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Venture aims to mine millions from trash

W.Va. company planning to turn waste into energy at Washington County landfill

August 18, 2013|By C.J. LOVELACE | cj.lovelace@herald-mail.com
  • Washington County Administrator Gregory B. Murray said a proposed plant to turn waste into fuel pellets at Forty West Landfill could bring significant monetary benefits for the county. In the past year, the county budget has been hit by a nearly $800,000 shortfall for operation of the landfill.
By Yvette May/Staff Photographer

A West Virginia company has been given the initial go-ahead to begin planning a waste-to-energy operation that would be built at Washington County’s Forty West Landfill west of Hagerstown.

The company, America First Inc., is headed by President Kevin Whited, who went before the Washington County Board of Commissioners on Aug. 6. The board voted 4-0 to give the planning process of the public-private partnership a green light.

Commissioners President Terry L. Baker abstained from the vote, saying he did not have enough information to take a position one way or the other.

Baker later said he didn’t vote because the item wasn’t presented on the commissioners’ agenda as other items typically are, with a recommended motion from county staff.

“When information comes forward to the commissioners, normally we know if we’re going to make a motion or not ... so I just wasn’t comfortable because our agenda didn’t state that we would be voting,” Baker said.

In emails to The Herald-Mail last week, County Administrator Gregory B. Murray said America First was created in 2006 to identify and research components of alternative fuel technologies, then bring together partners that have equipment, as well as financiers with access to capital, to implement a process that turns municipal solid waste into alternative fuel sources as an end-product.

“They are the facilitators, the entrepreneurial end that puts everyone into a package,” Murray said.

The group’s proposal calls for a phased approach, which would include building a plant to turn waste into fuel pellets and reduce the volume of trash going into the Forty West landfill by 95 percent, Whited told the commissioners.

The first phase would require an investment of about $12 million from the group, while the second phase, which would include expanding the facility to produce a synthetic liquid fuel through gasification, would cost around $50 million, Whited has said.


The county’s part

What does the county contribute?

The short answer: Just the land on which the plant would be built.

Murray said the county would allow the group to use about 15 acres of land at the landfill just off U.S. 40 for its “refuse-derived fuel” plant, which would produce pellets that are comparable to coal, but burn cleaner.

The county would receive 40 percent of the money generated by the sale of the fuel pellets, or about $50,000 to $75,000 per month, without any required up-front costs, Whited said at the Aug. 6 meeting.

“We have no up-front cost. We have no financial obligation to it,” Murray said. “We just simply provide space for it and the fuel for it, which is the trash that is coming in.”

That trash — daily intake waste, along with refuse already buried at the landfill — provides the sustainable base of “raw materials” for the operation. Recyclables would be removed from the waste and the rest would be used to make the pellets.

Digging up, or “mining,” existing mass of solid waste greatly extends the 100-year expected life span of the landfill, Murray said.

Murray said the project has huge monetary benefits for the county, which, in the past year, has been hit by a nearly $800,000 shortfall for landfill operations. That shortfall has required the county to tap other funding sources.

America First estimates that first-year revenue for the county from the operations would be $866,000, bumping up to several million dollars annually if both phases are completed.

Murray said the money coming in could cut the county’s total debt by 50 percent over a 10-year span, potentially bringing in $2 million annually when the plant is completed and functional.

The revenue generated will be available to address shortfalls and debt-service obligations, freeing up the county’s enterprise funds, he said.

“The other thing is, as we start to mine waste, the less leachate is generated,” Murray said. “All those intangibles, the amount of money that we spend right now on equipment and replacing equipment ... that won’t be there anymore.”

While a full financial analysis has not yet been done to verify the full scale of phase two of the project, Murray said the initial phase still would be worthwhile.

“If we do nothing but phase one, we’re fine,” he said.


Who will build it?

Repeated attempts to reach Whited for comment by phone and email over the past week were unsuccessful.

Asked why, Murray said in an email Wednesday that Whited has “agreed that he would not speak to anyone until we have the final negotiated contract signed that details who does what, and final numbers that comes back” to the commissioners.

“Everything is to come through us so they do not speak out of turn,” Murray wrote.

The “they” to whom Murray referred includes Whited and several partners — a team that Murray said includes a design firm, a biotechnology equipment company, patent holders and financiers behind the scenes.

GAI Consultants, a design firm with offices across the eastern United States, will serve as the engineers for the team, according to Murray. He also identified New Hampshire-based Continental Biomass Industries as the equipment provider.

Murray said the county has met personally with America First’s investors, which include “Wall Street” financiers with “green portfolios” that represent some large insurance firms.

The investors “decided that they wanted to invest in green technology in Washington County,” Murray said.

With rising maintenance costs and tightening environmental regulations, the traditional burial method of waste disposal has put a strain on local governments in recent years.

Murray said the county has, over the past three years, been looking into avenues for increasing renewable energy initiatives, and the America First group has been in the picture for about a year.

“It definitely has not been done quickly,” he said.

Asked about America First’s track record and apparent website, www.americaleading.com, which appears to have not been updated since 2011, Murray said in the email “there is none.”

“They have a simple page that has their name on it,” he wrote, explaining that the team is made up of a group of entrepreneurs and that “each has a specific background.”

“Along with their technical adviser that has the background and patent for phase two of the project, they have been assembled specifically for their expertise based on the requirements and goals for this project under the new project name,” Murray added.

“Their technical partners identified in the presentation (to the commissioners), including the equipment manufacturer and engineering firm ... were selected for the specific needs with these types of processes in other locations,” he wrote. “All of this is brought together to make us a leader in the state in zero-waste facilities.”

Many communities across the state — and the nation — are striving to gain the distinction of being able to claim they are “zero-waste” locations, a growing initiative that aims for increased sustainability.

Murray said being a zero-waste county can be a strong economic development tool, especially with companies that market themselves as environmentally friendly.

Will this company remain committed to Washington County after the proposed waste-to-energy plant is up and running? Murray said it will.

America First currently is a home-based operation in Summit Point, W.Va., but with this project, Murray said, the company plans to establish a corporate office in the county, bringing all of the partners to a central location “and expanding from there.”

“We have already had inquiries about how to get them to customize projects for other locations,” he wrote.


The process

At this point, the county is not locked into anything. The commissioners’ Aug. 6 vote gave approval for America First to begin initial planning for its “waste recovery facility.”

As Murray pointed out during that meeting, several steps must take place before construction could begin. Those steps would include holding public hearings and going through the permitting process.

The Maryland Department of the Environment would need to inspect and sign off on the plans for the first phase of the project before any other county approvals can be given, Murray said. That process typically takes six to nine months.

Murray said the county also has to modify its solid-waste plan for the project to become a reality.

The county met July 29 with MDE personnel, informing the state agency about the joint venture with America First, MDE spokeswoman Adrienne Diaczok said.

Diaczok said the county will be required to report back to MDE when, and if, the two parties decide to proceed.

Whited told the commissioners that his company has had a “very favorable” meeting with MDE to discuss the project.

If built, the phase-one plant would utilize a series of processes to remove metals and other recyclable materials and/or materials not usable for fuel, Whited has said. The remainder would be ground down into a fuel that then can be compressed into pellets.

Murray said the production of the pellets would take place within an enclosed building, which would mean less noise and lower emissions than those generated by an open-cell operation.

Also part of phase one, a pilot plant for a full-scale gasification plant would be built to convert high-energy gas into liquid biofuels for transportation applications such as gasoline or diesel, Whited has said.

If all goes well, phase two would include an expansion of the gasification plant, increasing production to about 700 barrels of biofuel per day, he has said.

The county would share in the revenue generated by the sales of both cleaner-burning fuels, including about 30 percent of the biofuel sales, Whited has said.

Once ground is broken for construction, officials have estimated that phase one would be up and running within six to eight months, and phase two would be completed within 12 to 18 months.

Murray said other communities in Maryland have implemented similar waste-to-energy facilities, including Montgomery County and Elkridge. The implementation of renewable energy gasification facilities is on the rise globally as well as nationally, he said.

“This is going to be very interesting,” Murray wrote in an email. “It is gaining notoriety and is going to be a widely used model.

“We’re pretty pleased to be on the cutting edge ... so we can make this project not only noteworthy in the State of Maryland but also nationwide,” he added.


Funding plans

The financing for the project would come from private sources, according to Murray, who said the first $12 million already is secured and available.

“We met with the financiers who are Wall Street types representing insurance companies that want more of a green portfolio,” Murray wrote. “I was impressed by their research (and) knowledge of Washington County. They like what they saw and want to invest here.”

The second phase of the project would be paid for with a combination of revenue generated from phase one and additional private financing, Murray said. He said there would be no reliance on state or federal grants, “but I am sure they would be happy to use them if they become available.”

Washington County will not face any liability for the debt of the project, he said.


What the commissioners say

Although Baker did not vote at the Aug. 6 meeting, he said the commissioners have “had some discussion” about the proposed facility.

“I’m very comfortable with the company, personally,” Baker said.

Commissioner William B. McKinley said the five-member board has been assured by county staff that America First and its partners have “strong credentials.”

“Our belief after listening to staff ... is that they are a legitimate group,” McKinley said. “We did talk to them personally in executive session.”

“I think it’s one of the more exciting things to come down the road,” he said. “There are so many positives.”

McKinley said one of the biggest positives of the proposed plan is that most incoming waste will never make it to the landfill, and capacity will be added through the mining process.

Whited has told the commissioners that between 40 and 70 people would need to be hired to work at the plant.

McKinley said the money that would go to the county isn’t bad either.

“When we take a look at our deficit at the landfill, about $800,000, the idea of helping make money is very exciting,” he said.

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