IN DEPTH: MHI & Hyflux’s 120MW Waste to Energy Plant Takes Step Forward : $473m Finance for Singapore’s 3600 TPD TuasOne Waste to Energy Plant

A consortium comprised of waste to energy technology supplier, Mitsubishi Heavy Industries, and Singapore water company Hyflux, has secured a S$653 million ($473 million) 27 year loan for the development, construction and start-up costs of the TuasOne waste to energy plant.

The project financing is provided by DBS Bank Ltd, Maybank Kim Eng Securities Pte Ltd, Mizuho Bank Ltd and The Bank of Tokyo-Mitsubishi UFJ Ltd who are the lead arrangers, underwriters and bookrunners for the facility.

TuasOne Plant is Singapore’s sixth and largest waste to energy plant designed to process 3600 tonnes of waste per day and generate 120 MW of energy, the plant is expected to be completed in 2019.

For more on the project read Matt Clay’s article from the November/December issue of Waste Management World below.

To help reduce its reliance on energy imports, Singapore has unveiled plans for its sixth waste to energy plant, which it is calling its most land and energy efficient. Matt Clay investigates.

When it comes to economic and environmental performance, it’s often hard to exceed in one without impacting the other. Take China; years of growth from the now global superpower have resulted in a polluted environment in need of a desperate clean up.

In stark comparison, albeit on a vastly smaller scale, city-state Singapore can now be seen as the jewel in the crown of Asian countries for its environmental performance. It has proved that industrial growth can go hand in hand with environmental stewardship. Quadrupling its GDP per capital in the last 20 years alone, Singapore is now also achieving the enviable recycling rate of 60%, landfilling 2% and sending the remaining 38% for waste to energy (WtE).

The challenge that Singapore now faces is keeping up this record with a rapidly increasing number of inhabitants. Home to 5.4 million people, its population has grown by more than 25% over the last decade and is set to grow by another 30% by 2030.

This leads onto Singapore’s second challenge: high energy imports. Lacking indigenous energy resources, the island nation imports fuel to meet most of its energy needs. Both crude oil and petroleum products increased between 2013 and 2014 to meet a 3.3% increase in electricity consumption, according to the Energy Market Authority.

The third challenge facing Singapore is that its first WtE plant, built in Ulu Pandan, has been decommissioned after 30 years in operation, leaving a gap in its treatment infrastructure.

To solve these three challenges head on, Singapore is looking to waste to energy to create more energy dependence and serve its growing population of energy hungry, middle class citizens.

“If we continue our waste generation in a business-as-usual manner, and taking population and economic growth into account, we would need more WtE capacity,” says Eugene Tay, executive director of non-profit Zero Waste Singapore.

In September the National Environment Agency (NEA) announced plans for the country’s sixth WtE plant. A consortium comprising Mitsubishi Heavy Industries (MHI) and surprisingly, Singapore water company Hyflux, were listed as the preferred bidder to deliver the 3,600 tonnes per day (tpd) project.

To be located in the industrial area of Tuas, the project will eventually generate 120 MW of electricity, powering the plant and exporting the excess to the grid.

The MHI-Hyflux consortium will design the plant under a Design-Build-Own-Operate (DBOO) scheme for a period of 25 years. Hyflux will undertake engineering, procurement and construction works while MHI will provide the technology. Hyflux and MHI will respectively hold 75% and 25% of the shares in the project company.

Interestingly, while MHI could be considered a household name when it comes to waste to energy, having delivered 180 plants since 1964, it’s the first venture for water firm Hyflux into waste.

In a statement Olivia Lum, executive chairman and group CEO of Hyflux, said: “With the growing importance of resource optimisation to urban cities and industries, the development of alternative sources of water as well as the recovery of energy from waste has become crucial. Our business is evolving in response to this global trend.”

It is not the company’s first venture into the power business, however. It’s currently operating the Tuaspring seawater desalination plant, delivering 318,500 cubic metres of water per day and a co-located combined-cycle gas turbine power plant, delivering 411 MW.

For some, it’s the increasing competition of the global water technology business that is forcing companies such as Hyflux to diversify into waste.

“Hyflux is under economic pressure since they are facing stiff competition from low-cost countries,” says Professor Asit Biswas, distinguished visiting professor, Lee Kuan Yew School of Public Policy, Singapore. “Desalination has now become a commodity business. The companies will sell equipment and expertise to whoever that wants it. Thus, Hyflux will find it difficult to maintain, let alone expand, its market share. Thus, they are moving to new areas even where they have limited expertise, like solid wastes.”

Land is one of the biggest constraints in Singapore, even though it has increased its total area since independence by 30% by reclamation from the sea. As a result, space is at a premium and new infrastructure has to fit in with this. The NEA not only anticipates the Tuas project to be “Singapore’s largest and most energy-efficient WtE plant” but the most “land-efficient”. This is calculated by looking at how many tonnes per day of waste are processed on the space taken by the facility.

For the new plant, it’s 750 tonnes/day per hectare. In comparison, the existing Keppel Seghers plant also situated at Tuas (see box out) has processing capacity of 500 tonnes per day/per hectare. So in effect more waste will be processed in the same amount of space – evidence that WtE processing technology is indeed evolving as new projects come online.

The new Tuas project will be Singapore’s sixth waste to energy project but bring the total number of plants in operation to five. The first, in Ulu Pandan, was decommissioned in 2009 after 30 years in operation. According to the NEA, the four existing plants generate an average of 450 kWh per tonne of waste incinerated. In total, they meet between 2% to 3% of Singapore’s electricity needs.

Sembcorp Industries will have two WtE facilities on Jurong Island. The first is a 60 tonnes per hour biomass steam boiler running on woodchip derived from waste wood, which is already in operation. The second is an additional 140 tonnes per hour steam generation facility that will be fuelled by industrial and commercial waste. This second facility is under construction and expected to be completed next year.

“In the long term, prospects for energy-from-waste in Singapore are good,” Ng Meng Poh, executive VP and head, group asset management Sembcorp Industries, tells WMW magazine.

“Using waste to produce energy maximises the use of scarce resources. It presents us with an environmentally-friendly source of energy to meet our long-term energy needs, and may reduce consumption of fossil fuels. As a nation, diversifying our energy sources to include an alternative source like energy from waste also strengthens energy security.”

Tuas and Senoko

The Keppel Seghers’ Tuas project previously mentioned was Singapore’s fifth WtE plant and the most recent brought into operation. It was built under the NEA’s Public Private Partnership initiative.

Developed by Keppel Seghers in 2006 and operational since October 2009, the plant is equipped with two incinerator-boiler units with one condensing turbine-generator. Incorporating the company’s in-house technologies such as the air-cooled grate and flue gas cleaning system, the plant is able to treat 800 tpd of waste to generate 22 MW of energy.

Keppel Seghers also operates the Senoko WtE plant, the third to be built in Singapore. Providing operations and maintenance to the 2,100 tpd project, it was retrofitted with the company’s flue gas treatment technology to comply with an emission requirement completed in 1992. Senoko generates 36 MW.

Zero Waste Singapore

If continuing to replace and evolve its waste to energy infrastructure isn’t enough, Singapore also has its sights set on an even higher recycling rate. By 2030, the nation aims to be recycling 70%, as set out in the Sustainable Singapore Blueprint. However, the recycling rate dropped from 61% in 2013 to 60% in 2014, suggesting recycling efforts have perhaps plateaued.

“High recycling rates often come with high levels of WtE, and this is the case in Singapore,” says Paul Davison, managing director of communications consultancy, Proteus Environmental (Hong Kong).

“The current recycling rate is down 1% from the previous year, reflecting the fact that, for the first time ever, overall volumes of waste generated also fell. In other words, recycling in Singapore may have reached its maximum and, without a new push in recycling and materials recovery, they experience ‘flat lining’ for some years.”

It was in 2001 when Singapore began a programme to boost recycling rates, although by then it already had a good start with a base of 44%. A strong economy, coupled with its small size and willing public meant the city-state could make progress quickly. With existing landfill capacity running out, it built a landfill on the island of Semakau, on land reclaimed from the sea, located about 8km south of Singapore. The bund is lined with an impermeable membrane a layer of marine clay, which the NEA says ensures “leachate from the refuse is contained within the landfill area”.

Others believe there’s room for improvement in household recycling.

“We have a vibrant recycling industry for various materials in Singapore, and together with the high disposal fee of $77-87 per tonne at the WtE plants, companies are able to and encouraged to recycle their waste,” adds Zero Waste Singapore’s Tay. “In addition, public recycling programmes and education have been introduced, although household recycling is still low.”

Lessons from Japan

While Japan’s WtE energy industry has over 300 plants compared to Singapore’s six, the drivers are very similar in the two countries. Both nations need energy to feed their growing industries and populations. And both nations increased recycling and waste to energy simultaneously while minimising waste sent to landfill.

“Both Singapore and Japan are very positive about WtE, mainly due to their lack of landfill and need for energy and the fact that the general population sees benefits from the technology,” adds Proteus Environmental’s Davison. “The long and successful history of WtE in both countries, and residents’ trust in their governments, makes it far easier to build new plants in these countries than anywhere else in Asia.

“Just over the border, the Malaysian Government is getting a lot of public resistance to proposed WtE, with many outdated arguments - including perceived health risks - being used against a new proposed WtE for Kuala Lumpur. Even in China there is increasing public opposition to WtE, with more than 10 projects delayed or even cancelled due to mass public protests.”

Singapore’s new Tuas development will help the nation become less dependent on foreign imports, even if it’s by a few percent. With two existing WtE operators already involved in the water markets, as well as new entrant Hyflux, it’s clear the gap between the water and waste treatment industries is becoming closer.

A positive, well informed public will no doubt get behind the government to reverse the plateauing recycling rate, hit the ambitious 70% target and welcome the WtE addition in Tuas.

Matt Clay is a freelance correspondent for WMW magazine.

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