Milorganite Operational Risk Register Market Assessment

Background and Project Goals: Material Matters supported the Applied Technologies Inc Team (Applied Technologies, Inc. GHD Group, and Veolia Water Milwaukee) in developing an Advanced Biosolids Facilities Plan for the Milwaukee Metropolitan Sewerage District (the District). The Advanced Biosolids Facilities Plan will identify and evaluate a variety of biosolids treatment alternatives that the District will consider, adopt, and implement. The project sought to answer the following three questions: 1. What is the best way to make Milorganite®? 2. What drivers influence the long-term viability of Milorganite®? 3. How can the District adapt to changing drivers? To answer the project questions, Material Matters developed an Operational Risk Register, with the support of the project team, to identify market risks most critical to maintaining the District's nationally acclaimed and distributed dried biosolids product - Milorganite®. Project Approach: The Operational Risk Register was developed to identify regulatory and market-based risk events associated with the Milorganite program. A risk register is a risk management tool that identifies potential risk events, assigns the probability of the risk event occurring (likelihood of failure [LOF]), and quantifies the resulting consequence if the risk event occurs (consequence of failure [COF]). Risk events include internal risk events (i.e., risk events that can be controlled by the operating entity), as well as external risk events (i.e., risk events that are outside of the control of the controlling entity). A risk register is a unique and innovative tool for evaluating a biosolids management program because it is dynamic and can be updated to match any changes in program goals or to reflect known changes in the market. Ultimately, over 60 potential risk events were identified and evaluated resulting from changes to District's biosolids processing (internal risks) or changes in the market or regulatory climate (external risks). The risk evaluation was based on existing customer purchase data, interviews with a representative sampling of Milorganite direct customers, and interviews with regulators from the top distribution states (Figure A-1). Information collected was summarized and used to evaluate the likelihood of the risk events occurring, and the corresponding level of consequence to the District should the risk occur. The scoring matrix and risk rating used for the risk register is shown in Table A-1 and based on scoring methods developed with the District as part of the 2050 Facilities Plan. Project Findings: Project findings revealed five key market-based risks critical to consider for the ongoing dominance of Milorganite® in the natural fertilizer market space, including: 1. Changing the physical characteristics of the Milorganite product (Figure A-2), 2. Reducing the production of Milorganite®, 3. Change in nutrient content or ratios, 4. Change in product odor, and 5. Regulatory changes related to contaminants of emerging concern (CEC) including per- and polyfluoroalkyl substances (PFAS). Mitigation measures and future consideration were provided to the District for operational risks identified as Medium or High overall risk. The risk register results will be used by MMSD to guide selection of process changes and technology choices for the remainder of the project. The outcome of the risk analysis concluded that technology decisions for wet-side treatment processes, digestion, thermal drying technology, and product diversification must be carefully considered in the next phase of the Advanced Biosolids Facilities Plan to avoid the highest rated operational risk. This paper will describe the risk register development process, including data gathering approach, scoring, and ranking process. The paper will also discuss the overall outcome, including mitigation measures to be used by the District to reduce risk impact on the program & and to preserve the Milorganite's unique position in the national fertilizer marketplace.