Presentation on theme: "Waste Management PPP: City of Johannesburg Alternative Waste Treatment Technology Project Municipal PPP Conference 18 February 2010."— Presentation transcript:
Waste Management PPP: City of Johannesburg Alternative Waste Treatment Technology Project Municipal PPP Conference 18 February 2010
2 Contents _______________________________________________________________________ Background Institutional Arrangements The Need Legislative Mandate Project Planning CoJ Process Lessons Learned
3 Proactive absorption of the poor Balanced & shared growth Social mobility and equality Settlement restructuring Sustainability & environmental justice Innovative governance solutions The GDS presents the City’s understanding of the longer term strategic direction and future efforts needed to accelerate growth and enhance development The GDS ensures harmonisation and alignment with National & Provincial strategies GDS developmental paradigm consists of six principles, which collectively reaffirm the City’s commitment to its Constitutional objects and duties Background ______________________________________________________________________________________ The Growth and Development Strategy
4 Background ______________________________________________________________________________________ The City’s Vision “In the future, Johannesburg will continue to lead as South Africa’s primary business city, a dynamic centre of production, innovation, trade, finance and services. This will be a city of opportunity, where the benefits of balanced economic growth will be shared in a way that enables all residents to gain access to the ladder of prosperity, and where the poor, vulnerable and excluded will be supported out of poverty to realise upward social mobility. The result will be a more equitable and spatially integrated city, very different from the divided city of the past. In this world class African city for all, everyone will be able to enjoy decent accommodation, excellent services, the highest standards of health and safety, access to participatory governance, and quality community life in sustainable neighbourhoods and vibrant urban spaces” Proactive absorption of the poor Social mobility and equality Settlement restructuring Sustainability & environmental justice Innovative governance solutions Balanced & shared growth
5 Background ______________________________________________________________________________________ Planning Instruments Precinct Plans / Development Frameworks / Community Participation 1 x SDF * 1 x IDP * 7 x RSDFs Jo’burg GDS Jo’burg GDS 13 Sectoral Plans
6 INFRASTRUCTURE AND SERVICES SECTOR SECTOR FOCUS AREAS KEY OUTPUTS WATER JOBURG WATER ENERGY CITY POWER WASTE PIKITUP DELIVERY OF BASIC SERVICES IMPROVE SERVICE DELIVERY WATER 1.MAXIMISE REACH 2.REDUCE BACKLOGS 3.REDUCE LOSSES 4.INFRASTRUCTURE UPGRADE ENERGY 1.MAXIMISE REACH 2.REDUCE BACKLOGS 3.REDUCE LOSSES 4.INFRASTRUCTURE UPGRADE 5.REDUCE OUTAGES WASTE 1.CLEAN CITY 24/7 2.IMPROVE OPERATIONAL EFFICIENCIES 3.MINIMISE WASTE TO LANDFILLS IMPROVING THE QUALITY OF LIFE OF CITIZENS Institutional Arrangements _______________________________________________________________________ Infrastructure & Services Sector
8 Institutional Arrangements Mandate ISD: Waste Sector Develops waste service delivery framework Ensure Pikitup delivers services in line with Agreement Monitors Pikitup performance Assess & verify Pikitup performance Reporting to Mayoral Comm & Portfolio Committees Tariff modelling & determination Implements strategic projects e.g LFG & Alternative waste treatment Technology projects.
9 Institutional Arrangements Pikitup Johannesburg (Pty) Ltd Municipal Owned Entity, 100% owned by CoJ Delivers waste services according to Service Delivery Agreement (SDA) Implements critical priorities as per GDS, IDP & other priorities Develops annual business plans outlining service levels, methods Renumerated by CoJ via service fee & Capex funding Reports monthly, quarterly & annually Mandate
10 The Need ______________________________________________________________________ Major growth period for the City Limited landfill airspace Difficulty to establish new landfills due to: –NIMBY & lack of suitable land –New Waste Act & Relevant authorities support for new landfills IDP requires 15% waste diverted from landfill
11 The Need ______________________________________________________________________ LandfillAnnual Tonnage (Tons) Current Airspace (Years) Knock-on Effect Linbro Park00_ Robinson Landfill279 5683_ Marie Louise186 48474 Ennerdale63727103 Goudkoppies156 547173 Private landfills (Chloorkop, Mooiplats) 200 000__ Total1 572 652_
12 The Need ______________________________________________________________________
13 The Need ______________________________________________________________________
14 Legislative Mandate ______________________________________________________________________ –The Constitution A right to an Environment that is not detrimental to human health Schedule 4 & 5 –National Environmental Management Act Duty of Care Polluter pays principle –Environmental Conservation Act Section 20 –Municipal Systems Act Municipalities to ensure universal access to essential services Integrated Development Planning (IDP) process –NEMA: Waste Act
15 Legislative Mandate ______________________________________________________________________ Polokwane Declaration –50% of waste away from landfill by 2012 –A plan for zero waste by 2022 CoJ IDP Targets –15% diversion of waste from landfill by 2010 –50% composting of waste by 2010 Currently only 5-7% diversion achieved
17 Project Planning ______________________________________________________________________ Why Waste Treatment Technology (Waste to Energy)? –Reduce waste to landfill by about 60- 80% –Electricity Generation –Potential for earning carbon credits –Proven technology world-wide; Europe leading
20 Comparison of treatment technologies Ref: COWI Treatment technology Is it proven?Cost (invest / oper / revenue) Landfill diversion Input qualityOutput risks MBT - aerobicYes. > 60 plants 10 years Proven I: Medium O: High R: Negative Low - no RDF) Medium - with RDF Size reductionRDF off-taker? Quality of recyclables Compost to landfill MBT - AnarobicYes > 30 plants 10 years Proven I: High O: High R: Low/neg Low - no RDF) Medium - with RDF Size reduction Structure/fiber material WtE moveable grate /rotary Yes > 1000 plants 100 years Proven I: High O: Low R: High High Very high if ash recycling Receives all except excess bulky FGT to H:h Ash recycling Pyrolysis /gasification No. Very few plants 5-10 years Not proven I: High O: Low R: High High Very high if ash recycling Size reduction and sorting Char, syngas user? Landfill of residue?
21 Project Planning ______________________________________________________________________ The optimum combination of technologies for an integrated waste management system depend on the following key decision-making parameters: –Landfill diversion targets –CO2 reduction / Environmental targets –Energy recovery and material recovery targets –Affordability targets (Capex, Opex, household levy /gate fee) –Procurement, ownership & financing strategy (risk allocation)
22 CoJ Process ______________________________________________________________________ 1. Mayoral Approval to initiate the project 2. RFI Issued 3. Feasibility Study Conducted in line with PPP guideline 4. Procurement process to follow involving: –RFQ –RFP 5. Appointment of preferred bidder
23 CoJ Process ______________________________________________________________________ Technical Feasibility Study 1. Needs Analysis – Summary of need for alternative waste treatment technologies in the City. 2. Technical Solutions Options Analysis – This is a full analysis listing Technologies available. 3. Technical Options to be considered for Johannesburg 4. Service Delivery Options Analysis- A full review of service delivery options carried out. 5. Proposed solutions 6. Summary and Recommendations.
24 CoJ Process ______________________________________________________________________ Other Aspects of Feasibility Study 1.Detailed Due Diligence of all the key issues associated with the selected options 2.Execution of a Value Assessment exercise in terms of affordability of the selection technical options as compared to avoided landfill costs 3.Risks & costing thereof 4.Detailed Procurement Plan for the various options 5.Submission of Report to Treasury & Council
25 CoJ Process ______________________________________________________________________
26 CoJ Process ______________________________________________________________________ Gate fees Income DescriptionUnit DescriptionUnits WasteTonnes/annum500,000 FeeRand per tonneR112 TotalRandsR56,000,000.00
27 CoJ Process ______________________________________________________________________ Refit Tariff Net electricity available for sale per annum R277,222,713.60 Price per KWh0.76 Total incomeR210,689,262.34
28 Electrical Connection Load Study –Linbro Complete - Eskom Connection –Other 4 sites Complete City Power connection Embedded Generation Application. Systems Use Agreement / Supplementary Supply Agreement.
29 Electrical Connection Generation plant Meters REPA/ ISO Municipality / Eskom Invoice for K W sold at REFIT tariff Invoice for K W sold at Eskom Tariff Power delivered to end user PPA between ENER-G and REPA PPA between Municipality and Eskom A three party agreement for systems use
30 Power Sale Agreement City Power was initially approached to purchase the power. NERSA, Renewable Feed In Tariff - April 2009. License application with NERSA - May Government Notice R.721 - Electricity Regulations Act (4/2006): Electricity Regulations on New Generation Capacity published in August 2009
31 Electricity Amendment Act NERSA to draft rules for Independent Systems Operator (ISO) REPA / ISO to purchase power from all Independent Power producers REPA / ISO Tender process Conditional upon; REPA needs Cost recovery Mechanism ( CRM) to be approved. IRP 1 - Integrated Resource Plan 1 National Treasury Support (Guarantee) for the costs of the program
32 CoJ Process ______________________________________________________________________ Key Considerations from Feasibility Study Site Selection Calorific value of the waste Hazardous landfill site Suitability of technology for CoJ purposes CoJ By-Laws Financing of the project How to address the risks & sensitivities
33 Lessons Learned ______________________________________________________________________ PPP process requires proper time management & project management Use the support from National & Provincial PPP Units Establish a multi-disciplinary Steering Committee Ensure to procure Transaction Advisor with prior PPP & Project Finance experience Being a 1 st in South Africa, international expertise is necessary Ensure Buy-in from Senior Management & Politicians