resolution 5135: aDOPT A RESOLUTION AUTHORIZING THE CITY OF GLENDALE TO RECEIVE AND ACCEPT ANY PROCEEDS FROM THE SALE/RECOVERY OF BIOGAS AT THE JOINTLY OWNED 91st Avenue Wastewater Treatment Plant
Staff Contact: Craig A. Johnson, P.E., Director, Water Servicesnd
Purpose and Recommended Action
Recommendation
This is a request for City Council to waive reading beyond the title and adopt a resolution authorizing the City of Glendale to receive and accept any proceeds from the sale/recovery of biogas at the jointly owned 91st Avenue Wastewater Treatment Plant (WWTP).
The proposed agreements provide an opportunity to sell excess digester gas as a renewable green energy commodity for beneficial use and to create a positive revenue stream for the SROG members. The 91st Avenue Wastewater Treatment Plant (WWTP) generates digester gas as a byproduct of treating wastewater. A small portion of the gas produced is used in the treatment process as boiler fuel to heat the digesters. The excess gas produced is currently burned in flares at the WWTP..body
Background
The 91st Avenue WWTP is owned by a partnership of cities that include Mesa, Glendale, Phoenix, Scottsdale, and Tempe, jointly referred to as SROG. The digester gas produced at the plant is a result of the natural breakdown of organic matter in the wastewater treatment process and captured in the anaerobic digesters. Current quantities of gas produced at the plant are 600,000 million British Thermal Units (Btu) or enough to meet approximately 6,700 household’s annual consumption.
Ameresco proposes to lease a small area of City of Phoenix land at the WWTP to process the excess biogas. Gas processing will include removal of moisture, removal of selected contaminants, and pressurization of the product gas to interstate gas transportation pipeline pressures. A component of the project is a new pipeline from the gas processing facility to the Kinder-Morgan Pipeline, which is about three miles west of the WWTP.
Benefits of this program to the SROG members include reduction of digester gas wasted by flaring to the atmosphere, reduction in the amount of air pollution emitted, potential future use of cleaned gas on-site for emergency power, and receipt of revenue from the sale of the renewable green energy. Ameresco will pay for all capital costs for installing the equipment and pipeline and all costs for operating and maintaining the gas processing facility.
Analysis
The biogas in question is currently being burned in a flare at the 91st Avenue WWTP. The City of Phoenix, on behalf of the SROG partners, put out a request for proposals to energy developers to see what options existed to beneficially utilize this wasted resource. Proposals were received and a selection committee consisting of representatives from the five SROG cities selected Ameresco as the winning proposer.
Previous Related Council Action
At the June 21, 2016 Council Workshop, the Water Services Department presented information on this item.
Community Benefit/Public Involvement
Benefits of this program to the SROG member communities include reduction of digester gas wasted by flaring to the atmosphere, reduction in the amount of air pollution emitted, reduced carbon footprint, potential future use of cleaned gas on-site for emergency power, and receipt of revenue from the sale of the renewable green energy.
Budget and Financial Impacts
The developer is funding the capital and operational costs of this project. The total revenues to be received by SROG are estimated to range from $1.2M to $2.0M per year over a 20-year project time frame. The total revenue projected over the 20-year project is estimated to be $32.2M. Since the City of Glendale’s share of this revenue is about 6.5%, the revenue would range from $79,000 to $130,000 per year over the 20-year project time frame. The total revenue Glendale is expected to receive over the 20-year project is $2.1M.