As previously mentioned in the trading update of February 17 2009, Hydrodec concluded an agreement with a major US utility company. After gaining approval from all parties to the agreement, the following press release gives further information about this contract.
Today Hydrodec has announced a three-year agreement with the utility; A-Line E.D.S. Inc. out of Waterloo, Iowa. Hydrodec will receive all of Exelon's used transformer oil (approximately 650,000 gallons per year) and re-refine it into new SUPERfine™ Oil. The Chicago-based electric utility ComEd has committed to purchase back this re-refined SUPERfine™ Oil, effectively creating a closed-loop supply chain for transformer oil; the first of its kind in the utility industry. This agreement will prevent the oil from reaching secondary markets, where typically it is burned as fuel, and thus eliminate over 7,000 metric tons of carbon dioxide emissions per year.
Hydrodec partnered with A-Line E.D.S., the nation's leading onsite transformer decommissioning service provider to create a single step for recycling Exelon's transformers and used oil. A-Line E.D.S. will remove the used oil as part of the decommissioning process and provide it to Hydrodec, which will recover and re-refine the oil into its SUPERfine™ brand of new transformer oil. Exelon will purchase SUPERfine™ for use as maintenance oil as well as petition that new transformers contain SUPERfine™ oil.
Ben Stroh, President of A-Line E.D.S. Inc. stated, "This is the first turn-key transformer and oil recycling closed-loop contract of its kind and we expect that a lot of utilities across the country will want to jump on board for an opportunity like this as it's the wave of the future," Stroh also stated that "immediate capacities are limited so contracts like this will be developed on a first come, first served basis."
"This agreement sets a new best practice standard for the utility industry for transformer oil," said John Cowan, president of Hydrodec, North America. "For the first time, a U.S. utility will be recovering, remanufacturing and re-using transformer oil as new oil, thus reducing emissions and preserving a dwindling resource."
ComEd is a unit of Chicago-based Exelon Corporation (NYSE:EXC), one of the nation's largest electric utilities with approximately 5.4 million customers. ComEd provides service to approximately 3.8 million customers across northern Illinois, or 70 percent of the state's population. "This partnership supports Exelon 2020: A Low-Carbon Roadmap and our goal to reduce, displace or offset more than 15 million metric tons of greenhouse gas emissions per year by 2020," said Edward Jandacek, Vice President of supply operations and sourcing for ComEd. "Recycling our transformer oil is a great opportunity to help reduce Exelon's carbon footprint and green our supply chain."
This 'closed-loop' agreement is the first of its kind in the industry. Traditionally in the decommissioning process, used transformer oil has been sold to secondary markets where it has been burned as home heating oil or transportation fuel, thousands of metric tons of CO2 each year. Simultaneously, new transformer installation and existing transformer maintenance require millions of barrels of oil to meet the demand for new transformer oil, and Hydrodec's technology changes this. The company's proprietary technology converts used transformer oil into new SUPERfine™ transformer oil -- a chemical contaminant-free product that exceeds industry standards for new transformer oil. SUPERfineTM can be recycled repeatedly, giving utilities a sustainable, recyclable, reliable resource. Hydrodec's patented technology and industry-leading expertise provide next generation carbon efficiencies and environmental sustainability benefits to customers and communities alike.
- Greenhouse Gas Emissions Reduction: Each barrel of transformer oil refined through the Hydrodec system represents a direct reduction in CO2 emissions.
- Resource Conservation and Independence: Each barrel of oil refined through the Hydrodec system helps conserve more than one barrel of limited global crude oil reserves. Conservation of crude oil also represents a further net reduction of CO2 emissions by avoiding the new oil refining process.
- Fewer Hazardous Chemicals: Hydrodec's technology eliminates any Polychlorinated Biphenyls (PCBs) contained in used transformer oil thus eliminating the possibility of emission of PCB-like chemicals and Dioxin into the atmosphere from that oil. Thanks to Hydrodec's focused eco-efficient process, SUPERFine™ Oil avoids crude oil refining wastes by refining by-products such as air emissions and secondary fuel incineration emissions.
About Hydrodec
Hydrodec (AIM:HYR) is a specialty "sustainable" oil producer and the creators of SUPERfineTM -- the world's first sustainable, reusable near zero-emission transformer oil. Hydrodec is traded on the London Stock Exchange, and operates refining facilities in Canton, Ohio in the United States and New South Wales, in Australia. Two new plants in Mississippi and Japan are in development. More information is available at www.hydrodec.com and www.superfineoil.com.
About A-Line E.D.S. Inc.
A-Line E.D.S. Inc. is North America's premier provider of on-site transformer decommissioning and recycler of distribution transformer equipment. Their PCB Commercial Storage and processing facility is located in Waterloo, Iowa. More information about A-Line can be found at www.alineeds.com.
For further information please contact:
Hydrodec Group plc
+61 2 6382 5387
Mark McNamara, CEO
John Dickson, Finance Director
Numis Securities Limited
020 7260 1000
Nominated Adviser: Simon Blank
Corporate Broker: David Poutney / Alex Ham
Curve PR
020 8742 1597
07764 197003
Original Press Release can be found here.