By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
Rival proposals were too ambitious over the "enormous amount" of waste-to-energy they believe the New Providence landfill can generate, the winning bidder argued yesterday.
Kenwood Kerr, pictured, Providence Advisors' chief executive, told Tribune Business that the 15 megawatts (MW) of biomass-generated energy targeted by his group was deliberately "conservative" and designed to minimise any loss to Bahamas Power & Light (BPL).
Mr Kerr, whose investment house won the bid in partnership with the nine to ten Bahamian garbage management providers that make up the Waste Resources Development Group (WRDG), said the group's power plant could be "scaled up" and expand should the landfill's incoming waste volumes - and their energy-generating content - be greater than expected.
He argued, though, that it was better for the consortium to start small, with New Providence's population and waste volumes unlikely to be sufficient to support the amount of waste-to-energy predicted by some of its competitors.
The Bahamas WTP group, one of the final two rivals to Providence/WRDG, had proposed an 80 MW waste-to-energy plant that would supply 60-65 MW per hour to BPL, but Mr Kerr was sceptical that the landfill could fuel such amounts.
"Other stories have alluded to enormous amounts of mega watts to put on the grid," he told Tribune Business, "but those [scale of power plants] have proven to be very expensive in North America and Europe.
"We as a group decided to do something that was conservative, achievable and could be financed. Those were our priorities to get something on to the grid and not create loss to BPL; that was compatible with BPL. It's structured where it's expandable."
BPL will be incurring extra cost in purchasing renewable energy from the Providence/WRDG plant, and foregoing power it could generate itself, so Mr Kerr said the consortium did not want to undermine the utility's financial position by supplying huge quantities.
And, while Bahamas WTP's proposed waste-to-energy plant was six times' larger than the winning bidder's in terms of the maximum power it could produce, the Providence chief questioned its "sustainability".
Mr Kerr argued that industry experience has shown waste-to-energy plants with that output needed to be located in major cities or population centres where millions lived. New Providence, with its six-figure population, simply could not generate the necessary garbage volumes.
"By comparison I've seen news stories speaking to 80 MW, 65 MW. That requires a significant size of population and volume of garbage coming into the landfill which we don't have in New Providence, raising questions of sustainability," Mr Kerr told Tribune Business.
"We decided on something that was more achievable, conservative, expandable and applicable to the Family Islands as well. That was the premise from which we defined the amount of MW of power we wanted to produce for biomass.
"If we want to increase the size [of the plant], we can always increase the size on scalability. It's scaleable; that's the key. It wouldn't be disruptive to the financial modelling."
Mr Kerr said Providence/WRDG's renewable energy plant, which will also produce the same amount (15 MW) of solar, could be constructed within nine to 12 months of getting "all the 'i's' dotted and 't's' crossed" on the landfill contract with the Government.
He cautioned, though, that the consortium would also have to obtain the necessary regulatory approvals; negotiate a power purchase agreement (PPA) with BPL; and solve technical/engineering issues related to interconnection with BPL's grid before its supply of renewable energy reached end-users.
"We'll need to get Independent Power Producer (IPP) status and negotiate a PPA with BPL, all of which has to be in compliance with the Electricity Act 2015," Mr Kerr explained.
"We have to have grid compatibility. Once we pass the regulatory issues we go to the infrastructure ones. Power has to get on to the BPL grid. We're doing several things at once to cause that to be a fluid exercise."
Bahamas WTP, in a statement issued to Tribune Business on Monday, challenged the Government to ensure the winning bidder offers "the same or more" as its proposed $400m investment, up to 200 jobs and two renewable energy solutions.
Fay Russell, a Bahamas permanent resident and one of Bahamas WTP's principals, said it had proposed supplying BPL with waste-to-energy priced at 25 cents per kilowatt hour for the plant's first 10 years.
Describing this as a 50 percent reduction to present energy costs, he disclosed that the price paid by BPL would fall to 10 cents per kilowatt hours after that decade as Bahamas WTP would have recovered its construction costs and be generating the necessary return on investment (ROI).
The other remaining rival to Providence/WRDG, the Bahamas Waste/Bahamas Hot Mix group, had also proposed a waste-to-energy plant as part of its landfill solution. Peter Andrews, Bahamas Waste's chairman, writing in the company's annual report said: "In the next year, we will endeavour to put together a proposal for the remediation of the dump and a waste-to-energy plant to eliminate the need for a dump in the future."
Mr Kerr, meanwhile, said Providence/WRDG's $130m landfill transformation was "up there in terms of being one of the largest public-type infrastructure projects to-date, if not the largest" in Bahamian history.
"The project is significant in many respects," he told Tribune Business. "One is the environment and social quality of life issue. It's significant in being the largest PPP, it's significant in how it affects tourism and the quality of the visitor product, particularly the western infrastructure - Baha Mar, Albany and Lyford Cay - as the prevailing wind blows fumes in that direction.
"It's being led by a group of Bahamians who have a vested interest, not only from an economic perspective but being Bahamians who will benefit from all the social and qualitative elements. We're going to work as quickly as we can within the confines of the project, but there will certainly be visible changes in the operation of the landfill that will be seen and can be measured."
Mr Kerr said Providence/WRDG was targeting several 'quick wins' once it took over, including cleaning up the landfill's Tonique Williams Highway entrance and minimising traffic hazards, plus removing garbage from the roads.
While efforts will be led by a team of four-five foreign landfill experts, he added that the majority of employees will be Bahamians - a number of whom will be appointed as "understudies" and trained to take over, with knowledge transfer a priority.
Comments
Economist 5 years, 6 months ago
It will be interesting to see if 15 megawatts is realistic. Even that sounds ambitious. Good luck though, hope you achieve it.
Sign in to comment
Or login with:
OpenID