Bedfordshire abandons 25-year waste project

Central Bedfordshire council has abandoned the procurement of a 25-year contract to deal with the authoritys residual and organic waste as the final bids are both unaffordable.

The project originally had the support of other local authorities in the county but they withdrew several years ago.

Councillors at Central Bedfordshires executive committee decided to withdraw from the Bedfordshire Energy and Recycling Project (BEaR) at a meeting last week (December 10) and to instead pursue an alternative option.

Both Viridor were and consortium of New Earth Solutions and Remondis were in the running as final bidders for the 25-year contract, having beaten off competition from Covanta and Veolia in January 2012 (see letsrecycle.com story).

However, the council said that neither of the two final bids provided a financially viable option in the midst of government cuts to local authority funding, which it said had left council budgets under huge pressure.

The BEaR Project would have seen the winning contractor handle 65,000 tonnes of residual waste and 35,000 tonnes of household organic waste each year, with facilities developed at the council-owned site at Thorn Turn near Dunstable.

The final value of the contract would not have been known until it was awarded, but the councils Reference Project was previously valued at 397 million.

Council documents state that the project is unaffordable in the short to medium term as council budgets cannot cover expected additional costs. Furthermore, the documents also state that recent government funding cuts has led to concerns over the councils ability to fund the project in future years when it does not know what its budget position will be.

By locking in to a long-term contract, according to documents, the council would be unable to reduce services or withdraw from the contract completely without suffering significant penalty which limits its flexibility and places a risk on the authority for this type of long term contracting.

Viridor

One of the final bidders for the contract, waste management company Viridor, said it was extremely disappointed with Central Bedfordshire councils decision.

Robert Ryan, head of projects for Viridor, said: We have put a great deal of work into this integrated procurement with Central Bedfordshire which started in 2010. We are extremely disappointed with Central Bedfordshires decision to abandon the procurement and have now received formal notification of abandonment.

The BEaR Project suffered several setbacks since it was first announced in 2005. It was originally conceived as a three-council partnership, with Luton and Bedford borough councils dropping out over concerns about the affordability of the project (see letsrecycle.com story).

‘it doesnt make financial sense to continue with a procurement that will add to our immediate financial burden and limit our flexibility long-term’

Central Bedfordshire councillor Budge Wells

Two separate applications for PFI credits were also rejected by the government (see letsrecycle.com story), but Central Bedfordshire opted to press on with the project alone.

Central Bedfordshire

Central Bedfordshire council said it was now looking to develop an alternative solution for its residual and organic waste as soon as possible in early 2014 and had left capital in its budget to invest in new facilities if need be.

Central Bedfordshire councillor Budge Wells, deputy executive member for sustainable communities-services, said: At a time when council budgets are already under huge pressure and with further funding cuts inevitable it doesnt make financial sense to continue with a procurement that will add to our immediate financial burden and limit our flexibility long-term.

The work that we have already done through the process we have been through means that we can move forward quickly to deliver an alternative waste disposal solution to a similar timescale as originally proposed.

He added: That new solution will need to meet similar targets for reducing use of landfill and also increasing recycling and composting rates where possible. We have retained capital in our budget to invest in developing new and existing facilities, if needed, to achieve our goals.