Supercritical Water Oxidation Update

City Council WorkshopApril 25, 2011

17.4 MGD (40)

13.1 MGD (25)5.1 MGD (7.5)

Iron Bridge

Rulemaking Updates

“The management of residuals, both nationally and in Florida, has grown increasingly controversial as development has brought people and residuals sites closer together. Indeed, several local governments have recently adopted or are considering restrictive residuals ordinances. Concerns with the beneficial use of residuals are clearly a statewide issue and the Department wants to review and address these concerns.”

Long Term Planning Considerations

• After excessive rain in 2004, we had difficulty finding suitable land application sites

• Recognized that proposed rule changes would make land application difficult if not impossible

• Tasked staff with finding a long term solution that would eliminate our dependence on land application

Long Term Planning Considerations

• In 2005, team of Boyle Engineering and Black & Veatch evaluated options that provided an all weather solution and didn’t rely on landspreading

• Team reviewed available technology and developed a short list consisting of:–Pelletization– Incineration–SCWO

Incineration

Pelletization

SCWO

What is SCWO?• Supercritical Water Oxidation uses high pressure and

temperature water to treat sludge• Organic material dissolves in supercritical water. In

the presence of oxygen, organic material will chemically combust (burn without flame) at SCWO temperatures and pressures.

• End result is inert ash, metal salts, water, carbon dioxide and heat

• The heat energy is captured through heat exchangers and will be used to power a steam turbine

•Technology results in complete destruction of organic material in sludge• Provides the highest level of treatment

recognized by regulatory agencies• Produces excess energy and usable by-

products (CO2, phosphorus and hot water)• Provides all weather solution and is not

dependent on land application

SCWO upsides

•Technology had only been demonstrated on a small, pilot scale basis•Had not been tested extensively on

wastewater sludge• Process would require significant R&D

investment before it could be adapted to wastewater application

SCWO downsides

• On May 21, 2007, Council approved entering into an agreement with SuperWater Systems to develop a full size pilot unit• City provided operating expertise and R&D funding and

agreed to turn over new IP to SuperWater• SuperWater provided access to patented technology

elements • City to receive development royalty of $2.50 per ton of

sludge processed worldwide and SuperWater would purchase pilot unit at end of testing

Path forward

• It’s not normal for a municipality to take on R&D of new technology• What makes Orlando different?• Orlando has a history of developing successful,

innovative wastewater projects• Water Conserv II• Iron Bridge Wetlands• Iron Bridge plant rerate• ERRWDS

History of innovation

Water Conserv II

Engineering Design Fees - $8.4 million

Construction cost - $76.3 Million

City Investment

• Project has proven to be a significant component of Central Florida water supply plan•RIBs flows were key part of OUC’s

consumptive use permit•Received numerous awards, from prestigious

Grand Conceptor by American Consulting Engineers Council to Outstanding Project of the Year Award by the WateReuse Association.

Return on Investment

Iron Bridge Wetlands

Engineering Design Fees - $2.1 million

Construction cost - $19.4 Million

City Investment

• Has received numerous awards such as Governor’s Environmental Award and WEF Outstanding Achievement Award• Provides great park amenity visited by 15,000

people annually • Has been rerated from 20 mgd to 32 mgd at no

additional cost to City (savings of $10 million if new capacity had to be constructed)• Provides high level of treatment – sufficient to

meet new NNC established by EPA

Return on Investment

Iron Bridge rerating

Engineering Design Fees - $7.1 million

Construction cost - $32.7 Million

City Investment

•Consulting engineer estimates the cost of constructing equivalent new capacity at $80 million•Capital cost savings to City of over $40

million•May be rerated to a higher capacity,

increasing the ROI even further

Return on Investment

ERRWDS

Engineering Design Fees - $6.4 million

Construction Cost - $45.6 Million

City Investment

• Key part of Central Florida’s alternative water supply plan – Seminole County, Orange County, UCF, Oviedo, and OUC• Instrumental in OUC’s consumptive use permit

negotiations• Minimizes/eliminates surface water discharge to

Little Econ (tough rules ahead!)• Results in annual revenues of $550,000 from

reclaimed water sales

Return on Investment

SCWO Project Status

SCWO Project Status• Initiated design work in 2006 and completed design

concept in late 2007• Construction initiated early 2008 using combination

of city forces and contractors for fabrication and installation; completed base unit in early 2009

• Began pilot testing on Jan. 2009 and over the next 18 months, debugged and modified the process

• Conducted sub-critical runs with sludge in late 2010• Conducted super critical runs of sludge in February

2011

Engineering Design Fees - $3.0 million

Construction Cost - $5.5 Million

City Investment

• Long term compliance with any possible regulatory changes• Provides all-weather solution and eliminates

reliance on land application•Based on SuperWater business projections,

has the ability to return royalty payments of $60 million over the next 20 years

Return on Investment

Long Term Financial ConsiderationsCapital Cost at 35 dry tons per day

Operating cost/ D.T.

Annual operating cost

Land Application $32,850,000 (2190 acres at

$15,000)

$257 $3,283,175

SCWO $33,698,000 $268 $3,423,700

Gasification $38,682,000 $286 $3,653,650

Pelletization $30,381,000 $429 $5,480,475

Incinerator $53,496,000 $647 $8,265,425

Transition plan

•On today’s agenda is an agreement for SuperWater to lease space at Iron Bridge to continue process development and testing•Also working on Amendment 3 to the original

agreement spelling out the transition terms• Plan to bring Amendment 3 to Council for

approval by May 23

Transition plan

Don Morgan, Chief Executive OfficerSuperWater Solutions, Inc.

Copper Yaw, ChairmanWaterway Finance Limited

Business model options:•Outright sale•Lease to own•Contract operations•Build/own/operate for tipping fee with

customer option to purchase at any time in future

Transition plan

Production schedule assuming order by end of May:•Enter into design agreement with an

engineering firm– June 2011• 90% Design completion - Dec 2011•QA/QC review with City and development of

final drawings – Jan 2012• Start production of first unit – Feb 2012•Construction completion - Dec 2012

Transition plan

Production schedule:• Factory Testing - June through Nov 2012 •Construct site modifications – Summer 2012•Delivery to City Conserv II plant - Dec 2012• Start up and testing - Jan 2013• Fab / Delivery of remaining units - June 2013

Transition plan

Financing Plan

Questions?