Suffolk county council will consider plans to re-finance the contract for its Energy from Waste facility at Great Blakenham.
In a meeting next week (4 December), the council’s full cabinet will decide if it wants to back the plans, which will see the council borrow £10.2m to reduce the capital cost for which it is responsible, with the gate fee also being lowered.
It’s hoped this will lead to a £10.4 million saving over the remainder of the contract, which runs until 2035, which the council entered into in 2010 as part of a Private Finance Initiative (PFI)-backed contract with Suez.
Under the contract, Suez has been responsible for the building, financing and operation of the facility.
According to the council’s calculations, as detailed below, a loan of £10.2 million to be paid at the end of the year and the subsequent reductions in gate fees will enable it to make the saving.
Commenting on the deal, Suffolk county council’s cabinet member for waste, Paul West, claimed that the deal is important in light of financial pressures facing the council
“It is only right that we seek innovative ways to make savings. The Cabinet is always looking at ways in which we can be more commercial in how we manage our contracts,” he explained.
Mr West added: “This opportunity to take advantage of a second refinancing agreement on the contract for the Energy from Waste facility offers the council the chance to save £10.4 million over the next 21 years, without impacting on services that we provide for residents.
“Discussions with our long-term partners Suez and Defra leading up to this proposal have been positive and we now need to consider if we are happy to explore the savings on offer.”
If approved, the move would not be the first time the council has opted to pursue refinancing for the contract.
Back in 2016, six years after signing the deal, it entered into a refinancing agreement for £37.8 million of the facility’s capital construction cost. This was equivalent to 22.6% of the facility, and if the new deal is passed it would up this to 28.4%.
The 269,000 tonnes per year capacity energy from waste plant located at Great Blakenham near Ipswich, has been receiving residual waste from Suffolk county council since commissioning began at the plant in June 2014.
Process equipment was supplied by energy-from-waste specialist CNIM, while the building itself was designed by Grimshaw, the architectural company behind the Eden Project in Cornwall.