Small communities in Ontario can now benefit from an innovative wastewater collection and treatment system, as well as a unique funding model to implement it.
In 2013, residents at the Fetherston Mobile Home Park in Ontario faced eviction due to a septic system that had been leaking for years, and the prohibitive costs of replacing it. However, close cooperation between residents, the Township of North Grenville, the Ministry of Environment and Climate Change (MOECC) and Clearford Water Systems Inc. led to an innovative solution. The community became the first in Canada to install a Clearford One wastewater system under a pay-for-performance funding model.
The system is made up of three components. Instead of a septic tank, each home is equipped with a smart digester. The digester separates and breaks down the sewage, providing primary and some secondary treatment. The liquid effluent is then conveyed through small-bore sewer pipes to the treatment plant. A membrane biological reactor, designed by Koester Canada,Inc., completes the digestion and removes suspended solids and nutrients. The effluent undergoes UV disinfection before being released into the environment.
The Clearford system is ideal for small or remote communities, where piping sewage to an urban centre wouldn’t make economic sense, and where putting in a conventional system would be too expensive,” said Kevin Loiselle, president & CEO of Clearford Water Systems. “It’s subdivisions that will be serviced separately.”
Among the advantages, Loiselle says the use of sealed, high-density polyethylene pipes prevents leaks and groundwater infiltration. The liquid flow requires half the slope of convention sewer pipes. Overall, the decentralized system boasts lower capital, operating and life-cycle costs than a conventional sewage system.
Clearford has been installing various components of its technology since 1999, but the Fetherston site, commissioned in February 2016, represents its first all-in-one installation that includes the new membrane bioreactor. Moreover, the demonstration site is the first to use Clearford’s pay-for-performance (P4P) funding model.
Unlike a typical P3 design, build, operate and maintain contract, the P4P model has no capital requirements. “Clearford will finance the entire capital and operating costs for the 25- or 30-year period, in exchange for the commitment of a monthly payment for each serviced home,” said Loiselle. “In other words, there’s no risk to the municipality of whether our system will work or how much it will cost to operate. We take all of that risk on our own shoulders, as long as they commit to paying for the service when it works.”
Ownership is transferred to the municipality at the end of the service agreement, at no cost. The expected useful life of all in-ground components is over 90 years.
Clearford funded Fetherston’s $1 million system itself. However, in January 2016, Clearford signed a $100-million funding agreement with a Swiss facility, Signina Capital AG, to cover the capital costs of installing its wastewater collection and treatment system in Ontario municipalities.
“Municipalities in Ontario are considered very good credit risks,” explained Loiselle. This is partly due to provincial legislation governing how much municipalities can borrow. Loiselle notes that because sewage collection is a rate-payer item, committing to pay for this service on a per-door basis will not affect a municipality’s credit worthiness or borrowing limit.
Loiselle admits that establishing this fixed monthly payment can be tricky. “At the moment, people do not pay the full costs of water services,” he said. “Most water bills just cover operation of the system, not the capital costs of putting the system in.” For this reason, he suspects the model may be most successful in projects where a developer is adding on to a town, and where the town can bridge the gap in rates by charging fees to the developer.
Most recently, Clearford was one of two companies invited to submit an RFP for a wastewater collection and treatment system for a new development in the Township of Adjala-Tosorontio, Ont. If Clearford wins the contract, it would be its first P4P contract accessing the Signina funding.