FREMONT — A shuttered waste-to-energy power plant in Newaygo County has reopened under new owners and management after abruptly closing two years ago.
The Fremont Regional Digester, which was placed into receivership in September 2015 after the former owner failed to cover its upfront costs, runs on organic waste from various types of food producers to generate enough electricity to power roughly 2,500 homes.
One of the first local companies to provide feedstock to the plant is food processor Gerber Products Co. in Fremont, which also supplied the plant under the former owner. So far, the new owner — Generate Capital of San Francisco, Calif. — has about a dozen companies providing waste to the power plant.
In total, the 2.8-megawatt facility annually will divert roughly 165,000 tons of organic waste that would have otherwise gone to landfills, or about 120,000 gallons per day. The plant began taking waste products on Aug. 1 and anticipates generating power in early fall.
“We are basically an alternative to a landfill or a wastewater treatment plant,” said Daniel Meccariello, COO of Dynamic Systems Management. The Waukesha, Wis.-based company was hired to operate and manage the plant, and has experience with similar facilities in Wisconsin and Indiana.
As MiBiz previously reported, Generate Capital purchased the facility and its assets in January for $4.4 million, a fraction of the $22 million it cost to build the plant.
“The City of Fremont was very pleased with Generate’s purchase of the Fremont Community Digester and impressed with their ability to refurbish the plant and get it back up and running in such a short time,” Fremont City Manager Todd Blake said in a statement. “The digester not only benefits our local economy by supporting food and agricultural producers in West Michigan by recycling food waste to produce electricity, but will also create a lasting impact on the Fremont community and our natural environment.”
Meccariello said Dynamic Systems put in a “significant amount of time, energy and money” to update the plant’s controls system, which sat idle for roughly two years after May 2015. That included cleaning and emptying feedstock tanks, along with new piping and plumbing upgrades.
“The majority of it was going through piece by piece and calibrating it to get it into like-new or operating condition again after sitting so long,” Meccariello said.
The facility takes organic waste from a variety of food producers — whether it’s liquids, solids or packaged food products — to convert into biogas. The remaining solids are used as an organic fertilizer for local farms.
Generate Capital, which was co-founded by renewable energy financing pioneer Jigar Shah, specializes in equity and debt facilities for “sustainable infrastructure” in the energy, food and water sectors.
“We want to come in and own these assets for the betterment of resource efficiency,” Shah told MiBiz in May. “This technology has been operating successfully in Europe for several years, but not so much in the U.S. — we want to figure out the reasons for that. This will be a good project in Michigan and will really provide an extraordinary outlet for producers of organic waste.”
‘OVERBUILT’
The facility was formerly owned by Southeast Michigan-based NOVI Energy, and opened to widespread praise in 2012 as the first large facility in the state to take organic waste from companies as a feedstock for renewable energy.
However, the court-appointed receiver at Amherst Partners LLC previously told MiBiz the digester had been “overbuilt,” despite a $12.8 million federal loan guarantee. NOVI had reportedly faced a lawsuit claiming it owed $5 million to the company that built it, which went on to generate several claims and counterclaims with more than 50 unsecured creditors. The digester ran out of money and abruptly closed in May 2015.
Going forward, the Fremont Regional Digester will have two revenue streams: the energy it sells to Consumers Energy under a power purchase agreement that lasts another 15 years, and tipping fees collected from the waste producers.
A network of trucking subcontractors will pick up waste from producers if the companies are unable to haul it themselves. At the facility, the waste is ground into a slurry and pumped into tanks where it is turned into biogas. The leftover solids are used by nearby farms as fertilizer. The plant also includes “state-of-the-art controls” and features to control odors, which was a problem that ultimately led to the closure of a waste-to-energy facility in Lowell.
“This was a well-built facility — there wasn’t anything technically or physically wrong with it,” Meccariello said. “It was the business plan and the management that was needed to make this a successful plant.”
