edit - At the November 7, 2018 DEP public hearing on Synagro's permit applications, Green Knight representative Robert Cornman, Jr responded to a citizen's question of "what is in this for the community?" by stating that Green Knight will receive "some funds" that will benefit the community. He didn't mention anything about the amount of funds - knowing the answer would displease anyone hearing the figure. Yet he promotes this horrible proposal.
Setting aside for a moment that no amount of money would ever compensate local residents or the communities within 50 or 100 miles for having Class A (90% dried) sludge spread on farmland, let's take a deep dive into the economics of this operation - and in the process see how Waste Management may profit handsomely from the proposed operation while the host communities and those within delivery distance become literal shitholes.
In Synagro's NPDES permit application to DEP it states that the product Synagro will process is 21% solids. There is industry data available that details the amount of energy required to dry-roast shit on belt conveyors, which is the same process that Synagro proposes. A chart published by Veolia Water Systems/Kruger on the "BioCon" dryer is presented, which has been marked up accordingly:
What the chart shows is that to dry 9523.8 pounds of "wet cake" to Class A biosolids (90% dry solids), just over 11 million BTU of energy is needed. Since there is 1000 btu in one cu ft of natural gas, and the industrial cost of natural gas in August 2018 was $9.38 per 1000 cu ft, we divide by 1000 twice to find that 11 cu ft of natural gas is needed. This is a fuel cost of $103.21 for 9523.8 pounds, or $21.67 per wet ton.
Recall that Synagro proposes to bake 400 tons of crap a day, so the cost of using 100% natural gas per day would be 400 * 21.67 = $8669.88.
Now let's compare to the cost of Green Knight's waste energy. At a planning commission meeting a few months ago, Synagro project manager Jim Hecht stated that Synagro plans to use 84% waste heat and 16% natural gas. So much for being the "green" project this is hyped to be - Synagro can't run on 100% waste heat. At $100,00 per year, Synagro will pay $273.97 per day for 16% of its baking costs. That is $273.97/(0.16 * 400) or $0.81 per wet ton.
Something stinks here:
- To heat with natural gas, Synagro pays $21.67 per ton
- To heat with Green Knight's waste heat, Synagro pays $0.87 per wet ton.
Synagro's fuel cost per day will be reduced to 0.84 * 400 * 21.67 + 0.16* 400 * 0.87 = $1387.18 + 273.97 = $1661.15, or $4.15 per wet ton. Jim Hecht also agreed in the past few months "this plant could run profitably running on 100% natural gas." In other words, Synagro could afford to pay $8669.88, but will only be paying $1661.15.
Let's look at how the plant could run profitably on 100% natural gas, and consider the consequence that Green Knight appears to be screwing citizens twice over - once for partnering in this operation, and twice for not receiving even 1/10 of fair market value for its waste heat. And in the process we will discover why Waste Management wants this so badly... It's green - money, that is.
There are several assumptions here, and they are shown. Since Synagro is not building a waste water treatment facility, the cost of the plant has been reduced $2m from an original estimate of $10m. The lowest paid employees (most of them) are estimated to earn $35,000 a year, and one or two lucky people $80,000. The waste water of this operation is loaded with ammonia and nasty. Assuming it doesn't leak into high quality water bodies and Synagro finds someone to take it, the cost of disposing it was estimated.
In the S&P 500, an 11% profit margin is typical. We have allowed for 18.6% here. Look at who the big winner of this shitty operation could be - Waste Management. They can pretty much charge what they want. Using the estimates above,
- Using 100% natural gas, Waste Management may receive $8000 per day or $2.9m per year
- Using 84% waste energy, Waste Management may receive $15000 per day or $5.5m per year
The assumption is that Synagro delivers the product for the cost of delivery - there is no need to charge for the product because it is so lucrative to haul the raw product away from sludge generators.
Once the landfill shuts down and the waste heat goes away because the landfill gas to energy plant is shuttered, Waste Management will remain on easy street for decades. And Synagro's trucks will be using a "street" that is actually Plainfield Township's recreational trail.
Did Waste Management dictate that Green Knight will only receive $0.87 for energy that would otherwise cost Synagro $21.67? There is evidence that Green Knight's lease with Waste Management that was just renewed for 20 years may have been used to leverage GK's participation with this project. At each of the planning commission review meetings this year, several Waste Management personnel have been in attendance. Now it is very clear that Waste Management is the driver of this operation, not Green Knight. Waste Management will very likely reap millions of dollars of income per year from this operation, while Green Knight gets table scraps of "up to" $100,000. You just could not make this shit up. "Slate Belt Heat Recovery Center" my ass.
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