Construction is underway on a new $440-million wastewater treatment facility in St. Thomas, Ontario, that will serve the Volkswagen PowerCo battery plant and other industries planned for the city’s Yarmouth Yards development.
A new report to St. Thomas city council says local taxpayers and existing utility ratepayers are not expected to bear the cost of servicing the new industrial development.
The Dalewood Water Reclamation Facility is the most expensive component of the broader Yarmouth Yards infrastructure program. According to a report from the city treasurer, the wastewater project is expected to be financed primarily through land sale agreements, development charges and government transfer payments.
The city expects to have approximately $273 million available to fund construction of the facility, leaving about $167 million to be financed through long-term debt.
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The new facility, set for substantial completion in 2030, will provide wastewater treatment capacity for PowerCo’s battery cell manufacturing plant and other industrial development within Yarmouth Yards, a major employment area being developed in northeast St. Thomas.
The project also represents a significant change in how major municipal wastewater infrastructure is being delivered in Ontario. In a project announcement, contractor North America Construction (NAC) says Dalewood is the province’s first municipal wastewater project to use a progressive design-build model.
NAC is working with engineering firms J.L. Richards & Associates (JLR) and WSP on the project. The progressive design-build (PDB) approach brings the owner, designers and contractor together while design is still underway, allowing cost, constructability, scheduling and risk considerations to influence the design before it is finalized.
Under a more traditional design-bid-build model, detailed design is generally completed before the project is competitively tendered for construction.
For Dalewood, the City of St. Thomas, NAC and the design team have worked together from the project concept through detailed design to align the facility’s scope, budget, schedule and operational requirements.
According to NAC, the team completed design development in nearly half the timeframe typically required for comparable projects. The contractor attributed the accelerated process partly to focusing early work on operationally critical requirements and bringing construction expertise into the design process to identify potential complications and reduce rework.
The PDB process also incorporated formal decision points at the 30% and 60% design stages and at the Guaranteed Maximum Price milestone, giving the city opportunities to review scope, pricing, schedule and project priorities as the design developed.
That process identified relatively early that some of the project’s original expectations would exceed the available budget, NAC said.
Rather than discovering those pressures after the design was completed and construction bids were received, the project team was able to consider changes while design was still underway. Options included phasing portions of the project, modular approaches, scope refinements and constructability-related changes intended to maintain project feasibility while protecting long-term operational objectives.
The project has moved quickly since NAC submitted its proposal in November 2024, advancing to early construction activities in less than a year.
One early priority was finalizing the layout of buildings and tanks so that an early works program could proceed while the remainder of the facility continued through design.
Bulk excavation and work on select building areas are now underway. Upcoming activities include establishing the project office and carrying out ground improvements for foundations supporting major tanks.
Design and construction will continue concurrently, with the project team prioritizing critical-path and enabling work as the remainder of the facility’s design advances.
Once completed, the Dalewood facility will form a key part of the infrastructure needed to support the expansion of St. Thomas’s industrial base, while providing an early Ontario test case for the use of progressive design-build on a major municipal wastewater project.
