SPSA Sells Waste-to-Energy Facilities to Wheelabrator

Wheelabrator Technologies Inc., a wholly owned subsidiary of Waste Management, has purchased the Southeastern Public Service Authority’s (SPSA) refuse derived fuel plant and adjacent waste-to-energy facility. The closing of the sale follows votes taken by the SPSA Board of Directors on April 28 as well as transfer of US $150-million in funds from Wheelabrator to SPSA.

Wheelabrator will assume management of the operations. The purchase concludes a lengthy process that started more than two years ago when SPSA began consideration of a proposal to sell the two plants in order to reduce debt and operating costs and draw on the expertise of a private vendor. Three other companies submitted competing bids.

After narrowing the candidates to two, SPSA chose Wheelabrator in November 2009. SPSA said that it will use the $150-million from the sale to pay down debt to the Virginia Resource Authority (VRA) and other lending institutions, and repay money owed to the City of Virginia Beach.

“A competitive procurement process and rigorous negotiations between SPSA and Wheelabrator have produced a sale contract of the Portsmouth facilities that is fair for all parties,” said Rowland “Bucky” Taylor, SPSA executive director. “The sale to Wheelabrator establishes a predictable, affordable service fee, and upholds all current member community agreements.”

As a result of the transaction, 164 SPSA employees at the two Portsmouth facilities will become Wheelabrator employees. Wheelabrator also plans to invest more than $20-million in capital improvements.

Most of the municipal solid waste (MSW) generated in eight Hampton Roads localities – Portsmouth, Norfolk, Chesapeake, Virginia Beach, Franklin, Suffolk, Southampton County and Isle of Wight County – is brought to the plant. There it is sorted, metals are removed and recycled, and the processable garbage is transferred across the street to the waste-to-energy facility, where four boilers turn up to 2,000 tons a day of MSW into 600,000 pounds of steam per hour and 60-megawatts of electricity. The Norfolk Naval Shipyard uses the steam in its ship repair operations, while the power is sold onto the electrical grid.

The non-processable waste, which has been deposited in SPSA’s regional landfill in Suffolk, will now be taken to landfills operated by Waste Management outside of South Hampton Roads. This will save SPSA an estimated $50 million, the cost of expanding the Suffolk facility.

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