The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Stellar Energy yesterday slammed critics of its proposed waste-to-energy plant at the New Providence landfill as “Monday morning quarterbacks”, disclosing that capital investment costs had been cut by more than one-third.

J P Michielsen, the company’s chief executive, told Tribune Business that the investment required to construct Stellar’s plant had come down from an initial $650 million to $400 million.

Arguing that people were getting “hung up” on the cost, he explained that better technical and engineering information on the waste going into the landfill, coupled with improved technology availability, had resulted in Stellar reducing its initial estimates.

Mr Michielsen was responding to concerns raised by the Waste Resources Development Group (WRDG), the 10-strong consortium of Bahamian waste service providers, with whom it could be potentially competing to takeover management of the New Providence landfill (see accompanying article on Page 1B).

The WRDG group, in a lengthy statement sent to Tribune Business yesterday, challenged Stellar’s initial $650 million price tag on the grounds that larger waste-to-energy facilities were “nowhere near” as expensive as its proposal.

They also argued that the plasma gasification (PG) technology that Stellar wants to employ at the landfill is unproven, as it has yet to move past the ‘pilot project’ stage and shown to be “commercially viable”.

Mr Michielsen, though, said WRDG’s statement was partially based on information that was no longer accurate, as UK-based APP (Advanced Plasma Power) was no longer among its technology partners on the proposed Bahamas project.

Pointing to Stellar’s involvement on bids and projects to construct waste-to-energy plants in locations such as China and Africa, he defended plasma gasification as a technology that was “scalable” and proven.

Mr Michielsen said that with waste-to-energy technologies evolving rapidly worldwide, plasma gasification was not the only option open to Stellar, pointing to “gasification and torrefaction/Pyrolysis”.

“I always like it when you hear from Monday morning quarterbacks,” he told Tribune Business of the WRDG group, whose members include BISX-listed Bahamas Waste, Wastenot and United Sanitation. “These people don’t sit on my payroll.

“When we first started budgeting the plant three-and-a-half years ago, we went with assumptions we got from the then-technical providers.”

Mr Michielsen thus explained that the initial $650 million capital investment cost was not based on any detailed scientific or engineering studies. While it has conducted some research, more detailed investigation was part of the now-infamous Letter of Intent (LOI) signed with the Government.

“We did one, and are still waiting on two and three,” he said of the engineering studies. “The technology has grown and become more popular; it’s out there and waste-to-energy is happening throughout the world....

“The number for the Bahamian plant is now around $400 million, which has come down dramatically from what it was before.

“As it moves along, the numbers are based more on factual information, engineering information, at our disposal. The numbers have come down significantly since we first started.”

Mr Michielsen said the supplier market for waste-to-energy technology had also expanded over the past three-and-a-half years, enabling Stellar to “shop around” and obtain more competitive prices on the various plant components.

“As it stands now, we’re looking at a $400 million plant to generate 105 Mega Watts [of electricity] gross,” he added.

“We will use 30 Mega Watts (MW) internally to run the plant, and sell 75 MW net at a kilowatt per hour (KWh) price to the electricity provider.”

WRDG had argued it was “slightly disturbing” that APP, which Stellar had named as one of its technology partners, had only started construction on a ‘pilot project’ for plasma gasification in the UK in 2016.

It suggested this showed Stellar’s chosen technology was not “commercially viable”, and questioned how it could be used in a plant of the scale planned for the New Providence landfill.

Mr Michielsen, while revealing that APP is no longer involved, pointed to Stellar’s involvement with two potential waste-to-energy projects in China, and others in Africa, as evidence that both itself and the technology were genuine.

“The technology works,it is scalable and APP is not the technology partner we are working with,” he told Tribune Business. “We have technology partners, the plasma gasification system as well as the technology has grown tremendously and become more robust, and it does work.

“A number of tier one jurisdictions like China, South Africa, and including the UK; why are they looking at it, investing in it, if it doesn’t work?

“I don’t know where they’re [WRDG] coming from. The budget has come down, the technology is more widely used, and we’re not just looking at plasma gasification because waste-to-energy is growing so quickly,” Mr Michielsen continued.

“Do they think we’re going around the world investing all this money in technology that does not work? We’re not selling a bag of potatoes here. We’re selling high quality plants that work.”

He added that Stellar was requiring its technology providers to give it guarantees, thus ensuring it would be compensated for any technical failures that prevented it from delivering.

Mr Michielsen agreed with WRDG’s figure that Stellar’s proposed plant would need to burn 1,500 tonnes of waste per day to generate the promised 75 MW of electricity.

However, he disputed WRDG’s assertion that just 500 tonnes of waste was fed into the landfill on a daily basis, arguing: “It is more than that. I know that for a fact.”

The WRDG group argued that to make up the ‘waste shortfall’, Stellar would have to ‘mine’ 1,000 tonnes daily from what is already in the landfill, creating new issues of potential fires and cell collapses.

Mr Michielsen, having suggested that WRDG’s figures were flawed, dismissed these risks, saying: “Landfill fires are irrelevant. Methane will be siphoned off and capped before we mine, which should have been done years ago but no one ever did.”

He also refuted WRDG’s assertion that under Stellar’s management, tipping fees at the landfill would increase five to six-fold, growing from the current $10 per tonne to $50-$60 per tonne.

“Tipping fees will go down,” Mr Michielsen told Tribune Business. “This is done completely through private financing, and it has nothing to do with the Bahamas paying for it.

“Our mix of garbage that will be mined for fuel will come from what is tipped in during the day, as well as what is mined and sitting there, rotting away. We have taken that into account.”

Mr Michielsen offered to give WRDG and its members “insight” into Stellar’s business and plans, adding: “If they want to know the technology being used, I’m more than happy to share it. They know where my office is. They can come again.”