Main Treatment Plant - Award of Beneficial Use
Contracts and Procedure for Selection of
Design/Build Firms for the Implementation of
100 per cent Biosolids Beneficial Use Program
The Strategic Policies and Priorities Committee recommends the adoption of the
Recommendation of the Budget Committee embodied in the communication (February 22,
1999) from the City Clerk.
The Strategic Policies and Priorities Committee reports, for the information of Council,
having requested the Commissioner of Works and Emergency Services to submit a report,
directly to Council for its meeting scheduled to be held on March 2, 1999, on the present
status of the Ministry of the Environment approvals for the two companies recommended in
the report dated February 8, 1999, from the Commissioner of Works and Emergency Services
and on whether such approvals are time or otherwise limited.
The Strategic Policies and Priorities Committee submits the following communication
(February 22, 1999) from the City Clerk:
Recommendation:
The Budget Committee on February 19, 1999, recommended to the Strategic Policies and
Priorities Committee, and Council the adoption of the report (February 8, 1999) from the
Commissioner of Works and Emergency Services, wherein it is recommended that:
(1)authority be granted to commence negotiations with and, if successfully concluded, enter
into an agreement with Terratec Environmental Ltd. (Terratec), for the transport, storage and
direct land application of dewatered biosolids from the Main Treatment Plant in accordance
with Terratec's proposal dated December 16, 1998, such agreement to be for a period of four
years, for biosolids quantities up to a maximum of 28,000 dry tonnes per year with an
expected minimum of 25,000 dry tonne per year at a cost of $107.00 per dry tonne of
biosolids, on the terms and conditions as set out in this report, the Request for Proposals
(RFP) issued by the City, dated September 28, 1998, and otherwise on such terms and
conditions satisfactory to the Commissioner of Works and Emergency Services and in a form
satisfactory to the City Solicitor;
(2)authority be granted to commence negotiations with and, if successfully concluded, enter
into an agreement with USF Canada Inc. (USF) for the design, construction and
commissioning of a biosolids pelletizing facility in accordance with USF's proposal dated
December 16, 1998, such facility to be located at the Main Treatment Plant at a lump sum
price of $22,235,959.00, on the terms and conditions as set out in this report, the RFP issued
by the City dated September 28, 1998, and otherwise on such terms and conditions
satisfactory to the Commissioner of Works and Emergency Services and in a form satisfactory
to the City Solicitor;
(3)subject to finalizing the agreement in accordance with Recommendation No. (2),
authority be granted to commence negotiations with and, if successfully concluded, enter into
an operations agreement with USF for the transportation, marketing and distribution of up to a
maximum of 28,000 dry tonnes per year of biosolids pellets with an expected minimum of
25,000 dry tonnes per year of biosolids pellets at a cost of $13.35 per dry tonne, such
agreement to be for a period of 15 years, on the terms and conditions as set out in this report,
the RFP issued by the City dated September 28, 1998, and otherwise on such terms and
conditions satisfactory to the Commissioner of Works and Emergency Services and in a form
satisfactory to the City Solicitor;
(4)subject to finalizing agreements in accordance with Recommendations Nos. (2), and (3),
authority be granted to negotiate with USF for the management and operation of the
pelletization facility for a period of two years from the date of successful commissioning of
the pelletizing facility;
(5)the Commissioner of Works and Emergency Services be authorized to short list a
minimum of three firms to receive the Request for Proposals for the provision of biosolids
loading and odour control facilities at the Main Treatment Plant ( MTP), and to short list a
minimum of three firms to receive the Request for Proposals for the provision of plant heating
facilities at the MTP based on criteria and procedures contained in this report;
(6)the Commissioner of Works and Emergency Services report to the next meeting of the
Works and Utilities Committee on the Request for Proposals for biosolids loading and odour
control facilities at the MTP and Request for Proposals for plant heating at the MTP;
(7)authorization be granted to add to the 1999-2003 Capital Works Program an amount of
$76,600,000.00 net after GST rebate for the Biosolids Beneficial Use Program; and
(8)the Biosolids Beneficial Use Program additional cash flow be approved at the following
levels: $15,710,000.00 for 1999, $53,303,000.00 for 2000, and $7,855,000.00 for 2001.
The Budget Committee reports, for the information of the Strategic Policies and Priorities
Committee, having requested the Commissioner of Works and Emergency Services to report
to the Strategic Policies and Priorities Committee, at its meeting of February 23, 1999, on the
cost of the treatment process (i) through incinerators; (ii) using the current equipment; and
(iii) using 100 percent Biosolids; said report to include the cost of any necessary replacement
equipment.
Background:
The Budget Committee on February 19, 1999, had before it a communication (February 10,
1999) from the City Clerk, advising that the Works and Utilities Committee on February 10,
1999, recommended to the Budget Committee the adoption of the Report (February 8, 1999)
from the Commissioner of Works and Emergency Services, wherein it is recommended that:
(1)authority be granted to commence negotiations with and, if successfully concluded, enter
into an agreement with Terratec Environmental Ltd. (Terratec), for the transport, storage and
direct land application of dewatered biosolids from the Main Treatment Plant in accordance
with Terratec's proposal dated December 16, 1998, such agreement to be for a period of four
years, for biosolids quantities up to a maximum of 28,000 dry tonnes per year with an
expected minimum of 25,000 dry tonne per year at a cost of $107.00 per dry tonne of
biosolids, on the terms and conditions as set out in this report, the Request for Proposals
(RFP) issued by the City, dated September 28, 1998, and otherwise on such terms and
conditions satisfactory to the Commissioner of Works and Emergency Services and in a form
satisfactory to the City Solicitor;
(2)authority be granted to commence negotiations with and, if successfully concluded, enter
into an agreement with USF Canada Inc. (USF) for the design, construction and
commissioning of a biosolids pelletizing facility in accordance with USF's proposal dated
December 16, 1998, such facility to be located at the Main Treatment Plant at a lump sum
price of $22,235,959.00, on the terms and conditions as set out in this report, the RFP issued
by the City dated September 28, 1998, and otherwise on such terms and conditions
satisfactory to the Commissioner of Works and Emergency Services and in a form satisfactory
to the City Solicitor;
(3)subject to finalizing the agreement in accordance with Recommendation No. (2),
authority be granted to commence negotiations with and, if successfully concluded, enter into
an operations agreement with USF for the transportation, marketing and distribution of up to a
maximum of 28,000 dry tonnes per year of biosolids pellets with an expected minimum of
25,000 dry tonnes per year of biosolids pellets at a cost of $13.35 per dry tonne, such
agreement to be for a period of 15 years, on the terms and conditions as set out in this report,
the RFP issued by the City dated September 28, 1998, and otherwise on such terms and
conditions satisfactory to the Commissioner of Works and Emergency Services and in a form
satisfactory to the City Solicitor;
(4)subject to finalizing agreements in accordance with Recommendations Nos. (2), and (3),
authority be granted to negotiate with USF for the management and operation of the
pelletization facility for a period of two years from the date of successful commissioning of
the pelletizing facility;
(5)the Commissioner of Works and Emergency Services be authorized to short list a
minimum of three firms to receive the Request for Proposals for the provision of biosolids
loading and odour control facilities at the Main Treatment Plant ( MTP), and to short list a
minimum of three firms to receive the Request for Proposals for the provision of plant heating
facilities at the MTP based on criteria and procedures contained in this report;
(6)the Commissioner of Works and Emergency Services report to the next meeting of the
Works and Utilities Committee on the Request for Proposals for biosolids loading and odour
control facilities at the MTP and Request for Proposals for plant heating at the MTP;
(7)authorization be granted to add to the 1999-2003 Capital Works Program an amount of
$76,600,000.00 net after GST rebate for the Biosolids Beneficial Use Program; and
(8)the Biosolids Beneficial Use Program additional cash flow be approved at the following
levels: $15,710,000.00 for 1999, $53,303,000.00 for 2000, and $7,855,000.00 for 2001.
--------
(Communication dated February 10, 1999, addressed
to the Budget Committee from the City Clerk)
Recommendations:
The Works and Utilities Committee recommends:
(1)the adoption of the report dated February 8, 1999, from the Commissioner of Works and
Emergency Services, subject to amending Recommendation No. (6) to provide that the
Commissioner of Works and Emergency Services be authorized to proceed with issuing the
Request for Proposals for the design/build of the biosolids loading and odour facilities and for
plant heating at the Main Treatment Plant, and report back to the Works and Utilities
Committee;
(2)the adoption of the following recommendations embodied in the proposal before the
Biosolids Multi-Stakeholder Committee meeting on February 9, 1999, headed "Ongoing
Public Participation Proposal for Discussion at BMSC":
(i)that the consultant provide status reports on the design/build projects at the Main
Treatment Plant to the Main Treatment Plant Neighbourhood Liaison Committee (MTP
NLC), with special attention to odour and building design issues; and
(ii)that there be ongoing public involvement through the MTP NLC with respect to
dryer/pelletizer construction at the Main Treatment Plant, especially in regard to community
aspects such as odour;
and that Councillors from Wards 25 and 26 be invited to attend the MTP NLC meetings
during its consideration of the design/build phase;
(3)that the Biosolids Multi-Stakeholder Committee and the Independent Review Committee
be disbanded, and the members thanked for their time and commitment; and
(4)that a Biosolids Management Plan Committee be established; and reports having referred
the membership and terms of reference to Councillor Bill Saundercook and the Environmental
Task Force to consult with the Biosolids Multi-Stakeholder Committee and report back
thereon to the Works and Utilities Committee at its meeting scheduled to be held on March
24, 1999; and further recommends that:
(a)Members of Council with treatment plants in their ward be invited to attend and/or
become members of the Biosolids Management Plan Committee; and
(b)the Biosolids Management Plan Committee be co-chaired by a Member of Council and a
citizen member.
The Works and Utilities Committee reports having granted authority, in order to further the
due diligence, for Councillors Bussin, Layton and McConnell as members of the Biosolids
Multi-Stakeholder Committee, accompanied by a consultant and/or staff member, to visit
USF's pelletizing facilities in Belgium and Spain, and meet with the local area elected
officials and residents to discuss their experience with the USF operation, prior to Council's
consideration of this report at its meeting scheduled to be held commencing on March 2,
1999, at a cost of approximately $19,000.00, with funding to be accommodated in the current
Biosolids Beneficial Use Program budget; and requests that Council concur in the action taken
by the Works and Utilities Committee.
The Works and Utilities Committee further reports, for the information of Council, having
referred the communication dated February 4, 1999, from Mr. Peter Leiss, Executive Vice
President, Toronto Civic Employees' Union Local 416, to the negotiating team for
consideration.
Background:
The Works and Utilities Committee on February 10, 1999, had before it a report (February 8,
1999) from the Commissioner of Works and Emergency Services respecting the
implementation of 100Percent Biosolids Beneficial Reuse Program at the Main Treatment
Plant.
The Works and Utilities Committee also had before it a communication (February 4, 1999)
from Mr.Peter Leiss, Executive Vice President, Toronto Civic Employees' Union, Local 416,
addressed to Councillors Betty Disero, Sandra Bussin, Tom Jakobek and Pam McConnell,
setting out recommendations with respect to the Biosolids Multi-Stakeholder Committee, and
the implementation and operation of any application program for the beneficial use of
biosolids.
The Works and Utilities Committee also had before it the following:
(i)a proposal entitled "Ongoing Public Participation Proposal for Participation at BMSC",
which was before the Biosolids Multi-Stakeholder Committee at its meeting on February 9,
1999; and
(ii)a communication (February 9, 1999) from Mr. Brian Gallaugher, Gallaugher Associates,
forwarding excerpts from the Minutes of the Biosolids Multi-Stakeholder Committee meeting
held on February 9, 1999.
The following persons appeared before the Works and Utilities Committee in connection with
the foregoing matter:
-Ms. Gayle Christie, Gayle Christie Associates, and Mr. Daniel Boulanger, Berlie
Technologies; and
-Mr. Wally McKinnon, Project Vice-President, USF Canada Inc.
--------
(Report dated February 8, 1999, addressed to the
Works and Utilities Committee from the
Commissioner of Works and Emergency Services)
Purpose:
To obtain authorization to award contracts for beneficial use of biosolids from the Main
Treatment Plant (MTP), and to proceed with the shortlisting of firms for the supply of
biosolids loading, odour control and plant heating facilities at the MTP required to support the
Toronto Biosolids Beneficial Use Program.
Funding Sources, Financial Implications and Impact Statement:
Approval will be required to add to the 1999-2003 Capital Works Program a total of
$76,600,000.00 net after GST rebate for the Biosolids Beneficial Use Program of which
$15,710,000.00 will be expended in (1999); and $53,030,000.00 in (2000); and $7,855,000.00
in (2001). It is anticipated that there will be no impact to current operating budget levels
resulting from the Biosolids Program. Funding for this project is to be provided from the
Water and Wastewater reserves.
Recommendations:
It is recommended that:
(1)authority be granted to commence negotiations with and, if successfully concluded, enter
into an agreement with Terratec Environmental Ltd. (Terratec), for the transport, storage and
direct land application of dewatered biosolids from the Main Treatment Plant in accordance
with Terratec's proposal dated December 16, 1998, such agreement to be for a period of four
years, for biosolids quantities up to a maximum of 28,000 dry tonnes per year with an
expected minimum of 25,000 dry tonne per year at a cost of $107.00 per dry tonne of
biosolids, on the terms and conditions as set out in this report, the Request for Proposals
(RFP) issued by the City, dated September 28, 1998, and otherwise on such terms and
conditions satisfactory to the Commissioner of Works and Emergency Services and in a form
satisfactory to the City Solicitor;
(2)authority be granted to commence negotiations with and, if successfully concluded, enter
into an agreement with USF Canada Inc. (USF) for the design, construction and
commissioning of a biosolids pelletizing facility in accordance with USF's proposal dated
December 16, 1998, such facility to be located at the Main Treatment Plant at a lump sum
price of $22,235,959.00, on the terms and conditions as set out in this report, the RFP issued
by the City dated September 28, 1998, and otherwise on such terms and conditions
satisfactory to the Commissioner of Works and Emergency Services and in a form satisfactory
to the City Solicitor;
(3)subject to finalizing the agreement in accordance with Recommendation No. (2),
authority be granted to commence negotiations with and, if successfully concluded, enter into
an operations agreement with USF for the transportation, marketing and distribution of up to a
maximum of 28,000 dry tonnes per year of biosolids pellets with an expected minimum of
25,000 dry tonnes per year of biosolids pellets at a cost of $13.35 per dry tonne, such
agreement to be for a period of 15 years, on the terms and conditions as set out in this report,
the RFP issued by the City dated September 28, 1998, and otherwise on such terms and
conditions satisfactory to the Commissioner of Works and Emergency Services and in a form
satisfactory to the City Solicitor;
(4)subject to finalizing agreements in accordance with Recommendations Nos. (2), and (3),
authority be granted to negotiate with USF for the management and operation of the
pelletization facility for a period of two years from the date of successful commissioning of
the pelletizing facility;
(5)the Commissioner of Works and Emergency Services be authorized to short list a
minimum of three firms to receive the Request for Proposals for the provision of biosolids
loading and odour control facilities at the Main Treatment Plant (MTP), and to short list a
minimum of three firms to receive the Request for Proposals for the provision of plant heating
facilities at the MTP based on criteria and procedures contained in this report;
(6)the Commissioner of Works and Emergency Services report to the next meeting of the
Works and Utilities Committee on the Request for Proposals for biosolids loading and odour
control facilities at the MTP and Request for Proposals for plant heating at the MTP;
(7)authorization be granted to add to the 1999-2003 Capital Works Program an amount of
$76,600,000.00 net after GST rebate for the Biosolids Beneficial Use Program; and
(8)the Biosolids Beneficial Use Program additional cash flow be approved at the following
levels: $15,710,000.00 for 1999, $53,303,000.00 for 2000, and $7,855,000.00 for 2001.
Council Reference/Background/History:
On September 24, 1997, the former Metropolitan Toronto Council adopted Clause No. 8 of
Report No. 12 of The Environment and Public Space Committee, entitled "Main Treatment
Plant Environmental Assessment Implementation Plan", which endorsed the conclusions of
the Main Treatment Plant Environmental Assessment, including the phased implementation of
Biosolids Beneficial Use following the completion of four demonstration programs.
In January 1998, the Works and Utilities Committee requested the Commissioner of Works
and Emergency Services to report on the feasibility of accelerating the shutdown of
incineration at the Main Treatment Plant.
By adoption of Clause No. 2 of Report No. 6 of The Works and Utilities Committee, at its
meeting of July 8, 9 and 10, 1998, City Council authorized the Commissioner of Works and
Emergency Services to establish the Biosolids Multi-Stakeholder Committee (BMSC) and
Independent Review Committee (IRC), retain consultants and request proposals to allow for
the shutdown of sewage sludge incinerators at the Main Treatment Plant within a three-year
period. This initiative is now known as the Toronto Biosolids Beneficial Use Program.
At its meeting of July 28, 1998, City Council adopted Clause No. 5 of Report No. 7 of The
Works and Utilities Committee, which contained an accelerated timeline developed for
planning purposes by the Committee for the initial implementation of the Biosolids Beneficial
Use Program. Subsequently, with input from the BMSC an aggressive timeline was set with
the target date of December 31, 2000, for the end of biosolids incineration at the Main
Treatment Plant.
Public participation, through the involvement of the BMSC, has been intensive and proactive.
The BMSC's role has been to assist in the overall development of the biosolids program by
helping to chart the directions of the program, its goals and intentions, and to provide input on
the concerns and recommendations of the community in regard to developing a successful
biosolids program.
Committee membership was derived from several sectors. Members included Councillors
Disero, Bussin, Jakobek, Layton and McConnell, environmental groups, a watershed group,
neighbourhood industry, representatives of the Humber, Highland Creek, North Toronto and
Main Treatment Plant Neighbourhood Liaison Committees, Lakeside Area Neighbourhood
Association (LANA) and union representatives from the Main Treatment Plant.
Fourteen meetings of the BMSC were held between July 6, 1998 and February 9, 1999.
Involvement of the BMSC included the following activities:
-review and input into the public consultation program for the biosolids program
development phase;
-review and input into the selection of the biosolids management consultants;
-review and input into the Expression of Interest evaluation process;
-review and input into the development of the Toronto Beneficial Use Program Request for
Proposals;
-recommendations for ongoing biosolids program development; and
-review and comment on the proposal evaluation process.
The IRC also assisted the City in the development of the biosolids program. The primary role
of the IRC was to allow Toronto to draw on the experience of knowledgeable individuals from
The University of Guelph, Water Technology International, Ministries of Environment and
Health, and representatives from other jurisdictions (Los Angeles and Philadelphia) which
have already implemented beneficial use programs. The IRC has provided advice and
independent peer review at all critical stages of program development. The IRC includes two
public members of the BMSC and is chaired by Councillor Disero.
In December 1998, the 1999-2003 Water and Wastewater Capital budget was presented to the
Budget Committee. In that submission, it was agreed that the General Manager of Water and
Wastewater would report on the biosolids program costs. This report identifies costs for the
100percent Biosolids Beneficial Use Program and required design/build projects.
Comments and/or Discussion and/or Justification:
The process for selection of beneficial use contractors was developed by the City's biosolids
consultants, R.V. Anderson Associates Limited and Brown and Caldwell, together with staff,
and with extensive public consultation with the BMSC and IRC. A two-stage selection
process was used which began with a request for Expressions of Interest (EOI) and then a
Request for Proposals (RFP) issued to firms that had been short-listed from the EOI phase.
The key milestone dates were:
Issue request for EOIAugust 14, 1998
Receive EOIs from 16 firmsSeptember 8, 1998
Shortlist to 7 firmsSeptember 22, 1998
Issue Request for ProposalSeptember 28, 1998
Perform Due Diligence inspectionsOctober-December, 1998
Receive proposals from 5 firmsDecember 16, 1998
The RFP limited the beneficial use options for respondents to two types of technologies:
direct land application, and pelletization by thermal drying. Direct land application involves
loading the biosolids onto trucks at the MTP and delivering it to farmland for use as a
fertilizer. The biosolids are produced, processed, analysed, transported, stored, and applied
according to guidelines developed by the Ontario Ministry of the Environment (MOE). The
guidelines are designed to protect humans, animals, plants, ground water and surface water,
and to ensure that biosolids are applied in a safe and beneficial manner. Biosolids may also be
land applied to disturbed sites such as mine tailings for site remediation. In pelletization, the
biosolids are dried to produce a small stable pellet that can be used in the production of
commercial fertilizer or sold as a bulk fertilizer product.
Only proven technology and firms with demonstrated successful operations were selected to
participate in the City's program. The evaluation process included tours of representative
facilities by consultant team members, staff, and BMSC members (on IRC) to assess the
Respondents' capabilities and to verify successful operations. A detailed technical, financial,
and price review was conducted using a project-specific evaluation strategy. This included
systematic scoring of both technical/financial components which accounted for 66.7 percent
of the total score, and price which accounted for 33.3 percent of the total score. Firms were
requested to provide proposals for the processing of 10,000 dry tonnes (0 percent water) per
year, 25,000 dry tonnes per year and their optimum volume of biosolids not to exceed 25,000
dry tonnes per year for each technology proposed. Firms proposing pelletizing were also
requested to provide proposals for facilities to be fully owned, operated and built privately or
to be designed and built by the contractor and following commissioning transferred to the
City. Marketing and distribution services for the pellets are to be provided by the successful
firm for both private and public operation options.
Respondents were requested to provide a unit price per dry tonne for direct land application of
biosolids for a period of four years and for the fully privately owned and operated pelletizer
option for a period of 15 years. Under the City owned and operated pelletizing facility option,
the Respondents were to provide a lump sum price for the design, construction and
commissioning of the facility. All respondents that proposed to construct a facility at the MTP
were required to submit prices for both the fully privately owned and operated and City owned
and operated options. The Respondents were also required to submit a per tonne price for any
contractor owned/operated portion of the pelletizer's proposal, which includes the
transportation, marketing and beneficial use of all pelletized biosolids produced at the MTP.
The technical/financial evaluation and scoring were based on the following criteria:
(1)Experience and capabilities;
(2)Technical issues;
(3)Odour control;
(4)Environmental health and safety;
(5)Beneficial use/product marketing;
(6)Flexibility/expansion;
(7)Performance guarantees;
(8)Public consultation plan;
(9)City biosolids program; and
(10)Financial capabilities.
The financial capabilities/stability criteria evaluation was conducted by the City's Finance
Department based on the financial information requested from each Respondent.
When the technical/financial scoring and ranking had been completed, the price proposals
were then opened and total score and ranking was completed.
The evaluation next considered the optimal program for meeting the City's objectives for a
reliable beneficial use program as the best value for ratepayers. From the top ranked
Respondents, a recommended program was developed considering an appropriate mix of
technologies, biosolids quantities, and qualified firms. Throughout the development of the 100
percent utilization program, there has been consensus that diversity and multiple contracts are
a key for long-term success. The recommended program is a direct reflection of this.
From the original shortlist of seven firms, five proposals were submitted from the following
firms:
(i)Berlie Technologies (La Prairie, Quebec) - biosolids pelletizing;
(ii)Braemar Acres (York, Ontario) - biosolids direct land application and pelletizing;
(iii)Canadian Waste (submitted EOI as AGRA Bio Gro) (Oakville, Ontario) biosolids direct
land application and pelletizing;
(iv)Terratec Environmental Limited (Oakville, Ontario) - biosolids direct land application;
and
(v)USF Canada Inc. (Markham, Ontario) - biosolids direct land application and pelletizing.
Toronto Biosolids Program:
To provide diversity and stability, the City has envisioned a 100 percent biosolids utilization
program that will have multiple contracts and technologies. Flexibility was included in the
RFP and proposal evaluation process to allow the City to select any mix of technologies and
biosolids quantities offered by each respondent to best suit the needs of the City. The value of
diversity has been recognized by other municipalities and the IRC from the perspective that
other elements of the program can take over if events cause one element to lose viability. For
Toronto, it was determined after the EOI stage that direct land application and pelletization
represented the best mix of technologies.
Submittals were divided into two categories, direct land application of dewatered MTP
biosolids and thermal pelletization. Separate evaluations were conducted for each technology.
In general, the per tonne unit cost for drying and pelletization of 10,000 dry tonnes per year
was almost twice the cost of the 25,000 dry tonne per year option. This can be attributed to the
economies of scale for handling larger biosolids quantities. Much of the capital costs related
to site preparation and facility construction would be required regardless of whether 10,000 or
25,000 dry tonnes per year was processed. Distribution of the capital costs over a larger
quantity of biosolids results in a significantly reduced price for the processing of 25,000 dry
tonnes per year. Based on these considerations and the value of maximizing flexibility and
diversity, it is recommended that the program include a 25,000 dry tonne per year pelletization
component.
In consideration of whether the proposed biosolids pelletizing facility should be privately or
publicly operated, several factors were evaluated. Prices for both fully private operation and
City owned and operated options were assessed in addition to other factors which led to the
conclusion that the City owned and operated option was the preferred alternative. The
pelletizing facility will be located at the MTP within an existing building and within the
biosolids dewatering, storage and former incinerator complex, making private operation less
desirable due to possible conflicts with the City's ongoing operations. From an economic
point of view, the City's per tonne operations cost would not include any profit mark up as
would be included in the private operations option and it is envisioned that the City will be
able to operate the facility at or below the private operation unit per tonne cost. Based on the
costs for the contractor provided marketing and distribution of the pellets, amortized capital
costs and the City's projected operations and maintenance costs, we estimate that the cost to
the City of the pelletizing facility under full private operation would be greater than the cost
for the facility to be fully publicly owned and operated.
Quality control of the dried pellets produced by the pelletizing facility is critical in ensuring
marketability. Proper operation of the dryer is essential to guarantee product quality.
Accordingly, it is recommended, based on the advice and experience of our consultants, that
there be a transition to public operation, over a period of 24 months after completion of the
facility. During this period, the private contractor would be fully responsible for the operations
and training of City staff. The details of the transition would be finalized during negotiation.
To ensure efficient and economic City operation, the City's performance and cost of operating
the facility can be monitored and compared against the private operation price presented in the
proposals. The contractor will continue to be responsible for transportation, storage,
marketing and distribution of the pellets for a period of 15 years during both the private and
public operation phases of the drying facility, in accordance with the requirements of the
City's RFP.
Based on the evaluation of the technical, financial and price proposals and the preference to
retain the option for a city operated facility, USF Canada Inc. is recommended as the drying
contractor.
USF's proposal ranked highest in the pelletizing technology category under the preferred
public operation option. In particular, the USF indirect drying/pelletizing process had
attractive features from the standpoint of emissions control, safety and low energy
consumption. USF presented a strong project team for technology, design construction, public
participation and operation and reuse of existing MTP building foundations and proximity to
plant dewatering processes were considered in recommending USF to design and construct the
pelletizing facility.
USF Canada has proposed to design and construct a two train biosolids pelletizer with
capacity to process 25,000 dry tonnes per year on average and the ability to handle peak
volumes of up to 32,500 dry tonnes per year for a lump sum price of $22,235,959.00. USF's
design and construction cost is reasonable in comparison to similar facilities constructed in
other jurisdictions. IRC members with experience and knowledge in biosolids beneficial use
have confirmed that USF's cost for the construction of the pelletizer is highly competitive.
USF has proposed to locate the pelletizing facility in a new building at the MTP where
incinerators Nos. 1 and 2 were previously located and reusing the existing floor and
foundation. Following demolition of these incinerators in 1992, this area is presently unused
and available for installation of the proposed biosolids pelletizing facility. The USF pelletizer
is an indirect (meaning heated plates in lieu of hot air is used to dry the biosolids) vertically
oriented drying system. Several installations are operating successfully in the United States
and Europe.
In accordance with their proposal, USF Canada will also be responsible for the transportation,
marketing and beneficial use of the biosolids pellets for the unit cost of $13.35 per dry tonne
for a period of 15 years.
For the reasons identified above, we also propose to enter into negotiations with USF for a
two year operations, management and training contract. Council approval to enter into the
agreement will be sought following successful negotiation.
USF will be required to post a Performance Bond and a Payment Bond, each in the amount of
50percent of the agreed capital cost to design, build and commission the proposed facilities.
The Performance Bond will guarantee the construction, completion and commissioning of the
facility as set out in the contract. The Payment Bond will guarantee the payment for labour
and materials.
In the direct land application category, Terratec ranked highest following the technical and
price evaluation. They presented strong qualifications and experience in all categories
including innovation in solids handling, pro-active public consultation and strong technical
support staff. Technical support and pro-active public consultation are critical elements in
ensuring continued success of a biosolids land application program. Terratec is in a position to
easily implement the land application component as currently scheduled with minor expansion
of their existing storage facilities. Other municipal jurisdictions that have dealt with Terratec
were extremely satisfied with Terratec's performance and good relations with the agricultural
community.
In accordance with their proposal, Terratec will be responsible for receiving dewatered
biosolids at the MTP and transportation to either storage or direct land application on
appropriately permitted agricultural lands for a contract period of four years at a unit cost of
$107.00 per dry tonne. Terratec will also be responsible for providing biosolids storage
facilities sufficient for six months of operations during the winter and other periods when land
application is not possible.
Earlier in the development of the program, it was envisioned that no one contractor would
receive more than 25,000 dry tonnes of the City's biosolids per year. In consideration that the
recommended City's optimal program will involve two contractors and that the City may
produce an estimated 53,000 dry tonnes of biosolids per year at the MTP, it will be necessary
to negotiate contracts with each recommended firm for biosolids quantities of up 28,000 dry
tonnes per year with an expected minimum of 25,000 dry tonnes per year. This flexibility will
also be required to address potential fluctuations in biosolids produced at the MTP from year
to year.
Each contractor will also be required to provide operating security in the amount of
$500,000.00 in the form of an irrevocable letter of credit to ensure that the contractor carries
out its obligations under the services agreement. Appropriate indemnification and insurance
provisions will be included subject to the satisfaction of the Commissioner of Works and
Emergency Services and in a form satisfactory to the City Solicitor.
In summary, it is recommended that the biosolids beneficial use program for the City of
Toronto consist of a contract with Terratec for direct land application of biosolids for a period
of four years, and a contract with USF to design and build a biosolids pelletizing facility at the
MTP and operate and train City staff for a period of two years. Marketing and distribution of
the pellets is to be handled by USF for a period of 15 years.
The IRC at its meeting of January 25, 1999, concurred with the recommended City program as
developed by the consultants and staff.
It is recognized that due to the very tight schedule for implementing the 100 percent biosolids
utilization program, some consideration may need to be given to short-term emphasis on
direct land application. Practical construction scheduling for the pelletizing facility is
dependent upon contract negotiation, early design and project definition, odour/emission
modelling and MTP facility integration issues.
Design/Build Contracts to Support Beneficial Use Program:
In order to support the beneficial use contracts described above, and to allow the shut down of
incineration, it is necessary to construct modifications to the MTP. These modifications will
replace some of the services currently provided by incineration. The required modifications
are:
(1)The installation of a biosolids loading facility to allow for the removal of biosolids from
the MTP by the land application contractors. A new loading facility is required, as the existing
temporary loading facility has a maximum handling capacity of 270 cubic metres per day
while the MTP can produce up to 800 cubic metres per day of biosolids. The existing
temporary facility also does not provide sufficient storage capacity and was not intended to
provide the high level and quality of service required by the Biosolids Beneficial Use
Program. The new facility will provide up to 2,000 cubic metres of storage and be able to
handle the MTP's peak biosolids production. It will provide faster and better truck loading,
reduced traffic congestion, increased reliability and improved odour containment. The
preliminary capital cost estimate for the new loading facility is $30,000,000.00.
(2)The MTP currently uses the heat produced by the combustion of the biosolids in the
incinerator to produce steam that heats the plant's buildings in the winter and the digestion
process all year round. With the shutdown of incineration, the MTP will not be able to
produce enough heat during the winter months. It is therefore necessary to install additional
boilers and make modifications to the plant's heating system to allow the MTP to continue
operating. The preliminary capital cost estimate for the new heating system is $15,000,000.00.
(3)Incinerators are very effective in destroying odours due to the high temperature
conditions inside the incinerator. The MTP makes use of this feature by sending odorous air
from parts of the plant to the incinerator for odour control purposes. With the shutdown of
incineration and the construction of the new loading facility, it will be necessary to construct
new odour control facilities. These facilities will treat odorous air from the dewatering
building, the existing loading facility and the new loading facility. Air samples from multiple
locations at the MTP are currently being analyzed for odorous compounds, to assist in the
design of the new odour control facilities. The new system will be designed to meet the same
high standards specified in the beneficial use RFP. It is envisioned that a multi-stage
scrubbing system will likely be employed to ensure complete odour control at all times. The
preliminary capital cost estimates for the new odour control facilities are $10,000,000.00.
The time available to design and construct these facilities is very short and a design/build
delivery method will be utilized to ensure they are operational prior to December 31, 2000.
The Purchasing and Materials Management Division of the Finance Department will assist in
the issuing, evaluation and awarding of the design/build contracts in order to ensure
compliance with all City policies and procedures. The three projects will be bundled into two
contracts: (1) for the design and construction of the biosolids loading facility and odour
control facility; and (2) for the design and construction of plant heating facilities.
The procedure and timeline being followed for planning purposes for procurement of these
contracts is as follows:
Advertise for Letters of InterestJanuary 26, 1999
Issue Request for Qualifications (RFQ)February 12, 1999
Receive Statements of Qualification March 11, 1999
Report on RFP to Works and Utilities CommitteeMarch 24, 1999
Short list respondentsMarch 29, 1999
Issue Request for Proposal (RFP) to Short listed FirmsApril 15, 1999
Receive ProposalsJune 14, 1999
Recommend Award to Works and UtilitiesJuly 14, 1999
All facilities operational December 31, 2000
The method to be used for short listing is one adapted from the Canadian Construction
Association for design/build projects. Respondents to the RFQ will be evaluated against the
criteria attached in Appendix A. The RFQ will request respondents to provide the information
necessary to allow staff and the consultant team to evaluate the Statements of Qualification
and shortlist a minimum of three respondents for each project. This procurement strategy is
consistent with that developed by the BMSC and IRC for the beneficial use projects. The
progress of these design/build projects will be reviewed by the public on a regular basis at the
Main Treatment Plant Neighbourhood Liaison Committee meetings. Additional details and
refined cost estimates will be reported to the Works and Utilities Committee as they become
available.
Prior to the award of contracts for these design/build projects, a further report will be
submitted with more precise cost estimates resulting from completion of the preliminary
design.
Conclusions:
We believe the evaluation of Proposals for the Biosolids Beneficial Use Program has been fair
and comprehensive with a high degree of public involvement through the BMSC and critical
peer review by the IRC throughout the development of the program, evaluation and selection
process.
The two firms recommended to be awarded contracts for the Beneficial Use Program, Terratec
Environmental and USF Canada, have demonstrated capabilities and will provide the City's
Biosolids Beneficial Use Program with diversity and flexibility through proven technology.
Incinerator shutdown at the MTP will follow construction of the ancillary design/build
facilities at the MTP and full implementation of the 100 percent Biosolids Beneficial Use
Program.
This report has been reviewed by the City Legal Services Division and Finance Department.
Contact Name:
Mr. R. M. Pickett, Director, Water Pollution Control
Telephone: (416) 392-8230; Fax: (416) 397-0908
e-mail: bob_pickett@metrodesk.metrotor.on.ca.
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Request for Qualifications
Main Treatment Plant Truck Loading and Odour Control Facilities
Appendix A
Evaluation Criteria
for Statement of Qualifications
Mandatory submissions required regarding financial resources:
(A)Certified, audited, financial statements, and
(B)Letter from Bonding Agency.
The criteria to be used in evaluating SOQ submittals include the following:
(1)Corporate Structure - Design/build team organization and defined roles will be
evaluated. Design/build teams with previous working relationships on successfully completed
projects will receive a more favourable review.
(2)Construction Capability - Annual value of related construction (average over last 5 years)
and value of construction of largest single successfully completed project over $10 million
(within the last 5 years) will be evaluated. Experience and qualifications on wastewater
biosolids (or similar) projects will receive a more favourable review.
(3)Qualifications of Personnel Assigned To The Project - Project management and Quality
Assurance/Quality Control experience of Project Manager, Construction Manager and Senior
Project Designer, will be rated based on details provided. Experience and qualifications on
comparable wastewater biosolids (or similar) projects will receive a more favourable review.
(4)Design/Build Experience - Previous design/build projects successfully completed by the
Designer and the Constructor will be evaluated and rated based information submitted on
Projects Information Forms.
(5)Related Design Experience - Proponents with proven performance records for design of
biosolids handling facilities with pumping, conveying and storage of biosolids cake with a
total solids concentration, of 25 - 30 percent, and wastewater treatment odour control systems,
of a similar size to the proposed facilities, will receive a more favourable review. Evaluations
will be based on information submitted on Project Information Forms.
(6)Related Construction Experience - This will include a variety of rating criteria
considering number of similar projects and project descriptions addressing time frame, scale,
and location Evaluations will be based on information submitted on Project Information
Forms.
(7)References - Findings from communications with project references will be evaluated
and rated.
Request for Qualifications
Main Treatment Plant Heating
Evaluation Criteria
for Statement of Qualifications
Mandatory submissions required regarding financial resources:
(A)Certified, audited, financial statements, and
(B)Letter from Bonding Agency.
The criteria to be used in evaluating SOQ submittals include the following:
(1)Corporate Structure - Design/build team organization and defined roles will be
evaluated. Design/build teams with previous working relationships on successfully completed
projects will receive a more favourable review.
(2)Construction Capability - Annual value of related central heating plant construction
(average over last 5 years) and value of construction of largest, single, successfully completed
central heating plant project (within the last 5 years) will be evaluated. Experience and
qualifications on central heating plants for wastewater (or similar) projects will receive a more
favourable review.
(3)Qualifications of Personnel Assigned to the Project - Project management and Quality
Assurance/Quality Control experience of the Project Manager, Construction Manager and
Senior Project Designer will be rated based on details provided. Experience and qualifications
on central heating plants for wastewater (or similar) projects will receive a more favourable
review.
(4)Design/Build Experience - Previous central heating plant experience on design/build
projects successfully completed by the Designer and the Constructor will be evaluated and
rated based on information submitted on Project Information Forms. Design/build experience
for central heating plants fuelled completely or in part by digester gas will receive a more
favourable review.
(5)Related Design Experience - Proponents with proven performance records for design of
central heating plants for wastewater treatment plants and other facilities, of a similar size and
nature to the proposed facilities will receive a more favourable review. Evaluation will be
based on information submitted on Project Information Forms.
(6)Related Construction Experience - This will include a variety of rating criteria
considering number of similar projects and project descriptions addressed time frame, scale,
and location. Evaluation will be based on information submitted on Project Information
Forms.
(7)References - Findings from communications with project references will be evaluated
and rated.
The Strategic Policies and Priorities Committee also submits the following report (February
22, 1999) from the Commissioner of Works and Emergency Services:
Purpose:
To provide the Committee with information requested by the Budget Committee.
Funding Sources, Financial Implications and Impact Statement:
There is no financial implications arising from this report. Any financial implications would
arise from adoption of one of the presented methods or combination thereof as the future plant
operation strategy.
Recommendation:
It is recommended that this report be received for information.
Council Reference/Background/History:
The Main Treatment Plant (MTP), the largest water pollution control plant operated by the
City, has been using incineration for the last fifty years as a method of disposal of
sludges/biosolids generated during the wastewater treatment process.
On September 24, 1997, the former Metropolitan Toronto Council adopted Clause No. 8 of
Report No. 12 of the Environment and Public Space Committee, titled "Main Treatment Plant
Environmental Assessment Implementation Plan", which endorsed the conclusions of the
Main Treatment Plant Environmental Assessment, including the phased implementation of
Biosolids Beneficial Use following the completion of four demonstration programs.
In mid 1996, the plant started to beneficially utilize a portion of its biosolids (about 35
percent) under two demonstration projects operated by private contractors. Under one of them,
biosolids were directly applied to agricultural land in southwestern Ontario and the other used
the material for minetailing remediation in northern Ontario. We are negotiating a termination
of one of the projects, and the other, the land application contract, is still in operation.
In January, 1998, the Works and Utilities Committee requested the Commissioner of Works
and Emergency Services to report on the feasibility of accelerating the shutdown of
incineration at the MTP.
By adoption of Clause No. 2 of Report No. 6 of the Works and Utilities Committee, at its
meeting of July 8, 9 and 10, 1998, City Council authorized the Commissioner of Works and
Emergency Services to establish the Biosolids Multi-Stakeholder Committee (BMSC) and
Independent Review Committee (IRC), retain consultants and request proposals to allow for
the shutdown of sewage sludge incinerators at the MTP within a three-year period. This
initiative is now known as the Toronto Biosolids Beneficial Use Program.
At its meeting of July 28, 1998, City Council adopted Clause No. 5 of Report No. 7 of the
Works and Utilities Committee, which contained an accelerated timeline developed for
planning purposes by the Committee for the initial implementation of the Biosolids Beneficial
Use Program. Subsequently, with input from the BMSC an aggressive timeline was set with
the target date of December 31, 2000 for the end of biosolids incineration at the MTP.
At its meeting on February 19, 1999, the Budget Committee requested the Commissioner of
Works and Emergency Services to report to the February 23, 1999 meeting of the Strategic
Policies and Priorities Committee "on the cost of the treatment process through (i)
incinerators, (ii) usage of the current equipment, and (iii) using 100 percent Biosolids, the said
report to include the cost of any necessary replacement equipment."
Comments and/or Discussion and/or Justification:
The plant presently generates approximately 53,000 dry tonnes per year of solids. Out of this
amount some 36,000 dry tonnes per year is incinerated, and 17,000 dry tonnes per year
beneficially utilized by applying the material in the form of approximately 30 percent
concentrated sludge cake to agricultural land in southwestern Ontario, utilizing the services of
Terratec Environmental Inc., a private contractor. The combined cost of solids disposal using
this method is approximately $113.00 per dry tonne. This cost does not include any capital
cost of the equipment involved, as it is assumed to be already amortized.
In case the sludge incineration process would be adopted as a preferred method for disposal of
all the sludge solids presently generated at the MTP, the existing multiple hearth incinerators
would have to be replaced with the new fluidized bed units and the state of the art emission
control system installed. New ash dewatering facilities would also have to be constructed.
The sludge disposal cost using this method including Operation and Maintenance (O&M)
costs as well as the capital costs amortized over a 20 year period would reach approximately
$282.00 per dry tonne.
The cost of the MTP solids disposal based on the proposed 100 percent Beneficial Use of
Biosolids includes the amortized capital cost of the necessary new facilities (e.g. biosolids
load-out facility, odour control facility and heat generation facility, replacing the incinerator
heat recovery boilers), as well as the operation costs quoted in the recently received proposals
for direct land application of 50 percent of the biosolids generated at the plant, plus heat
drying, pelletization and marketing of the other 50 percent of biosolids. This combined cost
would come to approximately $280.00 per dry tonne.
In the Appendix "A" enclosed we provide calculations of the unit costs presented above and
their basis.
Conclusions:
The presently used method of the MTP sludge disposal, which is incineration of the part of the
volume of solids using existing and already paid down equipment, plus land application of the
remaining volume of solids utilizing services of a private contractor represents the lowest cost
of $113.00 per dry tonne, however, this must be balanced with the eventual need to replace
the existing equipment.
The costs of incineration versus beneficial use of 100 percent of the plant generated biosolids
(both methods require replacement of existing and/or addition of new facilities) represent a
higher than presently incurred costs and are quite similar. However, the cost of incineration
which is $282.00 per dry tonne is still $2.00 per dry tonne (0.7 percent) higher than the cost of
beneficial use of biosolids.
Contact Name:
Mr. R. M. Pickett, Director
Water Pollution Control
Telephone: (416) 392-8230
Fax: (416) 397-0908
e-mail: bob_pickett@metrodesk.metrotor.on.ca.
--------
Appendix "A"
Main Treatment Plant Solids Disposal Costs
Using existing method and equipment:
(1)Incineration of approximately 36,000 dry tonnes of solids per year in the multiple hearth
incinerators;
(2)Land applying of approximately 17,000 dry tonnes of solids per year utilizing services of
a private contractor.
(3)Capital cost of any equipment used is assumed amortized.
Annual operation and maintenance (O&M) cost $6,000,000.00
Unit cost @ 53,000 dry tonnes per year $113.21 per dry tonne
Incineration of 100 percent of solids generated:
Capital cost of 3 new fluidized bed incinerators$48,000,000.00
including heat recovery boilers and emission control
Building to house the new units$20,000,000.00
Ash dewatering facilities$15,000,000.00
Replacement of the plant heating system from $7,500,000.00
steam to hot water based
Engineering plus contingencies$12,750,000.00
Sub-total $103,250,000.00
Capital cost amortized over 20 years $9,575,715.00 per year
Operation and maintenance cost (O&M) $5,390,000.00 per year
(including ash handling and disposal)
Total$14,965,715.00 per year
Unit cost @ 53,000 dry tonnes per year$282.37 per dry tonne
100 percent beneficial use of biosolids:
Capital cost of the required facilities:
(based on design/build contracts)
Biosolids loading facility$30,000,000.00
Heat generation facility to replace incinerator heat$15,000,000.00
recovery boilers (includes change from steam to hot water
Odour control facility$10,000,000.00
Sub-total$55,000,000.00
Amortized over 20 years $5,100,865.00 per year
Land application of 26,500 dry tonnes per year
@ $107.00 per dry tonne based on obtained proposal
from Terratec Environmental Inc.$2,835,000.00 per year
Pelletization and marketing of 26,500 dry tonnes per year
based on obtained proposal from US Filter Canada Inc.
Capital cost of $22,235,959. amortized over 15 years$2,062,229.00 per year
(as per contract duration)
Operating cost: Marketing and distribution $353,775.00 per year
Utilities $901,000.00 per year
Labour$3,085,130.00 per year
O&M cost of the auxiliary facilities by the City $500,000.00 per year
Total $14,837,999.00 per year
Unit cost @ 53,000 dry tonnes per year $279.97 per dry tonne
