Public Services Commission members closed out two days of intense public hearings on St. Thomas and St. Croix by approving power purchase and interconnection agreements between the V.I. Water and Power Authority and Denver-based Alpine Energy Group for the construction of waste-to-energy facilities on both islands.
The vote came around 10:30 p.m. Tuesday, after a mixed bag of testimony from WAPA, Alpine and V.I. Waste Management Authority officials, along with a handful of local residents who signed up to speak during the St. Thomas hearing. In the end, commission members made clear their support for the project, saying that they had been researching and discussing the issue for months and were ready to consummate the years-long quest for alternative energy in the V.I. by moving ahead with the proposal.
In August, Government House announced that both WAPA and the Waste Management Authority had entered into agreements with Alpine Energy Group for waste-to-energy facilities that would, according to officials, allow WAPA to bring down its costs and lower its dependency on fossil fuel, while giving WMA the ability to burn municipal trash and close the territory’s two landfills.
The approvals came attached with certain stipulations from WAPA and Georgetown Consulting Group, the PSC’s advisors on WAPA-related matters. One major section of the joint stipulation speaks to various scheduling deadlines Alpine must meet over the course of the project and what WAPA must do if those deadlines aren’t met and the contract with Alpine is terminated. Another section gives the authority 18 months to sit down with Georgetown and work out how it will be able to recover the cost of having to purchase power from Alpine — whether through Levelized Energy Adjustment Clause (LEAC) rates, base rates or a combination of both.
Under the power purchase agreements, WAPA has committed to buying power from Alpine at fixed rates set for the next 20 years. That commitment provides Alpine with a stable revenue stream with which it can pay back the hundreds of millions of dollars the company is borrowing from U.S. and European banks to finance the $440 million project.
Voting to approve the agreements were commission members Joseph Boschulte, Donald "Ducks" Cole, Verne C. David and M. Thomas Jackson. Commission member Elsie V. Thomas-Trotman voted against the authority’s petition for approval, while commission member Sirri Hamad was absent.
Testifiers also made it clear that the public will have other chances to scrutinize the project, which will come up for permit approvals and be aired in the Senate when lease agreements for the property needed to house the facilities will be up for consideration.
Meanwhile, both sets of public hearings were packed with residents either supporting or opposing the project, or, as in the case of the St. Thomas hearing, asking that PSC members take more time to consider what kind of environmental impacts the partially pet-coke fueled facilities will have on the local community.
St. Croix residents packed the conference room of the Henry E. Rohlsen Airport Monday night to speak on plans to build the trash and petroleum coke-powered generator.
After WAPA Executive Director Hugo Hodge Jr., WMA Director May Adams-Cornwall and a bevy of consultants testified to their support of the project and answered PSC members’ questions, the floor was opened to the public, and residents took the microphone expressing, in turn, deep misgivings or strong support.
Paul Chakroff, executive director of the St. Croix Environmental Association, disputed some of the environmental claims and some of the cost-saving assumptions made by WAPA’s hired consultants.
He argued that claims about the plans’ greenhouse gas emissions relied on the assumption that methane at the dump would be released into the air, but the EPA mandated the dump be capped and the methane captured. Also, arguments the new plant would be more efficient because it allowed inefficient generators to be shut down were inaccurate, he said.
"It can’t be done on St. Croix because the plant will only generate 16 megawatts on St. Croix, which is less than the 29 MW those generators produce," he said. "Also, the pet coke prices will go up too, along with fuel oil."
In written testimony, Chakroff argued burning pet coke and trash would release an array of heavy metals and other pollutants into the air, harming the health of residents. Earlier testimony from Hodge and industry consultants had addressed that particular argument, averring that the new plants would have better scrubbers and other cleaning technology than is possible with the oil-fired plant, and air pollution would actually be reduced from current levels.
During Tuesday’s hearing on St. Thomas, MACTEC Vice President Michael Lukey said Alpine’s systems would use "some of the best technology in the U.S. and around the world," removing about 95 percent of the sulfur oxides embedded in the pet coke and close to 100 percent of the dust, dirt and grit that comes out of the stack.
Steffen Larsen, a resident of St. Croix’s east end who powers his house entirely with solar and wind and is a longtime proponent of zero emission power generation, raised similar concerns during Monday’s meeting, particularly about the hazards of storing the fly ash left over from burning trash and pet coke.
"Overall, I think this is a really bad idea," Larsen said. "I think there are hidden costs we are going to pay that will way outweigh the benefits."
The fly ash is a serious danger to ground water and could be blown all over the island in the event of a major storm, he said.
Alpine reps said during Tuesday’s meeting that the ash becomes hard when water is added to it, turning into a material that’s used on the mainland as a soil amendment or substitute for limestone on roadways, among other things. In terms of its plans for the territory, Alpine said the material will be stored in silos, then shipped to the mainland, but discussions are ongoing with local vendors about whether it can be used on island. The material can be stored for up to 21 days.
Percival Edwards, an educator at St. Croix Educational Complex and pro-agriculture activist, said he was concerned about the risks to drinking water and to the air, and that he did not trust Hovensa to meet expected price agreements.
On Tuesday, St. Thomas resident Miles David questioned Alpine’s previous work experience.
"I have studied this thing for a couple months now, and I’ve heard a lot of stuff put out here tonight that’s inaccurate," he said. "It was asked whether Alpine has had experience like they should have in this area — they said no. They have never dealt with pet coke before."
But Alpine President James Beach said the combination of trash and pet coke is what makes sense for the territory.
"The reason this hasn’t been done before is because every operating system is different and unique," he explained. "In this case, you have an island with a large waste problem and a huge supply of pet coke. So, it’s a different situation." And while there are pet coke-powered facilities in states across the mainland, Alpine plans on using as much trash — to include old tires, sludge from the waste treatment facilities and biomass materials such as trees and grass clippings — as possible to fuel its boilers and will only burn the pet coke when there’s a shortage of waste, Beach said.
St. Croix attorney Kevin Rames, a principal in a planned resort project at Estates Williams and Punch on St. Croix’s west end, said Monday that he supported the project, though it may not be absolutely perfect.
"On St. Croix, the perfect is often set up as the opponent of the good and of what we are capable of doing," Rames said. "I think a lot of the commentary on the radio and in the community is specifically about that. There is a fundamentally anti-development orientation. But St. Croix needs these steps."
Rames continued that because the projects offer lower cost, improvements to line loss and plant efficiency, solutions to federal consent decrees and the risk of the airport being closed and a way to address the need to close the territory’s landfills, there were substantial benefits to the project that outweighed the potential negatives.
"I am in full support of this project," he said.
PSC members recalled Rames’ sentiments during Tuesday’s hearing, saying that no project is perfect, but that it was time for the Virgin Islands to get moving on the alternative energy front.
"I think its ludicrous that the people of this community could believe that local professionals that have been working for the past years to get renewable energy would exchange the high cost of electricity for something that is detrimental to the health of the people," Jackson said. "Just last year when the rates were sky-high, we heard the cry ‘why don’t you use pet coke because it’s cheaper’ and now those same people are speaking out against it.
"This is not a process that started last week or last month, it’s a process that been around since 2003 where we’ve been talking about renewable energy. Now it’s time to act."
Alpine’s generators would burn about 150 tons a day of pelletized trash at each of the two sites, with the rest of the fuel needs coming from petroleum coke, WAPA officials said during the hearings. The St. Thomas plant would generate 33 megawatts (MW) of power while the St. Croix plant would generate 16 MW.
When fully operational, it is estimated the two proposed projects will supply about 40 percent of St. Thomas-St John’s peak generation load and 20 percent of St. Croix’s.
