Investment in municipal waste separation, recycling, composting and bale-press packing plant with a capacity of 2,000 tons per day in the form of BOT Contract for 49 years in Hanoi, Vietnam
The need for the project investment and the investment objective:
Hanoi City has 6.2 million people living in an area of 3,300 km2, with an average density of 1,880 person/km2. The City is divided into 29 districts and towns. It has diverse terrain conditions, including: mountainous, midland and lowlands areas.
In 2009, Hanoi achieves the GDP growth rate of 9.5-10%. The rate of municipal waste collected per day in 2 cities: Hanoi and Ha Dong is 95-98%.
The total waste volume in Hanoi City amounts to 5,500-6,000 tons/day. The urban areas generate about 3.000 tons/day (60%), waste from the industrial zone is estimated at 500-600 tons/day (10%), construction waste is about 1,000-1,200 tons/day (20%), and the septic sludge and other waste are 500-600 tons/day (10%). The wastes are not totally classified/separated and still mixed in the municipal waste.
Currently, the municipal waste of Hanoi City is disposed of at a sanitary landfill at Nam Son, Kieu Ky, Xuan Son, and Chuong My. The suburban districts’ municipal wastes are buried arbitrarily in ponds (open dumping method). There is no collection and treatment system for wastewater/leachate.
Municipal solid waste in over 1,000 villages (Minh Khai, Cat Que, Duong Lieu, Hoai Duc, Tan Hoa, etc) are not collected and processed properly, thus becoming a source of pollution in many places.
The collection of municipal and solid waste in general is still assigned mainly to the Hanoi URENCO (a member state Limited Company), Ha Dong Urban Environment company, Son Tay, Xuan Mai, and environment enterprises in the suburban districts.
Disposal of municipal waste by means of burying/landfilling becomes less preferred in the economical, environmental and social aspects. The landfills in Hanoi are fully burdened with the volume of incoming waste. The landfill in Nam Son, receiving about 3,000 tons per day, will be filled up by year 2011; the landfill in Xuan Son is expected to be filled up by June 2010; and in the Thoong Mountain landfill, the cells 1, 2, and 3 have been filled up with no more land available for expansion but still continuing to receive waste.
Finding suitable locations for municipal waste landfill is a never ending problem if Hanoi continues to handle municipal waste by means of landfilling.
At present, the government is looking for new waste processing technologies and minimizing waste disposal to landfill. Simultaneously, the government is to generate capital investment in advanced technology, and to adopt a sustainable process for municipal waste and solid waste management. The City has a policy to encourage investors to invest in waste management, and is offering contracts in the form of Build and Transfer (BT), and Build-Operate-Transfer (BOT), allowing potential companies and individuals taking part in investing capital and technology for recycling and treatment of the municipal waste with the aim of minimizing landfilling.
The city is encouraging recycling (by classification and then re-use the classified waste) which is an indispensable trend in municipal waste treatment, and thus minimizes the amount of waste going to landfill. Waste reuse is classified as follows:
Group A: Production of compost and organic fertilizers from fermented organic materials.
Group B: Burn to generate energy and reuse the energy from the flammable organic material.
Group C: Re-use the materials such as metal, plastic, rubber, etc.
Group D: Bale, sterilize and use as ground levered material, construction materials for the inorganic materials and inert materials (brick stone, sand, glass, pottery, etc.)
The investment in technology in the direction of Group (A) – (D) mentioned above depends on markets and the investors involved.
The objective of this project investment is to build a recycling plant for processing municipal waste with a capacity of 2,000 tons/day minimum, following the projected direction stated in Group (A) – manufacturing compost; Group (C) – recycling, re-use; and Group (D) – baling, re-use as levered material. The products in Group (A), (C), (D) will have a consumption markets in the country and abroad. The most interesting part of the project is that the recycling technologies stated in Group (A), (C), and (D) are being integrated in order to increase the efficiency of waste recycling rate.
Simultaneously, the above technologies are integrated with the bale-press and packing technology to optimize the volume for recycling, to reduce the area of warehousing and transportation cost, and thus increases the overall efficiency of the project.
Likewise, all issues related to the environment (odor, emissions, waste water) in the project are completely mitigated and given the highest consideration. There will be no wastewater/leachate discharged out of the perimeter. The wastewater/leachate shall be collected, treated and re-used in the process and within the facility. The odor shall be minimized by means of applying deodorizers and disinfectants, using microbial technology. The receiving area shall be fully covered and the odor extracted and filtered before being released to the atmosphere.
All products in Group (A) – compost, and Group (C) – recycling materials, will be packed and shipped out of Hanoi City area to the markets identified by the investors. The inert materials in Group (D) which accounts to ≤ 15% of total waste volume shall be baled at site and could either be sold to potential buyers for use as reclamation materials and slope retaining walls; or could be landfilled at approved sanitary landfill.
The plant is planned to receive and process 2,000 tons of municipal waste/day. It requires a minimum area of 15ha to be used for:
– Collection of municipal waste for 3 days = 10,000 m2
– Receiving and sorting of waste = 10,000m2
– Shedding and bale-press packing area and storing of bales (15 days allowance) = 15,000m2
– Composting area (21 day-cycle, 60% organic composting in municipal waste) = 50,000m2
– Storage area for compost, recycled materials, and bales = 40,000m2
– Area for wastewater/leachate treatment, air pollution = 5,000m2
– Technical area = 6,000m2
– Administration area = 1,000m2
– Open space, paths, and green area = 13,000m2
Total area required = 150,000m2
The project is proposed at Nam Son solid waste treatment complex, Soc Son, Hanoi.
The main design solutions are as follows:
• Municipal waste arrives at the factory area will go through the weighbridge and then the trucks shall get into a fully covered receiving area where the waste shall be unloaded. The wastes shall be disinfected and deodorized with microbes. At this floor, workers shall separate bulky waste (tables, wardrobes, chairs, concrete wall), dangerous materials (aerosols, fire extinguisher, etc), as well as packages containing chemicals, paint crusted, etc shall be recovered, and the remaining waste shall be pushed into Pit No. 1.
• There will be two (2) grapnels that grab the wastes and placed them in the individual hopper at the beginning of the conveyor belt system. The waste will be moved up to the second floor meant for separation of waste by means of four (4) conveyors. From here waste are separated manually. Items of non-organic materials such as plastic, rubber, aluminum cans, are separated. The workers shall collect household hazardous items such as battery, spray canes, aerosols, etc. These materials are placed at recycling material store. The wastes shall pass through conveyor belt No. 5 where a magnetic separator will separate all the metal components of the waste. The remaining wastes on the conveyor shall be placed in Pit No. 2 where the wastes are generally organic waste that could be turned into Composts.
• The Organic materials from Pit No. 2 will be used for compost production. Generally, the compost will undergo two main stages namely pre-composting stage and composting stage. Wastes from Pit No. 2 shall be placed at pre-compost furrow measuring 8.5m (width) x 120 m (length) x 12.0m (depth). The waste shall be treated with microbes and remain there for 7 days. There will be eight (8) furrows designed for pre-composting stage.
• On the eight (8) day, the wastes shall be transferred to the composting area. The area is made up of 20 furrows measuring 8.5m (width) x 60m (length) x 2.0m (depth). The waste shall be further treated with microbes and regularly churned using mechanical turner up to thirteen (13) days. It is designed for the wastes to turn into good quality compost after twenty (20) days of pre-composting and composting processes.
• The Compost will be taken to the sieving area. At this stage, inorganic materials (glass, leather, crystal, metal, etc) that are still in the waste/compost shall be recovered and send to Pit No. 3. The good quality compost shall be graded and send to compost packing area for packaging process, complying with the packaging standard. The compost which has been packed shall be stored at the Compost Storage Area.
• Inert materials from the Compost placed in Pit No. 3 shall later be pressed into bales for landfilling or used as reclamation materials or as slope retaining walls.
• Large and bulky materials (beds, wardrobes, chairs, trees, etc) from bulky store area shall be shredded and placed in Pit No.3. These wastes shall be baled using the bale pressed system and later stored at the storage area for bales.
As a result of these integrated processes, the entire waste received amounting to 2,000 tons/day will be converted into the following products:
• Water and moisture: 800-900 tons/day (45%).
• Compost: 350-400 tons/day (20%).
• Recycling products (plastic, rubber, aluminum, metal, glass): 300-400 tons/day (20%).
• Products for inorganic baling for leveling, burying: 300 tons/day (15%).
Techniques to be applied in the BOT project which will receive and process 2,000 tons of municipal wastes/day by the joint venture company between AIC and partners are the combination of the latest technology and integration of the technical know-how of the municipal waste treatment methods. This is to ensure that the proposed BOT project will provide the solutions to the entire municipal waste treatment and related issues arising from managing waste.
Total investment for the project is USD 15M only. The percentage of the investment cost are devided as follows:
– Equipment/technology : 65%
– Construction of Infra/buildings : 30%
– Others : 5%
Capital investment will be raised by Kristar International Sdn Bhd through its own funding mechanism.
Project construction period: Mei 2010 – Nov 2010.
Project operation period: Dec 2010 to Mac 2058 (49 years).
Analysis of the projected financial investment of the project
No. Parameters Unit Results
1 Capacity of waste treated Tons/day 2000 (minimum)
2 Working time in year Day/year 365 days
3 Total investment:
+ Equipment / technology
+ Others USD 15 million
4 Construction time Months 6
5 Interest loan on capital investment %/year 6%
6 Loan repayment period Years 3 years
7 Project lifecycle Years 49 yrs with 7-yr equipment replacement and 12-yr machinery replacement options
8 Number of worker Persons 123
The details of the financial model and justifications are submitted herewith under the financial requirement section.
The preliminary planning and development of the project, the feasibility study, and site identification have been completed. We are in the process of submitting the basic design for approval by the Hanoi’s People’s Committee.
The estimated time for project implementation is about 7-10 months after getting the construction design approval from the People’s Committee.
The full tendering procedures to select sub-contractors for construction of the facility will take two (2) months. The time taken to complete construction of facilities and installation of equipment is 6 months.
Capital recovery plan
The capital investment shall be recovered from these revenue streams:
– A tipping fee on waste treament paid by Hanoi city at USD 3.50 per ton of waste received.
– Revenue generated from selling of compost at USD 100.00 per ton.
– Revenue generated from selling of recycled materials USD 50.00 per ton.
The cash flow has shown a positive recovery plan and this project is rated as highly profitable and feasible to be implemented.
The project implementation and operation scheme.
The project shall be implemented in the form of BOT contract for a 40 year period. For project implementation, the promoter will:
– Purchase and import machinery and equipment.
– Appoint qualified sub-contractors to construct the facility.
– Carry out the construction of the facility and install, test, and commission the equipment.
– Formal takeover of land to be used for the project from People’s Committee, including access to other related infrastructures (road, drainage, water supply, electricity supply).
– To instruct URENCO (waste collection company of the People’s Committee) to deliver 2,000 ton per day to the facility.
– To liaise with the Electricity Department for electricity supply, and with Water Department for clean water supply.
– To obtain permission from Department of Natural Resources and Environment for the drilling of the underground water in the area to provide water to the facility if additional volume of water is required.
– To recruit workers to work at the facility.
– To formalise procedures for acceptance and payment with the People’s Committee.