Extended Incinerator Deal Means Lower Garbage Bills in Union County

Two-decade lease with energy-from-waste facility could save $100 million all told

Union County residents in more than dozen communities will see their garbage bills drop because the county has negotiated an extension of a deal to send trash to an incinerator in Rahway for another two decades.

The Union County Utilities Authority announced it has approved an extended lease that will reduce disposal costs for the 14 towns sending garbage to the energy-from-waste facility, saving approximately $100 million over the length of the new lease, now scheduled to end in 2031, eight years longer than the existing lease.

The agreement stipulates the new lease is retroactive to January 1, 2011, a provision that will require Covanta Energy, the owner of the facility, to send rebate checks to each of the towns. The unexpected windfall is especially lucrative for the county’s big cities; Elizabeth will be reimbursed $658,000 and Plainfield, $235,000.

Over the long term, customers also will see a drop in their garbage bills as the authority’s new lease will reduce the towns’ costs by $12 per town, which officials claimed will amount to a total of $100 million over the length of the deal.

“We are thrilled to have been able to strike a deal that puts money immediately back into the budgets of municipalities during tough economic times and ensuring those continued savings into the future,’’ said Daniel Sullivan, acting executive director of the authority.

According to authority, the rebates will amount to $16,000 for Garwood; $101,000 for Hillside; $30,000 for Kenilworth; $148,000 for Linden; $41,000 for New Providence, $158,000 for Rahway; $95,000 for Roselle; $54,00 for Springfield; $90,000 for Summit; $69,000 for Union; and $9,800 for Winfield.

“Union County has taken an innovative approach by maximizing an asset to deliver taxpayer savings,’’ said Freeholder Deborah Scanlon. “ This is a win-win situation. At the same time we are guaranteeing that our municipalities maintain low disposal rates at the Resource Recovery Facility.’’

That view was disputed by Jeff Tittel, director of the New Jersey Sierra Club. “We need to be phasing out these incinerators, not extending their life,’’ he said, arguing the state’s handful of garbage incinerators undercuts recycling efforts and programs designed to reuse waste.

The Rahway incinerator began operation in 1994 and processes about 1,540 tons of garbage each day, while producing about 39 megawatts of electricity. Covanta, which owns about 40 energy-from-waste facilities as the company prefers to call the facilities, had pushed the Christie administration to revamp its Energy Master Plan to reflect those plants as preferred renewable energy projects, a stance rejected in the final master plan released earlier this month.

“In addition to the financial benefits this transaction brings municipalities, the deal ensures that the Union County energy-from-waste facility will continue to supply reliable, renewable electricity to thousands of county homes while reducing greenhouse gases which contribute to climate change,’’ said Paul Stauder, senior vice president of business management for Covanta America.

Tittel argued the incinerators were developed at a time of a completely different mindset when it came to environmental issues. “This is a 1980s Oldsmobile at a time when people are buying plug-in electric vehicles,’’ he said.