A moral dilemma

Posted July 31, 2013

A recent article in the Kitchener/Waterloo Record stated that the Region of Waterloo was losing $1,166,300 million a year with its wet waste being processed in Guelph’s Organic Waste Processing Facility (OWPF).

Three years ago, the Region decided it wanted to process its organic material and requested proposals from Hamilton and Guelph.

The Hamilton proposal was a pay-as-you-go arrangement with no set amount to be shipped. The Guelph proposal included a fixed amount of wet waste feedstock pegged at 20,000 tonnes over ten years.

In its wisdom, the Regional council decided to accept the Guelph proposal. Then came trouble, they were only able to ship 9,100 tonnes as only 15 to 35 per cent participated in the Region’s “green bin” collection system that contains organic materials.

They still have to pay $107 a tonne regardless if the Region uses its contracted tonnage or not. The Regional contract with Guelph is worth $2,140,000 a year. The shortfall of tonnage amounts to a loss to the Region of $1,166,300.

A few weeks ago, Guelph waste management general manager, Dean Wyman, announced the city was seeking to sell capacity processing waste from other municipalities. This perplexed folks who believed the capacity of the plant was taken with the city of Guelph processing 10,000 tonnes and the Region of Waterloo providing 20,000. Guelph has maintained the capacity of the plant is 30,000 tonnes per year.

To recover the cost of the lack of wet waste volume, the Region still owns 20,000 tonnes of capacity at the OWPF and should be able to control its share. Instead, the Guelph waste management team decided to sell the tonnage not being utilized by the Region.

There are two issues here. The Regional council failed to understand that if you install green bins for wet waste collection, it has to apply to everyone in the collection area, not just a small percentage. That’s a whoops!

The other issue is a moral one. Should Guelph double dip and sell Waterloo capacity while taking money from the Region when it cannot meet the capacity agreed in the original contract? Should not that contract be renegotiated to accommodate the needs of the Region and Guelph?

Guelph’s mistake was saying it would sell the unused Regional capacity to others without consulting the Region that owned the capacity.

In order to change the terms, the Region must be prepared to work with Guelph to find additional clients for the OWPF to replace the unused capacity of more than 10,900 tonnes.

1 Comment

Filed under Between the Lines

One response to “A moral dilemma

  1. Glen N. Tolhurst

    Given the past lack of financial acumen exhibited by the waste mismanagement team, it may be that their only reference point for “double dipping” is at a soft ice cream cone shop.

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