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Kincardine council wants the details before it makes any decision about
taking over the sewer and water systems at the Bruce Energy Centre (BEC).
At a meeting last night (Oct. 1) among council, Bruce Power, and
representatives of the industries at the energy park, the proposal was
put forward by economic development chairman Mike Leggett, municipal
staff, and municipal engineer Bruce Potter of B.M. Ross and Associates.
The bottom line is that Bruce Power wants to get out of the business of
supplying sewer and water to the Bruce Energy Centre, something it
inherited from the former Ontario Hydro and Ontario Power Generation (OPG).
Bruce Power wants the municipality to assume the $9-million asset, along
with $300,000 to help cover the cost of upgrades.
Potter said the sewage treatment plant, which also takes waste from
Tiverton and Inverhuron, is worth $6.35 million. It requires minor
repairs to the tune of $70,000 and is operating at 50-per-cent capacity.
It is performing well but additional inspection is required for sludge
accumulation and aerator condition. "It is likely the diffusers will
need replacement within the next 10 years at a probable cost of
$400,000," he said. "The probable cost of sludge removal, if required,
is about $225,000."
The elevated tank which contains process water (not drinking water), was
inspected and would require remedial work in the order of $35,000 said
Potter. Re-coating may be required in five to seven years, at a probable
cost of $200,000.
Potter did not recommend connecting the Bruce Energy Centre to the
Kincardine Shoreline Distribution System due to the additional costs
required to connect (between $1.2 million and $1.8 million) as a pumping
station would be required. Plus, the new rates would need to be applied
to the industries and that does not fit their current business plan, he
said.
Therefore, the total cost of upgrades or repairs over the next seven to
10 years is estimated at $930,000, said Potter.
Economic development and tourism manager Steve Murray said the proposal
has several benefits to the municipality. It secures sewage treatment
for the municipal residential sector, stabilizes the utility costs for
the industries, secures additional land base for economic development,
can be assumed by the municipality without the addition of new staff,
allows Kincardine to accept septage, is an advantage to the northern
infrastructure of the municipality, and the sewage plant has also half
its capacity available for growth.
From an industry perspective, Ted Dodkin of Commercial Alcohols, located
in the Bruce Energy Centre, said it makes good sense for Bruce Power to
extricate itself from utility services at the energy park so the company
can focus on its core business of generating electricity.
He said the steam supply is inefficient because it comes from a bunker
oil fuel supply. Once the industries find an alternative source of
steam, that means lower greenhouse gases, reducing global warming and
improving air quality, he said.
Chief administrative officer John deRosenroll said the municipality
already pays $100,000/year for use of the sewage treatment plant that
serves the Bruce Energy Centre. With the transfer of the system to
Kincardine, the municipality can turn a net loss of almost $3,000/year
into a net operational savings of $110,000/year because of reduced
manpower.
Robert Cottrill of the economic development committee said the committee
supports this project and the report now goes to council Oct. 7 with a
request to support it, in principle. Council will then debate the
proposal at its Oct. 14 meeting.
Ed Roberts of the Tiverton and District Ratepayers' Association said the
municipality is buying a "pig in a poke."
"If you take on this sewer plant, it will cost you $1 million to fix
it," he said. "We already have capacity for what we need. If you take
this on, it should be in good working condition with no improvements
needed - 'as new' with no hidden expenditures." As for industrial growth
at the energy park, "that's wishful thinking," he said. "There's been
nothing new at the energy centre for years."
(next column)
02/10/2009 09:36 AM
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Councillor Mike Leggett
He suggested council consider the costs and have the plant fixed
before taking it over. "Otherwise, you're taking on somebody else's
liability."
"We're not purchasing this from OPG or Bruce Power," said Leggett.
"We're being handed a $9-million asset, along with $300,000, on 100
acres of land."
He said the plant can take septage which the sewage treatment plant in
Ward 1 cannot take. Plus, there are several companies that provide parts
to Bruce Power that would like a piece of land in the energy centre to
build on. "The landowners want to sell it but not until we get the sewer
and water issues resolved," he said.
Councillor Ron Hewitt asked how many employees staff the current sewage
plant. It takes two people to operate the system, said Dwight Willett,
executive vice-president of corporate services at Bruce Power. "So, we
have two spare people in our department?" asked Hewitt. "No, the
municipality has the required staff in that department to absorb the
extra work without hiring anybody," said deRosenroll.
"I'm disappointed that we haven't considered a well system to provide
potable water to the energy centre and drinking water to Inverhuron,"
said councillor Guy Anderson. "That would have been nice. I'd also like
a guarantee on this operational surplus of $110,000/year. Otherwise, in
seven years, we could be in the hole."
Councillor Randy Roppel questioned the proposed project, saying there
has already been a "terrible honest effort to make the Bruce Energy
Centre a success. "The businesses there are responsible to their
shareholders and we are responsible to our taxpayers. They want to spend
money and we want to ensure our tax money is spent wisely. We have no
facts and figures here to sort out what the costs are for the industries
(in the energy park)."
He said the energy centre has an uncertain future and there's nothing to
stop the industries there from packing up and leaving, just as the owner
of the greenhouses did. "We have to be careful we're not going to be the
ones holding the tail of the donkey," he said. "I don't support this. We
need more review. We need a public meeting and we need to see all the
figures."
"There's no opportunity without risk," said mayor Larry Kraemer. "This
is a huge opportunity for the Municipality of Kincardine. At the end of
seven years, we would have a reconstructed $9-million asset that other
municipalities would have had to pay for. This would be a godsend if
municipalities become responsible for accepting septage. Whatever growth
we have at the energy park, the better the investment."
"So, what's the next step?" asked councillor Kenneth Craig.
The project comes to council for support, in principle, next Wednesday,
said deRosenroll. Then it's on to a legal review, with a report to
council and the proposal will be discussed at the Oct. 14 meeting. If
Phase 1 is approved, the project goes on to Phase 2.
"Will we have access to the numbers, a proposed budget and business case
for this operation?" asked Craig.
"We have the operating costs and can put together a draft municipal
budget for council to review," said deRosenroll.
"There were a number of projects years ago that did not make sense at
the beginning," said Craig. "This looks a lot like that. We should get
the numbers and then make an informed decision."
Deputy mayor Laura Haight said she was disappointed with the tone of the
discussion at the meeting. "Obviously, there are more questions. Rather
than taking a polarized position, for or against, I think we need to
understand the issues and have some dialogue. It's easy to see that
Bruce Power's core business is generating nuclear electricity, not
managing a sewage plant. Council needs to reach a comfort level on this
simple transaction. We need to do due diligence so our taxpayers are not
at risk, but we also must give some value to the work done by the
economic development committee."
"Four years ago, the economic development committee was working on this
idea," said Anderson. "We need to get as much economic value out of this
as we can."
Councillors are to send any questions they have to staff, said
deRosenroll, "and we'll get the numbers together for you by the Oct. 7
meeting."
Leggett said he was not surprised by the negative responses on council.
"A lot of people think the municipality is purchasing the lagoons from
Bruce Power, but they're being handed to the municipality with $300,000
to cover some of the costs for upgrades." |
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