Waste Diversion in Ontario; a Broken Business Model

This week in the Toronto Star there was further reporting of abuses of waste that was supposed to be diverted and sent for composting, being sent to landfill instead.

The problem of less waste being diverted than expected, to my mind lies in how the waste industry's current business model works.

The simple version of this story is that waste is seen as a liability and the rewards go to people who take the waste off the municipalities hands.

The rewards are best if you have a landfill; you take waste, get paid an attractive fee and bury it in a hole in the ground. Without a landfill you have to pay part of the fee to someone who has one. Thus the landfill operators are the big winners in this game. Until waste is recognized as an energy resource and should be used to create liquid fuels or electricity, this is unlikely to change.

Recyclers make their money by extracting resalable materials from the waste stream and selling these commodities on the open market.In good times they make money, but in low commodity cycles recycling is a tough business. Many of them would like to have alternatives to landfill and so would their customers.

There seems to be no particular incentive for landfill operators to find alternatives to landfill, unless the capacity of their landfill is almost used up. Most see the solution as finding other landfill sites and until we find viable alternatives they are probably right. I've spoken to a number of landfill operators and they believe that landfill is here to stay. They also feel that most alternatives are too capital intensive to justify serious attention at this time.

The article focussed on Dongara Pelletizing Plant sending waste to landfill instead of processing it into energy pellets. This story highlights an excellent example of what is wrong with the system, not what is wrong at Dongara.

York Region doesn't pay them for energy pellets delivered to customers. The way their deal works, they get paid the tipping fees for each tonne of garbage delivered to their plant regardless of what happens to it. It's off the municipality's hands, so they no longer need to worry. When and if Dongara dumps it in landfill, irrespective of the reason, by my rough calculations they appear to make about $20.00 per tonne. Its not much, but if the Star is right and they have no market for their product, that might become an important source of revenue. Is it any wonder that they take advantage of it?

In a contract of that nature, there ought to be a penalty for dumping instead of processing, rather than a reward as is currently the case. The $84 per tonne paid by York Region is a significant premium as is pointed out in the article, but it should be tied to diversion only.

Until there are incentives that drive the right diversion behavior, many promising solutions are unlikely to survive. Most are capital intensive and require investors to take significant risks. Why do that, when there are cheaper and safer investments in the area of waste handling and diversion?

Power Stations or Locomotives?

This morning I got to do something I generally don't have time for during the week. My wife and I were able to sit together and enjoy a tasty home cooked breakfast of bacon and eggs with grilled tomato and onions. Small pleasures are still great.

While we were eating and chatting, we were also had the news on TV in the background and a story caught my attention.

There was a protest going on about the use of diesel locomotives on a rail link between Toronto and the city's airport. The protesters weren't protesting about the new commuter transport facility. They were protesting the use of diesel locomotives, suggesting that electric locomotives might be better for our health.

A noble but misguided thought!

While I'm not a particular fan of fossil fuels, it stuck me, as it has many times before, that protesters are often ill informed, no matter how well intentioned.

Where do these people think electricity comes from?

Most of the electricity in North America is generated by fossil fuels, coal being the predominant source.

Although coal powered generating stations are being phased out in Ontario and other jurisdictions, coal will still account for most of the power generation across North America in the coming years.

Which is the healthier choice, a fossil powered generating station or a few diesel powered locomotives? I don't know the correct answer to that, but I'm pretty sure the power station is the less healthy choice, however until I know the specifics, I'm not going to be lead by the nose.

I think protesters should know the answer to that kind of question. But in my experience most protesters are light on specifics, using emotional arguments to sway public opinion.

Sadly many good projects are prevented from moving forward because emotional arguments have stirred up public opinion against them and we the public don't generally investigate the merits of these arguments to decide who is right. See my post covering the differences between incineration and gasification.

Just because most of us are removed from the source of production, doesn't make electricity as it is produced today, a clean source. Power stations today belch millions of tons of CO2 into the atmosphere every day. Why is electricity produced this way preferable to fossil powered locomotives?

Despite our efforts to generate electricity from clean sources like solar and wind, these two sources will account for less than 10% of our power needs for the foreseeable future.

Protesters; by all means let your feelings be known, but before you do so make sure you are familiar with the facts.

The Difference Between Gasification and Incineration

I recently received an e-mail from a concerned citizen of Ontario. Jane Wilson was very upset with me because she'd heard my firm is planning to build a waste to energy plant in Sarnia, Ontario. She went on to say that it is impossible to run an incinerator without any emissions. Funnily enough I pretty much agree with her.

I tried to explain the difference between incineration and gasification, but she was not having any of it. She told me it was just semantics. Apparently she is a chemist and this gave her superior knowledge about such subjects.

Seeing that I was unable to get her to listen, let me set the record straight about these two issues.

Admittedly there are similarities, but that does not make them the same or the consequences of using them the same.

Incineration is simply burning. Burning requires oxygen either in the air or as a pure feed. When a substance is burnt, it is oxidized. If we burn hydrocarbons like those found in waste we typically get lots of CO2 and some water H2O. Waste is seldom pure and a lot of toxic substances are formed. These toxic substances are released to the atmosphere in smoke if it is not scrubbbed.

I was going to give you my own definition of gasification, but thought an independent 3rd party view might remove any bias that I have. Here's what Wikipedia says:

"Gasification is a process that converts carbonaceous materials, such as coal, petroleum, biofuel, or biomass, into carbon monoxide and hydrogen by reacting the raw material, such as house waste, or compost at high temperatures with a controlled amount of oxygen and/or steam. The resulting gas mixture is called synthesis gas or syngas and is itself a fuel. Gasification is a method for extracting energy from many different types of organic materials.

The advantage of gasification is that using the syngas is potentially more efficient than direct combustion of the original fuel because it can be combusted at higher temperatures or even in fuel cells, so that the thermodynamic upper limit to the efficiency defined by Carnot's rule is higher or not applicable. Syngas may be burned directly in internal combustion engines, used to produce methanol and hydrogen, or converted via the Fischer-Tropsch process into synthetic fuel. Gasification can also begin with materials that are not otherwise useful fuels, such as biomass or organic waste. In addition, the high-temperature combustion refines out corrosive ash elements such as chloride and potassium, allowing clean gas production from otherwise problematic fuels.

Gasification of fossil fuels is currently widely used on industrial scales to generate electricity. However, almost any type of organic material can be used as the raw material for gasification, such as wood, biomass, or even plastic waste."

Plasma gasification runs at about 5,500 degrees Celsius and immediately breaks everything down to its basic molecular structure. The only residue is an inert vitrified slag which can be used to make aggregate for construction.

You can learn more about gasification with this YouTube video.

As you can see the two processes are quite different and gasification offers a number of distinct advantages over incineration.

It is true that gasification does release some CO2, but that is generally less than what is produced by incineration.

Incineration can be used to create heat and steam for the generation of electricity, but the syngas produced by gasification can be used to make a number of value added commodities including liquid fuels like green diesel and ethanol.

There is no future for oil! The Future for oil is fine!

There is no future for oil! The Future for oil is fine!

Everyday the argument continues and the so called evidence mounts each day for both sides of the argument.

I personally believe that oil is finite and that we've probably reached peak production, but there are a lot of voices from people more qualified than me that might disagree. The announcement last week of BP's deep discovery in the Gulf of Mexico is being used by some to support the theory that there's lots more oil and that modern technology will help us find it and extract it.
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That may be true, but as the cost of finding and extracting oil climbs the search for alternatives grows. The problem is that many of the alternatives are not really viable today. Either they cost considerably more than oil, or they are not really scalable and so while contributing to the pool, do little to change the situation.

North America consumes about 8.16 billion barrels of oil per year. Biomass is often touted as the solution. There are about 1.3 billion tons of biomass available in the US to be turned into fuels. Canada probably has more, but i could not find the numbers i needed to confirm this. The problem with Canada is that most of the biomass is in remote areas and the costs of transport and harvesting make it unattractive at the present time.

The truth about biomass everywhere, is that it is expensive to grow, harvest and transport to fuels production facilities. I'm not saying biomass cant work, merely that there are large problems to which we have not found answers. If all of this biomass was converted to liquid fuels, I've estimated we'd create no more than 34% of the fuel needed for North America.

On the other hand waste presents a very interesting set of numbers.
*Municipal solid waste contains about 8000 BTU per pound.
*Each barrel of oil contains about 5.8 million BTUs.
*Each ton of waste converts to 2.7 barrels of liquid fuels
*We dump about a billion tons of waste into landfill each year

This means, using existing technology that we know works, we could produce 2.7 billion barrels of fuel from the MSW we produce and currently spend about $80 billion a year to dump in holes in the ground.

The beauty of converting waste to liquid fuels is that we kill two birds with one stone; we reduce our dependence on landfill and solve a number of the problems that go along with it like the escape of methane into the atmosphere, the leachate that seeps into our ground water and the odors that affect all who are close by.

However more importantly if we were to convert all of this waste we could produce about 37% of North America's fuel needs from a widely distributed energy resource. We go a long way to reducing our dependence on foreign oil and we produce a fuel that is one of the greenest on the planet.

It is unlikely that in the short term there will be the capital available to convert all of our hydrocarbon waste to fuels, but if the governments of the world want to create green jobs, this technology would be a good place to put money.

Fischer Tropsch fuels contain no sulfur, no particulates, no nitrous compounds and no aromatics. Their life cycle greenhouse gases are among the lowest of all fuels and their is a huge carbon offset from the waste diverted from landfill.

What's also important is that these fuels can be produced today, with virtually no technology risk. This technology has been around for over 80 years but only operating at very large scale. With second generation advances it is now possible to build economically viable small scale plants that would provide waste handling solutions to the more than 336 cities around the world with more than 1,000,000 people.

I recently returned from Cleantech Boston where there was much talk of waste to energy, but most were talking about using waste to generate electricity. There's no doubt that this approach works, but it is low value add when compared with fuels. More about this in a later blog.

What the Big Waste Companies Dont Want You To Know About Landfill?

I don't know anyone who thinks landfill is a good idea, yet it is one of the most widely used ways of disposing of waste. Every city in the world seems to have one. I'm sure there are a few places that don't and would definitely be interested to find out where these cities are and what they do instead.

Yet despite this common dislike, very few people understand the perils beyond; "They stink!" or "I don't want to live near one!". They don't want to live near one, probably because they stink and maybe because of all the trucks taking garbage to the dump.

Most of the big companies that operate them definitely don't want the public to know the problems associated with them. Some of them are multi-billion dollar corporations and their business models would be irreparably damaged if they were not allowed to landfill, which is what would happen if people really understood the truth about landfills. However some of the more enlightened ones are looking at alternatives. Most of the alternatives involve incineration and using the heat to drive turbines to generate electricity. Incineration has its own set of problems and destroys the resource molecules so they are lost forever.

The first thing you should know is that even where there is rigorous recycling, more than 30% of what we throw out ends up in landfill. More likely its closer to 60%. These numbers rise when commodity prices are low, like now, and it becomes too costly to recycle much of what is collected.

All cities could do a better job of recycling, but we need to change their paradigm about recycling and what it is. See my blog What is Recycling at the Molecular Level? This way resource molecules can be reused many times over.

The reason why landfill smells is largely because of the bacteria in waste that cause decomposition. We all know what rotting food smells like and its only one of the components. These smells are carried into the air with the gas that escapes from landfill. This decomposition is slowed by the lack of oxygen in the landfill and it results in a combination of biological processes, physical processes and chemical process that may take more than 150 years to break down all the materials in a landfill. Until that happens gas builds up and leaks out of even the best managed landfills.

There is a lot of talk these days and some action around tapping landfills for the methane gas they produce. The idea is to capture it and use it to produce electricity or to use as a natural gas substitute. This definitely works, but is one of those ideas that work better in theory than in practice. Landfills by their nature are not completely gas tight, so as much as 50% of the methane produced simply escapes into the atmosphere. This is a big problem if you are a believer in the climate changing effects of green house gases (GHG)from landfill. Methane is 21 times more powerful than CO2 as a GHG. Methane is light and rapidly dissipates into the atmosphere.

Municipal waste is the most non-homogeneous substance known to man. The problem is that we throw anything undesirable into the garbage. Apart from plastic, paper glass and metals, we throw rotting food, dirty diapers, dog poop, soiled tampons, paper towel used to clear up everything from gravy spills to vomit etc. I could go on, but you get the point.

Much of this stuff is laden with bacteria. The bacteria spreads and grows in the warm moist environment,further breaking down whatever it can thrive on. This in turn generates liquids, some of which can be very toxic and they can leak out as leachate. Leachate can contaminate the ground water and must be monitored on a very regular basis with wells in the nearby country side. We've got better at preventing ground water contamination, but why take the chance.

In some countries landfill fires are a problem. These fires fill the air with toxic smoke and the ash may also mix with the leachate, causing further problems if it is toxic. This doesn't often happen in North America, but it doesn't mean it cant.

We need to begin to push back against new landfills and embrace emerging technologies that offer the promise of zero landfill. The big companies that operate landfills make a fortune from this archaic and unpleasant practice and it is not in their best interests to change their business model.

Checklist for Alternative Fuel Viability

I was at a party last night and at one time the discussion topic was the next big breakthrough in alternative fuels to power vehicles. One young woman was excitedly extolling the virtues of the "Hydrogen Economy" and bio fuels. One or two others at the party were convinced that the future lies in electric cars, forgetting that today most electricity is generated using fossil sources.

I personally doubt that any single approach is going to save us from the problems of a diminishing oil supply and the concurrent rise in oil prices. I believe there are a number of viable alternatives and we need to consider them all. The problem is that many will prove not to be viable in the long run.

We also need to remember that fuels that are fine for cars may not be suitable for trucks and aviation. Ethanol and methanol may be suitable for cars, but have not found a place in trucking or aviation.

The question is; What criteria determine if a fuel will be a viable alternative?

I believe that in order to succeed a fuel must offer positive answers to the following 8 questions:

1. Is it sustainable?

How long will supply last? There are a number of fuels that can be considered, but many are in short supply. Bio-diesel is a prime example, there just isn't enough to supply all the demand for diesel. Biomass; crops that have to be grown and converted to liquid fuels are less sustainable because although it's theoretically possible to have an unlimited supply, practical reasons like space and soil productivity suggest this may not be the case over the long term.

Right now solar, wind, hydro-electricity, geothermal and garbage look like they are truly sustainable and to all intents and purposes unlimited, but most of these are not suitable for powering vehicles and planes.


2. Can it be produced in sufficient volume?

The volume of liquid fuels consumed is enormous at close to 100 million barrels per day during peak demand periods. It has been estimated that if every acre of arable land in the USA was converted to growing corn for fuel and not one ear of corn was used for food, we'd probably only be able to provide about 10% of the US's liquid fuels, so bio fuels are unlikely to be the long term solution, but may well provide part of the answer.
With regard to waste, my own estimates show that we dump enough raw material into our landfills each year to produce nearly a billion barrels of oil.The capital costs of doing this may prove challenging, but this solution is viable.

3. Can it be utilized with existing infrastructure?

To change the infrastructure to accommodate a new fuel is incredibly expensive. Imagine the costs of changing all of the engines in all of the vehicles on the road, updating fueling stations and transport systems to get it to the fueling station and the cost of changing support systems to support and entirely new type of fuel system. If this ever happens, it will happen gradually, probably over 20-30 years or more, otherwise it is unlikely to be affordable even to countries as rich as the US and Canada.
What is more likely is a fuel that can be used in all parts of the existing infrastructure with no or minimal cost. Fischer Tropsch fuels are attractive for that reason as they are chemically identical to fossil fuels and because they are so much cleaner burning.

4 Are the environmentally sound?

Today the watchword is green. If a fuel isn't green, its unlikely to pass the smell test.The question what is "green"? Is is something that burns clean? Is it something that has a low GHG profile when all parts of its life cycle are considered? Is it something produced from sustainable sources? All these issues are still unclear, but what is clear, is that the public want fuels that are clean burning, sustainable and reasonably priced.

5. Can it provide a constant supply?

What happens when the wind stops blowing, crops fail or the sun doesn't shine for a few days. At present we don't have commercially viable answers to these problems. The only thing that might stop the supply of garbage for a waste to liquids plant, is a garbage strike like we just had in Toronto or competition for the raw material by other waste to energy businesses.

6. Is it competitively priced?

Oil price is the yardstick by which the price of all alternative fuels are measured. If the cost to produce a fuel is way out of line with the price of oil, people will simply stick with fossil derived fuels. As the price of oil rises, this will make other alternative fuels more attractive, but to truly compete, the cost to produce an alternative fuel needs to be pretty close to that of oil if it is to be competitive with oil.

7.How much energy is used to create the fuel?
In fuel circles there is a term that covers this; its Energy Return on Energy Invested (EROEI.) Simply stated if it takes less than 1 barrel of oil to make one barrel of oil the energy return is positive. If it takes more then it is negative and you go bankrupt. Government incentives help, but no alternative energy should be dependent on them for the long term.
Over the years the EROEI for oil has gradually fallen from an average of 100 barrels produced for every one in inputs, down to 3 for every one of input, but it is still positive. Many peak oil theorists believe that we are not so much running out of oil as we are coming to the point where the EROEI is negative. For a lot of alternative fuels, the EROEI is negative. This is true of cellulosic ethanol and for hydrogen. Because garbage is essentially free it remains an attractive feedstock for waste to liquids projects and the EROEI is positive.

8. Scarce materials
Some alternative energy sources require the use of scarce materials. Lithium for use in batteries may be relatively plentiful now, but if we are successful in producing batteries that can store enough current to sustain longer journeys in electric powered vehicles and the public begins to embrace electric powered cars, how long will it be before the world's lithium supplies become depleted and we enter "Peak Lithium"?

For the above reasons we need to be developing multiple alternatives and over time public opinion and price will determine the winners. As I see it waste to liquids from Fischer Tropsch comes very close to meeting all of these criteria and deserves a close look. There is probably no single solution that will meet all of our liquid fuel needs so let's commit before its too late to finding ones that will work and provide us with the fuels we need for transportation and for the quality of life to which we've become accustomed.

Is Peak Oil real or Imagined?

There is a lot of discussion over peak oil; if it is real; if it is here or still to come.

The article below presents the most compelling data on peak oil that I've seen in a long time.

http://truecostblog.com/2009/07/14/is-peak-oil-real-a-list-of-countries-past-peak/"

Whether you are a believer or a doubter, Praveen Ghanta's data is worth looking at.

I have long believed that peak oil is a reality. I just didn't know for sure if we'd reached it or not. Now the answer is clear and tells me that apart from any environmental reasons or social reasons, the new alternative fuels from waste business I'm building is the right thing at the right time.

What's more, the data reinforces that we need every type of alternative fuel if we are to avoid an energy catastrophe once the down turn is over. The IEA's report from last year shows we'll need an additional 45 million barrels per day to meet demand by 2030.

Based on my own research, this new supply wont come from new oil discoveries. Our only chance is alternatives, but we have to move now because these things take time to prove and to scale up. We have to look at everything from bio-fuels to electric vehicles and every energy source from biomass to waste.

Fischer Tropsch is proven and ready to go, most of the other alternatives have problems with scaling up, social implications or are too early stage. Now is the time to act.