzle. By way of comparison, at Meramec UE fires solid
waste through the middle of five nozzles; UE is now considering
placing the firing nozzles higher and directing the waste fuel
downward. Waste fuel will replace 10 to 20 percent of the coal.
The unit is equipped with electrostatic precipitators.
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The spreader stokers were manufactured by Riley and have waste-fuel
nozzles placed 5 feet above the spreaders. Overfire air will be added
through additional nozzles just below the waste-fuel nozzles.' The units
are equipped with mechanical cyclone air pollution devices. The U.S.
Energy Research and Development Administration (ERDA) has funded a
$40,000 study of the air emissions from the stoker units.
Monroe County, New York and Rochester Gas & Electric Co. Monroe
County has begun a one-year effort to design a $25 million, 2,000 ton-
per-day system to recover fuel, magnetic metals, and non-magnetic metals.
The plant, expected to go into operation in three and a half years,
will consist of primary shredding (6-inch particle size); magnetic
separation; rotary drum air classifier; heavies to a trommel for
recovery of glass and nonferrous metals.
Rochester Gas & Electric (RG&E) has limited boiler capacity for
waste. Boilers will be retrofitted to handle high quality waste as
30 percent of heat input. The system will concentrate on maximizing
the quality of the fuel, which will represent 50 to 60 percent of the
weight of the incoming raw solid waste. RG&E is considering having
a final shredding to about a 1 -inch particle size just before injection
into the boiler to minimize the chances of fire or explosion.
RG&E's fuel specifications call for moisture content, less than
25 percent; particle size, 100 percent less than 1 inch; and ash
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New York City. The City has engaged Horner & Shifrin, Inc.. to
develop a preliminary design for a processing plant and boiler
modifications for a system to produce shredded fuel and burn it in
Consolidated Edison's oil-fired Arthur Kill boiler (unit 20). This
is a front-fired boiler manufactured by Babcock & Wilcox.
Power Authority of the State of New York (PASNY). PASNY has
issued specifications for a new boiler to burn either coal or oil
in combination with 4500 tons per day of prepared solid waste. The
waste fuel would provide up to 30 percent of the boiler's heat input.
Comments of Boilermakers
Babcock & Wilcox. B&W noted that ignition of the waste fuel
must come from the heat provided by the burning of the primary fuel.
To burn in suspension the waste particles must have a surface-to-mass
ratio such that they can absorb heat, ignite, and burn in the time
period they are in the furnace. Shredded newspaper will burn in
suspension, but the dense, heavy material such as wood, leather, citrus
rinds, etc., will end up in the ash pit without burning. They would have
to be pulverized to burn in suspension. To distribute the waste fuel more
evenly throughout the furnace, B&W is considering the installation of a
burner instead of just a nozzle where the waste fuel enters the furnace.
Cyclone Furnaces, says B&W, worked beautifully when wood bark was
burned with coal (wood bark provided up to 50 percent of heat input) by
the International Paper Co. B&W expects that a cyclone-fired boiler
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could handle waste at 50 percent of heat input adequately if the fusion
temperature of the ash in the waste is such that the ash will remain
liquid at the temperatures existing in the Cyclone Furnace and the
primary furnace.
Combustion Engineering. Inc. CE reported that European experience
in burning municipal refuse as a fuel in utility type steam generators has
been with a relatively large percentage of total heat fired from refuse.
Significant high temperature corrosion has been experience on furnace wall
tubes and high temperature superheater sections when fired in combination
with oil. When fired in combination with coal, corrosion has not been a
major problem.
The Europeans utilize only grate firing and burn unprepared refuse.
This method of firing results in a constantly changing reducing and
oxidizing atmosphere which is conducive to high rates of metal wastage on
high temperature steam generator heating surfaces. There is no complete
concensus as to the corrosion mechanism other than it being a high
temperature liquid phase phenomenon.
The United States' approach to burning municipal refuse in utility
type steam generators has been with prepared refuse and in quantitites
which represent a smaller percentage of the total heat fired. Additionally,
pneumatic firing of prepared refuse in a tangential firing system assures
operation with an oxidizing atmosphere in the furnace. These basic concepts
offer distinct advantages over the European method of firing municipal
refuse and have been satisfactorily proven at the Meramec station of
Union Electric Company.
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Based on this experience, CE has no reservation on firing prepared
refuse in combination with coal. With oil, however, CE would recommend
a more cautious approach until sufficient experience is obtained in
establishing the affects of potential corrosion on unit availability.
Units designed initially for coal are generally suitable for
retrofitting for refuse firing with minimum modifications. More extensive
modifications would generally be required to retrofit units designed
initially for oil and gas only, as provisions for bottom ash removal would
be required. CE recommends that a complete study be made on a unit to
unit basis to define additional parameters which would affect satisfactory
operation when firing prepared refuse.
Foster-Wheeler. F-W manufactured Union Electric Company's Meramec
Unit 4 and will modify it to burn solid waste as part of UE's area-wide
system. Unit 4 is an opposed-fired boiler. Waste-firing nozzles will
be installed in the front of the boiler, 30 feet above the existing bank
of fuel burners, and in the back of the boiler, 10 feet above the existing
bank of fuel burners. The front wall nozzle will be directed downward
toward the hot core of the fire; the rear wall nozzle will fire horizontally.
To transport the waste fuel into the boiler, one to two pounds of air will
be used for each pound of fuel.
Regarding corrosion, F-W suspects that metals in the waste may be
the cause.
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General Comments
Mr. Klumb pointed out that, even with shredding and air classification,
there is not complete homogenization of the waste fuel. Moisture content,
ash content, and heating value vary considerably from day to day.
The boiler manufacturers expect that the higher temperatures in
newer boilers will permit increases in the rate of firing solid waste
fuel.
On the subject of particle size, Mr. Klumb indicated that particle
size specifications are largely subjective. The.main reason for requiring
a smaller nominal particle size (90 percent less than 1 inch) is to reduce
the occurence of oversize particles and to provide more complete burnout
than has been experienced with the 1 1/2 inch nominal size used in the
prototype.
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AIR POLLUTION SESSION
Sam C. Brown, Jr., Chairman
This session began with a summary of the results of the air emission
test conducted by Midwest Research Institute for EPA and by the Union
Electric Company in Fall 1973. Followina a discussion of the
test results and test procedures, the applicability and requirements
of Federal and State air pollution standards were discussed.
Results of the 1973 Air Emission Tests at St. Louis
James D. Kilgroe, of EPA's Control Systems Laboratory, summarized
the St. Louis/Union Electric Refuse Firing Demonstration Air Pollution
Test Report. This report presents the results of air emission tests performed
independently by Midwest Research Institute (MRI) and by the Union
Electric Company (UE) from October thru December, 1973, as part of
the Environmental Protection Agency's (EPA) comprehensive evaluation
of the St. Louis demonstration project. (This project is being conducted
by the City of St. Louis, UE, and EPA to demonstrate the use of prepared
solid waste as a supplementary fuel in a coal-burning electric utility
boiler.) MRI employed the EPA approved testing method to measure particulate
and gaseous emissions. UE employed the American Society of Mechanical
Engineers testing method to measure particulates only.
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Based on the MRI tests, it appears that most gaseous emission (sulfur
oxides, nitrogen oxides, and mercury vapor) are not significantly affected
by combined firing of waste and coal. Hydrogen Chloride may be increased
by about 15 percent.
The mass concentration of particulates at the inlet of the precipitator
was in the same range for all coal and coal-refuse tests. The firing of
refuse resulted in changes in the electrostatic precipitator operation as
characterized by increased sparking rates and decreased power levels. These
changes in operating characteristics were coincidental with performance
losses on the UE tests but not on the MRI tests. It is concluded that ESP
performance losses on the UE refuse resulted from a combination of increased
gas flow rates, and particle composition charges—plus possible non-optimum
precipitator settings. All of the performance losses on the UE coal-refuse
tests may not have resulted from refuse firing. Changes in coal firing
conditions may have played an equally important role.
The ESP performance data for the UE and EPA/MRI coal tests did not
agree. This apparent shift in baseline conditions; may have resulted from
(1) the pre-test history of refuse firing, (2) performance changes not related
to refuse firing or (3) differences in outlet grain loading resulting from the
different test methods used. Therefore, the quantitative effect of refuse
firing on ESP performance cannot be established on the basis of the
October-December, 1973 tests.
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The report recommends that further tests be conducted to complete
the characterization of particulate emissions and to support the develop-
ment of Federal and State air emission control standards. In response
to this recommendation, a second series of tests, conducted independently
by EPA and UE were initiated in late 1974 and are expected to be completed
by mid-1975.
Several of the workshop participants, in commenting on the Fall, 1973
tests, made the following recommendations for consideration in planning
future tests:
1. that more data are needed to indicate what ESP design changes are
needed for improved performance. This includes correlations of ESP
efficiency with sulfur emissions, moisture content of the waste and
coal, gas flowrate, and inlet loading.
2. that a portable model precipitator be installed at Meramec
to avoid the problems associated with the location of test
ports in the existing ESP ductwork.
3. that, if additional air pollution control is necessary,
it may be more economical to install a mechanical cyclone
collector ahead of the ESP.
4. that optimizing the ESP collection plate rapping cycle
may improve ESP collection efficiency.
Federal and State Regulations
Under the authority of the Clean Air Act of 1970, on December 23,
1971 EPA issued Standards for Performance of New Stationary Sources
(usually referred to as New Source Performance Standards, or NSPS)
for fossil-fuel fired steam generators and for incinerators.
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These standards set emission limitations for all "new sources" of each
type of source. A "new source" is defined as a source, the construction
or modification of which commenced after August 17, 1971. (Reference:
Federal Register. Vol. 36, No. 247—December 23, 1971, pages 24876-
24895.)
Sources for which construction or modification commenced on or
before August 17, 1971, are considered to be "existing sources," to
which State and local requirements apply. The question arose
as to whether retrofitting an "existing" fossil-fuel steam
generator constituted a "modification," thus bringing the
source within the coverage of the NSPS. On June 14, 1974, the
NSPS were amended specifically "to clarify that the performance
standards for steam generators do not apply when an existing unit
changes to accommodate the use of combustible materials other than
fossil fuel as defined in Section 60.41 (b)." (Reference: Federal
Register. Vol. 39, No. 116-June 14, 1974, pages 20790-20794.)
Similarly, Federal new source performance standards for incinerators
do not apply when an existing unit changes to accommodate solid waste.
(Reference: Official interpretation by Richard D. Wilson, Director,
Division of Stationary Source Enforcement, EPA, in a letter dated
November 29, 1974, to Nicholas Number, Director, Resource Recovery
Division, EPA) Therefore, existing sources that are retrofitted
to burn solid waste in combination with fossil fuel remain under
the State Implementation Plans, which are designed to meet natural
ambient air quality standards.
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Another question also arose about the standards for "new sources"
that are either originally designed or subsequently modified to burn
solid waste in combination with fossil fuels. No determination has
been made as to whether the NSPS for steam generators or for incinerators
do or do not apply. EPA's Office of Air Quality Planning and Standards
is currently doing analyses to decide whether a new standard for
combined firing can or should be promulgated.
Any utility (or other operator of a fossil fuel steam generator)
that requires further information or clarification should write directly
to EPA's Regional Offices or to Richard D. Wilson, Director, Division
of Stationary Source Enforcement (EG-341), U.S. Environmental Protection
Agency, Washington, D.C. 20460.
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ECONOMICS AND FINANCING SESSION
Carlyle W. Fay, Chairman
Firing solid waste fuel is not a technical problem but an economic
one. Firing waste is economically possible in many cases, and investor-
owned utilities are a viable market.
Some utilities are willing to purchase waste-derived fuel at a
break-even price. Their objective is not to make money; fuel riders
preclude this by requiring utilities to pass any fuel cost savings or
increases to the rate payer. Nor is it the utilities' objective to
lose money for firing waste fuel, because the utilities' first responsi-
bilities are to rate-payers and stockholders.
The value of the waste-derived fuel is a function of the cost of
the utility's fossil fuel and the quantity of fossil fuel replaced by
the waste-derived fuel. For example, if a utility is buying coal at
$.50 per million Btu's (British thermal units), and if one ton of
waste-derived fuel contributes six million Btu's to the boiler's heat
requirements, then that ton of waste-derived fuel is valued at $3.00
(six million Btu's times $.50 per million Btu's). The value of the
waste-derived fuel should be the usable energy measured by the amount
of fossil fuel saved by burning waste-derived fuel. The value of the waste-
derived fuel may be discounted (reduced) by additional costs that the utility
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must incur in order to fire the waste-derived fuel. These costs
include operating and maintenance costs and the amortization of
capital for plant modifications.
The majority of utilities will not and-do not care to make
money by burning solid waste. However, some utilities, such as
Union Electric Company, are considering the creation of profit-
making subsidiaries to process solid waste to recover fuel and
other materials. These utilities view solid waste processing as
a risk venture that may provide a profit and that also serves the
public interest in creating a solution to the solid waste problem.
The major economic question is the capital investment: who
pays for it and who assumes the responsibility for it?
There are indirect economic benefits from firing solid waste.
First, the utility is assured of a small but steady supply of fuel.
Secondly, by firing solid waste, the utility earns a certain measure
of political or public relations benefits. Conversely, some utilities
are motivated to fire solid waste in order to avoid adverse public
reaction that would result if the utility refused to fire solid waste.
In the opinion of the utilities that attended this session,
the state public service commissions, which regulate investor-owned
utilities, probably do not object to utilities firing solid waste
provided that:
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1. the reliability of electric generation is not impaired,
2. the utilities' ability to acquire capital is not jeopardized,
and
3. the net cost to the rate-payer is not increased.
If utilities proceed into the business of operating plants to process
waste, the public service commissions probably would not oversee
this new line of business. However, they.would want to be assured
that this new function is not subsidized in any way by utility
if ate payers.
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CONTRACT NEGOTIATING AND CONTRACT TERMS SESSION
Eugene C. Bailey, Chairman
Agreements between communities and utilities can provide for the
use of solid waste as an energy source in three ways:
1. The utility accepts the raw solid waste, processes it,
uses the fuel, sells other products, and arranges for
the disposal of residuals. Example: Union Electric Company.
2. The utility accepts or buys prepared waste-derived fuel
that has been processed by a community or a private company.
Examples: Commonwealth Edison Co. (Chicago), Wisconsin
Electric Power Co. (Americology, Inc./Milwaukee), Rochester
Gas & Electric Company (Monroe County).
3. The utility purchases steam or electricity. Examples:
Baltimore Gas & Electric Co. (Baltimore), Long Island
Lighting Co. (Hempstead, N.Y.).
Many factors influence the final choice of details of any
agreement, including what body has collection responsibility and
whether it is public or private; and the location of electric
generating plants and waste processing plants.
Prices for waste-derived energy should be tied to the price
the utility pays for alternative (fossil) fuels on the basis of
Btu's replaced. This should be modified (discounted) by the
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incremental costs to the utility for firing the waste fuel. In at least
three cases (Chicago, Milwaukee, and San Diego), the price that the
\y
utility pays for the fuel will be determined after a six-month trial
period, during which a history of operating and maintenance costs
will be established. Contracts should be re-examined periodically
to update cost and price terms.
Both parties should be prepared to provide maximum, long term
operability of the jointly-chosen system without threatening the
future operations of either party. Neither party should expect to
make a profit.
Goodwill and cooperation between supplier and user are essential
if agreement on details is to be reached. The support of top management
of both sides is equally important. Both sides must understand the
economic, technical, and political priorities and concerns of the
other. For example, utilities must be permitted to refuse to
accept waste-derived fuel at any time for good cause, such as
emergency maintenance on the boiler or boilers designated to fire
the waste-derived fuel. While goodwill and cooperation by individuals
and organizations are essential, they do not obviate the need for
precise contract terms to specify the responsibilities and entitle-
ments of each party.
24
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Conference Attendees
James Abert
Eugene Bailey
A.J. Banks
James L. Barker
C.R. Beyer
Ralph J. Black
Shelley M. Bostick
Sam C. Brown, Jr.
Robert E. Butz
Peter Cambourelis
Howard Christiansen
Douglas E. Clark
R.T. Combs
J.J. Cordaro
M.J. Corson
John Copeland
Michael DeBonis
Alton Donnell
Donald Dunlop
George Elder
Jerry Elmonson
Carlyle (Bud) Fay
Richard Fenton
Val A. Finlayson
P.M. Forster
Edward Fowlkes
Ira L. Freilicher
A.M. Frendberg
Robert B. Freitas
Raymond Giglio
J.M. Gulbronson
Thomas Hamill
G.L. Heins
Harvey Hershman
Lanier Hickman
Kenneth Higbie
Joseph Hodder
Robert Holloway
Ronald C. Holmes
Case Houson
Merlin Hove
James Lee Hudson, Jr.
Nicholas Humber
National Center for Resource Recovery, Inc.
Commonwealth Edison Company
Ebasco Services, Inc.
Development Sciences, Inc.
Federal Energy Administration
OSWMP, EPA
Tennessee Valley Authority
Virginia Electric & Power Company
Public Service Electric & Gas Company
Raytheon Service Corp.
Monroe County, New York
Baltimore Gas & Electric Company
Virginia Electric & Power Company
Louisiana Power & Light Company
Rochester Gas & Electric Corporation
OAQPS, EPA
EPA, Region II
Federal Power Commission
Florida Power & Light Company
State of Georgia
Public Service Co. of Oklahoma
Wisconsin Electric Power Company
City of New York
Utah Power & Light Company
Dayton Power and Light Company
Federal Power Commission
Long Island Lighting Company
Babcock & Mil cox
Hawaiian Electric Company, Inc.
Central Maine Power Company
Foster Wheeler Corporation
City of New York
Consumers Power Company
National Center for Resource Recovery, Inc.
OSWMP, EPA
Bureau of Mines, Dept. of Interior
New York State Electric & Gas Corporation
OSWMP, EPA
Minnesota Power & Light Company
San Diego County, California
Ames Electric Utility
Tampa Electric Company
OSWMP, EPA
25
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Gil Jackson
Andrew C. Johnson
Warren Kane
Hugh B. Kaufman
James Kilgroe
Paul E. Klisiewicz
David L. Klumb
Joseph Koyago
Herman Leibovitch
Ira Leighton
Steven Levy
Steven Lingle
Robert A. Lowe
James S. Luker
Robert Mauro
Joseph Mullen
T.F. Mitchell
D. Bruce McClenathan
Martin J. McCormick,
William McKinney
Stephen Naeve
A.J. Ormston
Arthur Padrut
Robert C. Paladino
Howard R. Palmer
S.L. Pernick, Jr.
Howard Poppleton
W. Porter
Robert Randol
Robert A. Riscica
Jacqueline Rogers
Charles V. Runyon
R.H. Schultz, Jr.
J.J. Scoville
Roland Schmidt
Bill Schremp
Paul Sheehy
Harvey Shell
Alan Shilepsky
Elmer Simmons, Jr.
John Skinner
Bernhard H. Smith
Robert B. Smith
Robert H. Sowyer
Charles L. Steel
David B. Sussman
Wayne Sutterfield
John M. Telesh, Jr.
Jr.
National Center for Resource Recovery, Inc.
Public Service Electric & Gas Company
Iowa Public Service Company
OSWMP, EPA
CSL EPA
Northeast Utilities
Union Electric Company
Atlantic City Electric Company
Union Electric Company
EPA, Region I
OSWMP, EPA
OSWMP, EPA
OSWMP, EPA
Southern Indiana Gas & Electric Company
American Public Power Association
Combustion Engineering
DeKalb County, Georgia
Delmarva Power & Light Company
Philadelphia Electric Company
District of Columbia
Houston Lighting & Power Company
Florida Power Corporation
Wisconsin Public Service Commission
Edison Electric Institute
Dayton Power & Light Company
Duquesne Light Company
Bureau of Mines, Dept. of Interior
Wisconsin Solid Waste Authority
OSWMP, EPA
Consolidated Edison Co. of New York, Inc.
Montgomery County, Maryland
Ohio Edison Company
Virginia Electric & Power Company
Potomac Electric Power Company
State of Maryland (Air program)
EPA, Region III
Lowell, Massachusetts
State of Missouri (Air program)
OSWMP, EPA
Cincinnati Gas & Electric Company
OSWMP, EPA
Combustion Engineering, Inc.
Jersey Central Power & Light Company
Pennsylvania Power & Light Company
Arkansas Power & Light Company
OSWMP, EPA
City of St. Louis, Missouri
Orange & Rockland Utilities, Inc.
26
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John P. Thomas, Jr. City of Tulsa, Oklahoma
Nelson R. Tonet Duquesne Light Company
Robert R. Watson Pennsylvania Power & Light Company
George C. Wiedersum Philadelphia Electric Company
Cliff Willey Maryland Environmental Services
Bill Williams DeKalb County, Georgia
Jim Wilson EPA, Region V
Nathan L. Wilson Delmarva Power & Light Company
H.J. Young Edison Electric Institute
Robert Zralek City of Chicago
Morris Zusman Federal Energy Administration
ua!197
27 oU.S. GOVERNMENT PRINTING OFFICE: 1975 631-107/869 1-
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