A consortium led by SITA UK has today (December 24) signed a 30-year residual waste treatment contract with the Merseyside Waste Disposal Authority (MWDA).
The completion of the deal, which is worth up to 1.2 billion, comes after a nine month delay following legal action by one of the unsuccessful bidders over the procurement process.
SITA, alongside its bidding partners utilities giant Sembcorp UK and investment firm I-Environment (part of the Japanese Itochu Corporation) were named as the preferred bidder for the contract in April 2013 (see letsrecycle.com story).
But, Covanta Energy Ltd challenged the decision in the High Court, seeking further evaluation of the bid. An amicable settlement between MWDA and Covanta was reached in October (see letsrecycle.com story) paving the way for the deal to be signed between the SITA consortium and the Authority.
Under the contract, SITA Sembcorp and its partners will be responsible for the development of an energy from waste facility with combined heat and power at the Wilton International site in Teesside, a site owned by Sembcorp.
Household waste from the Merseyside and Halton Waste Partnership, which consists of the metropolitan boroughs of the MWDA and the unitary authority of Halton borough council representing over 600,000 households – will be treated at the plant.
Heating
‘Signing this contract today puts in place a sustainable waste management solution for the next 30 years.’
Councillor Graham Morgan, MWDA chair
The deal will see the waste management firm treat up to 430,000 tonnes of waste per year.
Subject to local site demand, the energy-from-waste facility will also be able to provide heat to local businesses, with the capacity to deliver 190 tonnes of steam an hour to neighbouring industrial businesses via a district heating system.
The consortium will also develop a new rail hub at Knowsley on Merseyside for the transportation of waste to the Teesside facility. The rail hub will have the capacity to handle up to half a million tonnes of waste per year.
Both facilities already have planning permission and will require a capital investment of 250 million.
Conclusion of the deal marks the end of a relatively positive year for SITA, in which it also signed the 760 million waste treatment and disposal contract with the West London Waste Authority (WLWA) (see letsrecycle.com story).
West London
The transportation of Merseysides waste across the country draws parallels with SITAs plans for the West London contract, under which it plans to transport waste via rail-link to a facility in Gloucestershire.
Commenting on the Merseyside contract, David Palmer-Jones, chief executive of SITA UK, said: The signing of this contract is great news for Merseyside and for the environment, because it means we will now be able to begin building the necessary infrastructure to put this waste material to good use rather than sending it to landfill.
Agreeing this contract is also great news for local employment near our sites, because we expect to create around 75 permanent jobs and employ hundreds more during the construction process.
Value
The MWDA also welcomed the signature of the contract, adding that the deal will provide value for money for Merseysides taxpayers.
Councillor Graham Morgan, chair of the MWDA, said: Signing this contract today puts in place a sustainable waste management solution for the next 30 years. The solution we have selected for Merseyside and Halton is the best for the environment – saving natural resources, generating green electricity and providing value for money for Merseyside and Halton council tax payers.
Carl Beer, chief executive of MWDA, added: We are looking forward to working in partnership with SITA UK and other partners to develop modern and efficient facilities that apply the highest environmental standards in tackling the regions waste issues. Appointing the right contractors, with the right level of expertise, has been a critical part of that process.
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