Metro Vancouver sewage treatment plant project budget cut by $4 billion | Daily Hive

Metro Vancouver sewage treatment plant project budget cut by nearly $4 billion

Previous design concept: artistic rendering of the new Iona Island Wastewater Treatment Plant. (Metro Vancouver Regional District)

If everything proceeds as expected, the Iona Island Wastewater Treatment Plant project is anticipated to come in below its earlier estimated budget of up to nearly $10 billion, while still requiring a considerable financial commitment.

Earlier this month, the board of directors for Metro Vancouver Regional District approved a new direction of downsizing the scope of the project, resulting in a $4 billion cost reduction to a revised estimated cost of about $6 billion.

It comes after increased criticism and scrutiny over the regional district’s growing operational and capital costs, including the beleaguered new North Shore Wastewater Treatment Plant project.

This separate project is an upgrade of the sewage treatment plant found just northwest of Vancouver International Airport, situated at the mouth of the Fraser River on Iona Island.

You might also like:

Originally, the regional district had planned to build an entirely new replacement sewage treatment plant adjacent to the existing plant, which was constructed in 1963.

Under the revised approach to cut costs, the existing plant will be retained and upgraded, with phased improvements to meet the federal government’s necessary secondary treatment compliance standards. The regional district notes that this is possible due to more space-efficient wastewater treatment technology.

The existing primary treatment facilities will be rehabilitated, with their replacement now deferred as a future project. Instead, the regional district has pivoted its approach towards focusing on the most critical project components of meeting the federal regulations of secondary treatment.

This new approach reprioritizes and defers sub-projects not required for secondary treatment compliance. Previously included in the project, the higher additional step of tertiary treatment is no longer mentioned for the project’s rescoped design.

Location of the existing Iona Island Wastewater Treatment Plant. (Metro Vancouver Regional District)

iona island wastewater treatment plant f

Existing condition of Iona Island Wastewater Treatment Plant. (Metro Vancouver Regional District)

“Over the past year, Metro Vancouver has carefully examined options to deliver secondary wastewater treatment as quickly as possible, while ensuring cost sustainability for our region,” said Mike Hurley, the chair of the regional district’s board of directors and the mayor of Burnaby.

“In the past year, we’ve selected a technology that has given us an opportunity to rescope the Iona project… This is a great opportunity for us to keep annual rates as low as possible for residents, while still ensuring we’re protecting human and environmental health.”

Previously, secondary treatment was not scheduled to be operational until 2034 — four years after the federal government’s 2030 deadline of compliance. The new approach will achieve secondary treatment compliance sooner.

For such facilities, there are up to three levels of sewage treatment — primary, secondary, and tertiary.

Primary treatment loosely physically filters out 60 per cent of the larger solids in the water, such as debris and grit. Secondary treatment removes 93 per cent of the solids in the water following primary treatment, and it includes both physical and biological processes for its filtering.

Tertiary treatment is a highly advanced level of treatment that removes 99 per cent of the solids in the water, including harmful contaminants. After the completion of primary and secondary treatments, it involves using ultraviolet treatment for disinfection, before releasing the treated water into the Strait of Georgia.

According to the regional district, the existing plant is one of the last remaining primary-only sewage treatment plants in Canada and the United States.

The earlier, more ambitious design concept carried a budget of $9.9 billion based on 2022 dollars, including $6.4 billion in projected project costs and an additional $3.5 billion allocated for contingency and risk reserves to address potential unforeseen expenses arising from the project’s challenges and complex site conditions.

This plant provides the sewage treatment needed for Vancouver, parts of Burnaby and Richmond, the University Endowment Lands, and the University of British Columbia.

Under the previous project scope, it was noted that households in the sewerage service area could see an average additional annual tax increase of about $500 to fund this new plant, which was a cause for concern for municipal officials.

Map showing Metro Vancouver’s four separate sewerage areas (Yellow: North Shore; Orange: Vancouver; Red: Lulu Island West; Green: Fraser). (Metro Vancouver Regional District)

Site preparation — the first phase of construction, valued at $750 million — is well underway on Iona Island in advance of major building activity. Under a cost-sharing arrangement, the regional district is contributing $250 million, the provincial government committed $250 million in 2023, and the federal government allocated $250 million earlier in 2025, subject to strict conditions requiring reduced development fees for new housing.

The regional district had planned to seek substantial additional funding from senior levels of government to fully finance the multi-phased, multi-billion-dollar project. Including the first phase, it aimed to secure $3.5 billion each from the federal and provincial governments.

However, competing spending priorities, broader economic issues, and mounting annual budget deficits and debt at both the federal and provincial levels make such funding increasingly difficult to secure over the coming years, when major construction on the more expensive subsequent phases was scheduled to begin.

“The updated approach is an innovative way to make sure we’re meeting our regulatory requirements, protecting the health of the environment, and being mindful of what residents are able to contribute financially to this important project,” said Malcolm Brodie, the mayor of Richmond.

“While we understand that deferring projects is never ideal, we had to make an important decision about what we could afford to do all at the same time.”

As for the regional district’s other high-profile sewage treatment plant project, major construction on the North Shore Wastewater Treatment Plant resumed just under a year ago. Its projected cost has surged from $700 million, based on an original 2020 completion date, to $3.86 billion for completion in 2030. The previous contractor, Acciona Infrastructure Canada, attributed the project’s escalating costs and difficulties, at least in part, to the regional district’s mid-construction decision to incorporate the extra facilities for tertiary treatment. The regional district and Acciona are currently engaged in legal action over the project.

You might also like: