Dive Brief:
- Covanta and the Lancaster Solid Waste Management Authority (LCSWMA) recently announced a new agreement for the company to continue operating two Pennsylvania waste-to-energy facilities through 2032.
- Neither party would disclose specific financial terms of the deal, though LCSWMA said it is allocating an estimated $33 million for Covanta-related expenses in 2018. This is part of a broader budget in which the two WTE facilities comprise the majority of the authority's expenses.
- According to LCSWMA, this streamlines its contract with Covanta because each facility had separate operation and maintenance agreements before. Cost controls are included. The agreement also includes planned investments for unspecified regular maintenance upgrades.
Dive Insight:
These two LCSWMA facilities serve the counties of Lancaster and Dauphin, home to Harrisburg (the state's capital), and are capable of processing a collective 2,000 tons of municipal solid waste per day. Covanta has operated the Lancaster WTE Facility, which it helped design and build, since 1991. It has operated the Susquehanna Resource Management Complex (SRMC) since 2007, helping to upgrade it after a history of performance challenges and community relations issues. The LCSWMA purchased the SRMC facility from the City of Harrisburg in 2013.
The planned upgrades are the latest in a series of investments being made by LCSWMA in its operations. Other recent projects includes a $56 million vertical expansion of the Frey Farm Landfill and a new metal recovery facility operated by Inashco.
This 15-year agreement is one of the longer ones announced by Covanta in recent history. Aside from a 20-year deal in 2015 with another Pennsylvania county, others in Massachusetts, Connecticut and Pennsylvania were for five years or less. In terms of expansion, the company's attention has mainly been focused overseas with a new facility in Dublin and a variety of partnerships with companies such as Veolia, Biffa and Macquarie's Green Investment Group to pursue European projects.
