County Steams Downtown

December 15, 2005
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GRAND RAPIDS — Guests of the new JW Marriott Hotel will be steamed when the plush lodging facility opens for business in the fall of 2007.

That’s because Alticor Inc., the owner of the $100 million hotel and adjacent parking ramp being built on Campau Avenue just south of Pearl Street, has joined more than 100 other downtown building owners who have signed up with the Kent County Department of Public Works for its steam-generated heating and cooling service.

“We do have the contract to provide service to them, as we also do with the new art museum,” said Doug Wood, interim public works director, who took over the department after Curt Kemppainen retired this fall.

“We have about 125 customers. It varies, but only one or two up or down from that number,” added Wood, who directed the county’s solid waste operations before becoming interim director.

The county has offered the service via its Downtown Heating and Cooling Authority since 1986, when Kent bought the underground system from Consumers Energy, now Consumers Power.

The service has been operating since the 1920s; the old water boilers that made the steam back then were replaced with oil- and gas-fired boilers as part of the urban renewal effort that was so prevalent across the country in the late 1960s.

Consumers Energy continued to run the system for the county until 1989, when Covanta Energy began to operate the waste-to-energy facility and the heating and cooling system.

“This is a good example of a private-public cooperative effort. We let them do what they do best, which is to try to build on those efficiencies, and we bring something to the table, too,” said Bill Allen, the county’s Waste-to-Energy administrative manager.

One item the county brings to the table for building owners in the downtown sector is a competitive price for heating and cooling.

“I don’t think that the Alticor hotel would have come with us if we weren’t. By that I mean, you have to take into account the capital savings of not having to have your own in-house boiler system and operate it,” said Allen.

“For a high-pressure boiler system, you also have insurance costs and an ongoing operating cost, and we take both off the building owners’ shoulders,” he added.

Not having to house a boiler system also means a building owner has more space to lease to a tenant.

“They can take that room that would be non-revenue producing and convert it into a revenue-producing room,” said Allen.

The county uses natural gas, oil and trash to generate steam heat. Natural gas and oil can be burned at the heating and cooling building at 950 Market St. SW to produce steam. Whichever price is lower, gas or oil, determines which source is used.

The trash, of which the county gets up to 625 tons per day, is converted to steam at the waste-to-energy facility and then can be piped into the system. It serves as a winter supplement to the steam needed to heat downtown buildings, and for the snowmelt systems in the winter.

“Most of the year that pipeline connection between the two plants isn’t in use. It’s something that makes sense during the cold-weather months as demand increases and the cost of fuel goes up. We can do a better job of servicing our customers by bringing the line into operation, which we did in the middle of November. We’ll probably be running it into March,” said Allen.

Tax dollars are not used to support either the waste-to-energy facility or the heating and cooling system. Both are “enterprise” funds, meaning that the revenue collected from the services sustains them. The waste-to-energy operation has a budget of $37.4 million for 2006.

Wood told the Business Journal that public works is looking at possibly expanding the service in the future. If that becomes a feasible project, an extended service would likely resemble the “district” systems being used in a number of European cities. These are based on hot water generation rather than the high-pressure steam model the county currently employs. The district method uses fewer and larger units to create heat. It doesn’t use natural gas or oil to fuel the system, and it turns out cleaner emissions.

“The advantage to that is you can expand it further out and it’s a little easier to manage,” said Wood of a hot water system.

“You know the energy situation that we saw become some catastrophes isn’t going to go away,” he added. “There is a finite amount of energy, and a district heating system for core cities makes a lot of sense from an energy standpoint — and it also makes a lot of sense from an environmental standpoint.”    

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