Early Stage Project Development Case Study: The Cleveland Recycling and Energy Generation Center Waste Conversion Congress – East Coast June 13, 2012 1
Early Stage Project Development Case Study:
The Cleveland Recycling and Energy
Generation Center
Waste Conversion Congress – East Coast
June 13, 2012
1
Agenda
Introduction
History of Project Development
Project Development a. Request for Information (RFI)
b. Supplemental Request for Information and Qualification
c. Refuse Derived Fuel Production
d. Air Permit Strategy
e. Co-generation opportunity
Complexities of Project Development
Road Map for Project Development
2
Introduction
History of Cleveland Public Power
Cleveland Public Power was founded in 1907 by Mayor
Tom L. Johnson.
Largest municipally owned electric utility in the state of
Ohio
The only municipality that competes door to door for its
customers
Serves nearly 80,000 residential, commercial and industrial
customers
300 mega-watt system
Currently implementing a 65 million expansion project.
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Introduction In 2006, CPP completed the development of a five year strategic
business plan that among other things identified CPP’s over
dependence on power supply contracts and the power grid.
CPP purchased nearly 100% of its electric power needs
from the market in the form of long and short term
contracts.
CPP owned less than 1%
generation capacity and the
strategic plan recommended
steps to decrease its market
dependence and its reliance
on the transmission grid for
100% of its needs.
4
Introduction
The City of Cleveland Department of Public Works operates the
Division of Waste Collection and Disposal (DWC).
The Division provides weekly collection of waste from 155,000
Cleveland homes, the City of Cleveland’s West Side Market, Fire
and Police Stations, the Justice Center, City Hall and other City
buildings and public areas.
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Curbside Recycling
In 2007, a Curbside Recycling Pilot and Automated trash
collection system was launched to 15,000 households.
Through this program, residents receive sturdy garbage carts for
trash and recycling which can be wheeled to the curb.
The program will eventually be city-wide and currently residents
will receive postcards and brochures regarding the program
prior to receiving new carts.
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Curbside Recycling
This year, the City of Cleveland will provide Automated Waste
Collection and Curbside Recycling service to an additional
30,000 households this summer, increasing the total number of
served households to 70,000.
Adding 30,000 households allows over 46% of Cleveland
residents the convenience of recycling curbside and enables the
City to gain additional revenue from the increased recyclables
Upon receiving carts, residents will be required to place glass,
plastic, metal cans, cardboard and mixed paper items into their
blue recycle bins – all remaining waste materials must go into
the black bins.
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Ridge Road Transfer Station
DWC operates the Ridge
Road Transfer Station, a
municipal solid waste facility
located at 3727 Ridge Road,
Cleveland, Ohio 44144.
Municipal solid waste is
brought to the transfer
station via waste collection
vehicles.
The waste is gathered and
loaded into transport trucks
and then taken to landfills.
8
History of Project Development
In 2007, Cleveland Public Power created a special
project team to investigate the production of electric
power using municipal solid waste as the feedstock.
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CPP obtained the services of RNR Consulting, URS Corp.,
DLZ Ohio Inc. and Cloud & Associates to assess the
feasibility of a Municipal Solid Waste Facility at the
Cleveland’s Ridge Road Transfer Station.
RNR assembled a team experienced in technical analyses of
gasification technologies, environmental permitting and
regulations, traffic studies, financial analysis and community
assessments.
History of Project Development
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Composition of MSWE Steering Team
CPP created the MSW Steering Team in March 2009
The team consisted of 10 members varying in background expertise
Mission statement
“To position Cleveland as a global leader in advanced energy by developing an innovative resource recovery system that will employ efficient, safe and responsible technology and create a sustainable and transformative asset for the entire region.”
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In 2008, the RNR consultant team found that
gasification and steam compression
technologies were scientifically sound,
presented numerous opportunities for
economic growth and development, and
recommended site inspections to see
gasification facilities in operation.
History of Project Development
12
History of Project Development
In August of 2009, a delegation comprised of City officials and MSWE Steering Team members visited waste-to-energy facilities in Japan and China. The objectives of the trip were to observe the technologies in operation, assess environmental/community impacts at operating facilities and interview personnel.
The delegation visited Kinsei Sangyo headquarters in Takaski Japan and saw their demonstration plant and also two large customer installations. Both customer facilities were located in environmentally or residentially sensitive areas. In addition the group visited an MSW incineration power plant in China.
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History of Project Development
In 2010, the City entered into a preliminary Facility Design Agreement for the MSWE project.
The Facility Design agreement was to provide services for the submission of an air permit and preliminary, non-construction, facility designs for a gasification facility.
CPP has an electric substation on the transfer station property which connects to the grid at 69KV and the generator at the gasification facility would connect to the grid at that location.
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History of Project Development
In September of 2011, the City of Cleveland issued a Request for Information and Qualification (RFI) from thermal conversion technology providers, waste handling equipment suppliers, project developers, consultants and financial services companies.
The RFI explained that the proposed MSWE facility would use thermal and physical conversion technologies to process municipal solid waste from the City of Cleveland and neighboring communities to generate electricity and a number of marketable by-products, such as recyclables, refuse derived fuel (RDF) pellets, steam, and possibly decorative bricks.
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Project Design Objectives
The City will utilize MSW as a fuel source and assist
CPP in meeting the City of Cleveland’s Advanced Energy
Portfolio Standard (AEPS).
The AEPS requires CPP to purchase at least 15% of its
base load power from advanced and renewable sources
by 2015, 20% by 2020 and 25% by 2025.
Cleveland Advanced
Energy Portfolio
2015 15%
2020 20%
2025 25%
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Project Design Objectives
The CREG Center Project will
expand the City’s curb-side
recycling program which
currently covers over 46% of
the City.
Once fully implemented, all
residents will be able to
recover recyclables from their
household waste and be
allowed to comingle them in a
designated bin.
With the addition of a MRF,
onsite-sorting is expected to
further increase the material
diversion rate.
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Project Design Objectives
Items in the recyclable
container may be
commingled and will be
sorted at the Transfer
Station.
The City’s normal MSW
setout procedures, routing
and collection processes
will apply.
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Project Design Objectives
Recycled Materials
Curbside recyclable items and sorted recyclables from the MRF may include:
Heating inert materials in the gasification process would waste energy and reduce the efficiency of the gasifier.
o newspaper, o pop and beer cans,
o magazines, o steel and tin cans,
o catalogs, o aluminum foil,
o corrugated cardboard, o aluminum cans,
o mixed mail, o glass food/beverage containers
o boxboard, o plastic bottles (with a neck),
o phone books, o other recyclables.
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Project Design Objectives
The CREG Center would also include technology that
mechanically packages the sorted recyclable materials
to maximize revenues from the sale of recycled goods.
The CREG Center will also help the City meet its
Sustainability goals.
Connecting the project to the City’s other goals like the
AEPS and Sustainability goals has helped gain broader
range of support for the project.
Electricity generated at the facility will reduce Green
House Gas (GHG) emissions from the City’s current
waste management and energy generation sources.
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Project Design Objectives
The CREG Center will help the City align with other
sustainability related objectives including the US EPA
Waste Hierarchy and Food Waste Hierarchy guidelines.
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Project Design Objectives
Economic Benefits
In addition to the use of Cleveland’s MSW, interested
municipalities in the region will have opportunity to reduce
their tipping fees by 10-15% by tipping their MSW at the
Facility. They may also benefit from increased recycling
revenues.
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Project Development A. Request for Information
The RFI directed toward waste-to-energy thermal conversion processes including pyrolysis and conventional gasification technologies, MSW recycling, sorting, refused derived fuel production, gasification, and other waste recovery technologies, processes and consulting and financial services.
The City received approximately 25 responses in regard to the RFI.
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Request for Information
Proposed technologies must have a proven commercial
track record and history of successful installations for a
minimum of five (5) years.
Technologies and processes had to be scalable and
suitable for the range and volume of MSW received and
processed at the Cleveland Ridge Road Transfer
Station.
The output of the conversion process had to be the
production of synthetic gas that would be used for
electric generation production.
The residuals after the thermal conversion process was
required to be a usable, marketable by-product.
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Request for Information
The proposed waste-to-energy project would be
designed to gasify the equivalent of 560 tons of
MSW per day.
After the completion of the bid process, the
winning gasification technology would be required
to process the same amount of MSW as the
technology provided in the City’s air permit
application.
25
Request for Information
The RFI requested information from gasification and
pyrolysis technology suppliers, material recovery
facilities and refuse derived fuel production technology
providers.
This group was encouraged to provide a list of
operating facilities, the size of such facilities, description
of whether they were commercial or demonstration
facilities, date placed in operation, and their current
status.
Thermal conversion suppliers were asked to discuss the
environmental impacts of their technologies and issues
that require permits of any type.
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Thermal Conversion Technology
In addition to thermal conversion companies, waste
receiving and processing, recycling, drying, pelletizing,
syngas/fuel processing and air emissions controls system
providers were asked to provide a range of information.
Professional services companies, consulting firms,
developers, financers and related companies were asked
to provide a history of their experience working on
Municipal Solid Waste related projects.
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RFI Responses
The City received nearly 25 responses to
the RFIQ. This group includes a number of
gasification technology providers, waste
sorting and handling equipment providers,
various consultants, project developers
and financial service providers.
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B. Supplemental Request for
Information and Qualification In April of 2012, Cleveland City Council passed
legislation extending an opportunity for a broader range
of interested MSW recovery and conversion technology
providers to file responses to an addendum to the
request for information and qualifications of September
2011.
That lead to the issuance of the Supplemental Request
for Information and Qualification (SRIQ) on May 18,
2012. In the SRIQ, the City sought information from
other interested parties to ensure consideration of all
practical options before determining its next steps.
Reponses to the SRIQ are due July 31, 2012.
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Supplemental Request for
Information and Qualification The supplemental request targets the range of waste
conversion technology suppliers that were not provided opportunity to respond to the City’s initial request.
On May 18, 2012, the City issued the Supplement Request for Information and Qualification. The SRIQ expanded the City’s review of waste-to-energy and waste management technology options.
Similar to the City’s initial request, the criteria the SRIQ applied to each new option was that it demonstrate a proper application for the City’s waste stream, demonstrate it had proven reliability, show that it could obtain an air permit, if applicable, demonstrate commercial viability, and demonstrate successful operation for no less than five years.
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Respondents to the SRIQ
Respondents to the SRIQ were asked to discuss integrated municipal solid waste management processes including but not limited to:
◦ recycling,
◦ composting,
◦ pre-processing,
◦ conversion,
◦ post-processing and management of MSW products and residue,
◦ refuse derived fuel production and electricity generation.
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Supplemental Request for
Information and Qualification
For each reference facility and technology identified by the respondent, the SRIQ asked for the following ◦ Facility name/location;
◦ Description, owner/operator, dates in operation;
◦ Process flow diagram;
◦ Demonstration or commercial facility;
◦ Designed capacity tons per day (tpd);
◦ Current operating capacity (tpd);
◦ Number of units and unit capacity (tpd); Annual availability;
◦ Byproducts and outputs (designated in units MW, Btu, tpd, etc.);
◦ Type & quantity of waste processed;
◦ GHG emissions data that demonstrates how the proposed technology would help achieve the City of Cleveland’s GHG reduction goals and more.
32
Supplemental Request for Information
and Qualification
For waste management, composting, recycling and other related companies, the SRIQ asked for answers to the following:
a) name and location of reference facilities;
b) the owner/operator;
c) type of technology;
d) feedstock;
e) capital and operation and maintenance cost;
f) raw MSW and feedstock throughput;
g) types/quantities of products and by-products;
h) amount of residual sent to landfill;
i) history of operations;
j) start-up date;
k) time in service; and
l) a discussion of operating and maintenance challenges.
33
Supplemental Request for
Qualification
These companies were asked to discuss the
environmental impacts of their technology
including permit requirements, air emissions,
odors and more.
They were also asked to provide a description
of any pre-processing system required to
prepare the feedstock for processing and
include equipment used to pre-sort, separate,
shred, size, screen, dry, or otherwise process
the feedstock material.
34
Supplemental Request for Information
In April of 2012, Cleveland City Council
passed legislation extending an
opportunity for a broader group of
interested MSW recovery and conversion
technology providers to file responses
The legislation also authorized the hiring
of a new consultant
35
New Request for Consulting
Services The responses to the RFI of September 2011 and the
responses to the SRIQ of May 2012 will be provided to the consultant selected through this Request for Proposal process.
The information and steps the City undertook in its air permit application to develop the CREG Center as a gasification, waste-to-energy facility. will also be permitted to the consultant.
The information CPP has on the development of a cogeneration project will also be provided.
The consultant will evaluate all of the above.
The consultant will develop recommendations after reviewing each of these activities.
36
Cleveland Recycling & Energy
Generation Center
The City moved away from the generic MSWE label and
focused on branding to better position the facility with the
community and surrounding neighborhoods and renamed
the project.
The City’s recycling and waste-to-energy facility is now
referred to as the Cleveland Recycling & Energy
Generation (CREG) Center.
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C. Refuse Derived Fuel Production
Fuel Pellet Production
In addition to power production, the CREG Center will use yard waste, food, paper residuals and other non-hazardous and non-recyclable materials to produce an environmentally friendly, refuse derived fuel pellet.
The fuel pellet can be marketed as an alternative or supplement to coal and can be blended with coal to produce electricity.
The CREG Center’s RDF pellet could serve as the primary feedstock for the thermal conversion technology selected. Among the requirements of the RDF pellet is that it must be environmentally friendly.
Excess pellets would be sold to a local company that is currently using coal for steam production. Under the gasification model, only the RDF pellet would be feed into the gasifier.
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Refuse Derived Fuel Production
Although most gasifiers do not require pelletization of
feedstock, the City intends to weigh the benefits of
pelletizing against the benefits of using less extensively
prepared feedstock in the gasifier.
Chief of all concerns is the environmental impact
followed closely by the economic impact of such an
investment and the impact on system efficiency.
The targeted materials for pelletization may include
items such as residual paper, light plastics, food, yard and
wood waste and these items would be shredded and
converted to a biomass fiber.
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Refuse Derived Fuel Production
Depending on the pelletization technology selected,
the biomass fuel fiber would exit the system with a
low moisture content and a heat value around 10,000
BTU.
This biomass pellet would contain minimal sulfur and
would be much cleaner burning than fossil fuel. The
end product would be a high value fuel pellet that is
90% cleaner than coal.
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D. Air Permit Application
In March of 2011, CPP applied for an air
permit for a MSWE facility at the City of
Cleveland’s Ridge Road Transfer Station.
The Ohio EPA issued a draft of the
permit in November of 2011 and is
currently reviewing comments filed on
the draft permit.
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Air Permit Strategy
Consistent with Ohio EPA’s air pollution control rules, CPP identified three objectives for the CREG Center air permit application: ◦ Control air pollutant emissions with the use of
the best available air pollution control technology to minimize the discharge of air pollutants to the environment;
◦ Restrict annual air pollutant emissions (tons per year or TPY) consistent with classification as a “minor source” or “synthetic minor source”; and
◦ Design the facility and site layout to ensure the air pollutant emissions result in off-site air quality impacts that are well under acceptable levels.
42
Air Permit Strategy The types of air contaminants (or air pollutants) that will be emitted by the proposed CREG Center fall into three general categories:
1. Air contaminants for which the United States Environmental Protection Agency (US EPA) has adopted National Ambient Air Quality Standards (NAAQS). The NAAQS pollutants include:
Ozone (the precursor pollutants for ozone formation in the
ambient air are volatile organic compounds (VOC) and nitrogen oxides (NOx));
Nitrogen dioxide (NO2) (approximately 75% of the total NOx is NO2); Sulfur dioxide (SO2);
Particulate matter less than 10 microns in diameter (PM10);
Particulate matter less than 2.5 microns in diameter (PM2.5) (the precursor
pollutants for PM2.5 formation in the ambient air are NOx and SO2);
Lead (Pb); and
Carbon monoxide (CO).
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Air Permit Strategy
2. Air contaminants that are: (a) listed as a Hazardous Air Pollutant (HAP) by the US EPA, including hydrogen chloride (HCl), hydrogen fluoride (HF), cadmium (Cd), mercury (Hg) and dioxin; and/or (b) identified as a toxic air pollutant by the Ohio Environmental Protection Agency (Ohio EPA), including ammonia (NH3) and sulfuric acid (H2SO4); and
3. The Greenhouse Gas air pollutants designated by US EPA, including carbon dioxide (CO2) nitrous oxide and methane, expressed as CO2 equivalents or CO2e.
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Air Permit Strategy
The CREG Center’s air emissions are expected to be below all required air quality standards for the following reasons:
1. CREG Center will feature the best available, state-of-the-art air pollution control equipment that will capture harmful pollutants and cut emissions;
2. The City will invest millions of dollars in a state-of-the-art material recovery facility (MRF) at CREG that will help remove items that have mercury and lead at the beginning of the process, so these items will never be gasified and the related pollutants will be significantly reduced from the start;
3. The selected gasification technology will have a proven track record for pollutants such as NOx, mercury and lead.
4. CREG reduces the number of trucks in and out of Ridge Road Transfer Station and also reduces the number of trucks dumping waste at the landfill and thereby cuts Greenhouse gases by millions of tons a year; and
45
Air Permit Strategy
Gasifier Max Operation
◦ Schedule: 12 hours per day per gasifier (365
days per year)
◦ Feedstock: 70 tons of MSW/batch.
◦ Cycle: One batch of MSW will be processed
each day in each gasifier
46
Public Meeting
A public meeting was conducted by Ohio
EPA on January 9, 2011,
◦ A number of elected officials and
representatives of neighborhood
organizations expressed concern about the
original January 13, 2012 deadline.
◦ As a result, Mayor Jackson formally requested
that the deadline be extended by thirty days
◦ The Ohio EPA extended the public comment
period through February 23 2012.
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Public Meetings
Although CPP had conducted a number of public meetings prior to the issuance of the draft permit, the City added a number of additional meetings to inform and educate the public.
February 23, 2011 Meeting with residents and business stakeholders
April 4, 2011 Meeting with local environmental groups
January 11, 2012 Meeting with Cleveland City Council
January 19, 2012 Public Meeting at the Estabrook Recreation Center
January 26, 2012 Public Meeting at the Zelma George Rec. Center
February 8, 2012 Public Meeting at the Cudell Recreation Center
February 9, 2011 Public Meeting at the Harvard Com. Services Center
February 15, 2012 Public Meeting at the West Side Ecumenical Ministry
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E. Co-Generation Opportunity
Cleveland Public Power is in discussions with a local steam heat and cooling company about a co-generation project.
This company is a CPP customer that would modify one of its air permits and use the CREG fuel pellet along with coal to produce steam and electricity.
This configuration would be a co-generation operation with steam used for both CPP’s electric generation and Cleveland Thermal’s steam heat requirements.
The offsite location for co-generation may resolve neighborhood concerns about CREG Center’s waste-to-energy air emissions.
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Co-Generation Opportunity
Plant Operation
The co-generation facility would install two fluidized
bed, multi-fuel fired boilers and one 42 MW steam
turbine generator.
The facility could purchase all or some of the CREG
Center’s pellet product.
Gasification of CREG’s fuel pellet alone would not be
adequate for power output greater than 20 MW, so
additional feedstock or fuel would be needed for 42
MW capacity.
The remaining feedstock could be coal and/or additional
renewable feedstock.
50
Co-Generation Opportunity
Ridge Road CREG Center Activities
Under the co-generation approach, the City-wide
recycling, the recycling center, the material recovery
facility, the fuel pellet production facility and decorate
bricks would all remain and could be located at the
Ridge Road CREG Center campus.
The steam production and electric generation facility
would be located at the co-generation site. Composting
could be located at Ridge Road or a suitable located
elsewhere, if found to be a viable, self supporting option.
51
Complexities of Project
Development
Political Realities
◦ Local concerns and influence will either
propel a project forward or provide additional
impediments
◦ Timing is everything (expect a lengthy
development period) so knowing when and
who is important
◦ A well developed Public Relations campaign is
critical
52
Complexities of Project
Development The driving forces behind coalitions
To form a coalition one needs to demonstrate:
that the goals of each of the prospective members are similar and compatible;
that working together will enhance each groups' ability to reach their goals;
that the benefits of coalescing will be greater than the costs of proceeding alone;
that it is risky to consider alternatives to the coalition; and
that the activities of the coalition are likely to receive more media attention than those of any individual organization.
53
Complexities of Project
Development
Unique Nature of Coalitions Not all coalition members buy into the
joint effort equally Some members may be less committed to
the “goals” of the coalition than others Some members of a coalition may take
positions that are counter to the respective member’s traditional positions
Members may move away from their traditional views for the sake of joining or supporting a coalition
54
Complexities of Project
Development
Identify the differences in the core messages or
objectives of the members
To keep a coalition together, it is often
necessary for a coalition to cater to one side
more than another--especially when negotiating
External influences and
relationships are important
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Complexities of Project
Development
Settlement strategies may be effective to respond to members that: ◦ are not committed to extreme opposition
positions
◦ may be receptive to concessions that align with their core missions
◦ find the coalition is not meeting their expectation
◦ believe the other coalition members are not taking that respective member’s concerns seriously
56
Road Map for Project Development
Strategy development (outline how the project will be developed) ◦ Rigorously analyze the technical, economic and
environmental feasibility of the technology/project
◦ Work with the local interest groups an leaders for community buy-in
◦ Include a broad group of stakeholders
◦ Form a Steering Committee (include public leaders, waste management personnel, local environmental groups, sustainability representatives if possible)
Develop air permitting strategies ◦ Demonstrate reductions in harmful emissions
◦ Map emissions of key pollutants
◦ Meet with regulators before, during and after you file
57
Road Map for Project Development
Secure legislative support
Meet with community groups ◦ Identify groups more likely to support the project
◦ Meet with groups likely to oppose the project to understand their concerns
◦ Seek credible environmental and sustainability stakeholders to gain support for the components/benefits that support their agendas
Understand the technology ◦ Seek independent validation of technology
options
◦ Check references and ask for documentation
58
Road Map for Project Development
Determine how much risk will be taken with new technology verses mature technology
◦ Are full scale commercial projects required or are successful smaller scale demo projects acceptable
Visit/ inspect technologies that provide the most promise
◦ Verify technology claims
◦ Document environmental impacts
◦ Seek feedback from residents in the community where the technology is used
◦ Confirm successful commercial operation
◦ Visit technology user customers locations
59
Road Map for Project Development
Economic Impacts ◦ Emphasize the regional/community benefits of the
project to gain the support of contractors/labor in the area
◦ Job creation
Environmental Impacts ◦ Work to achieve the community’s recycling and
sustain ability goals
◦ Highlight reduction of landfill cost and environmental impacts like avoidance of GHG
◦ Marketing and branding is key emphasizing Green Energy, environmentally friendly energy and sustainability objectives
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Road Map for Project Development
Public Education ◦ Public hearings and public meetings
◦ Brief community groups (community outreach)
◦ Connect the project to other successful and related
beneficial community programs
◦ Target all age groups
◦ Advertise your message
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