In a vote that affects not only the citizens of Orange County, but also Los Angeles County and the cities of Riverside, Rialto, and San Bernardino, the Board of Directors of the Orange County Sanitation District (OCSD) will decide this evening whether to allow EnerTech, a source for disposal of the county's biosolids, a one-year extension to attempt to come into compliance with its contract. EnerTech's failure to live up to its contract costs the taxpayers in Orange County alone over $100,000 a month. The company has never been in compliance since the contracts were signed in 2005.
The (OCSD) Board of Directors consists primarily of mayors and councilpersons from many of the cities throughout Orange County. Each city appoints their representative. Orange County First District Supervisor Janet Nguyen and directors from several Orange County sanitary/water districts also serve on the board for a total of 25 members.
OCSD sources, on the condition of anonymity, have told Examiner.com that the contract with EnerTech is being pushed on the entire board by several of its members for "political reasons." So far, no one at OCSD has offered a plausible excuse for continuing to spend over a million dollars a year of taxpayer funds on a technology that has failed.
Examiner.com requested a copy of a third-party evaluation by Tetra Tech of the facility prepared for its bondholders but OCSD did not make a copy available. However, we were able to obtain the report from a confidential source. The report was prepared in May 2010.
The EnerTech plant was scheduled for completion in December 2008. However, as of this date it has yet to become fully functional, and based on that report, it appears that it may never produce the "green" energy the five jurisdictions are paying a premium to produce. Instead, the plant is a "brown" plant, meaning it takes more energy to operate it than it produces for sale to consumers.
In the first five years of operation, the plant was expected to bring in over $91.5 million in revenue to the Wall Street-based company, mostly from the five government agencies that are paying a premium to have their biosolids disposed of at the plant instead of being land applied, turned into compost, or dried using traditional methods. Some of that $91.5 million represents sales of the SlurryCarb product that was supposed to be produced by the plant.
The OCSD Board of Directors has been asked by EnerTech for an additional year to develop the technology that has yet to work anywhere in the world on a large scale. All the while the five agencies continue to pay millions more to EnerTech than they would to any other provider of biosolids disposal. If OCSD were to start the necessary steps to end its 25-year contract based on EnerTech's breach of contract, it is likely EnerTech would be forced to shutter its plant and the remaining four entities could be released from their contractual obligation that has cost their own residents millions above and beyond normal costs for biosolids disposal.
As a source told Examiner.com, at least one director at OCSD is determined to continue paying premium prices for technology that likely will never be "green." It is "environmental politics" that is costing Southern California taxpayers millions of dollars each year at a time when many jurisdictions are having to cut back on police and fire services.
The matter will be brought to a vote at its monthly meeting which starts tonight at 6:30 p.m. The location is the board room of OCSD, located at 10844 Ellis Avenue, Fountain Valley.
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