Olsztyn Waste Management PPP Project

Location:

Poland

Project number:

48717

Business sector:

Municipal and environmental infrastructure

Notice type:

Private

Environmental category:

A

Approval date:

29 Jan 2020

Status:

Passed Concept Review, Pending Structure Review

PSD disclosed:

11 Oct 2018

Translated version of this PSD: Polish

Project Description

Financing of the design, construction and operation of the waste to energy plant aimed to produce both heat and energy under a PPP scheme in the City of Olsztyn.

Project Objectives

The primary aim of the Project is to ensure treatment of the combustible fraction from municipal waste by means of thermal treatment with recovery of energy used for ensuring heat supplies to the municipal heating network.

Transition Impact

The new installation is expected to have a significant scale to generate meaningful environmental benefits in the form of significant annual GHG savings, which fits well with one of the Bank's key operating strategies for Poland. i.e. Promoting Green Economy Transition, which translates into improved energy and resource efficiency, more diversified energy mix and reduced air pollution.

The proposed Project structure is also an interesting way of bringing private sector knowledge, expertise, technical capacity and efficiency into the municipal sector's responsibilities such as ensuring heat supply.

Client Information

To be defined upon completion of the tendering process for the selection of the private partner.

EBRD Finance Summary

PLN 349,000,000.00

Total Project Cost

PLN 1,650,000,000.00

The Project costs are estimated up to PLN 1,650,000,000, excluding VAT.

Environmental and Social Summary

Categorised A (ESP 2014): The construction and operation of a greenfield waste-to-energy facility (WtE) requires an environmental and social impact assessment (ESIA). The ESIA was undertaken and disclosed on the Project dedicated website and in the offices of the City of Olsztyn. An independent  consultant was retained to carry out and Environmental and Social Due Diligence (ESDD) of the Project inclusive of a gap analysis in terms of compliance of the national and EU EIA requirements; relevant technical documentation; and the Project planning activities undertaken to date with Bank's Performance Requirements and best practices. Based on the ESDD a number of additional studies have been identified, including assessment of the Project design against EU Best Available Techniques (BAT), inclusive of the planned amendment of the BREF (Reference Documents). The ESDD also reviewed the fuel supply, together with sources and transportation of municipal and alternative fuel (Refuse-Derived Fuel, RDF), project social impacts and cumulative air emissions assessment.

The Project has been subject to an EIA and Polish public consultation process which is aligned with the EU EIA Directive. Development consent and approval of the EIA was granted in December 2015 and includes environmental criteria for the development and operation of the installation. City of Olsztyn will need to replace the existing Michelin owned CHP, which provides a proportion of district heating to the city. Following a number of studies and consultation processes the city authorities approved the development of a WtE plant in line with its current waste management strategy.

The WtE facility will be located in the eastern suburb of City of Olsztyn and in the vicinity of other industrial facilities on idle land already owned by MPEC. The closest residential developments are located 300m in the north-west direction from the project site. The Project site is not located in the vicinity of protected areas.

The key environmental and social risks of the Project are associated with the design of technology and how to mitigate air and noise emissions as well as waste generation (including hazardous waste) and wastewater management. The ESDD confirmed that emissions will be abated in line with National and EU standards (namely EID and BAT) and the plant will include live and on-line continuous air emission monitoring. As part of the ESDD and ESIA assessment a cumulative air impact assessment concluded that project implementation will result in reduction of total air emissions for SO2 and PM and increase of emission of NO2. In order to meet future air quality standards post 2020, MPEC plans to upgrade the Kortowo CHP (Kortowo) and install de-NOx installations on all boilers, therefore resulting in further reduction of NOx emissions. Modelling results of noise propagation in the environment show that noise emissions from the operation of the WtE facility will be in line with permissible values for residential areas. Storage of waste (including hazardous wastes), and other dangerous substances will be conducted in a way preventing soil and groundwater contamination. Hazardous waste resulting from the processes (waste from flue gas treatment, fly ashes containing hazardous substances, dust from boilers containing hazardous substances) will be subject to solidification and chemical stabilization in the waste processing plant located on site  and transferred to the licenced hazardous waste management facility.

Project will have limited direct social impacts. Review of the municipal waste and RDF transportation routes from the region to the nearby municipal waste treatment facility ZGOK (undertaking mechanical and biological treatment) and review of the operations of said facility concluded that potential impacts (fly tipping, odours and road safety risks) are well managed and comply with relevant permits in place. Health risks related to air, noise and waste water emissions will be controlled via implementation of the BAT requirements (verified by third party reviews at design and post construction stage) and strict monitoring and management systems. Constructions stage impacts will be temporary and related to potential noise and dust nuisance. These, along with H&S and labour risks will be managed through application of good construction practices under the Environmental and Social Management Plans. 

The new facility will incinerate RDF in an amount equivalent to 1350.7 TJ/a of energy.  Apart from RDF, the new facility will also use peak boilers fired either with fuel oil or natural gas. Based on the energy production data, the estimated current emissions from both Michelin CHP and Kortowo CHP combined are 195 000 tons CO2/a and predicted emission from combined WtE facility (133 000 CO2/a) and Kortowo CHP will be 193 000 tons CO2/a. Total reduction of CO2 emission will be 2 thousand tons per year, however, 59 thousand tons originating from biogenic RDF incineration is considered neutral for the environment, hence the actual reduction of CO2 emission is 61 thousand tons per year which corresponds to reduction by 31%.

The Projects will be designed in detail, constructed and operated by the Private Partner under a PPP agreement. Requirement for Project development and operation in line with EBRD Performance Requirements and the ESAP have been included in the Concession tender documentation.

Based on the ESDD, an ESAP has been developed, which includes commitment to use of the state-of-art and BAT compliant technology, emission values and monitoring as well as implementation of an integrated EHS and Social management plans.  In addition the ESAP agreed with the Sponsor commits the projects to strict compliance with the IED , relevant permits and BAT requirements, including advanced control system and continuous emission monitoring system (CMS) in line with draft 2017 BREF; BAT verification through  independent reviews at detailed design and operational stage; monitoring of  environmental and social performance of the alternative fuel suppliers; follow up biodiversity inventory on site prior to commencement of works;  completion of pre-construction archaeological works and implementation of SEP. The Project will be monitored by an independent environmental and social consultant with semi-annual reporting to the Bank during construction and first two years of operation and annual reporting at a later stage.

An ESIA disclosure package has been developed consisting of the Environmental and Social Supplementary Report (ESSP), Non-Technical Summary (NTS), Stakeholder Engagement Plan (SEP) and Environmental and Social Action Plan (ESAP). The documents are disclosed on the Project website and in hard copy at the City of Olsztyn offices; and in the EBRD resident office in Warsaw.  During the 60-day disclosure period, comments to the ESIA will be received in writing. The PSD will be updated following the public consultation.

There is an Environmental and Social Impact Assessment available for this project.

Technical Cooperation

None.

Company Contact Information

Magdalena Górecka or Malgorzata Kurpiewska
mgorecka@mpec.olsztyn.pl for contact in Polish language or mkurpiewska@mpec.olsztyn.pl for comments or enquiries in English
+ 48 504 479 745
http://ec.olsztyn.pl/
MPEC Sp. z o.o. ul. Sloneczna 46, 10-710 Olsztyn Poland

 

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