July 5, 1999

To:Works Committee

From:Barry H. Gutteridge

Commissioner, Works and Emergency Services

Subject:Toronto's Integrated Solid Waste Resource Management Process

Request for Expressions of Interest - Results of Application of Evaluation Criteria

Purpose:

The purpose of this report is to provide members of the Works Committee and Toronto City Council with the results of the application of evaluation criteria to the thirty-two (32) submissions received in response to Toronto's Integrated Solid Waste Resource Management Process ("TIRM") Request for Expressions of Interest ("REOI"). Of the thirty-two responses received, twenty-three (23) are qualified to proceed to the Request for Proposals ("RFP") stage (TIRM - Stage 3). The remaining nine (9) responses are not qualified to proceed. Attached to this report is a table that contains a description of each of the qualifying responses.

Funding Sources, Financial Implications and Impact Statement:

There are no direct financial considerations arising from this report.

Recommendation:

That this report be received for information.

Reference/Background/History:

On April 13, 14, and 15, 1999, City Council adopted Clause No. 1 of Report No. 5 of the Works and Utilities Committee, "Integrated Solid Waste Resource Management Process - Request for Expressions of Interest". The Clause was amended by adding thereto the following:

"It is further recommended that the report dated April 13, 1999, from the Commissioner of Works and Emergency Services, embodying the following recommendations, be adopted:

It is recommended that:

(1)City Council set a minimum of 100,000 tonnes per annum disposal capacity for the proposed Request for Expressions of Interest for new disposal capacity; and

(2)the project schedule contained in the April 9, 1999 report from the Commissioner of Works and Emergency Services be approved with the identified February 2000 decision point for Council's approval of top-qualified respondents."

On April 26, 1999, the TIRM REOI was issued by the Purchasing and Materials Management Division of the Finance Department, as per the Council approved schedule. Prior to the closure of the REOI on May 31, 1999, four addendums were issued by the Purchasing and Materials Management Division. They related to points of clarification, responses to questions raised by potential Respondents, and notification of Council's passage of the anti-lobbying clause.

The REOI called for submissions in three categories:

Category 1. Proven Diversion

Proven waste diversion technologies are those with an ability to handle mixed waste and/or source separated organic waste, utilizing a combination of manual, mechanical and/or biological processes. The products from waste diversion technology proposals must be capable of being commercially marketed for clearly established beneficial purposes. The technology must have been in operation for at least one-year at a minimum of 10 percent of the proposed capacity or currently licensed for full capacity. Proposals in this category can provide up to 300,000 tonnes per annum of diversion capacity.

Twelve responses were received in this category, of which eight have qualified.

Category 2. Proven Disposal

Proven waste disposal technologies must have an ability to manage mixed waste, utilizing landfill and/or energy recovery processes. Residuals from waste disposal technologies (e.g. energy from waste - "EFW" - ash) must be less than 20 percent of the input waste volume. Respondents are fully responsible for the management of any residuals. The technology must have been in operation for at least one-year at a minimum of 10 percent of the proposed capacity or currently licensed for full capacity. Proposals that cannot be operational for January 1, 2002, must provide five years of guaranteed disposal capacity as an interim measure. Proposals can range from 100,000 tonnes per annum of disposal capacity to the maximum amount of solid waste requiring disposal.

Nine responses were received in this category, of which seven have qualified.

Category 3. New and Emerging Technologies

New and emerging technologies are those that have been proven at the pilot scale, but have not yet been applied to larger waste volumes. These technologies generally are technologies or applications with:

-unproven large scale performance

-no demonstration of long term performance, or

-proposals for unconventional or unproven situations.

Technologies with six months of operating experience, or more, at one percent of the proposed capacity can submit responses that would provide up to 50,000 tonnes of service capacity per annum. Those technologies with six months of operating experience, or more, operating at 10 percent of the proposed capacity can submit responses up to 100,000 tonnes of service capacity per annum.

Twelve responses were received in this category, of which eight have qualified.

Discussion and Justification:

Our project consultant, Proctor and Redfern Limited, in conjunction with MacViro Consultants, has undertaken a comprehensive review and analysis of the submitted Expressions of Interest (EOI's) by applying the evaluation criteria contained within the Council approved REOI to the information submitted by the Respondents in their respective EOI's. Our consultant has reviewed each response to assess if the required financial and commercial information has been correctly provided; if the response has been submitted in the correct category and the proposed technology aligns with the category definition; and that all requisite information has been correctly submitted.

Certain responses contained information which required clarification. An example of the circumstances where clarification was required involved submissions which cited inclusion of documentation (e.g. confirmation of ability to obtain letters of credit), but which documentation was not found to be physically included within the submission package.

Listed below are the Respondents that have qualified within their respective categories to proceed to the Request for Proposals phase of the project. The proposed site or sites identified by Category 2 Respondents ("Proven Disposal") have been listed beside the names of the qualified Respondents.

* Energy from Waste

Appendix A contains a description of each of the responses provided by the qualified Respondents.

Several Respondents have not qualified to proceed to the RFP phase. Listed below are the names of these Respondents and the reason(s) for their non-qualification. In the case of the non-qualifying Category 2 Respondents ("Proven Disposal") the site or sites proposed have not been identified, in keeping with the policy established by Council through its approval of the REOI.

Many of the Respondents offered innovative proposals that could be considered in the future in some other process as adjuncts to many of the technologies and practices proposed in the qualifying responses.

Next Steps:

Our next step in the TIRM process is to undertake an additional phase of stakeholder consultation regarding the evaluation criteria for the RFP for proven disposal capacity. Based on our public consultation program to date, we have developed three categories of evaluation criteria:

(1)Human health and safety and the natural environment;

(2)GTA and Ontario social benefits; and

(3)Financial cost.

Waste disposal capacity proposals will be evaluated based on their performance in these priority areas. Performance will encompass the effects, as they are defined within the scope of the RFP, associated with transportation of waste and processing waste throughout the potential contaminating life span of a waste disposal facility, including closure and post-closure care. Each proposal will be given an overall performance score, based on weighted criteria. Overall scores will in turn be used to rank proposals in relation to each other.

Listed below is a description of the three priority areas.

Human Health and Safety and Natural Environment

Performance scores will be derived from the potential macro-environment effects (i.e., environmental burden) upon human health and the natural environment of waste transportation and disposal, and upon traffic safety associated with waste transportation. Higher scores will be awarded to proposals that have lower environmental burden and lower risk to traffic safety.

The macro-environment performance scores will be derived from the greenhouse gas emissions (indicators of energy resource consumption and climate change impacts), associated with proposed transportation and disposal facility operations. The RFP document will describe in detail the method for calculating macro-environment burden. In summary, the method will account for transportation fuel use efficiency and the net greenhouse gas emissions associated with facility operations, including direct emissions and offsetting reductions in emissions associated with energy recovery.

Micro-environment burden, defined as those emissions of substances regulated by municipal, provincial/state or federal jurisdictions, will not be taken into account in the TIRM Stage 3 RFP evaluation. Proposed transportation and facility operations must be in accordance with approvals given pursuant to these jurisdictions' authority. This authority is constituted to protect human health and the natural environment. Federal and provincial/state Environment Protection Acts address emissions of acid gases, smog prescursors, heavy metals and trace organics. In the case of landfill facilities' leachate, which may affect water quality, Respondents must comply with provincial/state standards and guidelines on ground and surface water quality protection and with municipal sewer use by-laws.

Ontario and GTA Social Benefits

Performance scores will be derived from the following three factors: direct employment allocated to the contract, including jobs created; total dollar value of wages allocated to the contract, including wages for new jobs created; and the total value of goods purchased in the GTA and Ontario. Respondents are required to provide all estimates in regard to these factors for a five-year period. Higher scores will be given to those proposals that have the greatest benefit for the GTA, and Ontario outside the GTA, respectively.

Financial Cost

Financial performance scores will be based on the average transportation and disposal price (i.e. tipping fee), expressed as net present value in dollars per tonne. The disposal price is to be based on costs per tonne for the entire duration of the contract. As was stated in the REOI document, Toronto may choose not to contract waste transportation services at this time. Respondents will therefore be required to provide a disposal price for both including and excluding costs associated with waste transportation. Both disposal prices must account for all proposed operations, including costs associated with any proposed modifications to a Toronto transfer station(s).

Appendix B of this report provides a table with the proposed evaluation criteria and priority weighing factors to evaluate responses to the RFP.

Public Consultation

To facilitate stakeholder review of the proposed evaluation criteria, we will be placing advertisements in newspapers that provide coverage in the local vicinity of the proposed disposal locations. Members of the public and other interested stakeholders (including those on the project mailing list) will be invited to provide feedback and input on the proposed criteria and the weighting to be applied within each category. We will be seeking responses in writing (including e-mail) and voice messages on our 24-hour Comment Line.

We will report out on the results of the consultation process in September 1999, when we will be bringing forward the Request for Proposals for proven disposal capacity for Committee and Council approval. The Council approved project schedule identifies October 1, 1999 for the issuance of the RFP, with a closing date of December 15, 1999.

We will also be bringing forward in September 1999 a report regarding the scope and schedule for the RFP for proven diversion and new and emerging technologies. This report will include a description of the associated stakeholder consultation process related to the development of evaluation criteria.

Conclusions:

Thirty-two (32) responses to the Toronto Integrated Solid Waste Resource Management Process ("TIRM") Request for Expressions of Interest ("REOI") were received within three categories: proven diversion; proven disposal; and new and emerging technologies. In conjunction with our project consultants, we have reviewed and analyzed these responses against the evaluation criteria established through the Council approved REOI.

We have proceeded, as per the Council authority provided on April 13, 14, and 15, 1999, to identify those Respondents who are qualified to proceed to the Request for Proposals phase of the project (TIRM - Stage 3). The list of qualified Respondents can be found in the body of this report. We have also provided in the body of this report a list of Respondents who have not qualified and the reasons for their non-qualification.

The twenty-three (23) qualified responses, considered both as a whole and within the three waste management technology categories, are interpreted as constituting a strong subscription on the part of the North American waste management marketplace to Toronto's TIRM project. The twenty-three (23) responses cover the full range of proven and new and emerging waste management technologies and practices, at large and small project scales and involving facilities located in Ontario and the U.S.A.

Our next step is to undertake an additional phase of stakeholder consultation regarding the evaluation criteria for the RFP for proven disposal capacity. This will include an invitation to stakeholders located near potential disposal sites to provide input and feedback, as well as others who have expressed an interest in the project to date.

We will report in September on the results of this consultation process. At that time we will submit a report seeking approval of an RFP for disposal capacity (TIRM - Stage 3). A report regarding the scope and schedule for an RFP for diversion capacity and new and emerging technologies will also be submitted.

Contact Name:

Lawson Oates, B.A., M.E.S.

Manager, Strategic Planning

Solid Waste Management Services

Works and Emergency Services

Phone: (416) 392-9744

FAX: (416) 392-4745

E-mail: lawson_oates@toronto.ca

Angelos Bacopoulos, P.Eng. Barry H. Gutteridge

General ManagerCommissioner

Solid Waste Management Services Works and Emergency Services

Attachment

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O:\RSUYCK\99Reports\99WC020.WPD

Appendix A

Description of Responses from Qualified Respondents

Category 1

Proven Waste Diversion Capacity

Category 2

Proven Waste Disposal Capacity

Category 3

New and Emerging Technologies

Appendix B