The V.I. Legislature will discuss a 30-year lease with AEG Bovoni for a refuse-derived-fuel processing facility in Estate Bovoni on St. Thomas Tuesday, and on St. Croix Wednesday. The V.I. Waste Management Authority, Government House, and the V.I. Water and Power Authority are pushing the plans.
The St. Croix Environmental Association, St. Croix’s largest and most influential environmental organization, has also come out in favor of this project after it was changed to eliminate the use of petroleum coke as a fuel. Others, such as Susan Parten of Community Environmental Services, remain opposed to the project on environmental grounds.
The V.I. Waste Management Authority and the V.I.Water and Power Authority entered into an agreement with AEG Bovoni parent Alpine Energy Group (AEG) for it to build trash processing facilities on St. Croix and St. Thomas that would supply refuse-derived fuel pellets to feed a trash-to-energy plant it will build on St. Croix.
The goal is to expand the territory’s energy base away from its current exclusive reliance on pricey fuel oil, while disposing of trash cheaply and allowing WMA to close the territory’s two landfills. Instead of burying trash at the landfill, the territory would ship much smaller quantities of trash off-island for disposal.
The government owns the proposed site in Bovoni and, by law, the Legislature must approve all leases of government land that extend more than one year. The two proposed St. Croix facilities are on private land: a 16-acre parcel on St. Croix’s southern shore within St. Croix Renaissance Park.
This is the second time the lease has come before the Legislature. Plans put forward in 2010 called for a second, larger power plant on St. Thomas, and for both plants to supplement the trash-based fuel with cheap petroleum coke from the Hovensa refinery.
In the face of stiff environmental opposition, the V.I. Legislature voted down a lease for the St. Thomas RDF facility in March 2010. Senators and residents objected principally to using the very inexpensive, but potentially dirty, petroleum coke as a fuel. These new plans eliminate the St. Thomas plant and plan to use the money-saving petroleum coke.
If approved and completed, the facilities will replace the use of 400,000 barrels of oil each year and help meet a U.S. Environmental Protection Agency mandate to close the Anguilla and Bovoni landfills, according to Government House.
Under the terms of the agreement, AEG will fund the entire $210 million price tag for the project up front and will get revenue both from disposing of the territory’s solid waste and from selling low-cost electricity to WAPA. AEG will guarantee electricity at 10 to 15 cents per kilowatt hour – roughly a quarter of the current retail price of 41 cents per kilowatt hour. Because the plant, if built, will only provide a fraction of total power generation in the territory, ratepayers will see smaller reductions in their actual bills.
The lease sent to the Legislature is for 1A-7 Estate Bovoni, St. Thomas. AEG Bovoni Power President James Beach signed it on Nov. 3, and Gov. deJongh signed off on Dec. 8.
The lease is for a term of 30 years, with options to renew for two 10-year periods. Rent would be $35,700 per year for the first five years, then adjusted based on market rates. As part of the lease, the company is to build the fuel-making facility, offices, and warehouses.
If the Legislature approves the lease, AEG Bovoni will then re-apply for permits. The company withdrew its permit requests in April, pending the approval of the Bovoni lease. After this week’s two hearings, the Legislature will have to meet again in session for a final vote on the matter.
In other news, Thursday, the Committee on Rules and Judiciary will meet to consider the nomination of Dr. Mercedes Dullum for commissioner of Health. Friday, the Committee on Housing and Labor will receive testimony on labor and housing issues, and consider a bill to expand eligibility requirements to participate in the V.I. Low and Moderate Income Affordable Housing Act of 1990.