San Jose Sets the Emerald Standard for Green Cities

Cities across the U.S. and around the world have proclaimed themselves as an emerging hub for the clean tech industry. But while some mayors may have visions of biodiesel-fueled buses and green collar jobs dancing in their heads, San Jose is leading the charge with its Green Vision plan.

Led by forward-thinking Mayor Chuck Reed, the Capital of the Silicon Valley adopted the Green Vision, an aggressive 15-year initiative for “economic growth, environmental sustainability and an enhanced quality of life for its community” in Oct. 2007. With good leadership, organized planning and focused execution, the Green Vision has been in full swing for almost five years and is making marked improvements.

The plan revolves around 10 goals for the city:

1. Create 25,000 Clean Tech Jobs as the World Center of Clean Innovation

2. Reduce Per Capita Energy Use by 50%

3. Receive 100% of Electrical Power from Clean, Renewable Sources

4. Build or Retrofit 50 Million Square Feet of Green Buildings

5. Divert 100% of Waste from Landfill and Convert Waste to Energy

6. Recycle or Beneficially Reuse 100% of our Wastewater

7. Adopt a General Plan with Measurable Standards for Sustainable Development

8. Ensure that 100% of Public Fleet Vehicles Run on Alternative Fuels

9. Plant 10,000 New Trees and Replace 100% of Streetlights with Smart, Zero Emission Lighting

10. Create 100 Miles of Trails Connecting with 400 Miles of On-Street Bikeways

Courtesy: San Jose Green Vision

Presently, the city reports it has made the most progress on the Zero Waste goal, diverting 71% of trash currently headed to landfills. The progress has been a result of efforts in both upstreaming (working with manufacturers on reducing the amount of packaging in products) and downstreaming (post-consumer waste). The Recycle Plus program gives San Jose one of the highest recycling rates in the nation as it diverts 293,000 tons each year from landfills. The city estimates it sends 569,000 tons to landfills annually.

In terms of waste conversion, the San Jose Green Vision 2011 Annual Report outlines the city’s plans for 2012 to partner with Zero Waste Energy Development and begin construction of an anaerobic digestion facility at the former Nine Par Landfill. Next to the waste water facility, the plant will use organics pulled from commercial wet waste. Additionally, San Jose will partner with Harvest Power to conduct a feasibility study of an ambitious gasification pilot plant which seeks to generate methane from thermal gasification suitable for use with CNG vehicles.   

Both of these actions are in line with the city’s announcement in 2009 of a $20-million deal with Green Waste Recovery, Zanker Road Resource Management and Harvest Power. The goal is a facility that will process 150,000 tons of waste to create 900,000 galls of biogas.

San Jose City Hall. Courtesy: SED Network. 

San Jose has also taken advantage of the clean energy credits and done a large amount of work with solar energy in an effort to satisfy its second goal. While we’d love to see a thermal waste-to-energy project in the city, the arduous permitting process may make that difficult. The city has sent a message throughout the industry that it is always open to being a demo site for any technology interested and willing to come to the Silicon Valley.

While we applaud San Jose’s immense progress in its initiative, the real success is in the format they used in approaching the problem. The 10^th largest city in America is using a multi-prong technological approach, educating the community and creating jobs. Organized planning, focused execution and a desire to educate and involve the community is the winning formula that has other cities green with envy.

Official Website: San Jose Green Vision

City of San Jose Green Vision 2011 Annual Report

In San Jose, Going Green Isn't Just About the Environment by Mayor Chuck Reed

Déjà vu: No Time for the Timid

This anecdote was shared by one of our members after his time at the West Coast Waste Conversion Congress:

A little over nine years ago, I was attending a conference sponsored by a genset company to gather information for a cow manure project I was considering. The presenter gave a great talk on his manure-to-digester gas project and I raced up to speak with him afterwards.

Eagerly shoving my card in his face, I told him that I had a similar project in the works and asked him if he would consider partnering with me.

“No,” was his flat response.

Stunned, all I could utter was “Why not?!”

“I’ve done one of these in my lifetime,” the presenter responded. “I have no reason to do two.”

He went on to describe all the financial and technical hurdles he had to overcome to see his project to fruition. Hearing him recount the many roadblocks he hit discouraged me and I later dropped the project, advising my clients that anaerobic digestion for animal waste-to-energy just wasn’t viable.

Needless to say, I missed that train. Anaerobic digestion is now a well-accepted practice and many people have made tidy profits off of projects relating to it.

I reflected on this as the West Coast Energy Conversion Congress came to a close. The conference perfectly illustrated the fact that we are still in the early days of gasification technology, giving me a strong sense of déjà vu to my time studying anaerobic digestion. Similar to then, the older technology (in this case, mass burn incinerators) has fallen out of favor and, although newer technologies with lower price points and cleaner emissions are on the horizon, they haven’t arrived yet.

But the real take-away lesson from the conference is that there are enough green technology advancements in the works, as well as plenty of brave developers trying to bring the projects to fruition. The sheer number of developers suggests that while many will fail, several will make it through to commercial and environmental viability. And I won’t scare so easy this time!

The above story is a perfect example of why Better BTU came into being. Our industry is growing and changing so fast and we feel that there isn’t a central place for communication on ideas, technologies and projects that work, don’t work, etc. That’s what we’ve come to be about: sharing information and working towards a greener future!  

Industry Influence Spotlight: Harvey Gershman

Photo Credit: GBB, Inc. 

Harvey W. Gershman has been a staple in the waste industry for almost 40 years. The president of Gershman, Brickner & Bratton, an international management consulting firm based in Fairfax, Va., has seen firsthand the change in the way our nation views and deals with waste as well as on continuing efforts to convert one man’s trash into another man’s treasure. And he has tracked it all in order to advise his clients on the best way to handle their waste management needs.

Gershman has the ear of some of the most important policymakers in Washington, advising organizations such as the National Center for Resource Recovery, U.S. Environmental Protection Agency (EPA), the U.S. Department of Energy and the Solid Waste Association of North America (SWANA). He has served on several boards and was awarded SWANA’s Professional Achievement Award in 1993.

The Northeastern University graduate most recently presented at the Waste Conversion Congress – West Coast in San Jose, Calif. on Dec. 6-7. His presentation, entitled “Different Technologies under the Commercial Microscope.” served as a sort of State of the Union for the waste conversion industry. Gershman tracks developments in the field with regards to trends on America’s MSW disposal, the number and type of waste-to-energy plants operating and emerging waste-to-energy companies and technologies. By presenting this material in a concise and readable format, Gershman helps us understand where we are and where we need to go.

Although the majority of GBB Inc.’s clients are municipalities that have tended towards more conservative solutions, Gershman stays on top of advancements in the waste conversion field in order to present all possibilities to clients. His philosophy is that the best solution is a 50-50 partnership between waste management systems with significant recycling and waste-to-energy projects. 

For more on Harvey Gershman and his consulting firm visit www. gbbinc.com.

Download his latest presentation "Different Technologies under the Commercial Microscope." Special thanks to Mr. Gershman for his permission to share this PowerPoint presentation. 

What's In A Name?

For those of you who have been steadily following Better BTU, you know we have three different blogs:

1. Better BTU Technologies - where we review and compare different technologies in the industry
2. Better BTU Projects - where we survey projects in the industry and continue to bring you updates on their progress
3. Waste Conversion Congress Blog - where we brought you updates and reflections on the Waste Conversion Congress on the West Coast that took place in San Jose on Dec. 6-7

Even though we've still got a few more blog entries in the future that will relate to the Waste Conversion Congress, we've decided to change its name to Better BTU Blog. This blog will act as a homepage of sorts where we'll discuss various topics that relate to the industry but do not fall under the categories of projects or technologies. 

We appreciate all the wonderful feedback we've been receiving about the blogs and we decided that we had so much more to say that we wanted to have a "home base" to discuss philosophies, trends, obstacles, etc. Our very next blog entry will be on the need for cleaner definitions of terminology in our industry. The sky's the limit (and one we hope to keep clean) for what we'll talk about here!

If you have any suggestions for topics you want to see covered by Better BTU or projects or technologies you think might have an impact on our industry, please drop us a note! You can comment on our blog, tweet us (@BetterBTU) or send us a message on LinkedIn. We look forward to hearing from you!

Waste Conversion Congress on the West Coast: What We’ve Learned

Back on the East Coast, we’ve had some time to digest all the information we received at the Waste Conversion Congress and reflect on some of the thought-provoking debates and conversations we were a part of. Here’s what has been on our minds as a result of the conference:

Ø   The amount of waste we deposit in landfills is absolutely staggering.  The energy    value we bury is equivalent to the amount of energy 31 million cars consume annually.

Ø   The general population has been taught to think of incineration when they hear the term “waste-to-energy.” Incineration conjures up images of massive power plants spewing pollution into the air and is an incorrect visual for the latter term.

Ø   Regulation of these projects and technologies is politically based when it should be scientifically based. California is the toughest state to permit, even when experts agree on the net positive environmental benefit of a project.

Ø   Financing is difficult given the current economic climate and many of the tax incentives that are set to expire at the end of the calendar year are not likely to be renewed. There are other ways to get financed, but developers need to be doing more research earlier on to determine how the project will be funded. The fewer projects that get scrapped midway, the better it is for our industry.

Ø   Facing a passionate, schooled and well-politicized opposition, it’s important that these initial projects are successful to avoid making projects down the pike more difficult. At Better BTU, we do our best to present both sides of an issue so we will be spending some time in later entries dissecting their arguments. Afterall, the best way to strengthen your product is to examine the areas receiving criticism.

Ø   The sheer number of projects using a variety of technologies and processes is encouraging. Although most will fail, the few that make it into production will create the inflection point for our industry.

Just because the conference is over doesn’t mean this blog is! Stay tuned as we continue to bring you a deeper look at some of the people, places and philosophies discussed at the Waste Conversion Congress on the West Coast.

Day Two: Case Studies - Putting Theory into Practice

The second day of the conference brought a number of presentations that made up the Waste Conversion Technology Showcase. Two case studies in particular excited the audience.

Flex Energy generator. Photo by Martin LaMonica/CNET

Marketing Manager of Landfills Su Ann Huang discussed a novel approach to conversion that Flex Energy is working on. The California-based company has been working on a thermal-oxidizer front ending turbine and the emissions profile is absolutely stunning. Currently, the technology is in the first commercial installation phase at Fort Benning, Ga.

By far the best thing about this technology is that it is a viable solution for low-BTU syngas with an excellent emissions profile. The downside is the cost, coming in at $4,000 per kilowatt for just for the component. This means one needs essentially free fuel to offset the high price in order to make this work in the United States. Despite the price tag, this technology is worth considering for existing digester gasification projects and is one to watch for in thermal gasification.

The second presentation that captured audiences was by Ken Foldare, the director of business development at Chinook Energy. Chinook has the benefit of a proven gasification technology that works on a metals recovery business model. Partial-oxidation gasification is effective at processing waste metals because all of the non-metal components are converted to heat. Chinook has focused on the emissions and also has an excellent profile.

Foldare provided cost data from $3,500-4,000 all-in. This is in the target range Better BTU calculates is required for economic vitality.

The presentation focused mainly on European waste incineration directives. Foldare argued convincingly that the limit is tighter than U.S. standards and that the industry would do well to focus and compare technologies on this standard. We loved this idea and support it for the growth of the industry.

Chinook has several metals recovery projects, including one with Alcoa in the United States, but does not yet have any projects on MSW biomass in production. The company estimates that the first commercial installation will happen later in 2012. Better BTU is excited to watch Chinook’s growth and will continue to bring you updates to this project on our project blog. 

Unfortunately, Better BTU had to catch a plane and wasn't able to stay for the afternoon session but we'll be back tomorrow to bring you our thoughts on the conference as a whole. Stay tuned!

Evening Wrap-Up: Technology and Funding - Embrace the Risk

One thing everyone at the conference can agree on is that risky technology is a key barrier to project financing. Developers and entrepreneurs can be in denial about the risk they are assuming, technologically, as they embark on their new project. The morning panel suggested that we “don’t avoid the risk, isolate it.”

There are several different components of risk and the panel recommends that folks in the industry isolate each part and deal with it separately. They are: 

Soundness Risk: Developers working with a new technology will need to clear this first hurdle by having a well-respected, independent engineering firm evaluate the technology. The engineering firm will do an energy balance, look at the metallurgy and perform a number of tests and calculations to determine if the design is sound.

Engineering firms put their reputation on the line when they evaluate a design so you can expect it to be a thorough process. If they deem the design sound, the firm will issue a letter to that effect. A project developer won’t be able to get debt financing to fund the technology if it hasn’t first cleared the ‘soundness test hurdle.’

Scale Up Risk: Most emerging technologies work on a prototype level and there is risk whenever you attempt to take something from the lab and scale it to the size of a commercial plant. Funding for this stage of development can come in two forms. A project developer can get debt financing even if the target technology must be “scaled up” to reach a commercial level – but the engineering report must identify the scale up risk as low. The second approach is to adopt a modular strategy and fund the initial module through traditional equity sources.

Integration Risk: Defined as the risk of putting proven components together in a new configuration, this is the final of the risk components. Assuming a project developer has all the other requirements for funding lined up (feedstock agreements, buyer for the energy, etc.), he can get debt financing if integration risk is still present.

Better BTU Take: Project developers and entrepreneurs are frequently embracing three types of technology risk without understanding the impact it has on financing. In addition to following tips on financing from the previous blog entry, the industry needs to work on funding each component of the risk in a separate manner.  

Mid-Day Update: Show Me the Money!

And we’re off! After an early morning registration, the Waste Conversion Congress, presented by Renewable Waste Intelligence, officially kicked off at 8:30 am with a warm welcome by Scott Green, Clean Tech/Regional Policy Officer. This is an excellent location for the conference because Mayor Reed of San Jose has made gasification demonstration a city goal. He hopes to have created 25,000 clean tech jobs by 2022 – impressive yet feasible given the progress they are making, we think!

The first session we sat in was called Financing Your Waste Conversion Project and was presented by John May, managing director of Stern Brothers & Co., an investment banking firm in Chicago and St. Louis. May is responsible for developing the firm’s renewable energy practice. He was joined by Mark Riedy, a partner at Mintz Levin and who serves on the general counsel of the American Council on Renewable Energy (ACORE), and Jonathan Silver, executive director of the Loan Progams Office at the DOE.

It was a sobering conversation as the trio explained that federal funding is going away and that most of the government grants such as 1603, will not be renewed after they expire. The message is that this isn’t the merchant-funding environment of the past. The sooner we accept it and move on, the sooner we can focus on what can work right now.

That being said, there were some good nuggets to take away from the lecture:

Ø    Municipal solid waste bonds are working. Projects will pay a higher interest rate but there is a great appetite for this high-yield paper.

Ø    Projects in some other countries will be easier to fund than domestically. Brazil has been mentioned as an example of a country that is open to projects right now.

Ø    The DOD is a great place to focus because it is coming into new money in 2012.

Better BTU Take: Too many developers are out there scrambling for funding because they’ve spent their own risk capital getting the project partially-funded. We suggest starting with a funding model first and then working your way backwards. Try to clearly understand what it will take to get a project funded BEFORE you empty your savings. The good news is that there are ways to get things done if you’ve done your homework.

From San Jose, Calif. we’re signing off!