This is a great example of our dream assignment – a phased and collaborative plan to help a client develop a large low-carbon energy project. It started with market analysis, screening, and concept development. It continues through the development of a detailed business case and delivery model; support in negotiations of an off-take agreement; assistance with internal and external approvals; input on technology selection; and assistance in procurement and delivery, including contracting.
Located about 14 kilometers outside the City of Victoria, Hartland Landfill is one of the largest landfills in BC. Developed as a private dump in the early 1950s, Hartland was purchased by the Capital Regional District (CRD) in 1975 and now provides waste disposal and recycling services for communities and residents throughout Greater Victoria. Hartland is expected to remain in operation until at least 2049, and is currently undergoing a planning exercise that, if approved, would see the landfill life extended to beyond 2100. Hartland is also the site of the CRD’s new Residuals Treatment Facility for residual solids from the new McLoughlin Point Wastewater Treatment Plant.
The CRD has been collecting and flaring landfill gas (methane) at Hartland since 1992. In 2003, the CRD engaged a third party to develop a facility to produce green electricity from landfill gas for sale to BC Hydro. With a capacity of about 1.6 MW, this facility uses only half of the landfill gas currently captured at Hartland. The remainder is flared.
Given the age of the electricity generation equipment, the pending expiry of the Power Purchase Agreement with BC Hydro, and the continued growth of excess landfill gas, the CRD first engaged Reshape in 2018 to conduct a screening study of long-term options for beneficial use of landfill gas. The screening study considered several options, including continued electricity production and upgrading landfill gas to Renewable Natural Gas (RNG) for sale to FortisBC. The screening integrated the latest modelling of future landfill gas production and considered the costs, market context and GHG benefits of different utilization options.
Based on the results of the screening, the CRD engaged Reshape to develop a detailed business case for upgrading landfill gas to RNG. This step included consideration of the optimal sizing for an upgrader, as well as delivery and ownership options.
Following approval in principle by the Board of CRD to proceed with the development and ownership of an upgrader, Reshape supported negotiations of a long-term Purchase Agreement with FortisBC. This project requires FortisBC to construct a new 7 km interconnection to its local gas network. A key consideration in the negotiations was how to accommodate uncertainty over the cost of this interconnection, as well as future landfill gas volumes within the cap on RNG acquisition costs under the Province’s Greenhouse Gas Reduction Regulation. Following execution of the Purchase Agreement, Reshape supported the CRD in its participation in FortisBC’s application to the BC Utilities Commission for acceptance of the Purchase Agreement.
Since acceptance of the Purchase Agreement by the BCUC in May 2021, Reshape has continued to advise the CRD on the development of the upgrader. We advised on the procurement model (a progressive design-build process, with a 5-year operating agreement), and helped develop the Request for Qualifications from interested design-builders and operators. We continue to advise the CRD on the full Request for Proposals, including process design, the project design basis, submission requirements, evaluation criteria, and proposed contract terms (including pricing arrangements and performance guarantees). We will remain involved in the review of submissions and detailed negotiations with a successful proponent.
The upgrader will be commissioned in 2023. It is expected to deliver over 200,000 GJ/year of RNG to FortisBC, which will eliminate about 264,000 tonnes of greenhouse gas emissions over the 25-year contract.
For more details on the Hartland Landfill and the CRD’s progress on this initiative, visit the project website here.