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BY NORDAHL FLAKSTAD
Freelance Writer
The July 1 that Bill Berzins, P.Eng., spent in Banff in 2001
is etched in the Earth Tech vice-president's memory. But unlike
thousands of visitors enjoying a Canada Day getaway, Mr. Berzins
was "deeply immersed" in something other than the
typical mountain experience - he worked in the bowels of the
picturesque town's wastewater treatment plant.
That's because it just happened to be day one of a 10-year
contract the Town of Banff had signed with Earth Tech Ltd.
to upgrade and operate the municipality's wastewater treatment
facility. With responsibilities for Earth Tech water, wastewater
and composting operations in Western North America, the Calgary
engineer increasingly works with Canadian and U.S. governments
within private-public partnerships, or P3s, to design, build
and then operate public facilities.
Banff's initiative was the first P3 venture in Alberta for
Earth Tech (formerly Reid Crowther). Built in 1988, the Banff
plant had an average design capacity of 14 million litres
a day and a peak design flow of 25.5 million l/d. The average
flow was sufficient, but heavy seasonal demand and spikes
generated by the hospitality industry meant the plant needed
more peak capacity.
A
P3 SNAPSHOT
· Having governments
turn to the private sector to design and build projects
(or to run them when built) isn't new. For hundreds of
years and in thousands of cases, governments have granted
private investors concessions to construct and then operate
roads, canals, waterworks and other infrastructure. In
fact Canada's dream of a national railway system, the
CPR, was a public-private partnership of sorts
· While projects now
labeled P3 once were more ad hoc, lately many governments
have more actively soliciting private partners to design,
build, finance and operate infrastructure to meet public
needs. Organizations such as the 10-year-old Canadian
Council for Public-Private Partnerships have become clearing
houses and advocates of P3
·
The oft-touted benefit of P3 is the easing of pressures
on cash-strapped governments. But P3 promises benefits
through innovation and efficiency as well, plus advantages
associated with the assembly of expertise and the management
of risk
·
Canada's prominent P3 initiatives include the Confederation
Bridge and Ontario's Highway 407. Overseas, the Chunnel
rail link connecting England and France, though not
without difficulties, is an example of a P3 project.
Brazil has some 60 P3-type highway toll-booth and other
highway concessions
·
Canada isn't necessarily a P3 trailblazer. Nor is Alberta,
despite government outsourcing, and privatizing of liquor
outlets and some medical procedures. Yet some Alberta
P3 projects, notably Canmore's water and wastewater
system run under a 10-year contract with EPCOR Water
Services Inc., have gained national recognition
·
Alberta's healthy economy may even hold back P3. Jonathan
Huggett, P.Eng., and his B.C. firm J.R. Huggett Co.,
have advised on the Canmore and more than 100 other
P3 deals in Western Canada. "If there's lots of
money around, there is less incentive to go the P3 route,"
he says.
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Banff contracted out wastewater treatment at its plant from
1990 to 2000. But the town faced more stringent Alberta effluent
regulations and wanted to achieve environmental leadership
standards set by Parks Canada. So the town and its director
of environmental services, Steven Gasser, P.Eng., began searching
for solutions.
The search led to the hiring of Associated Engineering Alberta
Ltd. to generate performance criteria and a shortlist of candidates
for a DBO contract - companies capable of designing, building
and then operating the plant.
Earth Tech which was awarded the contract, it will double
the plant's peak design flow to 50 million l/d by spring.
Upgrades include improved upfront screening, added parallel
treatment capacity created by more biological aeration, and
backend enhancements (added ultraviolet treatment and sand
filters). A year-round composter is a further feature. The
province and the federal government are financing more than
half the $11 million in upgrades.
Ten-Year Commitment
Under the agreement, Earth Tech will run the plant for the
next decade. As a result, says Mr. Berzins, the town is spared
"detailed day-to-day management of the operation. Its
role is to do the due diligence to confirm that we have met
the performance criteria established by the owner."
Earth Tech bears responsibility for most plant operational
costs over the duration of the contract. That, Mr. Berzins
notes, creates a powerful incentive for his firm to select
the right equipment and design.
Spring Completion in Jasper
Up the Icefields Parkway in Jasper, Earth Tech last
May assumed operation of a far more basic wastewater treatment
facility, consisting of four aerated ponds. It will soon be
replaced, however.
With Maple-Reinders, also the contractor at Banff, Earth
Tech is designing and building Jasper's new biological nutrient
removal process. Run under a 10-year contract, the $10-million
plant, when finished this spring, will have a 7.5-million
l/d capacity.
Planning for that plant began on Park's Canada's watch, then
received a green light once Jasper attained municipal status
in June 2001. Jonathan Huggett, P.Eng., a P3 expert from Surrey,
B.C., helped structure the proposal. Veteran Jasper engineer
John Ogilvy, P.Eng., also provided valuable input and is serving
as the town's on-site engineering representative.
In Jasper, as it does in Banff, Earth Tech receives a fixed
operating fee. Innovative combined treatment units have lowered
costs by reducing concrete and steel requirements.
Unlike Banff's linear system, Jasper will use a combined
bioreactor and secondary clarifier. "By combining them
in concentric tanks," says Mr. Berzins, "we were
able to achieve much of the cost savings."
Under the current approach, the municipality has saved more
than 25 per cent from the costs in an earlier design/build
proposal submitted to Parks Canada, says Keith Shepherd, Jasper's
acting environmental services director.
Risk Premiums Eliminated
Further savings accrue from design, construction and operation
occurring within one package. Among these savings, Mr. Berzins
notes, are those that stem from the elimination of "risk
premiums" factored into traditional delivery methods.
Individual designers, builders and owner/operators use risk
premiums to safeguard against less-than-optimal choices made
by others in the project delivery chain.
With designer and operator rolled into one, there's added
incentive to optimize operations and minimize long-term costs.
Even when Earth Tech takes over an existing operation, new
eyes, backed by wide experience, promise economies and improvements.
Certainly Jasper and Banff benefit from Earth Tech's experience
gained through its 180 varied North American P3 ventures.
For example, since August 2001, Earth Tech has operated the
City of Edmonton's composter, and in late October began talks
with the City of Calgary to operate the composter there as
well.
If necessary, Earth Tech will take P3 a step further and
arrange financing. For instance, under a 20-year contract
it will design, build, operate - and finance - a $17-million
US, 9.5-million litre-per-day, reverse-osmosis plant to treat
a quarter of Beverly Hills' water. Earth Tech will be paid
per acre-foot of water supplied. The contract also includes
a clause to lease the city a 30,000-square-foot building to
house the California community's water administration.
Drawing on Expertise
Unlike municipalities with a single plant or limited resources,
Earth Tech, with some 9,000 employees worldwide, can readily
tap into technology, innovation and expertise. That helps
the plant operations personnel and municipal officials.
Events in Walkerton, Ont., and elsewhere have heightened
the importance of officials doing their homework and carrying
out due diligence. Officials still must establish expected
standards for facilities, but P3 relieves administrators of
much of the second-guessing about whether they're spending
enough on maintenance, upgrading and staff training.
However, Steven Gasser is adamant that P3 projects do not
let him or the municipality off the hook. With just one staff
engineer in Banff, an alliance with Earth Tech "brings
a depth of engineering expertise that a municipality like
ours just doesn't have."
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