What this document is
The State A / State B economic model for Hennepin County, with the two payment flows kept separate and the capital comparison stated explicitly.
- State A is $88/ton at the HERC gate under the contracted 2027 rate, up from $77 today. What replaces it after closure has not been published, and this report does not invent a figure for it.
- State B at Phase Initial: $14.60M a year in Beneficiation Fee against $17.52M a year in Circular Royalty™ from Year 2 — two independent gross flows, reported separately.
- Zero County capital at every phase, and all regulatory work carried by Carbotura.
Hennepin County
Economic Impact Report
The comparator is HERC’s contracted $88/ton, and we are about $12 above it — before the royalty.
State A — the current system
Hennepin County operates HERC and supplements it with landfill, including out-of-state landfill. In 2023, 51% of what the County generated was land disposed and 12% left the state.
The HERC gate rate is $77/ton currently, contracted at $85/ton for 2026 and $88/ton for 2027. HERC’s non-hazardous ash is landfilled at Rosemount, which is a second cost and a second regulatory profile carried on the same tonnage.
What this report does not do: it does not assert a post-closure disposal cost. What the County pays per ton once HERC retires depends on contracts not yet let, and no figure has been published. It also does not argue landfill scarcity — the published regional analysis finds ample capacity for decades, and we have no basis to say otherwise.
State B — Advanced Circular Manufacturing under a CSA
What State B is not. Advanced Circular Manufacturing is not incineration, not waste-to-energy, not pyrolysis and not gasification. There is no combustion at any stage, no stack and no ash, and Carbotura does not sell power, electricity or hydrogen — energy is consumed internally, never a revenue line. State B is not a replacement thermal facility under another name.
In State B the County delivers the same stream to an ACM plant and pays a Beneficiation Fee of $100/ton, escalating 2.5% a year — approximately $12/ton above the contracted 2027 HERC rate. Separately and independently, Carbotura pays the County a Circular Royalty™ on the same tonnage.
| Year | Beneficiation Fee ($/ton) | Annual Beneficiation Fee ($M) | Royalty multiplier | Circular Royalty™ ($/ton) | Annual Circular Royalty™ ($M) |
|---|---|---|---|---|---|
| Year 1 (pre-royalty) | $100.00 | $14.60 | — | $0.00 | $0.00 |
| Year 1 (from Month 13) | $100.00 | $14.60 | 120% | $120.00 | $17.52 |
| Year 2 | $102.50 | $14.97 | 121% | $124.03 | $18.11 |
| Year 5 | $110.38 | $16.12 | 124% | $136.87 | $19.98 |
| Year 10 | $124.89 | $18.23 | 129% | $161.10 | $23.52 |
| Year 20 | $159.87 | $23.34 | 139% | $222.21 | $32.44 |
| Year 30 | $204.64 | $29.88 | 149% | $304.91 | $44.52 |
| 30-year gross | — | ~$641M | — | — | ~$874M |
Phase Initial, 146,000 TPY. Accrual basis throughout: Year n carries Mₙ × BFₙ. The two columns are independent gross flows and are never netted. Figures ILLUSTRATIVE.
The capital comparison
Every route the County can take requires someone to fund something.
| Path | County capital | Regulatory burden | Reaches the 90% goal? |
|---|---|---|---|
| Landfill the HERC stream | None directly | County/hauler | No — moves tonnage into the half of the goal being diverted from |
| Replacement thermal capacity | County-funded | County | No — and politically foreclosed in this county |
| Advanced Circular Manufacturing | $0 at every phase | Carbotura’s | Yes — neither landfill nor incinerator |
Carbotura’s Phase Initial is a $240M facility — $75M for the first module and $55M for each of three additional modules. That is Carbotura capital. The County commits none at any phase.
Employment
Phase Initial supports approximately 100 direct full-time roles, rising to roughly 250 at Phase Medium and 500 at Phase Expanded. These are manufacturing roles — process operation, maintenance, quality, logistics.
Employment figures are ESTIMATED from the standard per-TPD baseline, not from a county economic study. We note that HERC’s own workforce transition is a live question in the closure debate; we have not modelled any relationship between the two and would not present one without doing the work.
What could make this wrong
We have no operating plant. Carbotura is development-stage; no facility is at or past Commercial Operation Date. The CSA’s condition precedent exists precisely so that this risk does not sit with the County.
Composition. The stream split is ESTIMATED; no characterisation study has been performed for this engagement. That is a Term Sheet phase control.
No site. None identified. Siting can move both timeline and cost.
The closure timeline is contested — placed between December 2027 and 2040 by different actors. Our model is not indexed to any closure date.
The post-closure comparator is unknown. If the County secures landfill capacity substantially below $100/ton, the fee sits further above State A than this report shows. The royalty is the answer to that, and it is stated separately rather than netted against it.
Appendix A — Basis of presentation
All financial figures USD, ILLUSTRATIVE until Term Sheet execution. Beneficiation Fee $100/ton is a programme specification at the floor of the $100–150/ton range. Circular Royalty™ computed under the Release 31 formula: the multiplier applies to the current-year escalated Beneficiation Fee. Accrual basis stated and kept; no table mixes bases. Accounting standard: US GAAP / GASB.
Comparator is HERC’s contracted 2027 gate rate of $88/ton, VERIFIED. No post-closure disposal cost is asserted. No landfill capacity argument is made; the published regional analysis finds capacity sufficient for decades and this report does not dispute it.
The Beneficiation Fee and the Circular Royalty™ are independent transactions and appear only as separate gross lines.
Appendix B — Sources
- Hennepin County Environment and Energy — 2024 Solid Waste Management Plan and recycling progress reporting
- Hennepin County — HERC board briefing on the facility’s role in the solid waste system
- City of Minneapolis — waste disposal services contract (HERC gate rates)
- Minnesota Center for Environmental Advocacy — 2025 metro landfill capacity reports
- Minnesota statute — metro county recycling requirement