regulation changes and the impact on beneficial use of ash...

©2019 Charah Solutions, Inc.

Regulation Changes and the Impact on

Beneficial Use of Ash for Utilities

Danny Gray Scott Ziegler

Executive Vice President of Vice President of

Governmental & Environmental Affairs Byproduct Sales

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Danny GrayExecutive Vice President, Governmental and Environmental Affairs

Charah Solutions, Inc.

Danny Gray has more than 35 years of experience in the

electric utility and coal ash management industries and

joined the Charah Solutions team in 2008. He is responsible

for Charah Solutions’ legislative and regulatory affairs and

helps oversee the company’s sustainability efforts.

Scott ZieglerVice President of Byproduct Sales

Charah Solutions, Inc.

Scott Ziegler joined Charah Solutions in 2014 and has

over 15 years of experience in coal ash and cement

operations and sales. He is responsible for both Charah

Solutions’ byproduct sales and marketing efforts and

technology development for new markets and products.

Presenters


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▪ Drivers That Impact CCRs; RCRA,

Energy Trends, States and Courts

▪ Energy Trends

▪ CCR Regulation Trends

▪ Market Demand Trends

▪ Industry Response

▪ Beneficiation Technology Solutions For Supply

▪ Summary – Q&A

Discussion Agenda


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This presentation and our accompanying comments include “forward-looking statements” within the meaning of the Private Securities Litigation

Reform Act of 1995. These forward-looking statements may be identified by words such as “may,” “will,” “expect,” “intend,” “anticipate,” “believe,”

“estimate,” “plan,” “project,” “could,” “should,” “would,” “continue,” “seek,” “target,” “guidance,” “outlook,” “if current trends continue,” “optimistic,”

“forecast” and other similar words. Such statements include, but are not limited to, statements about future financial and operating results, the

Company’s plans, objectives, estimates, expectations, and intentions, estimates and strategies for the future, and other statements that are not

historical facts. These forward-looking statements are based on our current objectives, beliefs and expectations, and they are subject to significant

risks and uncertainties that may cause actual results and financial position and timing of certain events to differ materially from the information in the

forward-looking statements. These risks and uncertainties include, but are not limited to, those set forth in the Company’s Annual Report on Form

10-K filed on March 28, 2019 with the Securities and Exchange Commission (the “SEC”) and in our other reports filed from time to time with the

SEC. There may be other factors of which we are not currently aware that may affect matters discussed in the forward-looking statements and may

also cause actual results to differ materially from those discussed. We do not assume any obligation to publicly update or supplement any forward-

looking statement to reflect actual results, changes in assumptions or changes in other factors affecting these forward-looking statements other than

as required by law. Any forward-looking statements speak only as of the date hereof or as of the dates indicated in the statements.

Forward-Looking Statements

Charah Solutions

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• 24+ Utility Partners

• Over 20 Million+ Tons of CCRs Handled Annually

• Approximately 1,800+ Employees (U and NU)

• Over 600 Pieces of Heavy Machinery

Corporate Summary

• Established in 1987 (31 Years in Business)

• Headquartered in Louisville, Kentucky

• Over 50 Power Plants

• Operations in 29 States


▪ RCRA 1976 - Objectives and National Policy

- “The objectives…to conserve valuable material and energy resource

…promote…recovery of solid waste…”

- “Congress finds with respect to materials, that...millions of tons of recoverable

material…are needlessly buried each year” and that “…the recovery and

conservation of such materials can reduce the dependence…on foreign

resources and reduce the deficit in its balance of payments.”

▪ CCP Use History – An Impressive RCRA Success Story

- Recovered Material, Utility and Taxpayer Savings, Trade Balance, CO²

▪ Regulatory, Policy, Courts and Market - Continue To Impact

Industry and CCP Resource Markets

RCRA 1976 – Energy Goal And Objective


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World Energy vs. US – Driver Technology

Asia > 60% of the world's total increase in energy

consumption from 2015 through 2040

“Fossil fuels will still account for more than 3/4ths

of the world’s energy consumption through 2040”

DOE “The World Will Require CCUS Technologies”

Point of Comparison

Today-US ~260 GW

Domestic Energy

Consumption to 2040

Perspective of increase or decrease of Capacity of Coal-

Fired and Gas-Fired Power Generation in the World

EIA projects 28% increase in world energy use by 2040

Source: IEA World Energy Outlook 2019


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US Electricity Status – Driver For CCP

Coal-Fired Electricity – 28% , NG and Renewables Displace

Reserve Margins Narrow In Certain Regions

States Policy Impacts – ZECs, Mandates and Laws

0

1,000

2,000

3,000

4,000

5,000

6,000

2010 2020 2030 2040 2050

2018

history projections

natural gas

renewables

nuclear

coal

39%

31%

12%19%

18%

34%

28%

Based on EIA Data - January 2019

Electricity generation from, selected fuels

Billions kilowatt hours

17%


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▪ CCR Regulation – Mature Compliance Programs

- Groundwater Impacts Now Defined

- Early Closure and Retirements Impact CCR Production

▪ CCR Rules Impacted By Court Decisions

- D.C. Circuit Court – USWAG Case Expands Universe Of Unlined Units

▪ CCR – Phase I – Part 1 Mods- Suits Filed In Light Of 4th CC

- Deadline Extensions Point Of Contention – Immediate Operation Impact

▪ D.C. Circuit Court Orders Remand To EPA To Expeditiously Revise (9 Months)

▪ State Mandates: Closure By Removal versus Cap In Place

▪ WIIN Act – Opportunity For States To Manage Programs

▪ CCR Phase 2, 3, + Expected To Address Court Decisions And Remaining

List Of Agenda Issues

CCR Reg Drivers – Volume Decrease


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Trend Impacts To Coal Burn

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

2019 2020 2021 2022 2023 2024 2025 2027 2031

Announced Capacity Retirement (MW)2019-2031

Bit Cap – 8,566 MW

Sub Cap – 8,096 MW

Total Coal Reduction – 30+M TPY @40%

CCR Impacted – 2.5M – 4M TPY @40%

Capacity Factor Sensitive > 2023

Based on EIA Announced Retire – January 2019


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▪ 2017 Cement -105M Up 1.3%; 2018 Cement Usage: 108.6M - Up 3.4%

▪ Add 13%-20% Fly Ash - Typical 2019 Mix – 14M-22M TPY

▪ 2018 Net Imported Cement – 15.0M Ton – 14% Of Total

134,090

141,086

140,426

128,480

106,480

78,650

78,320

79,420

85,690

89,870 98,120

101,310

103,620

105,006

108,616 111,060

-

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

U.S. Cement Consumption


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CCP Industry Response

▪ Regional Supply Shortages

- Investment In Transportation Assets Increasing

- Alternative SCMs Increasing - Slag, Ground Glass, Natural Pozzolan

- Import CCPs To Increase In Coastal Markets with Terminal Capacity

▪ Legislative Clean Closure with BU Mandates Drive Investment

- North Carolina Case – Three Beneficiation Plants – 900K TPY

- Virginia Case – Dominion Requirements

- Mandates Coupled with Rate Recovery Push CapX Expense To

Ratepayers – Supply Side Impacts Need To Match Market Absorption

▪ Recovery of Surface Impoundments and Landfill CCR for Beneficiation –

High End Market Option – Technology (MP618™)


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• Supply fly ash that meets ASTM, AASHTO, and state specifications for concrete use

• Fly ash with high ammonia content creates health concerns for workers

• Mercury regulations limit raw materials at cement kilns

• Current thermal technologies have high capital and large footprint

• Consumers need consistent quality and supply

• Critical to utility to remove landfill / ponded material

Industry Challenges for Ash Beneficiation

MP618 Multi-Process delivers a saleable concrete or cement kiln

friendly material from coal fly ash ponds, landfills, or current production


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Charah Solutions’ MultiSource®

materials network:

Pins indicate sources and

terminals


• Proven thermal technology allows for beneficiation

of both wet and dry fly ash generated by/or stored

at electric power plants

• Lower cost profile of competitive thermal

technologies

• Process layout consists of:

– Feed Ash Handling and Storage

– Thermal Desorber

– Baghouse / Environmental Control

– Product Handling and Storage

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Technology Overview – MP618™


• Process can easily be started and

stopped for cost-effective operation

• Scalable with equipment that is

readily available

• Finished product storage investment

sized for market demand, not process demand

• Small footprint and components allow

for installation near market demand

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Gas Reactor

Technology Advantages – MP618


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• Fly ash is exposed to indirect heat

• Off-gassed contaminants are separated from the solids

in the Gas Reactor. (950oF – 1250oF)

• System removes carbon, ammonia and

mercury to generate a low LOI fly ash

• Proprietary Gas Reactor removes the metals,

ammonia, chlorides and the products of the

combustion from the gas stream

• Process generates minimal amount of

precipitate: less than 30 tons generated for every

200,000 tons fly ash process; precipitate is returned to

finished product (no waste stream)

MP618 – How It Works


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Process Components

Finished

Product

Storage

Ash Cooler

and Convey System

Thermal

Desorbor

Bag

House

Gas Reactor

Feed Ash

Preparation


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LOI Reduction Results


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Ammonia Reduction Results


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Mercury Reduction Results


Air Permitting

• Emission thresholds related to combustion of natural

gas/propane

• Particulate matter (PM 2.5 and PM 10)

• Minor source if located within a facility boundary of a

current Title V facility

Permitting

22©2019 Charah Solutions, Inc.

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MP618 Multi-Process Fly Ash

Beneficiation

Transforms Fly Ash. And Your Bottom Line.

• Proven thermal technology

• Provides beneficiation of both wet or dry fly ash

• Lower cost profile of competitive thermal technologies

• Small footprint reduces cost for site development and

ease of construction

• High volumes not required for cost effectiveness or

self-sustaining operation

• Versatile and scalable

• Equipment can be easily started and stopped


©2019 Charah Solutions, Inc.24

Danny Gray

Executive Vice President of

Governmental and Environmental Affairs

[email protected]

502-815-5017

Scott Ziegler

Vice President of Byproduct Sales

[email protected]

502-245-1353

mailto:[email protected]

mailto:[email protected]

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