Wakefield hopes to sign delayed PFI in early 2010

The council's chief executive, Joanne Roney, acknowledged that the process of finalising the 25-year contract – which is further advanced along the procurement process than any other unsigned PFI deal – had been affected by the economic downturn.

“Wakefield council and the VT Group are continuing the final negotiations process and are hopeful of getting to financial close early in 2010,” she told letsrecycle.com. “However, this has been a complex and challenging process in view of the economic climate.”

Under the deal, VT Group's subsidiary VT Environmental Engineering is expected to deliver infrastructure to treat up to 240,000 tonnes of waste and recycling-a-year, including an autoclave, anaerobic digestion (AD) facility, materials recycling facility (MRF) and a composting plant.

When VT Group was named as preferred bidder in November 2007, the two parties had hoped to finalise the contract by summer 2008 (see letsrecycle.com story), but a failure to sign the deal as planned led to the suggestion that they could look to secure a loan from the Treasury's Infrastructure Finance Unit to get the deal closed (see letsrecycle.com story).

A spokesman for VT confirmed that the company now anticipated contract close on what would be its first ever waste PFI deal by the end of the current financial year.

Ms Roney explained that, once negotiations were complete and the deal was signed, there would be a “short” mobilisation period, before the contract started in “early spring”.

Planning

While the deal remains unsigned, VT has received planning permissions for the key sites it plans to deliver under the contract, including the autoclave, AD plant, MRF and composting facility which will be built at South Kirkby (see letsrecycle.com story).

It has also been given the go-ahead to build a new transfer station and household waste recycling centre (HWRC) at Denby Dale Road, HWRCs at Glasshoughton and Welbeck, and a temporary transfer station at Ossett.

The company's spokesman added that environmental and transport licences for the developments were being processed.

The contract, which received £33 million in PFI funding from Defra, is intended to help the West Yorkshire council increase its recycling rate to 52% by 2015, as well as significantly reducing the amount of waste it sends to landfill.