MRWA to submit defence over tender dispute

The confirmation follows a legal challenge from American-based company Covanta, after MRWA announced its decision to award a 1.2 billion residual waste treatment contract to a SITA UK consortium comprising of SEMBcorp Utilities UK and Ituchu Corporation in April 2013 (see letsrecycle story).

Covanta, which served High Court papers on the authority earlier this month, is asking the court to order MRWA to set aside the decision not to award the contract to Covanta UK, while requiring it not to enter into a contract with its preferred bidder SITA without further opportunity for tenders to be submitted (see letsrecycle story).

The 109 page submission to the Court covers lengthy discussions between the two parties over financial structure, with Covanta claiming cost of its tender over the term of the contract would be 200 million cheaper than SITAs. However, the papers also note MRWA evaluated certain aspects of the claimants tender as being fundamentally unacceptable.

Tender

When approached by letsrecycle.com, MRWA confirmed its submission would be completed by next Tuesday, but said it would be quite some time before they could elaborate on legal proceedings.

Had Covantas bid been accepted, the company would have constructed an energy from waste facility at Peel Holdings Inca Park development nine miles east of Chester. It would have consisted of three streams totalling 850,000 tonnes capacity per annum, with a third line could be used on a commercial basis. However, the approval of SITAs bid could now see the waste transported to Teeside by rail for energy recovery.

Covanta would have held a 125 year lease with Peel Holdings, whose chairman John Whittaker voiced his disappointment with MRWAs decision.

He said: “I would normally never comment on a public tendering process, especially where a Peel business has a vested interest. However, the ramifications for the North West economy of this contract going outside the region are so important that I felt I had to speak out.

Disappointment

In a statement issued on behalf of MRWA, Merseyside Waste Disposal Authority (MWDA) chief executive Carl Beer said: MWDA regrets this action by Covanta. Whilst it is appreciated that an unsuccessful bidder will naturally be disappointed at the outcome, MWDA has conducted an extensive and fair procurement process over several years and is confident that the most economically advantageous solution has been selected for Merseyside.

MWDA therefore rejects the challenge made by Covanta and intends to vigorously defend the claim brought against it.