It was recently reported that at least one councillor feels they must rely on the experts the City hired to create the business case for the proposed Municipal Utility Corporation. With respect to the full-scale waste-to-energy project, I see no evidence in the plan or elsewhere to suggest that the City hired an unbiased third-party technical expert to work with Grant Thornton to complete the analysis.
Key technical and financial details related to the full-scale waste-to-energy facility are missing from the preliminary business plan. This is despite prior directives from city council, and agreement from city staff that they would be included. Among the missing information is a clear project definition and a preliminary engineering or “pre-FEED” study that outlines basic information such as feedstock types and quantities to be processed, gasification system details and other infrastructure requirements, operating assumptions and cost estimates.
The cost estimates that are contained in the preliminary business case do not appear to be complete. Several cost components appear to be missing (e.g. land, site development, processing equipment, engineering and project management costs) which means the capital and operating costs used by Grant Thornton could be significantly underestimated. This calls into question the completeness of the overall financial evaluation of the waste-to-energy project. Since this project is an integral component of the preliminary business plan, this also means that it is not possible to fully evaluate the overall financial performance of the City of St. Albert’s proposed Municipal Utility, or the benefits or impacts it will have on ratepayers.
Given this, it would be prudent for the City of retain an independent third party with demonstrated experience on waste-to-energy projects in general, and solid waste gasification in particular, to conduct a more thorough technical and financial review of this project prior to proceeding further. In my 25+ year career as a solid waste engineer and consultant, I have worked on many similar reviews. I can say from direct experience that they are not difficult to complete and all the information necessary to do a meaningful evaluation exists. It seems to me as a ratepayer that spending less than $25,000 to complete such an analysis would be a wise investment to confirm that this project is viable – particularly since the information in the Grant Thornton report currently suggests it is not.
The apparent omissions in the cost estimates for the full-scale waste-to-energy project also call into question the reliability of the other cost estimates contained in the preliminary business plan. Due diligence would suggest that council request independent technical reviews of the basis of design/assumptions/cost estimates completed for the other projects contained within the preliminary business plan.
This approach would provide ratepayers with the confidence that a thorough and balanced view of individual project costs and financial risks has been completed, and would allow ratepayers and council to better judge the overall value of the proposed Municipal Utility Corporation.
Scott Gamble, St. Albert
