The Essex Waste Partnership is on target to announce the preferred bidder for a 2-3 billion waste infrastructure and treatment contract in early January 2012 with an Urbaser/Balfour Beatty joint venture emerging as the potential favourite.
However, no decision has yet been formally announced with the other contender, Shanks, still in the frame.
Urbaser/Balfour Beatty was shortlisted with Shanks for the work, after a third contender, Cory, was dropped in April 2011. The client is the Essex Waste Partnership which consists of Essex county council, 12 district and borough councils and the unitary authority of Southend-on-Sea.
The centrepiece of the project, which has 110.9 million of PFI credits allocated by the Department for Environment, Food and Rural Affairs, is a mechanical biological treatment facility to be built in Basildon. There will also be an in-vessel composting facility in Basildon and an anaerobic digestion plant near Chelmsford.
Should Urbaser/Balfour Beatty be confirmed as preferred bidder, it is expected that construction and civil engineering work will be undertaken by Balfour Beatty. Such a move would be welcomed within Balfour Beatty which has put a value of 8 billion on waste infrastructure developments in the UK between 2010 and 2015.
The Essex project has a long history and there was significant opposition to earlier plans for an incinerator or energy from waste plant. Now, while no incinerator will be built, the MBT plant will be able to produce solid recovered fuel for incineration elsewhere. Currently, large volumes of SRF are being exported for energy recovery in northern Europe.
Partnership
At present residual waste in Essex goes to landfill the Partnership had a 46%% recycling rate in 2010/11 and the county is targeting a 60% household recycling rate. The project will serve a population of 1.3 million people in Essex plus 160,257 in Southend. Residual waste per head of population is 310kg per annum.
Urbaser is part of the Spanish firm ACS Group and has its UK headquarters in Cheltenham. This is close to its waste treatment and recycling contract with Herefordshire and Worcestershire councils which it secured in 1998 in a joint venture with Focsa under the brand Severn Waste Services. Focsa is a sister company of UK waste management firm WRG both businesses are owned by FCC of Spain. Urbaser also has a waste and recycling contract with Gosport borough council.
Shanks has a number of large PFI contracts including one for the East London Waste Authority which features an MBT plant at Rainham in Essex.
Confirmation of the preferred bidder will come just months after final tenders were submitted in October 2011, one month earlier than planned. And, the conclusion of the project in terms of selecting a preferred bidder is expected to come as some relief for the project team and local authorities involved. The project faced considerable upheaval this year.
While there are understood to have been no delays on the client side, a number of the contractor proposals faced changes.
In September 2010 there were three contenders:
- Skanska with Cory Environmental
- Resources from Waste (United Utilities/Laing ORourke)
- Urbaser with Balfour Beatty
In the last quarter of 2010, the Essex Water Partnership commented that two bidders suffered internal consortium issues which delayed their ability to properly engage with the Authority procurement team.
Decision
Then in September 2010, the Resources from Waste consortium told the Partnership that it was not going to continue in the process as United Utilities was being sold and Laing ORourke, according to the Partnership, had quite separately but coincidentally taken a corporate decision to pull out of the UK waste market.
Then it was revealed that Skanska was, said the Partnership, removing itself from its consortium with Cory and of any further involvement with the procurement.
This saw the Partnership agreeing that Cory could bid without Skanska and that also Shanks could bid as it had acquired the PFI market involvement of United Utilities.
The Partnership has remarked: In order to maintain and maximise the competitive environment, the Authority proposed to extend the closing date for Detailed Solutions to April 2011. This allowed both Cory and RfW an equal opportunity to re-engage in their new consortium formats whilst minimising the delay to Urbaser.
All three bidders submitted a detailed solution in April 2011 which then saw RfW (Shanks) and Urbaser chosen to return to dialogue with the final submissions in October 2011.
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