Trash-to-Energy Plant on Front Burner Again After Supervisors’ Vote
In a 3-2 vote that reflects continued division over the issue, the San Diego County Board of Supervisors Tuesday agreed to reopen negotiations with the would-be developer of a trash-to-energy plant in San Marcos.
The contract will establish, among other terms, to what degree the county will share financial liability with Thermo Electron Corp., the would-be developer and operator of the plant, in burning much of North County’s trash.
In Tuesday’s hourlong discussion, board chairman Susan Golding again voiced her longstanding opposition to the project on financial and environmental grounds.
Supervisor John MacDonald, whose district includes the county’s landfill in San Marcos, where the plant would be built, reiterated his concerns about its financial feasibility.
But South County Supervisor Brian Bilbray, the board’s most vocal trash-to-energy cheerleader, campaigned strongly for negotiations to begin and for the start-up of the project.
‘Bottom of the 9th’
He contested MacDonald’s statements that Thermo Electron already has two strikes against it--the dropping out of two previous partners who would have financially backed the $250-million project--and that, if Thermo Electron’s newest ally “strikes out, I think we should call the game. It’s the bottom of the 9th.”
Retorted Bilbray:
“We’re stuck in this ballpark. Waste disposal isn’t something we can walk away from. This project is alive as long as we need to dispose of our waste stream.”
The supervisors gave its negotiator, the New York financial consulting firm of Goldman, Sachs & Co., and Thermo Electron officials until March 31 to hammer out a contract proposal for the board’s review.
Critics of the project had complained that the terms of the proposed contract should be made public in order to allow them time to analyze it before it returns to the supervisors for a vote.
On Tuesday, Thermo Electron officials agreed to allow the county to reveal the proposed contract at the start of negotiations.
Jerry Davis, president of Thermo Electron’s Energy Systems Division, said the contract is 2 inches thick and contains proprietary information about the project that the company had hoped to keep under wraps.
He said he expects critics to find faults with the proposal but, by airing it publicly, the company believes it will garner more support than opposition.
At issue on Tuesday was whether supervisors have enough confidence in Thermo Electron to even negotiate a contract for the operation of the plant, which is designed to recycle about 20% of the incoming trash and burn most of the balance as fuel to generate electricity to sell to San Diego Gas & Electric Co., as well as to reduce the amount of garbage dumped in the San Marcos landfill, which is near capacity.
Projects in Europe
Two weeks ago, Thermo Electron signed a memorandum of understanding with American Recovery Corp., a joint venture of Sorain Cecchini Recovery of Italy and Potomac Capital Investment Corp. Potomac Capital is a subsidiary of the Potomac Electric Power Co., a publicly held utility that serves the Washington area. Among its other investments, Potomac Capital is part owner of five solar energy plants in the Mojave Desert, and is bidding on projects elsewhere to burn trash for power.
The joint venture company would rely on Sorain’s expertise as the designer and operator of several mass recycling projects in Europe, and Potomac’s financial resources, to guarantee to Thermo Electron that it would successfully operate the trash recycling operation in San Marcos.
Several speakers opposing the contract complained to supervisors that the addition of the joint-venture firm as a subcontractor has resulted only in financial guarantees to Thermo Electron, and not to the county itself.
MacDonald addressed that issue, asking American Recovery executive John Nutter: “If something happens to Thermo Electron, God forbid, would (American Recovery) take over the plant and not place the county in the position of picking up the pieces and taking over?”
“We’re certainly willing to discuss that possibility,” Nutter said.
Risk to County Cited
Golding said she is frustrated that other alternatives to disposing trash had not been fully studied, and said she is concerned about the county’s risk as a participant in the project.
“The county has nowhere near the guarantees necessary to move forward on this project,” Golding said.
The county and Thermo Electron had previously signed a contract for the operation of the plant, but that pact was ruled invalid by a San Diego Superior Court judge for a variety of reasons, in part unresolved environmental concerns and an oversight committed by the city of San Marcos.
Aside from the judge’s ruling, Thermo Electron itself asked for a renegotiated contract in 1986, hoping that the county would increase its share of the financial risk of operating the plant, especially should changing environmental laws require retrofitting the plant with newer technology.
In exchange, the county stands to gain royalty revenue through the sale of recyclable material and the sale of electricity to SDG&E;, in addition to lessening the demand for landfills.
